Tech firms at Democratic convention push for free trade

The Consumer Electronics Association, which represents Apple, Microsoft, and others, is pressing hard for legislators to embrace free trade.

DENVER--Technology companies are here at the Democratic convention this week to highlight more than just their new products --they're pushing an agenda as well.

The Consumer Electronics Association, a lobbying firm that represents 2,200 technology companies such as Microsoft, Sony, and Hitachi, brought its 28-state "America Wins with Trade" bus tour to Denver this week to convince Democrats that free trade benefits the tech industry, as well as consumers. Groups with opposing views are taking a high profile at the convention, however, and the conflicting interests in the party are apparent from its mixed messages on trade.

Interested in getting Democratic leadership to revive stalled trade agreements with Colombia, Panama, and Korea, the CEA unveiled poll numbers Monday indicating that Democrats are becoming more accepting of free trade: 62 percent of Democrats said they benefit from free trade, and 69 percent said it was a "good thing" that trade and global manufacturing have reduced the costs of consumer electronics sold in the United States.

The poll was conducted by Zogby International from August 12 to August 14 and has a margin of error of 1.7 percent. It surveyed 3,440 people, including more than 1,200 Democrats. Corresponding poll numbers on Republican perceptions about free trade will be released next week during the Republican convention.

"There's a saying that no two countries that support the golden arches have ever been at war," said Kathy Gornick, president of Thiel Audio, which is represented by the CEA.

Gornick's business, which designs and builds high-performance loudspeakers, would benefit from lifted non-tariff trade barriers in countries with large middle-class populations like South Korea. She said the efficiencies created by free trade would, counter to common belief, create new jobs.

"Admittedly we are shifting in the kinds of jobs, but generally they are higher paying jobs," she said. "The biggest reason jobs go away is not because of free trade but advances in technology that change the way we do things."

It's a message that should resonate with politicians: The consumer price index (CPI) for imported electronic machinery and TV and sound equipment has dropped by 11 percent since 2000, even as the overall CPI has increased by 28 percent.

"The expansion of trade and global supply chains has undoubtedly played a role" in dropping prices, said Dan Griswold, director of the Center for Trade Policy Studies at the Cato Institute in Washington, D.C.

It is, in fact, a message that the Democrats' new leadership could very well embrace. "There is no doubt that globalization has brought significant benefits to American consumers," Barack Obama wrote in his memoir, The Audacity of Hope. "It's lowered prices on goods once considered luxuries, from big-screen TVs to peaches in winter, and increased the purchasing power of low-income Americans."

The technology platform provided on Obama's Web site says that "Barack Obama supports a trade policy that ensures our goods and services are treated fairly in foreign markets. At the same time, trade policy must stay consistent with our commitment to demand improved labor and environmental practices worldwide."

The interests of the CEA are directly at odds with those of the major unions that heavily support the Democratic Party. Leo Gerard, international president of the United Steelworkers, has had a ubiquitous presence at the convention, urging state delegates to support Obama because he would protect American jobs from "rotten trade deals." He spoke to bloggers on Tuesday in the Big Tent about "some misguided Democrats" who support free trade deals, "leading to a trade deficit."

The convention proceedings on Tuesday night included remarks from no less than five union members, including John Sweeney, president of the AFL-CIO. His union earlier in the year committed $53.4 million for pro-Democrat campaigns in battleground states--part of an unprecedented $200 million effort from various labor groups.

Meanwhile, Congress has given no indication it will approve any of the three trade deals in question.

"From what I understand from CEA interactions in Denver, the interesting takeaway is the number of policy makers who say they agree on trade, but report how difficult the political environment is," said Tom Galvin, a partner for 463 Communications, a consulting firm assisting the CEA in its efforts. "Hopefully, once the political season is over we'll see a less charged environment and the trade agreements can be considered at that time."

Gornick of Thiel Audio demurred to say whether she favored an Obama or McCain presidency.

"Traditionally Democrats would be less open to free trade, but these days it's very hard to predict what a political party is going to do," Gornick said. "I wish Ron Paul were running."

 

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