Of Pork And Trade

IBD Editorials ^ | July 6, 2011 | Staff

[Kaslin]

Politics: Has corruption tainted even the battle over free trade? If not, why has the White House buried its own study of a jobs "retraining" program that it insists Congress must vote for as a condition for signing three trade deals?

A Labor Department study on the effectiveness of Trade Adjustment Assistance (TAA), a $1.3 billion program for workers who claim their jobs were lost to foreign competition, has not only missed its deadline by four years, but is also being withheld until the end of the year, the Wall Street Journal reports.

Based on how this White House operates, it's virtually certain they're hiding the results. Other studies show the TAA program to be a big failure. But President Obama wants Congress to pass it as a condition for his submitting the U.S. free trade treaty with South Korea to Congress for a vote. As ex-House Speaker Nancy Pelosi said: "You have to pass the bill to find out what's in it."

That's worth thinking about, because right now principled Republicans, such as Utah Sen. Orrin Hatch and Kentucky Sen. Mitch McConnell, are taking flak from even business groups for not going along with this pork.

Their reasons are understandable. The three stalled free trade deals — with Colombia, Panama and South Korea — will bring in $10 billion to $13 billion in sales for American producers, creating 250,000 new jobs.

The Obama administration, not so much. President Obama wants TAA to pacify unions, which vehemently oppose free trade. It doesn't hurt that 50% of TAA beneficiaries are union members, even though they make up just 6% of the private workforce.

But the $1.5 billion price tag of TAA amounts to a pretty hefty sales tax, even if the program were effective.

[CowboyJay]

#1 - If a company in a foreign country is benefitting from the protection of our military, and using our infrastructure to deliver their product into our markets, why shouldn’t they be required to help pay for upkeep costs by paying taxes as a US entity?

#2 - If they are not required to pay into our system, does that not amount to an indirect subsidy BY OUR OWN GOVERNMENT of companies that are in direct competition with domestic firms producing goods for US consumption?

#3 - If we do the math of the economic effects 10 yrs down the road of signing an FTA, and it will result in net loss of jobs or net GDP loss or net revenue loss to the US Treasury, why would we sign it at all?

#4 - Why should costs of retraining displaced workers and providing them with social services while they find another job not be factored into our decision and provided for beforehand?

#5 - Where in the US Constitution is our gov’t empowered to enter into trade agreements that give preferential treatment to foreign firms by indirectly subsidizing them and that are detrimental to the general welfare in that they put US-based operations out of business, US workers out of jobs, and deprive the Treasury of revenue?

#6 - The US gov’t is expressly given power to raise tariffs in the Constitution. We have huge revenue shortfalls forcing us to borrow, with interest, from the very countries we should be collecting tariffs from. Why is this power not being used?

#7 - Is ‘free trade’ implied in the US Constitution, or is it another progressive liberal construct like ‘free healthcare’ or ‘free love’?