The Undemocratic Job-Killing Trade Scheme That Is the Trans-Pacific Partnership

[eridani]

http://inthesetimes.com/working/entry/17880/the_undemocratic_job_killing_trade_scheme_that_is_the_trans_pacific_partner

Public Citizen’s Global Trade Watch examined the effect of NAFTA and wrote in a report issued in February of 2014, “Twenty years later, the grand projections and promises made by NAFTA’s proponents remain unfulfilled. Many outcomes are exactly the opposite of what was promised.”

The most devastating upside-down outcome is jobs. The Global Trade Watch report notes that more than 845,000 U.S. workers qualified for Trade Adjustment Assistance after having lost their jobs as a result of imports from Canada or Mexico or relocation of U.S. factories there. It’s extremely difficult to qualify for Trade Adjustment Assistance, so this number probably understates the total job losses significantly.

In addition, when workers who lost jobs landed new ones, they got paid less, with the average reduction greater than 20 percent.

KORUS is the same sad story. Free traders pledged three years ago that the deal with South Korea would produce tons more exports that would, of course, create lots of new American jobs. Instead, the U.S. goods trade deficit with Korea grew 84 percent, excluding the value of foreign-made goods that pass unaltered through the United States on their way to Korea.

Calculating with the trade-to-jobs formula that free traders used when they were promoting KORUS, the U.S. trade deficit with Korea translates into the loss of nearly 85,000 U.S. jobs—in just three years.

This does not engender trust.

Still, free traders now are huckstering the TPP with promises of job gains. They’re not fooling everybody, though, with their claim that it will create 650,000 jobs. In January, the Washington Post fact checker gave this promise its highest liar-liar-pants-on-fire rating of four Pinocchios.

[cali]

1. The TPP is different. It's better. Much, much better.

That's the line. It's better because President Obama says so. It's better because a simple minded piece of propaganda, a chart with bright red checks, posted at the WH site, says so.

It's incredible that any thinking person could fall for this idiotic shit.

[Recursion]

2. US exports to Korea went up after KORUS

Which was what was promised. Automobiles in particular; we used to sell 8,000 a year to Korea and now sell something like 40,000. They also sell more stuff to us, this being "trade" and all, but exports went up (notice how your link avoids addressing that question)? The claim was that exports would rise, which they did, but the complaint is that imports also rose (and the rise in exports is mysteriously not mentioned).

The most devastating upside-down outcome is jobs. The Global Trade Watch report notes that more than 845,000 U.S. workers qualified for Trade Adjustment Assistance after having lost their jobs as a result of imports from Canada or Mexico or relocation of U.S. factories there.

And what was the national jobs situation like in the wake of NAFTA's passage? Unemployment declined, labor force participation increased, median wages rose, and poverty fell (until W fucked up the economy by cutting taxes -- trade requires taxation to work).

Most of the job losses in the 20 years since were to China and Indonesia, two countries we don't have free trade agreements with because they can't meet the labor protections we require.

[eridani]

3. NAFTA made a bad situation worse

How could losing nearly a million jobs improve the job situation? The 90s expansion was mainly due to the tech bubble. Note that poverty, homelessness and food stamp use also went up in the 90s--which look good in retrospect mainly because of the Bush fuckups.

Increasing trade deficits are all we will get from "trade" agreements. TPP has nothing to do with actual trade--just with further empowering corporations to override democratically elected governments.

[Recursion]

4. Are you even listening to yourself? The tech bubble destroyed MILLIONS of jobs

MILLIONS. Remember how there used to be travel agents? Typing pools? Film developers? (I guess there are still a few of those.) The tech bubble (not just its popping; its growth) destroyed jobs right and left, including a lot of factory jobs (automation, part of the tech bubble, cost more jobs than offshoring in the 1990s).

But, in the 1990s, those jobs were replaced by a larger number of jobs created by technology and exports. That stopped happening under W.

How could losing nearly a million jobs improve the job situation?

Because they get replaced with higher-paying jobs. That's why the tech boom destroyed entire industries in the 1990s but the employment situation as a whole still improved. How many people are still travel agents?

[eridani]

5. Oh FFS--what bullshit

The vast majority of job replacements have involved serious pay decreases.

[Recursion]

6. What does "job replacements" even mean in that case?

A guy who worked for a factory that shut down doesn't have a "job replacement", he (hopefully) finds a new job. As median non-managerial wages have gone up every year since 1994 (except 2002 and 2009), most people are finding higher paying jobs than they had before. If you limit your view to the white working class in the rust belt, yes, they took a hit, but not "workers" as a whole.

[jeff47]

17. Psst...there's this thing called inflation.

You might want to remember to include it before making claims about rising wages.

Also, you might want to actually compare the relevant jobs instead of just "non-managerial wages". A 50-year-old former factory worker will not get a job writing software after a little "retraining". A 50-year-old software developer with 30 years experience has trouble getting that job. Rampant ageism isn't pretty.

The vast majority of the lost jobs were not "non-managerial wages". They were manufacturing jobs. The vast majority of the people who lost their manufacturing job replaced it with a service job and thus a significant pay cut.

Also:

A guy who worked for a factory that shut down doesn't have a "job replacement", he (hopefully) finds a new job

This is infinite facepalm stupid. What is a "job replacement"? It's a new job.

You are not that stupid.

[Recursion]

18. Psst.. there's a thing called "constant dollars"

Wage changes are measured in that.

[pampango]

15. "The Undemocratic Job-Killing Trade Scheme" vs "TPP has nothing to do with actual trade".

Which is it? A 'job-killing' trade agreement? Or an agreement that has nothing to do with trade?

How could losing nearly a million jobs improve the job situation?

Increasing trade deficits are all we will get from "trade" agreements.

The effect of an increasing trade deficit depends on the specifics. If we started importing more oil from Mexico after NAFTA and less from Saudi Arabia, that would increase our trade deficit with Mexico but not mean lost jobs. Cheaper "NAFTA" oil from Mexico and Canada would have reduced the costs of manufacturing and transportation companies allowing them to either lower prices and manufacture more (manufacturing jobs increased after NAFTA) and/or pay higher wages (manufacturing wages increased after NAFTA) despite an increasing trade deficit with Mexico.

The 90s expansion was mainly due to the tech bubble.

IOW, Clinton (and Democrats in general?) are just lucky when employment and wages increase while they are in office. They do everything (including NAFTA) wrong and just stumble into a strong economy.

republicans must wonder why the 'economic gods' smile on Democrats. The economy, jobs and wages are good under "clueless" Democrats despite disastrous trade policy like NAFTA. Then along comes a poor, little republican and the inevitable (but delayed by the partisan 'economic gods') disastrous effects of an agreement like NAFTA come home to roost under a republican president (who adds a few "fuckups" of his own).

[jeff47]

16. No, Democrats in general are not "just lucky", but Clinton did get lucky

The dot-com boom was large enough that even the Fed had trouble reining it in. It was largely independent of government (Original R&D for the Internet, and some infrastructure. Most of the investment was private). A Democrat happened to be president.

Claiming it was Clinton's doing is like claiming "Reagan created a million jobs in one month!!!". What happened is about 700,000 workers returned to work after a strike, plus a relatively normal 300,000 new jobs. Reagan happened to be the guy in office at the time.

If you'd like to claim Clinton caused the dot-com boom, you're free to list specific acts he took in office that caused it.

Why'd W get hit with the "NAFTA aftermath"? Timing. It takes a while after the treaty is signed to actually move your factory to Mexico, and the dot-com boom covered a lot of the pain. Bubble bursting coupled with relocated manufacturing jobs, and you get a shitty economy no matter who is president. Ta-da! 2001 recession, regardless of the sitting president's political party.

[pampango]

20. So Clinton was just "lucky"? And W was "unlucky" to get hit with the "NAFTA aftermath"?

I knew Clinton could not know what he was doing and the partisan 'economic gods' just smiled on him. ("A Democrat just happened to be president.&quot And poor W was not a victim of his own regressive tax and regulatory policies - just bad "timing". He just got caught in the Democratic-created NAFTA aftermath.

And it was the dot.com boom that raised manufacturing wages across the board and led to an increase in manufacturing jobs, despite the fact that there was no dot.com boom in manufacturing output? Output just continued upward at the same steady pace. Funny how that works sometimes. Sounds like a train of thought that republicans may want to use.



The graph also shows that manufacturing employment peaked in 1979 and has been trending downward ever since. That is the real power of NAFTA. It had been killing American manufacturing jobs for 15 years before it even came into being. Sure that decline reversed in the mid- to late-90's but pay no attention to that. NAFTA had nothing to do with that. The true power of NAFTA was evidenced 15 years before it existed and again about 7 years after it came into being.

Also the periods of increase in manufacturing employment shown on this graph show a rise during Carter's presidency, a decline during Reagan and Bush I, a rise during Clinton and a fall during Bush II. There would seem to be a partisan message hidden in that information somewhere - but it may just be that Democratic presidents are lucky and republicans are unlucky due to the whimsy of the 'economic gods'.

It takes a while after the treaty is signed to actually move your factory to Mexico

Apparently it does not take as long to do that to South Korea. Quite a few posts claim that the pain of the South Korea-US trade agreement surfaced right away. Funny how the aftermath is quick when we want it to be and delayed when that suits the argument.

[jeff47]

21. Again, you are free to list concrete policies that Clinton did which caused the boom.

Yet you somehow failed to do so. Odd.

And it was the dot.com boom that raised manufacturing wages across the board and led to an increase in manufacturing jobs, despite the fact that there was no dot.com boom in manufacturing output?

Yes. The stuff that "boomed" was very weakly-linked to manufacturing, and a lot of that manufacturing had already been offshored. Buying routers and servers would cause an increase in manufacturing planet-wide, but assembly in China meant the US didn't reap the main benefits.

That boom in non-manufacturing jobs lead to people buying more stuff that actually falls into manufacturing output, like cars. That boom also created a lot of automation which meant you could make more with fewer people.

Manufacturing wages increase because all wages increased, because there was a temporary shortage in labor.

Output just continued upward at the same steady pace.

You have an odd definition of "steady".

The graph also shows that manufacturing employment peaked in 1979 and has been trending downward ever since. That is the real power of NAFTA. It had been killing American manufacturing jobs for 15 years before it even came into being.

No, but this statement demonstrates you are a dumbass. No one is claiming loss of manufacturing jobs to Japan and China in the 1980s were caused by NAFTA. Except you, in order to incinerate that strawman.

NAFTA's effects can be seen around the time it passed, plus the lag required to actually set up a Mexican subsidiary, buy land, build a factory and staff it. In other words, the crash in Manufacturing employment starting around 1997.

Also the periods of increase in manufacturing employment shown on this graph show a rise during Carter's presidency, a decline during Reagan and Bush I, a rise during Clinton and a fall during Bush II. There would seem to be a partisan message hidden in that information somewhere

Then you could point to specific partisan policy that was enacted, and show a nice chain of data from policy to jobs.

Economics isn't voodoo, as much as the supply siders want it to be. Show me the tax hike that increased private spending which increased output shortly thereafter, and thus increased jobs shortly thereafter.

Since you aren't going to bother doing that, you could try and explain how HW Bush's tax increase didn't do what Clinton's tax increase did.

Apparently it does not take as long to do that to South Korea.

South Korea already had plenty of manufacturing. No need to relocate the US factory. Instead, the LG factory in South Korea can increase output. That doesn't take nearly as long.

The way the South Korean free trade agreement failed was South Korea didn't buy much more in US manufactured goods, but the US bought a lot more in South Korean manufactured goods. As a result, South Korean factories drastically increase output, while US factories slightly increase output. That yields a lot more South Korean jobs than US jobs.

NAFTA has been devastating because it actually eliminated US jobs. The South Korean free trade agreement has been bad in that it failed to create US jobs.

Funny how the aftermath is quick when we want it to be and delayed when that suits the argument

Funny how crashing a car at 5mph just scratches the paint, and crashing the car at 100mph is deadly. In both cases, the car crashed, and in both cases the car quickly went from moving to stopped. So clearly they must have the same result.

Oh wait, the details of the crash might be important, instead of just it being a crash.

[pampango]

22. If you think that the policies of Carter and Clinton were the same as those of Reagan and the Bushes

you are welcome to your opinion. republicans will be happy to tell you about all the policy changes that 'Reaganomics' - cutting taxes for the rich, deregulation and busting unions - that Mr. Reagan brought to the US. What he did not bring was 'free trade agreements' - other than the one with Canada in 1988 in the last year of his presidency and not a trade agreement that many cite as a cause of our problems. Overall tariffs rose during his administration.

The result of the Reagan being "unlucky", surely not because of his 'trickle down economic policies', was a decline of over 10% (more than 2 million workers) in manufacturing employment during the Reagan/Bush I administrations. Can't blame that on NAFTA or any other 'free trade agreement'. Must have just been 'bad luck'. This came after an increase in manufacturing employment of over 2 million workers during the short term in office of Carter. (Boy was he ever 'lucky'.)

During Clinton's administration manufacturing employment rose from 16.8 million in 1992 to 17.3 million in 2000 (with the rise coming after NAFTA came into effect) before falling off a cliff under Bush II with the return of 'Reaganomics' and the loss of about 5 million manufacturing jobs in the next 8 years. I suppose one can blame that devastation on NAFTA, but the return of 'Reaganomics', in light of the manufacturing disaster it had already caused 20 years earlier, probably had something to do with it as well.

If you need for me to spell out specific policy differences between Reaganomics and the policies of Carter and Clinton, I can't help you. If you think that Reaganomics was not really that big a deal and does not explain why the economy does so badly under republicans, I can't help you. If that means you continue to believe that the superior manufacturing performance under Democrats is just a matter of 'luck', so be it.

Perhaps a good campaign slogan for the next Democratic presidential nominee should be, "Vote for me. You'll do better economically because Democrats are lucky presidents and republicans never are."

[jeff47]

23. Hey look! Another strawman!!

If you think that the policies of Carter and Clinton were the same as those of Reagan and the Bushes you are welcome to your opinion

That's just sad and pathetic. Just post "I got nothin" instead of lowering yourself to that piece of shit argument.

The result of the Reagan being "unlucky", surely not because of his 'trickle down economic policies', was a decline of over 10% (more than 2 million workers) in manufacturing employment during the Reagan/Bush I administrations. Can't blame that on NAFTA or any other 'free trade agreement'. Must have just been 'bad luck'.

I take that back. You can get more pathetic.

Golly, if only I had mentioned what caused the manufacturing decline during that time period in the post you just replied to. Then you could actually address that instead of constructing another pathetic strawman to incinerate.

Oh well. We'll never know...except that my post is still up there.

before falling off a cliff under Bush II

Look at your own damn graph. The cliff starts in 1997/1998. So after trying to deride NAFTA opponents as claiming time travel, W's tax cuts went back in time 3-4 years?

If you need for me to spell out specific policy differences between Reaganomics and the policies of Carter and Clinton, I can't help you.

Of course not. You'd actually have to supply data to back up your claims, and you know you can not do that. So you erect strawmen and attack them instead.

[Recursion]

19. Well, W added some pretty clear fuck ups of his own...

That's hard to argue with...

[stillwaiting]

8. U.S. exports went up minimally (barely at all).

2011 - $43,461.60 (in millions)
2012 - $42,265.20
2013 - $41,714.70
2014 - $44,544.00
2015 - Jan. and Feb. show a 300 million decrease from 2014. At that rate could be back on track for 2011 export levels.

https://www.census.gov/foreign-trade/balance/c5800.html

Imports on the other hand:

2011 - $56,661.40
2012 - $58,901.50
2013 - $62,386.40
2014 - $69,605.70
2015 - Jan. and Feb. show a 1,400 million increase from 2014. On track for a HUGE increase in imports from 2014 levels.

Needless to say, the trade deficit has exploded.
And, exports have idled.

[Recursion]

9. As you say, US exports to Korea went up by $2 billion (nt)

[stillwaiting]

10. You can't be taken seriously when you make that claim when the facts are right in front of you.

It's 1.1 billion, and it's on track to be completely eliminated during 2015.

Stop being disingenuous.

Compare that to trade imports.

As I say, indeed.

[Recursion]

11. Up by 2.3 billion since the deal started, as you cited

Compare that to trade imports

Why?

If you could show that those imports were "stuff we used to buy from Americans" rather than "stuff we used to buy from China" or "stuff we used to not buy at all", that might be a worthwhile comparison to make, but since nobody's even bothered trying to do that, but simply hoped that everyone would just take it for granted...

[stillwaiting]

12. You are being disingenuous AGAIN.

We are constantly told that these free trade agreements will be great for exports.

GREAT is not a word I would use in this instance. You continue to ignore what seems to be happening during 2015 as well which could completely eliminate any export "gains" that materialized in 2014. Exports went down in '12 and '13 from previous years.

Since it went in to effect in '12 I think it is instructive to compare '12 to '11 (our exports went down). Exports should have gone UP from 2011 levels since the free trade agreement went in to effect in '12. So, my base year for comparison is 2011. I think that's fair to see the difference that free trade has had on our exports (comparing it to the full year where no free trade agreement was in effect).
I do see why you don't want to do that.

Also, many people DO care about the exploding trade deficit (and there are plenty of economists that agree). This free trade agreement has done nothing to help with our trade deficit, and it seems to be downright exploding in its aftermath.

Export gains have been minimal, and may be nil based on early 2015 results (exports and imports for 2015 compared to 2014 are not good at all for the U.S). It's most likely that in 2015 our trade deficit will have more than doubled with Korea since the free trade agreement was signed. That's not what most Americans want to see happen. I assure you of that. So, let's be honest with what's happened with this free trade agreement. The results have not been what most of the American people would want (if they knew the details and that's something that not many people will be telling them).

Edited to add:

2011 (last full year without the free trade agreement) exports = $43,461.60
2014 (after 3 years of the free trade agreement) exports = $44,544.00

Difference = $1,100 (or $1.1 billion) increase in exports from 2011 to 2014 due to FTA (and this $1.1 billion gain is on track to be wiped out in 2015 while our trade deficit is set to explode even more).

So, NOT 2.3 billion increase due to FTA's. We exported $43,461.60 without the "help" of any FTA.

[NuttyFluffers]

7. gotta be involved. this deal must be stopped.

keep readin', keep sharin', keep speakin' truth.

[AzDar]

13. K & R

[99Forever]

14. It's simply put, a corporate scheme to take control of everything.

Any fucking politician that supports it needs removed from office, permanently.

Period.