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Act Now: Dangerous Fast Track Bill Filed January 9th.

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Senator Max Baucus and Representative Dave Camp filed the dangerous Fast Track bill to ram secretly negotiated negotiated trade and global governance agreements through Congress.
We asked for a national priority goal of balanced trade.  They said no.

We asked for legislation to neutralize foreign currency manipulation.  They said no.

We asked for comprehensive tax reform to the double taxation of our exports through foreign border adjustable consumption taxes.  They said no.

Instead, they file the Fast Track (so-called “Trade Promotion Authority”) bill to these global governance deals like the TransPacific Partnership (TPP) through Congress without any amendment or sufficient debate.

They admit they can’t pass TPP under regular procedural rules because it is so controversial… so they change the rules!

Over 170 members of Congress from both parties, last November, said they opposed Fast Track because it is constitutionally wrong and because it produces bad trade policy.

Tell Congress to oppose Fast Track and support debate under the Regular Order… the ordinary rules of debate and procedures given to every other bill before the House and Senate.

We cannot reform trade policy to grow our economy, create jobs, and protect our constitutional republic unless we stop Fast Track now.

If we get it wrong, the trade deficits will continue eroding the American dream.

We can win this.  Tell Congress to oppose Fast Track to keep its power over trade treaties while protecting our sovereignty.

Sincerely,
Michael Stumo, CEO
Coalition for a Prosperous America

Have You Heard of the TPP Yet? An Important Trade Agreement You Need to Know About

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The U.S. government is currently working with 10 other countries to negotiate the biggest trade and investment agreement (also known as a “free trade agreement” or FTA) in history. It is called the TPP, or Trans-Pacific Partnership. Not only will it be bigger than NAFTA (the North American Free Trade Agreement)­—it’s actually NAFTA plus eight other countries. Have you heard of the TPP yet?
But the mainstream press doesn’t talk about the TPP much. Have you read about in in your local paper? Heard it mentioned on the evening news or on news talk radio? Perhaps on the Sunday morning talk shows?I have a feeling that most of you are shaking your heads, shrugging your shoulders or making faces—because the answer is most likely “no.” Most people simply have not heard of the TPP, nor do they know that it might be the last trade agreement the United States ever negotiates (unlike past agreements, this one will be open to new countries, whenever they want to join). So it is all the more important to get this one right.Why isn’t the press talking about this trade agreement? It’s certainly not because trade is boring or irrelevant, and it is definitely not because the debate is over.

Trade is relevant. The U.S. trade deficit, which has grown from a little more than $70 billion in 1993, the year before NAFTA went into effect, to nearly $540 billion today, costs us jobs. Trade deficits represent lost opportunities. The bigger the trade deficit, the more jobs we could have created in the United States but didn’t. Moreover, trade agreements affect our domestic laws. Once we enter into a trade agreement, it’s not so easy to raise tariffs on trading partners that engage in egregious human rights violations—nor is it easy to exit the agreement once we find out it is bad for our economy and our job creation.

Trade also is interesting. Trade rules affect your rights in the workplace, the safety of the food you eat and how clean your water is. Trade rules can affect whether tuna canneries are allowed to tell you if your tuna is dolphin-safe or whether local grocery stores have to label the hamburger you buy with its country of origin. Trade rules can affect the price of the fancy imported cheese you like or how much North American content must be in an automobile for it to qualify for the tariff benefits of NAFTA. And trade rules also can make it easier for an employer to shut down a factory, call center or legal support office and move it overseas. Trade is anything but boring.

And the debate is certainly not over. The proposed TPP is not yet finished—the rules are still being written. Will those rules largely mimic the rules that have helped kill off nearly 6 million manufacturing jobs in the United States in just over a decade? On the other hand, will the rules help make it easier for our brothers and sisters overseas to organize and act collectively to improve their wages and working conditions? Will the rules require our trading partners to protect endangered species? Or will they make it easier for giant global corporations to attack laws banning toxic chemicals? We don’t know the answer to these questions yet—because the deal isn’t done. But if the loudest voices the administration and Congress hear belong to the global corporations who have benefited from past agreements, I can predict what the answers will be. And they won’t be answers we like. If you have not yet spoken up to tell President Obama that America can’t take another NAFTA, now is the time. The president wants to finish negotiating the agreement by October 2013. Tomorrow may be too late.

SOURCE: AFL CIO Blog

Violence Erupts in Cambodia as Labor Dispute Intensifies

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American Made

Cambodia garment workers throw stones at riot police during a strike near a factory on the outskirts of Phnom Penh, Cambodia, Jan. 3, 2014 AP/HENG SINITH

 

PHNOM PENH, Cambodia – At least four people were killed Friday when police outside Cambodia’s capital opened fire to break up a protest by striking garment workers demanding a doubling of the minimum wage, police and human rights workers said.
Chuon Narin, deputy chief of the Phnom Penh Municipal Police, said the four were killed and about 20 others wounded in a southern suburb of the capital after several hundred workers blocking a road began burning tires and throwing objects at police officers. Witnesses said some officers fired AK-47 rifles into the air and that others shot at ground level.

Workers at most of Cambodia’s more than 500 garment factories are on strike, demanding an increase in the minimum wage to $160 a month, double the current rate. The government has offered $100 a month.

The local human rights group LICADHO said in a statement that at least four civilians were shot dead and 21 injured in what it described as “the worst state violence against civilians to hitCambodia in 15 years.”The statement said that security forces used live ammunition to shoot directly at civilians.

Made in USA

Belgian photographer John Wink stands to get a close look at the body of a man lying dead on the ground after riot police opened fire on garment workers on strike Jan. 3, 2014 AP/HENG SINITH

 
“The use of live ammunition was prolonged and no efforts appear to have been made to prevent death and serious injury,” it said. “Reports suggest that security forces were also injured after being hit with stones.”

It was not clear whether those killed were workers or local residents who had joined in the protest.

“They are anarchists, they have destroyed private and state property,” Chuon Narin, the deputy police chief, said by phone. “That is why our forces need to chase them out.”

The protesters were cleared from the street, at least temporarily, by early afternoon.

The violence comes at a time of political stress in the country, with the opposition Cambodia National Rescue Party holding daily protests calling for Prime Minister Hun Sen to step down and call elections.
Hun Sen won elections last July that extended his 28-year rule in the poor Southeast Asian nation, but opposition protesters accuse him of rigging the vote. Hun Sen has rejected their demand.

Although the wage and election issues are not directly linked, the opposition has close ties with the country’s labor movement. Last Sunday, many workers joined a massive political rally organized by the opposition.

The workers represent a potent political force, because the garment industry is Cambodia’s biggest export earner, employing about 500,000 people. In 2012, Cambodia shipped more than $4 billion worth of products to the United States and Europe.

Made in America

Cambodia garment workers throw stones at riot police during a strike near a factory on the outskirts of Phnom Penh, Cambodia, Jan. 3, 2014 AP/HENG SINITH

 

The site of Friday’s clash – a street with stores and dwellings – was strewn with debris. Walls bore holes apparently caused by bullets.

Mak Vin, a 25-year-old worker, said he was among those protesting for more than a week over the wage issue. He said that on Friday morning, as the workers burned car tires and shouted slogans, “hundreds” of armed police arrived and opened fire.

“They fired live bullets directly at us. I am very scared,” Mak Vin said.

There had been an earlier clash overnight, with no known fatalities.

Mak Vin said the workers were protesting only for higher wages, and would return to work once that demand was met. He said most workers were not cowed by the shooting, and would continue their strike.

Made in USA- Cambodia

Cambodian riot polices walk past an electric wire burned prepare to blockade garment workers on strike near a factory of Canadia Center, Jan. 3, 2014 HENG SINITH, AP

 

One measure of the seriousness of the situation was an unusual statement issued by the Defense Ministry affirming the military’s loyalty to the government. The statement said the army would take whatever action was necessary to defend the legal government, the king and the constitution.Friday’s confrontation followed a similar one a day earlier at a different location, in which elite troops broke up a demonstration outside a factory, beating demonstrators and arresting 10 people, including Buddhist monks, according to witnesses from human rights groups.

Violent suppression of social and political protests has not been unusual under Hun Sen’s authoritarian government, but there have been few incidents in recent years where more than one person has been killed.

The authorities also usually shy away from using live ammunition in Phnom Penh, where the population is largely hostile to the government.

But the U.N. special rapporteur on human rights in Cambodia, Surya Subedi, said it was the third time since the disputed elections that authorities have shot into a crowd and caused fatalities. He called for an independent investigation into whether excessive force was used. He also expressed concerned about increasing violence by some demonstrators.

The standoff over wages presents Hun Sen with a dilemma, as increasing violence could drive the workers into a tighter alliance with the opposition, providing a vast pool of people for their increasingly confident street demonstrations. But the government is also close to the factory owners, whose exports fuel the economy and who are generally seen as financial supporters of Hun Sen’s ruling Cambodian People’s Party.

Last week, violence erupts in Cambodia when the Garment Manufacturers Association in called for factory owners to close their plants, ostensibly for fear of damage by protesters. The situation puts pressure both on the striking workers, who are not being paid, and the government, which relies on garment exports to power the economy.

SOURCE:  CBS News

White House To Announce Manufacturing Hubs

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made in america

WHITE HOUSE (CNN) —The White House is finally following up on an initiative in 2013’s State of the Union, just three weeks before he lays out his new agenda for this year.
President Obama will host an event in the East Room on Thursday to announce what they refer to as “Promise Zones”- economically hard-hit areas where the White House will focus efforts to attract investments to overall improve the areas with job creation, economic security, education, affordable housing, and public safety.

While the President originally touted the initiative in his 2013 State of the Union address last February, Thursday’s event will be the first official launch of the program… White House To Announce Manufacturing Hubs.

The White House will announce efforts in San Antonio, Philadelphia, Los Angeles, Southeastern Kentucky, and the Choctaw Nation of Oklahoma for local governments and businesses to partner with the Department of Defense and the Department of Energy and other agencies to invest in workforce training, educational opportunities and community revitalization projects.

Those areas, White House officials say, are among the top 20 places most adversely affected by the recession. Each neighborhood or area in the “Promise Zone” has laid out specific goals and will be held accountable by program administrators and third-party experts to track their results.

In San Antonio, Mayor Julian Castro has been applauded by the White House for his efforts to work with federal programs and investments from local businesses to revitalize neighborhoods. The Eastside area of the city has partnered with St. Philip’s College for job training programs in energy, healthcare, and aerospace/advanced manufacturing jobs, among other initiatives.

“Investing in and rebuilding hard-hit communities are important parts of the President’s plan to restore the basic bargain at the heart of the American story – that every child should have a fair chance at success. And that, no matter who you are or where you’re from, if you’re willing to work hard and play by the rules, you should be able to find a good job, feel secure in your community, and support a family,” a White House official said about tomorrow’s event.

The White House has cited the Youngstown, Ohio area as an example of success as a “manufacturing innovation institute” which has turned around a once-shuttered manufacturing warehouse into a thriving 3-D printing center. In 2012, President Obama announced his plan to invest $1 billion in a network of up to 15 similar cities.

SOURCE:  CNN

Legislation Seeks to Tweak Standards for Made in USA

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American Made products

Sally Schilling/Daily Journal Dylan Sievers, right, and Lisa Sievers, third from right, with the Bulldog Lighting company.

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Sally Schilling
Most Americans probably don’t think twice when they read a label that says, “Made in USA” They assume the product is made domestically. What they don’t realize is that the meaning of “Made in the USA” is up for debate.
In almost all states, an item can be labeled as “Made in the USA” and still be made with a portion of foreign labor or foreign material.In California, on the other hand, there is no leeway for products labeled “Made in the USA.” Manufacturers who want to label their goods as “Made in the USA” in California must use only American labor and American material. For 19-year-old Dylan Sievers, CEO of Bulldog Lighting based in San Carlos, this proved to be a problem. At age 17, Dylan started Bulldog Lighting — which makes LED lights for off-roading vehicles — in a business enterprise class at Junipero Serra High School in San Mateo. The young off-roading enthusiast discovered there was a lack of affordable lighting available for people wanting to race their trucks through dark terrain. He asked his mom if she could use her own background in manufacturing to help him figure out how to make the lights. “He asked if I could find a factory that could help make LED lights that were affordable,” said Dylan’s mother, Lisa Sievers, who previously worked for Cool Balls manufacturing antenna balls. “We found a factory in China.” Bulldog Lighting debuted its products last year, and Dylan decided to bring all production stateside. “He was sitting in class hearing about people losing their jobs,” said Sievers. “We decided we could make it here in the USA” The Sievers were hoping to label their product as “Made in the USA,” and were disappointed when they found out they could not make that claim. Despite their best efforts to produce the lights in the United States, there were some materials in the lights that Sievers said had to come from foreign countries. “There’s just some things in the United States we don’t make,” she said. “We don’t make LED here.” Bulldog’s lights are about 90 percent made in the United States, said Sievers.  “I don’t think it’s reasonable to say everything can be made in the USA,” she said.  The aluminum in the lights is from Texas, and the screws are made in Ohio, she said. “[The product] is substantially transformed using American workforce,” she said. “Dylan said, ‘if we do everything here, how come we can’t say ‘Made in the USA’?’” The Sievers are considering moving to Texas, where their products could be sold with a “Made in the USA” label. Proposed state legislation The Sievers contacted state Sen. Jerry Hill, D-San Mateo, who wrote legislation to address the issue.  “If you want to be competitive and keep jobs in California, we need to do everything we can,” said Hill. Hill has since introduced Senate Bill 661 to “update” California’s labeling standard to reflect the realities of today’s global economy. SB 661 would reduce the “Made in the USA” standard to allow for 90 percent of the product to be made in the United States. In this case, the manufacturer would have to prove that the remaining 10 percent of production was unavailable domestically. “This still gives us the integrity of the claim,” said Hill. According to Hill’s office, the original standard in California was established in 1961 to “prevent foreign firms from taking advantage of ‘buy American’ promotions.”  This standard is unrealistic in today’s global economy where not all materials are available locally, said Hill.  He gave the example of Star Milling Company in Perris, Calif., which produces feed that is 99 percent made in the United States. Just one vitamin in the feed is unavailable domestically, he said. He hopes bringing California standards closer more in line with federal standards will allow companies within the state to remain competitive.  “The final transformation has to be done domestically,” said Hill of his bill’s requirements. “We’re meeting every standard that can be made.” False advertising? Some consumer advocates are opposed to changing California’s labeling standard because they say it would be false advertising.  “This is a truth in labeling issue,” said Richard Holober, executive director of Consumer Federation of California. “We do not support changing the current standard. If something is 90 percent made in the U.S., it should say ‘90 percent made in the U.S.’” Aside from a few sectors such as the automobile industry, there is no legal requirement for companies to disclose the origins of its products. Labeling should not be such a big issue because it is a choice, said Holober. Changing California’s standard would hurt companies who are 100 percent American-made, he said.  “If there is a union company that pays better wages and is 100 percent [Made in USA.], they’ll say, ‘wait a second, why shouldn’t be able to gain a tiny edge here?’” he said. Some unions are also coming out against the bill “If you’re going to advertise your product as “Made in the U.S.,’ then it should be made in the U.S.,” said Shane Gusman, who represents the Teamsters Union and the Machinists Union. “Why would we want to loosen the standard so that ‘Company X’ can import 10 percent of its components from somewhere?” The whole idea behind the label is to get consumers who want to be patriotic to buy that product, said Gusman. Taking away California’s high standard would reduce the demand for domestic manufacturing jobs, he said. Lisa Sievers will be testifying in before the Senate Judiciary Committee on SB 661 on Tuesday.

Where China Goes To Buy Made In USA

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Kenneth Rapoza
China loves Made in the U.S.A.

China’s Favorite U.S. States in 2012

The No. 2 economy kept its spot as the third largest importer of U.S. goods last year, second only to neighborly Canada and Mexico.“The U.S.-China trade relationship strengthens America’s economy and creates well-paying jobs for many American workers across the country,” said the U.S. China Business Council’s President John Frisbie.

In 2012, China purchased nearly $109 billion worth of  U.S. goods, from soybeans to scrap metal, electronic components to heavy machinery.  China will undoubtedly play a significant role as importer of Made in USA as locals keep getting richer. Some estimates forecast that China may have nearly 600 million middle class consumers by the end of the decade, as measured by the World Bank’s definition of middle class.

“Our exports to China remain a bright spot for many companies, particularly with European demand weakening,” said Frisbie in a statement last week.

Even though China’s economic growth slowed last year, growth in U.S. exports to China rose 6.5% from 2011, representing an increase of $6.6 billion.

Here’s a look at the top 10 states where Chinese companies go shopping for Made in USA.

SOURCE:  Forbes

Steel for America’s Military Will Once Again be ‘Made in USA’

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Brown is the Author of Legislation That Would Protect Domestic Jobs and America’s National Security by Restoring Requirement that Military Steel be 100 Percent Made in America; Cleveland’s ArcelorMittal and Cliffs Natural Resources, Marion’s Nucor All Involved in Production of Armor Plate
WASHINGTON, D.C. – U.S. Sen. Sherrod Brown (D-OH), the author of legislation to ensure that armor plate for America’s military is truly “made in America,” today applauded a move from the U.S. Department of Defense (DoD) that restores a 35-year rule requiring that steel purchased by the U.S. military be 100 percent domestically produced. The rule, originally overturned by DoD in 2009, requires armor plate steel to be both melted and finished in the United States. Several Ohio companies, including Cleveland’s ArcelorMittal and Cliffs Natural Resources and Marion’s Nucor, are involved in the production of Armor plate.
“This is a win for our military and for American companies like ArcelorMittal, Cliffs, and Nucor, that make steel for our military right here in the United States,” Brown said. “We know how to make steel armor plate here in America, and there’s no reason why countries like China and Russia should be making our military’s vehicles and equipment. By proposing a rule consistent with my legislation, the Defense Department has stood up for the American steel industry. Importing steel armor plate puts both our manufacturing jobs and our national security at risk, and that’s why steel armor plate should be both melted and finished in the United States.”

“ArcelorMittal is pleased with the Department of Defense’s decision to reinstate the longstanding requirement that steel armor plate procured for defense purposes be melted domestically. We are grateful for the support of leaders like Senator Brown who have fought tirelessly for this policy to be reinstated. This is an important decision for our hardworking employees in Ohio and nationwide. ArcelorMittal is proud to support the defense efforts of the United States through our production of steel armor plate, and we commend the Department of Defense for its decision to help ensure a vibrant industrial base in the years to come,” said John Mengel, Chief Operating Officer, ArcelorMittal USA Plate.

“As a major supplier of raw materials to the domestic steel industry, Cliffs is encouraged by the Department of Defense’s proposal to again require that all stages of steel armor plate manufacturing occur domestically. This proposed rule reflects the importance of producing strategically significant steel products in the United States from a domestic supply chain,” said Kelly Tompkins, Executive Vice President – Legal, Government Affairs and Sustainability and Chief Legal Officer at Cliffs Natural Resources Inc.

Steel armor plate is used for military vehicles, tanks, and equipment. Under DoD regulations, specialty metals procured for defense purposes—including steel armor plate—must be produced in the United States.  Despite more than 35 years of legal interpretation and administrative practice requiring that specialty metals be melted in the United States, DoD in 2009—in the midst of the wars in Iraq and Afghanistan and during a time when the demand for steel was high—published a final rule defining the word “produced,” as it applies to armor plate under the Special Metals Amendment, to include simple finishing processes. This means that armor plate melted in foreign countries, including Russia and China, could be imported and subjected to simple finishing processes in the United States and then deemed to have been “produced” domestically.

After numerous Congressional inquiries and report language questioning DoD’s interpretation of “produced,” the FY11 National Defense Authorization Act included a provision requiring a review and, if necessary, revision of the existing regulation to ensure the definition is consistent with Congressional intent (the review was required to be completed within 270 of enactment of the law, i.e., early October 2011).  On July 25, 2011, DoD published its request for comment, and the deadline for public comment was September 8, 2011. Earlier this year, Brown introduced the United States Steel and Security Act, which would have required steel armor plate to be both melted and finished in the United States, not only protecting American steel jobs, but our country’s national security. Cleveland’s ArcelorMittal manufactures steel armor plate, as does Nucor.

In September 2011, Brown—along with Sens. Richard Burr (R-NC), Robert P. Casey, Jr. (D-PA), Kay Hagan (D-NC), Daniel Coats (R-IN), Jay Rockefeller (D-WV), Al Franken (D-MN), and Amy Klobuchar (D-MN)—sent a letter to Defense Undersecretary Ashton Carter urging him to revise the Department’s requirements on steel plate. A copy of that letter can be seen here. During consideration of the National Defense Authorization Act in December 2011, Brown and Senate Armed Services Committee Chairman Carl Levin (D-MI) called for the DOD to expedite its review of this issue.

Yesterday, the DoD published in the Federal Register a proposed amendment to the Defense Federal Acquisition Regulations revising the definition of “produce” as it relates to the Specialty Metals Amendment.  The proposed amendment is the result of section 823 of the FY 2011 National Defense Authorization Act, in which Congress directed DoD to review the current the definition of produced to ensure its consistency with congressional intent.  There will be a 60-day comment period on the proposed rule.

2 Connecticut Shoreline Firms Collaborate on 'Buy American Act'

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Congresswoman Rosa DeLauro visited Engineering Specialties, Inc. in North Branford to see the manufacture of evacuated tube solar thermal collectors for Apricus, also a North Branford company. Left to right: Apricus Vice President Nigel Ruddell, Apricus engineer Eric Skiba, Rosa, ESI’s Vice President Carmen Ciardiello, ESI’s President Ronald Delfini, and Apricus marketing person Shannon Horsley.

Mara Lavitt/New Haven Register 

New Haven Register
By: Bridget Albert, Register Staff
balbert@newhavenregister.com / Twitter: @nhrbalbert

NORTH BRANFORD — Two local companies have teamed up to meet and exceed the requirements of the Buy American Act and American Recovery and Reinvestment Act.

Apricus is a designer and manufacturer of solar hot water and hydronic heating products. Founded in 2003, Apricus is a global company with offices in the U.S., Australia and France and sales in more than 30 countries. Its North American headquarters is in Branford.

Engineering Specialties Inc. is a manufacturer of engineered metal stamping, mechanical assemblies, wire forms, springs, and other custom component parts. It is located in North Branford. It started in 1990 and now has 20 employees.

U.S. Rep. Rosa DeLauro, D-3, visited the factories Tuesday to learn more about their efforts to work together and meet the requirements of the American Recovery and Reinvestment Act and the Buy American Act.

Nigel Ruddell, vice president of Apricus, said when his company decided it wanted to form a partnership with an American company to produce the AP-30C Buy American Solar Collector, they contacted larger companies that either didn’t respond to their request or told them their design couldn’t be made.

The collector absorbs thermal energy from the sun and converts it into heat that can then be used for hot water, heating, cooling and industrial processes. Apricus also manufactures these units in China, which services Europe, Asia and Australia.

“This is how it should work,” DeLauro said, adding she hopes there are more such business ventures.

“We wanted someone local so we could grow the product together,” Ruddell said.

“We are a good fit and hope to bring more new products in the future,” he added.

“We jumped at the opportunity,” said Ronald Delfini, president of Engineering Specialties Inc.

“They had their blueprint but some things needed to change; being close was perfect,” said Carmen Ciardillo, vice president Engineering Specialties Inc.

To qualify under the “Buy American” act, at least 50 percent of the product must be made in the U.S.

Ruddell and Delfini said 61 percent of the AP-30C is made in North Branford, including all the stainless steel parts.

DeLauro said she could see the “ripple effect” of this type of collaboration, including the need for installation and maintenance of the systems.

Additionally, DeLauro said she could see the benefits to federal buildings that were getting updated with new heating and air conditioning systems.

Ruddell said Apricus has already been awarded several government contracts.

Delfini said since January, they have shipped 250 units, averaging production of 15 a day. A complete installed system will cost the average homeowner $8,000 to $12,000 and it will save 50 to 80 percent on heating costs.

Solar collector owners can qualify for a 30 percent federal tax credit and $2,000 tax credit in Connecticut, Ruddell said.

Delfini said the product has a life expectancy of 25 to 30 years.

____________
Call Bridget Albert at 203-789-5702. Follow her on Twitter @nhrbalbert.

Manufacturing Jobs Still Matter, As Does the Dollar

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Published in today’s BUSINESS INSIDER Article by: Dean Baker, CEPR | Apr. 4, 2012, Dean Baker is the co-director of the Center for Economic and Policy Research Contact: Mr. Dean Baker Subscribe to his RSS feed
Eduardo Porter had an interesting column in the NYT discussing the future of manufacturing jobs in the U.S. economy and the role of trade. While the piece makes several valid points, it seriously underplays the importance of manufacturing jobs. Remarkably, it also does not discuss the trade deficit and the dollar.The piece is correct in saying that there is nothing intrinsically good about manufacturing jobs and that it makes little difference to manufacturing workers whether they lose their jobs to trade or productivity growth. Nonetheless, it is still true that manufacturing remains a source of relatively high-paying jobs for workers without college degrees. This may be the result of a historically legacy and higher than average unionization rates, but it is still the reality.The issue of trade is also important, because the loss of jobs as a result of trade deficit creates a situation that is in the long-run unsustainable. If the economy return to full employment we would have a trade deficit of close to 5 percent of GDP (@$750 billion a year). A trade deficit of this size logically implies negative national savings of the same magnitude. That means that we must have either negative private savings (i.e. households and firms have negative savings) and/or a government budget deficit that is equal to $750 billion a year.
Of course the main factor in determining the size of the trade deficit is the value of the dollar. If the dollar is over-valued by 15 percent, it means that our exports will cost roughly 15 percent more for people in other countries while imports will cost roughly 15 percent less for people living in the United States. There is no policy or set of policies that can have anywhere near as much impact on trade as the value of the dollar.This is why a discussion of the value of the dollar should be front and center in any discussion of trade. If the dollar were to fall by 10-15 percent, and bring trade back into balance, it would generate close to 5 million new manufacturing jobs in the United States. This would have an enormous impact on the labor market for less-educated workers.The article also includes a comparison of jobs that are subject to international competition and jobs that are not. This is highly misleading. Whether or not a job is subject to international competition is a matter of policy, not an intrinsic feature of the job. The fact that manufactured goods are widely traded is the result of long set of trade agreements over the last three decades that were deliberately designed to make it as easy as possible for U.S. firms to hire low-cost labor in the developing world and ship their production back to the United States. Our trade negotiators could have instead devoted their energies to make it as easier as possible for foreign students to train to U.S. standards as doctors, dentists, lawyers, economists or other professionals. There are tens of millions of very bright people in China, India, Mexico and elsewhere in the developing world who would be very happy to train to U.S. standards in these professions, including becoming proficient in English, and work in the United States for less than $100,000 a year. We do actually bring large numbers of foreign workers into the country in some occupations, but they tend to be low-paying ones. Immigrant workers are enormously important in farm work, restaurant and hotel work and residential construction. They would be equally dominate among physicians, dentists and lawyers if they faced as few barriers as they do to working in these low-paying occupations. The savings to U.S. consumers from this sort of expanded trade in professional services would be hundreds of billions of dollars annually in the form of lower health care costs, reduced university tuition and savings on all other products in which the cost of highly paid professionals is a major input. The reason that trade agreements did not take this route is that U.S. professionals have much more political power than manufacturing workers. As a result, they have been able to maintain barriers that largely protect them from competition with their counterparts in the developing and developed world. (U.S. professionals also make more than their counterparts in Europe.)
We are glad that Manufacturing Jobs Still Matter, how about you?

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