Posted on 02/12/2005 3:39:03 PM PST by yoe
Washington — Canadians often see themselves as the victims of trade clashes with the United States.
But don't tell that to U.S. Senator Hillary Clinton, who has co-sponsored a bill that would slap a cap on the soaring U.S. trade deficit — the latest manifestation of a tide of protectionism south of the border.
"I believe in trade," Mrs. Clinton insisted this week. "But I don't believe in the United States being the only country in the world that truly practises free trade."
Mrs. Clinton pointed out that last year, for the first time, more cars were made in Ontario than Michigan — the heart of the U.S. auto industry. She and the bill's co-sponsors, including North Dakota Senator Byron Dorgan, have demanded unspecified sanctions to curtail imports and get the deficit down.
Canada, like all of the United States' major trading partners, should brace for this kind of backlash as the record U.S. trade gap becomes a flashpoint of political debate, trade experts say.
"Trade protectionism is rising," Fred Bergsten, director of the influential Washington-based Institute for International Economics, warned ominously this week as he unveiled a proposed foreign policy for the United States.
The former top U.S. economic adviser said that, in spite of undeniable evidence that integration with the global economy makes Americans richer — to the tune of $9,000 (U.S.) per capita every year — free-traders may be losing the battle for their hearts.
Globalization "causes significant human dislocation and, thus, political backlash that could jeopardize these huge gains," he said.
Figures released this week show that the U.S. trade deficit cracked the $600-billion threshold, hitting a record high of $618-billion in 2004, or more than 5 per cent of gross domestic product. There were record deficits of $161.9-billion with China and $65.7-billion with Canada.
Mrs. Clinton is right that cars contributed to last year's imbalance with Canada. Ontario produced 2.7 million vehicles last year, while Michigan produced 2.6 million.
Bush administration officials insisted that surging imports are a sign of U.S. economic strength, pointing out that Americans are generating more surplus income to buy whatever they want from around the globe.
But others, including Mrs. Clinton and Mr. Dorgan, see something more sinister, including the flight of jobs. Mr. Dorgan, who, like Mrs. Clinton, is a Democrat, said the United States is headed for an economic disaster unless the trade deficit is reined in soon.
"There's no trade vaccine that will make us well," he said. "We have to have the backbone to demand fair-trade treatment, whether it's about cars or anything else."
His bill would impose a statutory trade debt ceiling and force the U.S. administration to curtail the deficit within 45 days by whatever means necessary, including trade sanctions, once the gap exceeds 5 per cent of GDP.
Mrs. Clinton likewise urged unspecified "drastic action" to close the trade gap. "We are not going to sit by year after year and be disadvantaged," she said.
The bill, one of thousands introduced in the U.S. Congress every year, stands only a slim chance of becoming law. But it nonetheless reflects a disturbing trend toward isolationism among the country's political elite, according to Dan Griswold, associate director of trade policy at the Washington-based Cato Institute. "It's disturbing that powerful politicians would propose something that is so intellectually thin."
Mr. Griswold added that "a wholesale assault" on trade liberalization in Congress is unlikely. But he acknowledged that protectionists have largely stalemated any further liberalization. They are also winning key victories at the margins, in areas such as mandatory country-of-origin labelling for beef and other food imports, he said.
This week, U.S. Agriculture Secretary Mike Johanns reversed a decision to lift a ban on imports of Canadian beef from older cows next month — largely because U.S. ranchers and meat packers complained that allowing the meat in would threaten U.S. jobs. The decision was made even though his own officials had already determined that imports of meat from older cows posed no risk of spreading mad-cow disease in the United States.
The trend isn't limited to agricultural products. Yesterday, the International Intellectual Property Alliance asked the Bush administration to monitor copyright piracy in 67 foreign countries, including Canada. The group cited deficiencies in Canada's copyright regime for costing U.S. software makers $486-million in losses last year.
Mr. Bergsten agreed that the United States urgently needs to lower the record U.S. trade and current account deficits.
But the way to do it isn't by thwarting imports, he said. The United States should persuade China to let its currency float, encourage Europe to spur its economy, and dramatically boosting trade adjustment aid to laid-off workers.
I question his health though.He looks like crap lately.
If I wanted to vote for a Democrat like McCain or Giuliani, I'd go all the way and vote for Hillary.
For your consideration:
http://www.freerepublic.com/focus/f-news/1339684/posts
Rice/Bush in '08 has a nice ring to it.
Nobody was worried about the trade deficit all through the 90's either. Every month it jumped.
That should shore up support for her here in Michigan, which cast its electoral votes for, uh, Kerry. Hillary must be a political genius. I'm sure the huge trade deficit the US has with China is meaningless.
Toyota and Honda both build autos in the US, while US-based automakers (and former US-based automaker Chrysler) build cars and make parts in Canada and Mexico, as well as the United States.
Next up, President Bush arranges for a major trade summit with European and Canadian leaders in Quebec. ;')
Good points.
True, no candidate has yet emerged among Republicans, but that is obviously going to change, and I find it hard to believe that the Republican primary fight will feature as many candidates as the 2004 DP primary, or be as nasty.
Hillary is a liability for the DNC, and they must be aware of that. But with Howard "Yeow" Dean as the party chair, Right To Life now officially repudiated, and the party having had its ass kicked *again* in 2006, perhaps she will be rushed to the front as it were in a shallow effort to place the first woman in the presidency.
First she has to win the 2006 senate reelection campaign in the face of the possibility that A) she won't serve out her second term and everyone knows it, B) even if she lost a presidential bid, she will be expected to make one, meaning an absentee senator in a shrinking minority party, and C) if she wins the presidency a Republican could succeed her, growing the Dim Deficit by one more seat.
The calculations continue.
Remember folks she is a lawyer and she has the training of a lawyer who knows how to play to the jury.
Never forget, for Hitlary it is all the politics of "Symbolism over substance."
She'll pick up right where she left off, with her buddies in Europe, attacking militias and right wing hate groups. Only this time she'll throw FOX News and Talk radio into the bag.
She'll work with Europe to, first, villify anything "right wing" (ie conservative) and then she and the our demon Euro "allies" will find a way to ban conservative, far right (meaning anything right of whackoism) parties.
That's my bet.
Did you notice in the article that 2.6 million autos were manufactured in Michigan last year? Do you think cars grow on trees?
On the obviously partisan Dim tv show, SNL, during last night's "Weekend Update", Amy P did the story about Hillary being the favorite for 2008 among Dims, saying that it was because they're looking for a new way to have their ass handed to them. The crowd erupted with applause. The same crowd had just had a similar response to a childish bash-bush "joke" from the reprehensible Tina Fey.
Maybe she should be blaming Bill Clinton for signing the NAFTA Bill that has moved all of the manufacturing jobs out of this country.
"Did you notice in the article that 2.6 million autos were manufactured in Michigan last year? Do you think cars grow on trees?"
Great,But that was mainly from parts imported from Canada and Mexico. So your point is?
The trade deficit is from more things coming into the US than going out. We are down to 13% of US jobs in the manufacturing process and the ones that remain are mainly from assembly from imported parts.
As Ross Perot said about NAFTA, A giant sucking sound is all I hear.
If you read the article as you state, more cars were made in Canada than the US.
We are down to 13% of US jobs in the manufacturing process and the ones that remain are mainly from assembly from imported parts
Sure. "We don' make nuthin', nowhere, nohow." What a joke. Where do you come-up with this BS?
It might pain you to learn that our manufacturing sector has been expanding for 20 straight months, and we set a record for goods exports last year.
Check this out . . . one of our resident economics experts has chimed in. Do you still have that graph of goods production as percentage of GDP?
Try telling that to the people in the US that are losing their jobs as plants close left and right and move to Mexico, Canada or China.
I don't have the reference handy but the percent of remaining jobs in the US that are manufacturing are only 13% of all jobs.
Do a search on TAA Dislocated Worker supplements to address your idea about increased jobs from manufacturing expansion. lol you need to wake up and look around.
I hope The RNC is painting a BIG "TARGET"on Madame DeFarge for the 2006 election!!!!!
EXACTLY RIGHT!When BeelzeBubba was POTUS there was"A Crisis In Soshe Scurity"(I'm only pronouncing it like "Little Dick Gephardt"and"Dingy Harry").There isn't one now(seven-years later)because The Rats aren't in charge!!!
Tahat was called(by Dick(the toe-sucker Morris)"Triangulation"!!!
Here come the violins. Manufacturing employment is dropping world-wide, friend. Including China. Remember them? That's the place where allegedly all our manufacturing jobs went.
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