A Detour Past Congress
What Bush can do for the economy.
Jan 22, 2007, Vol. 12, No. 18 • By CESAR CONDA
* Reduce trade barriers. Bush should mount an aggressive pro-free trade offensive to counter the new Democratic Congress's protectionist leanings. Generally speaking, the president is limited in what he can do to reduce trade barriers without congressional approval. One exception is the "anti-dumping" law designed to shield certain industries from imports. According to Dan Griswold of the Cato Institute, we currently have about 300 outstanding anti-dumping orders against specific imports, especially steel. The president has the authority to instigate what are called "changed circumstances reviews" that can result in orders being lifted.
Another related idea: The administration could declare China a "market economy," which would mean lower anti-dumping duties on cases brought against Chinese imports. As a political salve, market economy status would allow domestic producers to bring countervailing duty cases against Chinese imports allegedly subsidized by the government.
Finally, let's not forget about Cuba. Because of his rapidly deteriorating health, Fidel Castro is unlikely to govern Cuba again. Once Castro's grip ends, the president has the discretion, through the Treasury, to relax restrictions on travel, remittances, and so forth. Bush can promote more trade with a free Cuba unilaterally.
* Provide relief from Sarbanes-Oxley. The Sarbanes-Oxley Act, passed in response to corporate scandals, has imposed $35 billion in compliance costs on American firms, and imposed about $1 trillion in direct and opportunity costs on the U.S. economy, according to economist Ivy Xiying Zhang of the University of Rochester.
In particular, Section 404 of the act requiring corporate executives to certify internal controls has forced management and corporate board members to spend more time on accounting issues and less time expanding their businesses. Fortunately, the Public Company Accounting Oversight Board, an organization set up by the act, has issued a proposed rule to soften the Section 404 provisions. The administration should move quickly to finalize this rule.
To be sure, many of these moves will produce the usual howls of indignation about an "imperial presidency" from the Democrats. However, these bold actions would put the president on the political offensive--and on the side of ending the unfair inflation tax on people's investments, reducing the hidden tax of regulation, expanding global markets, and reducing excessive costs on American entrepreneurs.
Further, these actions provide a stark contrast to a pro-tax, pro-regulation, protectionist Democratic Congress. Besides, with 57 percent of the public disapproving of President Bush's handling of the economy, what does he have to lose?
Cesar Conda, former domestic policy adviser to Vice President Cheney, is a senior fellow of FreedomWorks and a Policy Council member of the Free Enterprise Fund.