Are Trade Agreements Good For The United States

At the end of the day, we cannot turn our backs on international trade. It is an inevitable part of the world in the twenty-first century. We simply need our elected leaders to prioritize initiatives to open up foreign markets, so that U.S. companies can sell more of our goods and services abroad. My studies of the effects of Nafta, Chinese trade, and other trade agreements use the same methodology as Jeff and Hufbauer in their initial pre-nafta of 1993, but I looked at the actual changes in trade deficits under those agreements, not the forecasts. An almost identical methodology was used in the trade and employment studies conducted by the staff of the Federal Reserve Bank of New York and in a study on trade and outsourcing by two scientists from the Brookings Institution, among many others. Last year, total U.S. private sector employment, non-farm employment, rose by 2.6 million jobs, and the unemployment rate fell from 5.5 percent to 4.9 percent, a level most economists consider near-full employment. Rob proposes, however, that U.S. trade with the other 11 Trans-Pacific Partnership countries has cost us 2 million jobs over that period! The vast majority of goods traded are manufactured goods.

And manufacturing jobs pay much more than other jobs, especially those created since the last recession. As a result, the U.S. lost more than 60 percent, or more than 400,000 jobs out of nearly 700,000. The trade deficit with Mexico was in manufacturing. Similarly, of the 3.2 million jobs lost as a result of our growing trade deficit with China, more than 75%, or 2.4 million manufacturing jobs, have been lost. As a result, the impact of free trade and investment agreements has not been positive for manufacturing or the vast majority of other American workers. In Monday`s first debate between Trump and Democratic candidate Hillary Clinton, he pointed to Ohio as an example of a U.S. state battered by trade deals and losing “so many of its jobs.” (The Cincinnati Enquirer reported that while manufacturing employment in Ohio has grown from 1 million in 2000 to 700,000 today, Ohio`s economic reality is “much more nuanced.”) And across the political spectrum, majorities say that free trade agreements are generally good for people in developing countries: 62 percent of Republicans say so, with 55 percent of Democrats and 58 percent of independents.

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