Free trade pacts have been good for U.S.? - The Hill (opinion piece by NAM)

[pampango]

The fact is that U.S. free trade agreements (FTAs) have never been a significant factor in the U.S. trade deficit, and over the past two years FTAs have resulted in a U.S. manufactured goods surplus of nearly $50 billion. That’s right — according to the Census Bureau data for manufactured goods exports in 2008-’09, we sold our trade agreement partners nearly $50 billion more manufactured goods than we bought from them.

There is no question the United States has a trade problem, but it is not caused by FTAs. Our challenge is with oil imports and with countries where we do not have trade agreements. While racking up a $50 billion manufactured goods surplus with our FTA partners over the past two years, we suffered an $820 billion manufactured goods deficit with the rest of the world.

Consider NAFTA and the assertion that it cost millions of manufacturing jobs. In reality, Labor Department data show that for almost a decade after NAFTA, the United States gained nearly a half-million manufacturing jobs. The big manufacturing employment loss didn’t begin until 2001 (with the ramp up in imports from China). What Wallach failed to mention in her opinion was that the manufactured goods deficit with NAFTA barely budged after 2001 while nearly doubling with the rest of the world. Jobs displaced by imports from NAFTA were offset by the jobs gained from exports.

True, the overall deficit with NAFTA has soared since 2001 — again, the result of oil imports, not manufactured goods. Growing oil imports do not cost manufacturing jobs, and aside from energy imports, the deficit is virtually unchanged. The deficit — and the trade problem — is with countries where we do not have FTAs, such as China, which accounts for three-quarters of our manufactured goods deficit. What about CAFTA, which opponents assured Congress would result in huge U.S. job losses? U.S. manufactured goods went from consistent deficits before CAFTA to a surplus that has totaled over $12 billion since the agreement. What about Peru? Peru is another example of the misinformation spread by Wallach and others. The U.S. has moved into a surplus with Peru.

http://thehill.com/opinion/op-ed/93115-free-trade-pacts-have-been-good-for-us

While most of our manufacturing trade deficit undoubtedly does come from the BRIC (Brazil, Russia, India and China - particularly China) countries with whom we don't have free trade agreements, I can't vouch for the accuracy of the NAM's figures regarding manufacturing trade surpluses and jobs as they relate to our actual "free trade" partners. It would make sense that the NAM would push FTA's if their experience is that they gain more business from exports than they lose to imports.

[Captain Hilts]

1. China is killing our employment base. If, indeed, we were losing those jobs to Mexico,

we would not be seeing the sustained emigration from Mexico to the US and Canada. This emigration has literally and figuratively changed the face of: the service industry, construction and daycare.

The National Association of Manufacturers is one of THE lobbying outfits in favor of loose emigration laws and a low minimum wage. They're creeps. But, in this case, they are correct.

A vigorous job market in Mexico would deter or slow this emigration by some degree.

China, conversely, has people living in squalid dormitories in order to make clothes, shoes and electronics for the North American market. Even Mexico cannot compete.

[zipplewrath]

5. Yes, there is some favorable accounting going on here

One can make the case that our FTA's aren't having the expected effect, because even THEY can't compete with China. Getting an FTA in place with China (and others) won't necessarily bring jobs back HERE. But it may pull them out of China to Mexico.

Furthermore, they are doing this on a dollar comparison basis. As useful as that is, it distorts the situation a bit because we manufacture very high dollar items, like Boeing Aircraft. But you can lose alot of jobs making low dollar items, and compensate with a few jobs in high dollar jobs, but you still have alot of under employed folks.

[Captain Hilts]

6. Good call on the 'dollar' comparison. nt

[TreasonousBastard]

2. Interesting. I've suspected this for some time, but haven't had a chance...

to check the numbers myself. I am aware that the US remains the world's largest manufacturing economy, even though we don't make cheap radios and kitchen appliances any more.

Even if true, however, it probably won't affect the mindset of the anti-trade crew.

[OHdem10]

3. Free Trade has been great for Wall Street, the Elites who get richer

and richer and Investors. This is why we cannot change
Trade Policy.

It is important to convince us that Free Trade is good for us.

Tell the 40,000,000 Americans who are facing job dislocations
that Trade has been good for them.

[ejpoeta]

4. well, we can buy cheap goods. unfortunately many can't even afford the cheap goods because

all the jobs are gone. but the rich folks are richer.

[pampango]

7. The point of the NAM guy in the OP is that our manufacturing sector does better with "free trade"

countries than it does with the rest of the world. His contention is that "free trade" agreements cause more US manufacturing, not less (assuming his statistics are accurate).

It makes some sense, since European countries have more "free trade" agreements than we do and their manufacturing industry is very healthy (though the US still manufactures more than any other country).

[ejpoeta]

8. free trade sounds great. the problem seems to be in the fact that it is not EQUAL trade.

so when china uses sweatshop laborers and pays them crap and then sells the goods here cheap, there is no real competition with US manufactured goods that involves a minimum wage requirement and health benefits and other benefits. and then what do our goods encounter in other countries also....