IU Dean ignites European Union trade discussion

The School of Public and Environmental Affairs Dean John Graham is sparking an international discussion on barriers to free trade.

The dean testified at a hearing Monday before the European Parliament’s Trade Committee in Brussels, Belgium, regarding a deal to smooth trade relations between the European Union and the United States.

Regulatory differences between the two zones create obstacles to free trade, Graham said.

In his testimony, he discussed the importance of regulatory collaboration.
He focused specifically  on the automotive, agricultural, chemical and information technology industries.

“My testimony seemed to be well received, and it sparked some significant debate among the legislators and representatives of the European Commission,” Graham said.

The committee sought Graham’s insight in part because of his service as the administrator of the Office of Information and Regulatory Affairs of the U.S. Office of Management and Budget.

He served under former President George W. Bush from 2001 to 2006.

Monday’s testimony was translated into more than 20 languages so the different member states’ representatives present could understand it, Graham said.

The U.S. government representatives were unable to attend because of the federal government shutdown, he said.

The deal discussed at the hearing, the Transatlantic Free Trade Agreement, is one of President Obama’s priority foreign policy initiatives aimed at boosting U.S. and European economies, Graham said.

It is meant to reduce political tensions between the regions, Graham said.

In his discussion, Graham argued the U.S. and European Union don’t sufficiently coordinate health, safety and environmental regulations, according to a press release.
He also said the regulators move too slowly to repair barriers.

He said the World Trade Organization is ineffective at resolving disputes and lawsuits in the WTO should be considered a last resort.

He focused on the auto industry and the challenges of selling cars on both sides of the Atlantic.

The U.S. and EU enforce different safety regulations for crash dummy compliance and consumer tests, such as whether or not the crash dummy should use a seat belt.

“The result of these testing differences is that an automaker must test a new model once under the U.S. test conditions and a second time under the EU test conditions,” Graham said.

“This is a wasteful process that does little to enhance safety.”

Graham suggested a new process for Transatlantic regulatory cooperation, with an aim toward “harmonization, mutual recognition and/or convergence,” he said.

“The solutions are not universal,” Graham said.

“They need to be tailored carefully on a sector-by-sector and even regulation-by-regulation basis.”

— Samantha Schmidt