Posted on 10/12/2011 8:23:35 AM PDT by Kaslin
When it comes to free trade agreements (FTAs) pending in Congress, Americans have learned not to get their hopes up. No matter what President Obama might say in favor of passing the three FTAs with Panama, Colombia and South Korea; no matter how close congressional leaders are in getting a deal done; and no matter how many times proponents preach the unsurpassed benefits to free trade, something always blocks final passage.
So we should take the news that Congress is - once again - close to finishing work on the three FTAs with a heavy dose of skepticism. Nevertheless, Congress has the best chance at passage than at any other point since the beginning of the Obama Administration and we cannot afford to squander this opportunity. When the final obstacles are cleared, it's up to Congress to forgo the partisan bickering and get to the business of finally passing these necessary vehicles of economic prosperity and job creation.
A new report from the Council on Foreign Relations spells out in troubling language the damage America's inertia on free trade has caused our economy. Headed by former Bush chief of staff Andy Card and former Senate Majority Leader Tom Daschle, the bipartisan report explains how other nations, especially in the EU, Asia and Central America, have spent the past decade pursuing free trade agreements, all the while the U.S. continues to dither.
The report summarizes: "By allowing the EU, in particular, to gain a first-move advantage, U.S. companies may find themselves forced to conform to European regulatory standards if they are to sell into the world's fastest growing markets." In other words, U.S. businesses are in danger of losing the autonomy that has given them their historical advantage over foreign competition. Now, we're playing catch-up instead of leading.
The CFR report covers more than the three pending FTAs with Panama, Colombia and South Korea. It sets forth a national trade strategy that "brings to more Americans more of the benefits of global engagement, within the framework of a strengthened, rules-based trading system." The Obama administration should work with Congress to consider the report's findings. If instead the president decides to punt, the Republican presidential candidates should give the report the attention it deserves - and the Obama administration all the criticism it has invited.
The truth is that despite the president's rhetorical support for the pending FTAs, he has put little White House muscle behind their passage. Indeed, the president has never mentioned the FTAs in any of his recent speeches on job creation or the economy. This absence of leadership has allowed pro-union congressional lawmakers to put up obstacle after obstacle to block their approval.
But the free-trade opponents are fighting a losing battle. When unemployment remains above 9 percent, cutting U.S. companies off from emerging markets won't build jobs. Protectionism is a short-sighted position that will, inevitably, come back to haunt us - just as the CFR report makes clear.
Besides, it's been so long since Congress has compromised on behalf of the American people. At least on the matter of free trade, the case is closed and shut.
That's because the benefits of free trade couldn't be clearer. Over the last 15 years, free trade has created more than 25 million jobs and increased real wages for U.S. workers. In fact, according to the Peterson Institute for International Economics, the cost of not passing the Colombian and South Korean agreements has been on the order of 300,000 jobs. The longer we delay passage, the longer hundreds of thousands of Americans remain out of work.
As president and CEO of an association representing more than 2,000 consumer technology companies, I know firsthand just how important free trade is for the continued prosperity of our industry. But the consumer electronics industry isn't alone. Across the economic spectrum, free trade creates wealth and jobs - and both have never been more needed than right now.
Free Trade with more low wage countries isn’t very appealing with a 20% unemployment rate.
The Founding Fathers did not like “free trade”.
In hindsight, it turned out that the Founding Fathers were right about tariffs. The United States did pretty well from the 1770’s until around 1970 or so we began to eliminate all of our protectivie tariffs and start trading with Communist China.
I made this point on another thread that no one responded to. What is the difference between these two scenarios, other than one is legal and one is illegal?
"Hey, Joe. Get out of here. You're fired. We just found this guy named Juan from Mexico City that will do your job for $3/hour."
"Hey, Joe. Get out of here. You're fired. We just found this guy named Juan in Mexico City that will do your job for $3/hour."
Now, now, that’s just shortsighted thinking. When American corporations can offshore every American’s job, we’ll be so much better off, you betcha.
You nailed it. The macroeconomics be damned, public support for free trade right now is at its lowest point since Ross Perot nearly took the oath of office in a straightjacket in ‘93.
A populist movement that wants to smack around bankers and Wall Street, send all the illegals home and get us out of NAFTA and GATT. That is the next coming big thing in our politics.
It is articles like this from so-called conservative websites that clearly demonstrate the intellectual bankruptcy and Moral Corruption of America. Shame on Townhall for allowing such TRIPE to soil their site. I would like to suggest that this asswipe writer read something other than Das Capital for economic theory, maybe some Adam Smith or Ayn Rand. For the record I stopped visiting the Townhall Website regularly a few years ago precisely because of Crap like this.
There can be no “free trade” where wage disparities between countries are not addressed. Ricardo never dreamed that productive advantage would be gained by employing slave labor.
The left and right are starting to share common ground on trade. Unfortunately, the idea that tariffs will fix our economy is delusion. The romanticism about tariffs clashes with sobering reality. Supporters of tariffs are reacting emotionally without thinking through the implications of fortress US. I think that government policies can push hard to eliminate or reduce harmful trading practices by China and other countries. However, the idea that fortress America with domestic industries protected by tariffs will fix our sick economy is delusion, devoid of careful analysis.
Here are some issues to consider for Freepers who feel that tariffs and fortress America will cure our sick economy.
- Tariffs will not fix our excessive government spending, regulation, and taxation. Tariffs will be an additional tax to fuel even more excessive spending and regulation.
- Tariffs will reduce economic activity world-wide. Smoot-Halley was a contributor to the Great Depression. A world-wide trade war will lead to lower demand world-wide because of the increase to consumer prices. Supporters of tariffs are clear that consumer prices will increase substantially. For example, I have heard supporters indicate that the price of clothing may double or triple after imposition of tariffs.
- Tariffs will embolden labor cartels both in their outrageous compensation demands and political power. Labor cartels know that any compensation increases be satisfied with increased tariffs and higher consumer prices. Labor cartels will push very hard to extend prevailing wage laws to the private sector.
- Fortress America will sink the dollar and expose our mountain of unsustainable debt. With a world-wide trade war, other countries will not want to hold US dollars or trade in US dollars.
- Broad-based tariffs have many complicating factors. What will be subject to tariffs? Consumer products? services? components? Broad based tariffs will effectively become a VAT in which every stage of production is subject to a tariff. How are services subject to tariffs? Can you tell a firm that its IT services cannot be performed in other countries? How do you stop consumers from directly ordering products from foreign firms? For example, many students buy foreign editions of textbooks. Many Freepers approve of this practice. Consumers will buy foreign versions of any number of products to avoid tariff induced higher prices.
- How can private companies be forced to move production to the US? Since our economy has many other serious problems besides global trade, foreign competitors will be free to increase prices yet still undercut inefficient US producers. This trend will increase because tariffs will reduce the impetus to eliminate excessive regulation and taxation.
- The imposition of broad-based tariffs will be a shock to many industries heavily dependent on global trade. The domestic aircraft industry will be in shock as a large part of its demand comes from other countries.
I invite other posters to make thoughtful replies. My posts on this subject are often met with ugly responses, similar to non reasoning on leftist sites.
So, you're ready for the price of a television to quadruple?
“Now, now, that’s just shortsighted thinking. When American corporations can offshore every American’s job, we’ll be so much better off, you betcha.”
“So, you’re ready for the price of a television to quadruple?”
That is always the bottom line; Walmart will raise prices. It does very little good to have cheap stuff if you don’t have an income to buy things.
We were sold NAFTA with the promise of all the export jobs we would get from it. That turned out to be a lie. Before NAFTA a man could raise a family on one income even without a college degree, now both husband and wife with college degrees must work to maintain a good standard of living.
you're a filthy turd maam. This is better stated as you're ready to be offshored and live in a 3rd world America where you're daughters are whores and your sons run drugs.
Only quadruple? As long as you’re making up numbers out of thin air, why not quintuple or sextubple. Go big or go home.
Being anti-free trade and (manipulating) pegging the Renminbi to the US dollar has been working out great for China for the last 20 years.
Thanks for your list of why I support tariffs. You know your history. You are aware that the United States deployed tariff in the past and we did well by them. Prior to the income tax (1913) tariffs were a main source of funding the Federal Gov’t. We run a 600 billion dollar trade deficit. Tariffs will cut this down
Japan, Korea, China, Taiwan don’t have any free trade delusions. They are predatory mercantilist nations. We have been their saps for decades. At least we are allies of Japan, Korea, Taiwan. But China is a rival and an enemy.
Back in the 1930s trade was 2-3% of our GDP. I fail to see how the Smoot-Hawley act contributed to the Great Depression.
There can be no “free trade” where wage disparities between countries are not addressed. Ricardo never dreamed that productive advantage would be gained by employing slave labor.
Bump.
Better study America's real productivity. Read here to get your economics up to date
You bring up the main skunk for future trade agreements, Middle class and working class Americans have not seen the benefits from NAFTA. I may think NAFTA was a good idea, and that the lack of benefits are not due to NAFTA, but to another trade law passed a few years later, MFN for China. The other part of the problem is that those who support free trade, seldom admit what they claimed the benefits of NAFTA were going to be when they passed it.
I remember claims that NAFTA was going to reduce illegal immigration and raise living standards in Mexico.
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