Alliance for Democracy

Oregonian || Building a New Consensus on International Trade‏

Posted in Oregon Fair Trade Campaign, Trans Pacific Partnership by Alliance for Democracy Portland OR on June 11, 2010

This follows up on my message of a few days ago talking about the trade agreements, the Trans-Pacific Partnership (TPP) specifically. The following, in the Sunday Oregonian, is from our friend Arthur Stamoulis with the Oregon Fair Trade Campaign talking about the TPP.  

David e. Delk, Alliance for Democracy – Portland Chapter, 503.232.5495

Building a new consensus on international trade

Published: Friday, June 11, 2010

By Arthur Stamoulis, Director of the Oregon Fair Trade Campaign

This week the United States hosts trade ministers from throughout the Pacific Rim for talks regarding what could well become the Obama administration’s first international trade agreement. These “Trans-Pacific Partnership” negotiations offer the perfect opportunity for the president to enact his promises on trade reform and to advance a new model for economic integration.

Trade with Asia is undeniably important, particularly in Oregon, where nearly 9 percent of the state’s gross domestic product is tied to exports. Past trade pacts have made it easier for the state to export goods, creating jobs in a number of key industries. What’s often neglected, however, is that these same trade agreements have increased imports at an even higher rate.

For the first time last year, China displaced Canada as Oregon’s largest export market. This was almost entirely the result of U.S. trade policy.

After China entered the World Trade Organization in 2001, Oregon’s exports to that nation expanded almost five-fold in just seven short years. Look at that fact alone, and China’s entry into the WTO was a huge boon for the state.

But over the same time period, Chinese imports to the United States increased even faster. According to a recent study by the Economic Policy Institute, Oregon lost a net 38,500 jobs between 2001 and 2008 due to the trade imbalance with China – more than 2 percent of the state’s total employment.

Jobs aren’t just being lost in traditional manufacturing and forest product sectors, but also in cutting-edge, high-tech industries. Oregon’s First Congressional District, home to the state’s storied Silicon Forest, lost the ninth most jobs in the entire nation due to uneven trade with China. This month, computer programmers from IGT in Corvallis will be the next to lose their jobs, after having spent much of the past year training their Chinese replacements.

Our trade deficit with China does a particularly good job of illustrating the shortcomings of existing trade policies. How “free” can trade really be when workers in many of the countries we’re trading with are denied basic freedoms of speech and assembly? When massive environmental externalities go unaccounted for? When government subsidies tilt the playing field against efficient and innovative businesses?

These are the issues that have caused local businesses to lose in the global marketplace, and these are the things that the United States must strive to address when negotiating the Trans-Pacific Partnership. This is especially crucial given that two of the governments the president has chosen to enter into his first new trade negotiations with are the Communist regime in Vietnam and the sultanate in Brunei.

Outside of Vietnam, Brunei and New Zealand, the United States already has free-trade agreements with each of the other countries currently participating in the TPP negotiations. Together, these larger nations represent more than 85 percent of the combined GDPs of the TPP negotiating partners. As such, the notion that the TPP’s main promise is in opening new markets is clearly wrong.

If not to open markets, then why then spend time and resources negotiating a Trans-Pacific Partnership? That’s where the president’s trade promises come in. While on the campaign trail, then-Senator Obama repeatedly pledged to use new trade agreements as a way to fix the problems of old-model pacts. He not only promised stronger labor and environmental standards, but pledged to address investment provisions, consumer safety standards, procurement rules and services agreements that disadvantage American employers.

At the time these promises were being made, national polling results released by the Pew Research Center found, “There is now broad agreement that free trade negatively affects wages, jobs and economic growth in America. By greater than six-to-one, the public says free trade agreements result in job loss rather than in new jobs.”

Political expediency aside, many policymakers continue to support the president’s trade reform promises well after the election. To date, 144 members of the House and additional members of the Senate have signed onto a comprehensive trade reform bill called the TRADE Act. While unlikely to pass this year, the legislation spells out in great detail what a high-standard, 21st century trade agreement should look like.

Oregon‘s congressional delegation, particularly Senate Trade Subcommittee Chairman Ron Wyden, should urge the president to take advantage of the opportunities presented by the TPP to build a new consensus around international trade.


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