Time for Smart Free Trade with the United Kingdom
by Ted Poe on February 23, 2017 at 11:10 AM
This past summer President Obama threatened to put Britain “at the back of the queue” for a trade deal with the United States should the British vote to leave the European Union and reclaim their independence. Despite such intimidations, on July 23, 2016 the British people spoke. They chose to throw off the EU’s shackles and take charge of their own economic future in the historic Brexit referendum.
This is not just good for the people of Great Britain, but for Americans as well. Even though the United Kingdom and the United States have enjoyed a “special relationship” ever since Churchill coined the phrase in 1946, the two countries do not yet have a free trade agreement. This is because for as long as the United States has negotiated free trade agreements — its first was with Israel in 1985 — the UK has been enveloped by the EU, prohibited from negotiating any free trade agreements on its own accord. A free trade deal with the EU, with its heavy regulations and protectionist policies, was always going to be difficult. With Brexit, the United States now has an opportunity to directly negotiate with a country that shares American values. No other country in the world so closely holds the same commitment to the free market as the UK. The result should be that the US and UK produce the gold standard of free trade agreements.
With a U.S.-U.K. free trade agreement there is no fear that American jobs will move overseas because our two countries share similar wage rates- there is no cheaper labor for American companies to pursue in the UK. Likewise, labor practices and environmental regulations are similar in both countries. So the usual big issues that trip up free trade agreements just are not there for a US-UK trade deal. Instead, negotiators can focus on reducing tariff rates, streamlining cumbersome regulations, and expanding the consumer base for U.S. services. Over a million Americans go to work for British companies everyday and the UK is the number one foreign direct investor in Texas. With a free trade agreement the benefits the United States is already reaping from our close economic cooperation with the UK will only increase.
After Brexit and elections in the US, President Trump and Prime Minister May were quick to make a US-UK trade deal a top priority for both their respective administrations. I fully support that move. The US and UK should take advantage of the expected two years it will take to fully remove the UK from the EU and negotiate a free trade agreement during that time. The goal should be to have an agreement ready to sign the day after the UK officially leaves the EU.
Trade is a very real issue for Texas. Half of Houston’s economy is based on the Port of Houston. When trade decreases or becomes more difficult to do, our economy, more so than other states’, is hit hard. Texans lose their jobs and many of those that do not still take home less pay. But give Texans a level playing field to compete on by reducing the barriers to trade and we will beat anybody out there. That’s just the way we are. So it is in our interest to allow more people around the world to buy our goods and services.
For over two hundred years the United Kingdom has been a valued strategic partner of the United States. The special bond between Americans and Britons has stretched from the trenches of WWI to the mountains of Afghanistan. A free trade agreement between the US and the UK is long overdue and should not be put off any longer. It is time to take the next step forward in the ‘special relationship’. And that’s just the way it is.