In the final months of his first term as President, Barack Obama is attempting something every U.S. president, except Gerald Ford, has tried since the Great Depression: to reform the complex export and trade bureaucracy.
Within the U.S. administration there are six major departments and agencies focused on business and trade. And that’s just in the federal government. They include U.S. Department of Commerce’s core business and trade functions, the Small Business Administration, the Office of the U.S. Trade Representative, the Export-Import Bank, the Overseas Private Investment Corporation and the U.S. Trade and Development Agency.
President Obama wants to merge them into one super-department to be run by the Office of the U.S. Trade Representative.
“We live in a 21st century economy, but we’ve still got a government organized for the 20th century. Our economy has fundamentally changed – as has the world – but the government has not,” President Obama said earlier this month when he announced his plan to introduce to Congress his Consolidation Authority Act. He said he plans to give Congress details of his trade department revitalization by this summer.
The bureaucratic overhaul is a follow-up to President Obama’s plan to double U.S. exports by 2015 to $3.14 trillion a year. He said the new department will focus on small and medium-sized businesses – companies that the administration’s economic team believes will help lead the U.S. out of a lingering recession – by making exporting simpler.
“Small businesses often face a maze of agencies when looking for even the most basic answers to the most basic questions. There is a whole host of websites, toll-free numbers and customer service centers that at times offer them differing advice. The result is a system that is not working for our small businesses,” President Obama said.
“There will be one department where entrepreneurs can go from the day they come up with an idea and need a patent, to the day they start building a product and need a warehouse, to the day they are ready to export and need help breaking into new markets overseas,” he said.
Part of the plan is to create a website, BusinessUSA, “a virtual one-stop shop” with precise and timely information for businesses of all sizes that want to export.
For any business that has tried to navigate the complex U.S. trade machine, this is welcome news. But the odds of it actually happening are slim to none. Every president from Herbert Hoover to Ronald Reagan – with the exception of Gerald Ford – has had reorganization authority. However, little has changed within the U.S. bureaucracy.
President Obama said he expects to save about $3 billion a year once he merges the Commerce Department with the USTR, now headed by Ron Kirk, a former mayor of Los Angeles.
But, Congress does not seem to be in the mood to upset the bureaucratic apple cart, especially in an important election year.
Sen. Max Baucus, chairman of the powerful Finance Committee and a Democrat from Montana, has reservations. “Everyone agrees we must do more to ensure that our government runs efficiently and makes the best use of taxpayer dollars,” Baucus said in a joint statement with House Ways and Means Committee Chairman Dave Camp, a Republican from Missouri.
“While we welcome the ability to reduce duplication and streamline government services, we are concerned about the impact that the President’s proposal could have on the ability of the United States to aggressively open new markets to American-made goods and services and create U.S. jobs” they said.
Some analysts are also skeptical anything of this magnitude will happen before the November presidential elections. “I really doubt it will happen this year,” said Gary Hufbauer, an international trade analyst at Washington’s Peterson Institute for International Economics. He questions the mood of congressmen in a major election year. “Is their heart really in it?”