After losing 880,000 jobs to NAFTA, we're back for more

The Springfield News ^ | Jul 22, 2005 | Peter DeFazio

[Willie Green]

For education and discussion only. Not for commercial use.

Proponents of so-called "free" trade agreements like the North American Free Trade Agreement (NAFTA), which I opposed, have long promised endless riches for U.S. workers, farmers, businesses and economy. They've been wrong on all counts.

Failed U.S. trade policies have led to the export of millions of high-paying American jobs; decline in U.S. living standards; soaring trade deficits; and a significant erosion of U.S. sovereignty to international trade bureaucrats.

Despite this unbroken record of failure, the House is expected to vote before August on an agreement the Bush administration negotiated to expand NAFTA to Central America via the Central American Free Trade Agreement (CAFTA). The Senate has already voted to approve the deal. I will vote no. Here's why CAFTA must be defeated.

• CAFTA will increase the already record U.S. trade deficit. The U.S. trade deficit this year is running at an annual rate of approximately $700 billion, nearly $100 billion above the record deficit set last year. We must borrow nearly $2 billion every day from foreigners to finance this deficit. Prior to NAFTA, the U.S. had a trade surplus with Mexico. In the wake of NAFTA, the surplus turned to a deficit that has risen steadily. The U.S. already has a trade deficit with the Central American countries of $1.6 billion, which will only grow if CAFTA is enacted. Deficits are dangerous because they cost U.S. jobs and put our economic and national security in the hands of foreigners who finance them.

• CAFTA will lead to the export of U.S. jobs. The U.S. Chamber of Commerce predicted NAFTA would create 170,000 jobs in the U.S. They were a little off. The actual result was a net loss of nearly 880,000 U.S. jobs, including more than 12,000 in Oregon. Looking at the numbers beyond NAFTA, Oregon has lost 40,000 jobs due to failed trade policies since 1994. CAFTA will be more of the same.

• CAFTA is not about exporting U.S. goods to Central America. More than 40 percent of workers in Central America make less than $2 a day. The combined economic might of the five Central American countries is only $151 billion, about what the U.S. economy produces in five days. Even if every penny of these countries' economies was devoted to buying U.S. goods, which isn't going to happen, the impact would be insignificant in the $11 trillion U.S. economy. The bottom line is that CAFTA is not about creating U.S. jobs and exporting U.S. goods. It is about creating a favorable climate for multinational corporations to export U.S. jobs and use Central America to export goods back into the U.S.

• CAFTA will erode U.S. sovereignty. CAFTA allows foreign corporations to sue our government for approving laws and regulations that may impede their ability to maximize profits. If the Oregon Legislature or the U.S. Congress approves laws to protect the public health, the environment, or consumer and worker safety that a foreign company doesn't like, they can sue to get the law overturned or to require taxpayers to pay large fines in return for keeping the law on the books. That is an unwarranted intrusion on the sovereignty of American citizens.

• CAFTA will hurt Oregon farmers. Farmers have repeatedly been promised that if we only approve another free trade agreement, they'll get rich. Family farmers are still waiting. The U.S. trade surplus in agriculture peaked in 1996 at $27 billion. The USDA predicts this year that the surplus will be zero. In the wake of NAFTA, the U.S. agricultural trade deficit with Mexico and Canada tripled from $5.2 billion to $14.6 billion. Perhaps that's why the trade committee of the National Association of State Directors of Agriculture voted unanimously to oppose CAFTA. Due to increased sugar imports, CAFTA will be particularly damaging to Oregon's many sugar-beet growers.

• CAFTA will restrict government procurement that benefits U.S. workers. CAFTA will prohibit governments from enacting procurement rules such as "Buy Oregon" or "Buy America" that prevent the export of jobs by giving preference to local contractors; promote the development of environmentally-friendly products or services; or provide preferences for small businesses, among other common procurement rules.

• CAFTA is a model for an even larger expansion of NAFTA. Finally, CAFTA must be defeated because it is a model for an even larger expansion of NAFTA to the entire Western Hemisphere via the Free Trade Area of the Americas, which is currently being negotiated by the Bush administration.

[cripplecreek]

Back when the senior Bush was in office pushing NAFTA, the owner of my factory constantly warned us that it would cost jobs.

That factory is closed now BTW.

[agitator]

Bush senior also wanted a "new world order." Quote Unquote.

[1rudeboy]

Does this mean that DeFazio (ACU Lifetime = 14) is becoming a Buchananite?

[CBart95]

Now that we are clear about what you don't want, what precisely do you want?
Do you or anyone you know of have an alternative?
Seems that little item is always missing in these 'Hate Bush" treatises.

[AEMILIUS PAULUS]

Statement: "After losing 880,000 jobs to NAFTA, we're back for more"

Response: Absolutely!

Comment: "In declining States the leadership intuitively choses the most harmful course of action..."-A Great Historian 1888.

[hershey]

On the History Channel not long ago, they were talking about Hadrian's Wall, and said at the end the barbarians were so desperate to have what Rome represented that they broke the wall down. That's exactly what's going on at our southern border. Rather than stay home and fix things, they want instant gratification. Cross the border and it's yours. Even better, turn it into MegaMexico or MegaEverywherelseSouth. They don't get it that the cultural, social mindset that dooms Mexico and points south will wreck the US, and if they did understand, they wouldn't care.

Yes, CAFTA will flop, for the same reasons NAFTA did. So what do we do? Build Hadrian's Wall? If so, we'd better start now and fortify it.

[hershey]

When CAFTA flops, they'll demand we think up something else to bail them out.

[Texas_Conservative2]

since the employment rate is much lower now than before NAFTA was passed... I have no idea how we have somehow lost 800,000 jobs.

[Jason Kauppinen]

Obviously some people who lacked the ability to compete globally were sheltered behind tariff barriers.

These anti-NAFTA bozos think that the American customer owes them a living and should be forced to pay for higher priced goods.

[Jason Kauppinen]

I'm sure people said the same things about Irish immigrants.

[Be Free]

"since the employment rate is much lower now than before NAFTA was passed... I have no idea how we have somehow lost 800,000 jobs."

And if the result is higher imports of cheaper goods, isn't that good for our economy and the American consumer? Also, as awful as trade deficits sound, no one has yet proven a harmful long-term effect. An example I read (Thomas Sowell perhaps?) is that, in my personal economy, I run a trade-deficit with my grocer (I buy more from him than he does from me). Is that such a bad thing?

[Oatka]

Obviously some people who lacked the ability to compete globally were sheltered behind tariff barriers.

"Global Competition" is a race to the bottom. It is a code word for "Who will work the cheapest?" Just ask the Mexicans who took our jobs away because they were cheap and compliant (read subjugated*) and have now lost theirs to the Chinese who are even cheaper and more compliant.

*Check out the Mexican labor battles in the cities or the countryside. The ringleaders always seem to be among those "accidentally" killed in the melee.

[Willie Green]

is that, in my personal economy, I run a trade-deficit with my grocer (I buy more from him than he does from me). Is that such a bad thing?

We need to know more about your "personal economy" to answer that.
But if you're following Dubya's example, then you obtain your money by gradually mortgaging your home to your grocer. Sooner or later, he'll own the whole thing and your hungry butt will be tossed out on the street. Yes, I would call that a bad thing.

[cp124]

lost 800,000 jobs
manufacturing

gained
Home Depot, Lowes, Dunkin Donuts, McDonalds, Wendys.....

[Toddsterpatriot]

The U.S. Chamber of Commerce predicted NAFTA would create 170,000 jobs in the U.S.

Really? Over what time frame?

They were a little off. The actual result was a net loss of nearly 880,000 U.S. jobs, including more than 12,000 in Oregon. Looking at the numbers beyond NAFTA, Oregon has lost 40,000 jobs due to failed trade policies since 1994.

Really? Over what time frame? Were the jobs lost the day NAFTA passed? A year later? 5 years later?

CAFTA will be more of the same.

Yeah, cause the predictions of doom and gloom were so correct last time. LOL!!

[cp124]

Obviously some people who didn't want to make 23 cents a week and eat rice 6 days a week to compete globally were sheltered behind tariff barriers.

[foobeca]

Your employer runs a huge trade deficit with you.

The benefits of free trade is not matter of debate. Saying that trade is bad is like saying the sky is not blue, that the sun does not rise in the east and set in the west.

Go take a decent economics class if you don't know or understand why trade is good.

There are some legitimate concerns about sovereignty, but there is no valid argument against free trade except for environmental issues.

[Nowhere Man]

Home Depot, Lowes, Dunkin Donuts, McDonalds, Wendys.....

Um, you forgot Wal*Mart. B-P

[foobeca]

"Global Competition" is a race to the bottom. It is a code word for "Who will work the cheapest?"

You sound like a communist. Competition is a good thing-it lowers prices and improves quality.

[1rudeboy]

And China lost 15 million.

[1rudeboy]

Is that why the citizens of the countries with the highest level of government interference in their economies also have the lowest per capita incomes?

[Swanks]

Back when the senior Bush was in office pushing NAFTA, the owner of my factory constantly warned us that it would cost jobs. That factory is closed now BTW.

Bush here in NC last month pushing the value here, to textiles. Surprised he found a plant in the state still in operation. One last push by these globalists to wipe out all manuf. - under the guise of 'its good for jobs'. Just like Nafta to textiles in NC.

[taxed2death]

"Do you or anyone you know of have an alternative? "

Tariffs worked wonders for Harley Davidson.

R. Reagan did not sell out the US workers.

[foobeca]

B.S., These stupid job loss quotes assume that there weren't new jobs that were created in the economy to replace those.

There's absolutely no reason for U.S. workers to do lame-brain jobs like textile jobs. There are more productive ways that we can use our labor force than making textiles or making stupid widgets. 10 million jobs were created after NAFTA, no doubt those US textile and widget workers found some of those 10 million jobs.

When we import cheaper goods and services, we can take the money we save and invest that in more productive parts of the economy. In addition, foreigners are then able to become richer and import goods and services also.

[taxed2death]

"Obviously some people who lacked the ability to compete globally were sheltered behind tariff barriers.

These anti-NAFTA bozos think that the American customer owes them a living and should be forced to pay for higher priced goods."

Nope. Free trade is not free. There's quite a cost. We won't even get into the fact that it's surely not FAIR trade.

If ya don't believe it....try opening up a mid sized manufacturing factory here in the US.......then get back to me.

[Black Tooth]

Proponents of so-called "free" trade agreements like the North American Free Trade Agreement (NAFTA), which I opposed, have long promised endless riches for U.S. workers, farmers, businesses and economy. They've been wrong on all counts.

Of course they were wrong. Free trade only benefits the fat cats on the inside.

[KC_for_Freedom]

Of course Nafta did not work as well as the positive forcasts, but it did not work as badly as the more negative forcasts. My company took jobs to Mexico, found the mexicans quality too poor to continue, and brought the jobs back. The best measure of whether we are doing well or doing poorly is the economic growth and the unemployment fraction. Both seem to be in good shape as we speak.

Whether Cafta will be bad depends on whether one is in the right or wrong business because there will be some effect on some businesses. The problem with capitalism is that it is hard to control. The problem with other forms or systems is that the government becomes the agency of control and the government is not so good as no control whatsoever.

[foobeca]

Interesting that your username is "taxed2death" and you support tariffs. A tariff better help the company, just like if the government wrote me a check or eliminated my competition.

Tariffs screw the consumer though and cause deadweight loss.

[hedgetrimmer]

trade is good

"Free traders" ignore that the type of trade that is being implemented is "free trade". People don't oppose "free trade" but the global system that is being implemented in the name of "free trade" is anything but.

First, the system usurps the authority of Congress to regulate trade. "Free trade" agreements are negotiated by unelected trade representatives, the agreement is sent to Congress for an up or down vote. Another issue with "free trade" just at the legislative level is that there is a shift in the balance of power that was not approved by the American people, and which is probably unconstitutional. That is the "fast track" authority given to the president. Finally, all rule making and arbitration for "free trade" agreements goes through an international body. This directly diminishes the sovereignty of the individual in this country because now an unelected international body is regulating our behavior, and it diminishes the sovereignty of our country, because it effectively allows Congress to completely abdicate itself from its treaty making authority for trade.

Now, even if you don't care that our constitutional government is undermined by "free trade" consider the fact that "free trade" is being used to redistribute wealth in a most socialist fashion to what is called Least Developed Countries, or LDCs. The American taxpayer,who lives paycheck to paycheck is now fingered by the international body ruling "free trade" to watch as money withheld from his paycheck goes to corrupt foreign governments and transnational corporations who could afford it on their own, for "trade capacity building".

Worse yet, our federal domestic agencies like the US Treasury Dept, the DOT, the EPA and many others are using the poor taxpayer dimes to operate in foreign countries for "trade capacity building".

In an utter corruption of diplomacy, the executive office is using "free trade" to establish foreign policy objectives, again, going around Congress because the USTRs office distributes "trade capacity building" funds, and Congress, who has the actual authority to do it, has no say.

Finally, and this is the worse, the Executive is using "free trade" to integrate the United States with all the corrupt communist, socialist, and totalitarian dictatorships in the western hemisphere. They will make a 'trading bloc' that effectively destroys the order of nations and puts into place a type of corporatist supranational government.

Thats why your statement 'trade is good' doesn't hold in todays reality.

[TopDog2]

Tariffs worked wonders for Harley Davidson.

Yep. And also for the American worker as factories were built to produce foreign motorcycles in this country to get around the tariffs. Those tariffs were a "win/win" for the United States.

[foobeca]

If you'll go reread my post, I said that the only valid argument against free trade is a potential erosion of sovereignty.

Most of the people against this are trying to argue against trade in general and how "evil" it is.

[1rudeboy]

$13.6 Billion in Manufactures Exported to CAFTA-DR in 2004

Incidentally, the U.S. exported close to 2.6 billion dollars' worth of fabric-type stuff to the CAFTA-DR region in 2004.

[Young Scholar]

Nope. Free trade is not free. There's quite a cost. We won't even get into the fact that it's surely not FAIR trade.

If ya don't believe it....try opening up a mid sized manufacturing factory here in the US.......then get back to me.

Could it be that the US doesn't have a comparative advantage in mid-sized manufacturing factories?

[Willie Green]

Incidentally, the U.S. exported close to 2.6 billion dollars' worth of fabric-type stuff to the CAFTA-DR region in 2004.

Yes, those exports will all become imports once CAFTA is passed.

[1rudeboy]

R. Reagan did not sell out the US workers.

Reagan was the first to propose NAFTA.

[durasell]

That was before Mexico's manufacturing base got creamed by China...

[1rudeboy]

You've never answered the following, Willie. Why haven't those exports become imports already, seeing that 80% of the stuff imported from the CAFTA-DR region enters the U.S. duty-free?

[1rudeboy]

Your point?

[Texas_Conservative2]

that's nothing but a bunch of liberal talking points.

90% of the people who work at those types of jobs are teenagers and young college students working part-time.

Most of the adults who complain about not being able to find a good paying job live in democratically run states. But it's not because of NAFTA that they can't find a high enough paying job to feed their family, it's because of the socialistic union coddling policies of the people running the state that have run the jobs and businesses off with high taxation, over regulation, and government subsidization, which has resulted in driving up the cost living in those areas to unfathomable levels.

If the adults with families that lived in these areas were willing to pack up their bags and move to a republican state they would find that good paying jobs are plentiful, and the cost of living is a fraction of what it is where they are coming from.

In California and new york you'd be lucky to get a 60 year old 2 bedroom shack that's falling down, in a crime ridden neighborhood with horrible schools for less than a million.

Of course you need higher paying jobs to afford to live in those places.

[bert]

Show me the breakdown on the jobs lost to NAFTA and unnamed sources won't do.

Mr DeFazio is a liar

[durasell]

Folks in Mexico had enough green in their jeans to buy American products. Once their manufacturers split for lower wages, they couldn't afford American made stuff.

Remember Perot's "suck sound" speech? It wasn't the sound of jobs leaving the U.S. for Mexico. It was the sound of Mexican jobs leaving for China...

[1rudeboy]

Surprised he found a [textile] plant in the state still in operation.

I can only imagine how shocked you'll be to read the following:

As the DR-CAFTA countries collectively represent North Carolina’s second-largest export market, with exports of $1.7 billion in 2003, opening up these markets is of key importance to our state as well as to the country as a whole. It is also worthwhile to note that the DR-CAFTA countries have also been North Carolina’s fastest-growing export market since 1999.

In the case of textiles and apparel, both of great interest to North Carolina, exports will generally be both duty-free and quota-free immediately if they meet the requirements of DR-CAFTA’s rules of origin. The rules of origin provide in part, for example, that if a garment is made in a member country from textile material originated in another member country, then it can be exported into any member country duty free. This should promote new opportunities for U.S. and Central American fiber, yarn, fabric and apparel manufacturing. North Carolina’s apparel and fabric exports to the DR-CAFTA countries totaled $1.29 billion in 2003 (up 158% since 1999), which is more than 50% of North Carolina’s worldwide exports of those products. Opening up these markets further should help North Carolina’s textile industry and thus its overall economy. [emphasis added]

[1rudeboy]

Sorry, here's my source.

[Afronaut]

Why are my tax dollars going to be used for private business in Central America?

[durasell]

If you have to ask, then you can't afford it.

[Paul C. Jesup]

These anti-NAFTA bozos think that the American customer owes them a living and should be forced to pay for higher priced goods.

That's not the problem. The problem is that foreign governments subsidize their industries to cut U.S. product out of the market.

Personally, I think the only things that should be tariffed at those products that are subsidized by foreign governments.