Joint Economic Committee Vice Chair Mike Lee (R-UT) led a committee hearing entitled “The Dynamic Gains from Free Digital Trade for the U.S. Economy” on September 12, 2017. At the hearing, JEC members discussed the importance of free digital trade to the U.S. economy, foreign barriers to trade faced by American companies, and how to protect and facilitate digital trade for Americans and their businesses.

 

 

Vice Chairman Lee explained how U.S. businesses are leading the way in digital trade:

 

“Advancements in technology mean that digital trade is capable of delivering ongoing improvements in production, distribution, and value for Americans … American consumers and businesses greatly benefit from the ability to buy and sell across borders and gain access to new products and customers. We are swiftly approaching the point where the word ‘digital’ will be an unnecessary adjective for trade.”

 

Vice Chairman Lee went on to explain that Congress should ensure that sensible regulations and standards are put in place for the protections of intellectual property and private information.

 

Representative Erik Paulsen (R-MN), the co-chair of the Bipartisan House Digital Trade Caucus, said that digital trade is not a fading trend or a niche sector.

 

 

Daniel Griswold, senior research fellow and co-director of the Program on the American Economy and Globalization at the George Mason University’s Mercatus Center, explained that advancing digital trade technology helps the American economy expand.

 

“The impact of digital trade is not a one-time shift, but an ongoing process that enhances the dynamic, long-term growth potential of the U.S. economy. By reducing costs, spurring competition, and expanding markets, digital trade creates gains that fuel productivity. … By playing to America’s competitive strengths, digital trade allows us as a nation to use our physical, intellectual, and human capital in ways that permanently boost our gross domestic product and general living standards.”

 

Sean Heather, vice president of the Center for Global Regulatory Cooperation at the U.S. Chamber of Commerce outlines how the United States has made progress removing foreign barriers to digital trade, but indicated there is an opportunity to improve existing trade law to enhance digital trade.

 

“[North American Free Trade Agreement ] NAFTA modernization represents an opportunity to get the rules right. [United States – Korea Free Trade Agreement] KORUS was a good start in the digital age. [Trans-Pacific Partnership] TTP built on that. But there are always new questions emerging in the policy space.”

 

Nick Quade, general manager of the Ecommerce Division of Relay Networks described that while his company is finding success competing overseas through digital trade, he knows of other companies that are not because of the barriers and difficulties they face.

 

“I know specifically businesses that are involved in digital trade that simply don’t offer their products internationally because they simply don’t want to deal with [the barriers]. That frankly hurts those companies because if … we can simplify these [rules], we can ship products that no longer have a market in the United Sates out of the United States and bring money back in.”

 

The United States Trade Representative has identified trade barriers U.S. businesses face when engaging in digital trade and has listed specific issues that they will closely monitor and enforce. In addition, key goals have been outlined for U.S. trade negotiations that include efforts to expand digital trade.

 

Watch the entire hearing here.