Democratic Party Trade Protectionism Rhetoric Reveals Promises That Cannot Be Delivered: Unions Beware!

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NAFTA reform just the start - U.S. trade critics


By Doug Palmer


March 5, 2008

WASHINGTON (Reuters) - The next U.S. president needs to fundamentally redirect U.S. trade policy to preserve manufacturing jobs and reduce the huge trade deficit -- not just tinker with the North American Free Trade Agreement, critics of U.S. trade deals said on Wednesday.


"We need to change the whole discussion about investment, about subsidies, about enforcement of trade laws," said Leo Gerard, president of the United Steelworkers union. "How does any country continue to prosper when it's accumulating an average annual trade deficit of about $700 billion per year?"


On Tuesday, Sen. Hillary Clinton revived her chances of winning the Democratic party's presidential nomination by beating her rival Sen. Barack Obama in three of the four states that held contests that day.


In recent weeks, both Clinton and Obama have increased their criticism of NAFTA and said they could pull the United States out of the pact if Mexico and Canada did not agree to renegotiate it.


[EVERYONE KNOWS THAT THEY ARE NOT SPEAKING THE TRUTH]


The two candidates have talked mainly about adding enforceable labor and environmental provisions to the pact.


[LABOR & ENVIRONMENTAL PROVISIONS WILL DO NOTHING TO KEEP JOBS IN AMERICA, WHEN THE BASIC COSTS OF LABOR ARE SO MUCH LESS TO BEGIN WITH. CLINTON & OBAMA PROMISES OF ENFORCEMENT OF THESE TYPES OF PROVISIONS WILL ONLY ANGER OUR TRADING PARTNERS AND FURTHER ALIENATE THE U.S. FROM THE WORLD, EXCEPT, PERHAPS, FROM THE EUROPEAN UNION, WHICH FAVORS SUCH NUANCED TYPES OF TRADE PROTECTIONISM. UNIONS SHOULD BEWARE OF DEMOCRATIC PARTY PROMISES THAT CANNOT BE DELIVERED.]




But Lori Wallach, director of Public Citizen's Global Trade Watch, said it was more important in the short term to change the agreement's investment provisions because they encourage U.S. companies to move jobs to Mexico.


Similar reforms are needed in other trade agreements, including the one that set the terms of China's entry into the World Trade Organization in 2001, she said.


[MS. LORI WALLACH IS ANTI-INDUSTRY, ANTI-FREE MARKET, ANTI-PRIVATE PROPERTY, AS THE ITSSD UNFORTUNATELY FOUND OUT WHILE ATTENDING SEVERAL U.S. GOVERNMENT STAKEHOLDER MEETINGS HELD IN WASHINGTON, DC IN THE PAST. SHE IS 'SHORT' ON BUSINESS & ECONOMICS KNOWLEDGE, BUT 'LONG' ON EMOTION AND RHETORIC.]


Wallach blamed NAFTA, China's WTO accession and other trade agreements for many of the roughly 3 million manufacturing jobs the United States has lost since 2000.


[UNFORTUNATELY, MS. WALLACH IS OUT OF TOUCH WITH REALITY. U.S. MANUFACTURERS FROM NUMEROUS INDUSTRY SECTORS HAVE BEEN FALLING OVER EACH OTHER TO MOVE MANUFACTURING JOBS & INVESTMENTS OVERSEAS, ESPECIALLY TO CHINA, SINCE THE MID-1990'S WHEN THE WORLD TRADE ORGANIZATION WAS CREATED. THE WTO PROVIDED FOR THE EVENTUAL PHASE-OUT (OVER A TEN YEAR PERIOD SPANNING 1995-2004) OF IMPORT QUOTAS, INCLUDING U.S. IMPORT QUOTAS IMPOSED ON CHINESE TEXTILES, WHICH FINALLY FELL TO ZERO, PURSUANT TO THE WTO AGREEMENT ON TEXTILES AND CLOTHING (ATC), ON DECEMBER 31, 2004. THE U.S. IS STILL PERMITTED, BY A BILATERAL AGREEMENT REACHED WITH CHINA DURING NOVEMBER 2005, TO IMPOSE QUOTA RESTRICTIONS ON CERTAIN CHINESE TEXTILE EXPORTS UNTIL DECEMBER 31, 2008. SEE: http://www.ustr.gov/assets/Document_Library/Fact_Sheets/2005/asset_upload_file813_8339.pdf CHINA'S VIRTUAL MONOPOLIZATION OF THE WORLD TEXTILE MARKET HAS EVEN PLACED TURKEY'S FORMIDABLE TEXTILE INDUSTRY IN A NONCOMPETITIVE POSITION. PERHAPS INDIA POSES THE ONLY REAL CHALLENGE. WHILE RICARDIAN SPECIALIZATION PROVIDES THE WORLD WITH AN OVERALL BENEFIT - AFFORDABLE TEXTILES, THERE WILL BE LOSERS, NAMELY LABOR, IN MOST OTHER COUNTRIES.


CHINA'S ACCESSION TO THE WTO DURING DECEMBER 2001 SOLIDIFIED CHINA'S PLACE AMONG THE WORLD'S MAJOR TRADING NATIONS, AND THUS BEGAN THE PROCESS OF SLOWLY OPENING UP CHINA'S MARKETS TO FOREIGN INVESTMENT. IF ANYTHING, CHINA MUST BE PREVENTED FROM MANIPULATING ITS FOREIGN INVESTMENT RULES AS DISGUISED MARKET ACCESS BARRIERS. IN ADDITION, CHINA MUST BE HELD TO STRICT WTO STANDARDS AS CONCERNS ITS INSUFFICIENT PROTECTION OF U.S. INTELLECTUAL PROPERTY RIGHTS. SO, YES, MS. WALLACH, THERE IS A NEED FOR ENFORCEMENT OF WTO RULES TO SAVE U.S. JOBS & KNOW-HOW. HOWEVER, ENFORCING WTO LABOR OR ENVIRONMENTAL RULES WILL NOT BRING BACK U.S. JOBS.]


The Bush administration -- noting that U.S. manufacturing output and exports set records last year -- argues that increased worker productivity and advances in manufacturing technology account for many of the lost jobs.


Also, total U.S. employment has grown 24 percent since Congress approved NAFTA in 1993, and U.S. unemployment has averaged 5.1 percent since the pact went into force compared to 7.1 percent in 1980 to 1993, the U.S. Trade Representative's office said in a NAFTA fact sheet.


The Steelworkers' Gerard called USTR's statistics "bullshit" because they gloss over real job losses in key industrial sectors such as steel and autos.


[U.S. AUTO MANUFACTURERS UNFORTUNATELY DO NOT MAKE QUALITY PRODUCTS THAT CAN EFFECTIVELY COMPETE WITH THE LIKES OF TOYOTA, NISSAN & HONDA, LET ALONE, KIA & HUNDAI. THERE ARE NO CHINESE MANUFACTURED CARS EXPORTED TO THE U.S. DUE TO MUCH LOWER BASIC LABOR COSTS IN INDIA & CHINA, THE U.S. STEEL INDUSTRY BEGAN MIGRATING THERE YEARS AGO. THE DEMOCRATS ONLY NEED LOOK AT FORMER U.S. STEEL TOWNS SUCH AS PITTSBURGH TO SEE HOW JOBS CAN BE CREATED WITHOUT TRADE PROTECTIONISM. PITTSBURG HAS SINCE RECREATED ITSELF AS A HI-TECHNOLOGY RESEARCH & START-UP MECCA. THE PROBLEM IS NOT ONLY A CHINESE PROBLEM. IT IS ALSO AMERICAN RELUCTANCE TO ADAPT TO CHANGE.]


NAFTA ALSO MEANS CHINA


The next president also needs to take a tougher stance on trade with China, which is responsible for a large portion of U.S. trade gap, said, Sen. Sherrod Brown, Ohio Democrat.


"In my state and in much of middle class America, NAFTA stands for trade policy generally," Brown said.


Many lawmakers believe Beijing deliberately undervalues its currency to give its companies a trade advantage.


Brown said he and other freshmen Democratic senators would continue pushing this year for legislation aimed at forcing China to revalue its currency, and have drawn a line in the sand against approving a free trade pact with Colombia.


[BROWN & OTHER DEMOCRATS ARE PLAYING POLITICAL ROULETTE HERE. THIS IS A FOOLISH GAME OF LOSE-LOSE. CONGRESSIONAL DEMOCRATS SIMPLY WILL NOT ADMIT TO THEIR LIBERAL CONSTITUENCIES THAT THEY CANNOT BRING AMERICAN JOBS BACK. THIS IS NOTHING MORE THAN VOTE PANDERING.]


In a separate speech, U.S. Trade Representative Susan Schwab said NAFTA had been good for all three countries and warned reopening it could backfire on the United States.


"The notion that you can reopen an agreement like NAFTA and not expect Canada or Mexico to ask for things from us that they didn't get last time" is unrealistic, she said.


Instead of preserving U.S. jobs, changing the pact could put at least some jobs at risk, Schwab said.


She described Clinton and Obama's sparring over who was toughest on NAFTA as a "rhetorical race to the bottom."

110th Congress' Obstruction of Colombia-US Free Trade Agreement Foolishly Harms American Exporters As Well As Colombian Businesses & Democracy

http://www.azcentral.com/arizonarepublic/opinions/articles/0312wed2-12.html


To a freer Latin America


Mar. 12, 2008 12:00 AM


By obstructing a free-trade agreement with Colombia, Congress is achieving a mathematical impossibility.




If opposition to the deal made no sense in terms of rational self-interest when it was sealed between the U.S. and Colombia in 2006, it makes even less sense now. Less than zero sense.

The agreement signed in November 2006 effectively stabilized an imbalance between the countries.


Most Colombian exports to this country arrive largely duty-free, courtesy of the 1991 Andean Trade Preference Act, which reduced or eliminated trade barriers to Latin American countries that took effective steps to fight drug-trafficking. A former narco-terror hell on Earth, Colombia has taken greater steps to fight the narcotics cartels than, arguably, any nation in the region.


The same relaxed trade rules do not hold for U.S. exports to the South American nation, however.


In 2006, for example, Arizona companies exported a relatively paltry $9.8 million worth of manufactured goods and electronics to Colombia, according to the U.S. Department of Commerce. And they paid a healthy fee for that privilege, including tariffs of 10 to 20 percent.


Congressional approval of the Colombian free-trade agreement would strike that imbalance and almost certainly would prove an immediate godsend to Arizona manufacturers that do business with Bogota.


Even as a matter of politics, the obstruction makes no sense.


Since assuming office in 2002, Colombian President Alvaro Uribe has made huge progress in stabilizing his formerly war-torn nation. He has created one of the most stable democracies on a continent that otherwise seems to be backsliding toward its tragic roots of totalitarianism, despotism and revolution.


Uribe's long-standing friendship with the U.S. - which is to say, his friendship with President Bush - is the source of his unpopularity on Capitol Hill, of course.


That political principle - any friend of my enemy is my enemy - took center stage on March 1 when Uribe sent his commandos a mile and a half into neighboring Ecuador to take out an encampment of narco-terrorists, killing notorious rebel leader Raul Reyes.

Many congressional Democrats condemned Uribe for daring to chase the murderous, kidnap-happy

terrorists into a nation that fawns over the drug-running revolutionaries.

Many of them, too, sided in the resulting border flare-up with Uribe's mortal enemy in South American, Hugo Chavez, the leftist president of Venezuela whose popularity in Congress is directly proportional to his hostility to Bush.


Trade protectionism, and the economic menace that surely would accompany it, is in the air this election season.


But snubbing a trade deal with staunchly democratic Colombia - a deal that is pure win-win for the U.S. - makes no sense, regardless.


Congress is protecting no one by fighting the Colombia trade agreement. It should approve the measure now.

State of the Union address: President Bush discusses Free Trade, Protectionism and Doha

State of the Union address: President Bush discusses Free Trade, Protectionism and Doha




Excerpt from Bush's final State of the Union address - Jan. 28, 2008:


"On trade, we must trust American workers to compete with anyone in the world and empower them by opening up new markets overseas. Today, our economic growth increasingly depends on our ability to sell American goods, crops, and services all over the world. So we are working to break down barriers to trade and investment wherever we can. We are working for a successful Doha round of trade talks, and we must complete a good agreement this year. At the same time, we are pursuing opportunities to open up new markets by passing free trade agreements.


I thank the Congress for approving a good agreement with Peru. Now I ask you to approve agreements with Colombia, Panama, and South Korea. Many products from these nations now enter America duty-free, yet many of our products face steep tariffs in their markets. These agreements will level the playing field. They will give us better access to nearly 100 million customers. And they will support good jobs for the finest workers in the world: those whose products say 'Made in the USA.'


These agreements also promote America's strategic interests. The first agreement that will come before you is with Colombia, a friend of America that is confronting violence and terror and fighting drug traffickers. If we fail to pass this agreement, we will embolden the purveyors of false populism in our hemisphere. So we must come together, pass this agreement, and show our neighbors in the region that democracy leads to a better life.


Trade brings better jobs, better choices, and better prices. Yet for some Americans, trade can mean losing a job, and the Federal Government has a responsibility to help. I ask the Congress to reauthorize and reform trade adjustment assistance, so we can help these displaced workers learn new skills and find new jobs."