Editors Note: This is a guest post by Curtis Ellis of the American Jobs Alliance
We need to put Americans back to work. While Washington fought over ‘raising the debt ceiling,’ it ignored the†simple fact that jobs are the best way to eliminate the deficit. More people working means more people paying taxes (and fewer people collecting unemployment), more people shopping and more profits for businesses. In fact, raising the percentage of Americans that are working, from the current 56% to 64%, eliminates the deficit entirely, according to Dan Fuss, respected manager of the $58 billion Loomis Sayles bond fund.
So now that the Washington politicians say they’re going to focus on jobs, what exactly do they want to do? Unfortunately, President Obama has called on Congress to pass three new trade deals, with Korea, Colombia and Panama. He, along with Congressional leaders, claim this will produce jobs for everyone. Well, as Ronald Reagan used to say when negotiating with Gorbachev (who enjoyed a higher approval rating than Congress does now), “Trust, but verify.”
Eleven previous free trade deals, including NAFTA and CAFTA, provide a record we can look at. Donít get fooled again. None of the agreements has come close to meeting the promised increase in U.S. net exports and the creation of American jobs.
From 2003, the year before CAFTA was signed, to five years later, U.S. net exports to the five CAFTA member countries (Costa Rica, El Salvador, Guatemala, Honduras, and Nicaragua) went from a $2.24 billion deficit to a $2.79 billion dollar deficit — our trade deficit grew by $556 million.
The Korea trade pact’s supporters are using the same old arguments used to justify the failed deals of the past.
They say it will increase exports and create jobs. They don’t mention that it will increase imports even more. (After all, Korea’s consumer spending is only equal to that of Los Angeles.) The US International Trade Commission, a nonpartisan government agency, says the Korea trade deal will increase the trade deficit by $14 billion. Imports take the place of goods once produced here at home, which puts more Americans out of work.
Supporters concede that even if we do lose jobs, the jobs that go overseas will be replaced by better jobs. But this has proven false. After jeans and t-shirts started pouring in from South China, the folks who used to make them in North Carolina did not start splicing genes or making computers. Many ended up as Wal-Mart greeters or among the long-term unemployed, while we import computers and high-tech gadgetry manufactured in Asia.
We were told we don’t need the “sunset industries“†of yesterday — manufacturing. The elites from Wall Street, Washington and the Ivy League dreamed of a post-industrial service economy based primarily on financial services –investment banking, insurance and real estate. Their dream became a nightmare for millions of working Americans.
America must have a diversified economy that includes manufacturing and produces real goods, not just questionable financial deals. We need a real jobs agenda that puts Americans back to work making more of what we buy and use everyday. Congress must reject the failed policies of the past and the fake jobs agenda that actually makes it easier for multinational companies to replace American jobs with more imports from abroad. It should start by saying ‘No’ to the Korea, Colombia and Panama trade deals.
Curtis Ellis is Executive Director of the American Jobs Alliance,an independent, nonpartisan not-for-profit dedicated to promoting jobs in the USA and businesses that hire in the USA.