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.
Thanks. How much of it is stuff manufactured elsewhere, but assembled here? [hoot]
I'm not here to argue with you. But I do hope you are not rudely awakened someday by a sudden loud sucking sound like many others have.
It seems we take our jobs for granted until they are gone. The textile business went south in the '80-'90s and are almost non existent in the US today. How many more manufacturing jobs have to leave before you realize what's happening?
It's all part of the globalization expansion of world market. Move the manufacturing process to the other countries to elevate their standard of living and bring ours down to a merge-able level for the upcoming American Union just like in Europe.
Now ain't that a laugh for you.........
I don't play the violin BTW, but I can hear them playing and you apparently can't lol........
What a relief. You were doing a poor job.
She may be a good politician with her finger in the air to see which way the wind blows, but she knows nothing about buying and selling on the international market.
You are a RUDE BOY
Shame you can't carry on a decent conversation. It is a lot easier to be rude here than it is to someone you face isn't it?
A battle of wit? You unarmed my friend, grow up and come back when you can be civil.
If by "decent," you mean claiming that NAFTA "moved all the manufacturing jobs out of this country," I am astounded that you can spout that bilge and expect not to be challenged.
You can believe what you want, I see the empty buildings where workers used to go everyday and produce the goods that are now imported. I see no new manufacturing jobs being created in my state, just the ones that are leaving.
The trade gap is created by something, and it is from importation of more than is exported.
I have no idea what you do for a living, but someday this may affect you in someway and when it does, realize that the taste in your mouth will be the same bile you accuse me of spewing.
This has gone far enough, I can see what happens around me and know first hand what is closing and going away. You read about it on your graph and feel safe from that sucking sound. Good day.
NAFTA was a major problem. We need to reinforce our National manufacturing, industrial and military-industrial base.
Sending sensitive work and manufacturing jobs to China, and others, is military suicide.
We should export useless, brainless, idiot consumer goods (Note1: like China has been) while amassing key, sensitive industrial strength here at home (note2: like China has been doing for 20+ years). Who is smarter, China, or the U.S. under the control of pro-China Clinton liberals? Thank God that Bush is in and can reverse some major flaws in out anti-strategy.
In a showdown, I would place my bets on the country seeking its maximum industrial and military advantage.
China has been the smartest poker player for well over 20 years. We buy their useless consumer junk, yet they import key raw materials and industrial technologies. Hmmm, maybe they have had a strategy all along??
I can not believe that this happened. The pro-China liberals and global, fake 'conservatives' are to blame for the massive upgrade to the Chinese military. LORD help us if the ChiComs acheieve parity, or attempt to surpass us. I see a version of Dec 7, 1941 happening all over gain.
We need pro-USA manufacturing policies and keep key industries and jobs here. Period. Rumor has it that Mickey Kantor stole DOC documents which assisted China, is that true? Was he another “stuffed shirt” like Berger? We need to DIG
http://www.nndb.com/people/539/000059362/
here's my hunch.
Marxism;Sandinista;Ortega;"FARC"; F.A.R.C.; Russia; China; Castro;Communist Manifesto;liberal;Left Wing;Socialism;socialist;progressive income tax;abolition of private property;anti military;Dellums;traitor;Kerry;U.N.; etc
Well, if you see empty buildings and you see no new jobs then you must be right. There can't be new jobs that you don't see. That would be impossible, right?
One wonders how on earth it got to be that socialist Ontario is producing more cars than Michigan. That is indicative of something seriously wrong with economic policy, at least in that state.
Regards, Ivan
What you are witnessing is the direct result of the DYNAMIC ECONOMY that we enjoy in the US. You can ignore the objective evidence in favor of your apocryphal observences all you want, but don't expect me to do the same.
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