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Trade Deals Unite Left and Right in Opposition

By Ambreen Ali, Roll Call Staff

Some tea party organizations have been quietly trading notes with left-leaning advocacy groups as both sides work to derail a series of upcoming free-trade agreements.

Together, they hope to deliver what one opponent of the deals described as a “one-two punch” to proposed trade agreements with Colombia, Panama and South Korea. As liberal groups and labor unions lobby Democrats, tea party members have been calling the Republican freshmen they helped elect.

Some tea party groups have a protectionist slant, opposing pacts that might increase competition faced by U.S. producers, but other groups oppose trade deals because they oppose “big government.” For this faction, free trade should simply be freedom to trade with anyone, instead of a detailed treaty written by governments.

Those concerns differ from labor rights issues and offshoring concerns raised by labor unions and liberals, but Public Citizen’s Lori Wallach said many of the arguments are “different sides of the same issue.”

“I’ve certainly talked to them. We’re not working with them, but I have called them at different times to ask how it’s going,” said Wallach, who is director of the left-leaning group’s Global Trade Watch.

The alliance is less surprising when viewed in light of a Wall Street Journal/NBC News poll from last fall that found a majority of Americans believe free-trade agreements have hurt the U.S. In that poll, 90 percent of Republicans and 84 percent of Democrats agreed that outsourcing is a reason the domestic economy is struggling and people are not being hired.

Coordination between liberal and conservative advocates could be the opposition’s best hope to overcome a strong bloc of support for the trade agreements. Top Republican leaders including Speaker John Boehner (Ohio) and Senate Minority Leader Mitch McConnell (Ky.) have urged the president to deliver these deals, and the White House strongly favors the deals.

The U.S. Chamber of Commerce, National Association of Manufacturers and Heritage Action — the advocacy wing of the conservative Heritage Foundation — are all pushing for passage.

Even FreedomWorks, which works closely with the tea party movement, has argued, “Protectionism only robs Americans of their income and their freedom of choice. The cost of trade tariffs are passed on to consumers in the form of higher prices.”

Some tea party members agree. Ryan Hecker — who helped devise the tea party’s policy platform, dubbed the Contract From America — said he is “100 percent for free trade and for anything that opens up trade barriers.”

Continue reading at Roll Call

  • Jim Welch

    Had enough yet?

    Originally referenced to the U.S. Labor Dept., it has been reported many times that for each one billion dollars in exported goods and services that are “made in America” there are approx. 20,000 jobs created.

    If that is true, then the inverse is equally true. For each 1 billion in imports there would be 20,000 jobs NOT created in America because they were created in another foreign country.

    Therefore, when we run a “trade deficit” we also run a “jobs deficit”.

    AP reported on Dec. 16, 2010 in the article entitled, “Broadest measure of trade gap grows to $127.2B”, just how well America is doing with our trading partners under all the “FREE Trade” agreements.

    The report states:
    “. . . For all of 2009, the current account deficit contracted to $378.4 billion, a 43.4 percent drop from the 2008 deficit. The sharp decline reflected the toll of the severe recession in the United States, which reduced Americans’ demand for imported goods.

    But with the economy growing for the past year — and more recently flashing signs of gaining momentum — economists believe the trade deficit will increase this year. . . . ”

    There are an estimated 17 million Americans either underemployed or just simply unemployed.

    So, lets see. Looks like the Trade Deficit may reach $400 BILLION DOLLARS. This will create about $400,000,000,000 divided by 20,000 jobs per Billion dollars, or IN REALITY America is running a JOBS DEFICIT of 20 MILLION JOBS !!

    Most would be high paying manufacturing jobs. Ones with benefits. There would be practically no need to borrow money to fund long term unemployment benefits.

    There would be almost no unemployment!!

    Our budget deficit would shrink dramatically because of the massive injection of payroll taxes coupled with tariffs and duties on imported goods. You know, the income the Founders set up to actually run the central government without directly taxing the people.

    The creation of these millions of GOOD jobs in America would immediately end this recession. How do I know this? Because it always did through out history.
    Once people started spending money the factories (throughout most of our history they were American factories) would start hiring more people and the economy snowballed.

    But now, when we spend money the jobs are added on in China, or India, or other foreign countries.

    America and it’s people grew great because we were an economic power. Today, we grow weaker every year because we are becoming more and more dependent on foreign powers for our needs both financially, consumer goods, and military weaponry. We can’t even make a jet engine without getting parts from overseas.

    Yes, it was the politicians that voted away your jobs and America’s future, but don’t just stand and point your finger at them. Look in the mirror to see the culprit. You voted them in and constantly return them to office.

    This economic pain you feel is self inflicted, and when you have had enough, the cure can be found in the voting booth, and in the mean time, by yanking your elected officials up by the scuff of the neck and explaining “just how the cow ate the cabbage.”

  • Jim Welch

    I would also like to point out “FREE Trade” is not FREE either.  The cost in manufacturing jobs is great, and this trade policy has ignored the damage inflicted on America’s ability to defend Herself.

    The Tea Party has stated many times their unswerving support for a “constitutional government.”  I too strongly believe in the Rule of Law – The Constitution for the United States Government.

    Today, America must depend upon foreign governments – even former enemies – for the very products needed for our self defense.  Products such as ball bearings for jet engines, flat screens for everything from the Abrams A-1 to fighter aircraft, numerous electronic components, even down to the boots our soldiers wear come from China.

    We can’t even march off to war unless the Red Chinese supply the boots!

    The destruction of this manufacturing base has left the Citizens of these united States dependent upon the capricious nature of foreign powers and former enemies for critical components for our national defense, and therefore these Democrats and Republicans who have led this Nation into trade policies which have destroyed our manufacturing base have abrogated one of the prime responsibilities delegated in the Constitution which is “ to provide for the common defence “.

    The American worker cannot compete against labor that is paid 50 cents an hour!  Tariffs even the playing field on labor costs.

    This policy of “FREE Trade” has resulted in trade deficits each and every year since 1976 and total in the trillions of dollars transferred to fill the treasuries of foreign nations!!  These deficits in combination with budget deficits have been the evil twins that have resulted in the horrific devaluation of the American dollar over the last 35 years.  This has in turn reduced the standard of living for every American family.

    And, had we been on the “gold standard” all the gold in America’s possession could not have paid our “current account” negative trade balance.

    In regard to the Smoot/Hawley Tariff Act and its’ effect on the Great Depression – It did NOT do diddley!

    Harding took power in 1921 on a promise to “prosper America first.” He cut Wilson’s wartime income tax rate of 63% back to 25% and, with Fordney-McCumber, doubled tariff rates.

    Result: The Roaring Twenties. Growth hit 7% a year, fastest in history; and ten years later Versailles America was producing 42% of the world’s manufactures, an all-time record.

    When Smoot-Hawley passed, imports were only 4% of GDP; and two-thirds came in free.   How did a marginal tax hike on 1.3% of GDP, caused a 46% contraction of the U.S. economy, 25% unemployment, and a wipeout of 85% of stock values?

    The cause of the depression was massive credit expansion by the Fed, creating a market bubble that, punctured in 1929, wiped out a third of the U.S. money supply. With America in shock from this loss of blood, a pair of chiropractors named Hoover and Roosevelt prescribed a “cure” of huge tax hikes and sweeping regulations.

    Smoot and Hawley were scapegoats, lynched by New Deal court historians to cover up FDR’s complicity. Their tariff did not even pass until eight months after the 1929 Crash.

    Countries around the world have lined up to sign on to globalization.  Why shouldn’t they?  To them it means an open door to the greatest market on earth, and U.S. capital pouring into their countries to build new factories to replace plants shutting down across the U.S.

    Our merchandise trade deficit is approx. 5.8% of GDP; it has crossed the $821 billion mark.  We are following faithfully the course pursued by all the great empires of history: consuming more than we produce; selling off our patrimony to finance the good times.

    Carpe diem remains the road to hell for nations as well as individuals.

    It was “protectionist policies” that took the U.S. from nothing to the greatest, most prosperous nation in the annals of history.  Our politicians put America first until GATT in 1947.  By the late 60’s our electronics industry was non existent and other industries have fallen steadily.

    As Hamilton insisted, U.S. trade policy should be designed to ensure the highest standard of living on earth for the American people, and the economic independence of the nation, so that, if need be, America could stand alone. Only thus could we stay out of Europe’s wars.

    To fully understand how the FREE trade policy has adversely affected the income of the American worker we must first understand that monetary policy is intertwined in this equation and a little lesson is history is needed at this point.

    Please remember that the policy of FREE trade has been an ongoing collective policy of both the Democrat and the Republican political elites who have ruled this nation since at least 1947 with the passage of the first GATT. The excuse has been the idea that if all of the world were interdependent through trade then there would be no more war. Obviously a failed excuse when one examines The Korean War, Viet Nam, countless smaller wars on various continents, and more recently the Gulf War, Afghanistan and the invasion of Iraq.

    This effort to make us “interdependent through trade” has had a devastating effect on the People of this Nation and particularly the average American worker for all the reasons I have discussed above, but also it has substantially lowered his standard of living by intentionally lowering the value of the dollar on the world market.

    That is a very strong charge to make, but one I am about to prove conclusively!

    The year is 1985, and under the pretense of “lowering America’s trade deficit” (it had reached the a level of 122 billion dollars) (Source: Census Bureau Historical Trade Records attached) the argument was raised that America should lower the value of the dollar which would make imports cost more and would make our manufactured goods “more competitive on the world market”.

    So the leaders of this country – both Democrat and Republican – used that reason to execute a plan that no nation had ever done in the history of the world. An action that would immediately began the process to reduce the value and worth of everything in America on the world market by a minimum of 50% !!!

    On September 22, 1985 President Ronald Reagan sent the new Treasury Secretary Jim Baker along with Paul Volker, and another man I can’t recall, to a meeting at the Plaza Hotel in NYC with the other members of Japan, Germany, Great Britain, and France for the expressed purpose of soliciting the DEVALUATION of America’s currency. That’s right. They wanted America’s “money” to be worth less so foreign goods would cost more.

    For the first time in the history of the world a nation (America) is asking other nations to join together and make our money worth less in the world marketplace!!

    Their “logic” (the reason they expressed publicly) was that the devaluation of the dollar would encourage Americans to buy less foreign made products and the trade deficit would go away.

    Please understand the significance of this out and out con job. In reality they are saying, “It is ok to drive UP the cost of a widget made overseas by making our money worth less thereby requiring more of our money to purchase it, but it is wrong to attach a tariff to a foreign made product because that would amount to a hidden tax on the American buyer.”

    And cost more it did. The yen that was trading in 1985 for about 238.5 yen to the dollar had within 10 years appreciated to 94 yen to the dollar. Our money FELL in value approximately 60% on anything made in Japan. (Source: EROP 2003 Exchange Rates Table B-110) That’s largely why a Toyota Tercel that only cost about $5,780.00 in 1987 would cost about $16,000.00 in less than 10 years.

    By 1995 the dollar was only worth about 50% of what it was in 1985 against most of the world’s major currencies. Something you could have bought in 1985 manufactured under costs denominated in Deutschemarks, or French Francs for 5 dollars would then cost about 10 dollars.

    I don’t care how you cut it that is a hidden tax of 100% or more. The only difference is this hidden tax does not encourage manufacturing to stay in America like a tariff would. The money simply goes overseas. In many ways it is like “foreign aid” only disguised as FREE trade.

    In fact, just the opposite happened. By reducing the value of the American dollar and dramatically increasing what the American Citizen had to pay for manufactured goods it actually encouraged manufacturers to move overseas. Why, you ask?

    Because for no other reason that a currency manipulation a company could double what it received for a product by moving overseas, making the product under costs denominated by francs, or yen, or marks, or damn near anything else, and when they shipped it back in to the good ole USA they would get double the dollars back when the cost went up as our currency value went down. Of course, all these American corporations report their sales and their profits in dollars (which now flowed into their coffers at double or triple the rates one devaluation was complete).

    Oh, and you and me??? Well, everything we own fell in value by at least 50% on the global plantation market place. Our manufacturing base is destroyed, and the worth of America has been plundered on a scale not seen since March 9, 1933.

    And the trade deficit? It has gone straight through the roof and transferred literally TRILLIONS OF DOLLARS OVERSEAS. I cannot believe all of the economic advisors, all of the Democrat and Republican political leaders, the Chairman of the Federal Reserve, and all of the elites that pull their strings did not know what would happen when they intentionally devalued the dollar and encouraged the exodus of the manufacturing industry of this nation.

    And the devaluations of our currency and our standard of living have continued unabated.

    Read: http://www.examiner.com/x-17571-LA-Populist-Examiner~y2009m7d18-TARIFFS-The-SmootHawley-Fairy-Tale

    The numbers revealed in the Bureau of Economic Analysis proves this point.