Though President Obama blamed failure to wrap up a long-delayed free trade agreement with South Korea on technical difficulties, the setback last week suggests a larger story: the shrinking capacity of a U.S. president.
In June, Obama targeted completion of the trade deal negotiated by the Bush administration in 2007 but which has since languished in the Democrat-controlled Congress. It would expand American exports of cars and beef while eliminating a tariff on Korean autos imported to the U.S.
Obama's meeting with South Korean President Lee Myung-bak in Seoul was expected to cap negotiations but came up short instead. â€œWe need to make sure that over the next several weeks, we are crossing all the t's, dotting all the i's, being able to make the case to both the Korean people and the United States population that this is good for both countries,â€ Obama said.
Really? A deal potentially worth billions of dollars and hundreds of thousands of jobs, upon which the president of the United States staked his prestige, was sidetracked by a few trifling details?
â€œIt reveals a stunning level of ineptitude and seriously undermines America's leadership in the global economy,â€ writes the American Enterprise Institute's Philip Levy. â€œThe implications extend far beyond selling Buicks in Busan.â€
Key hang-ups include Korean environmental and safety standards, seen by U.S. automakers as effectively closing that market to them. The New York Times reports Korean companies sold 10 times as many cars in the U.S. last year as American car companies sold in Korea.
There's also disagreement over how quickly a 2.5 percent U.S. tariff on Korean vehicles is lifted. The 2007 deal would eliminate it immediately, but the U.S. wants a gradual phase out.
Korean officials reportedly suggested the Obama administration was distracted by the midterm elections. â€œIf the problems really are just technical ones, the Obama team has played the role of the student who procrastinates on a term paper, counting on the ability to have a really productive all-nighter,â€ Levy writes.The trade setback adds to a larger sense that Obama's international clout is diminished, exacerbated by the pounding his party suffered in this month's congressional elections.
At last week's G-20 meeting China resisted Obama's pressure to revalue its currency. Meanwhile, others were critical of his administration's economic strategies, including the Federal Reserve's decision to inject $600 billion into the economy over the next eight months.
It's a significant turnaround from a time when foreign leaders clamored for bilateral meetings with Obama â€” and his autograph. Unfortunately, a trade deal that would be a help to the economy looks like a collateral casualty.