Prosperity undermined
Polling and congressional trade agreement voting records over the
past two decades show a steady erosion of what had been bipartisan
support for trade agreements.1 Polls show the U.S. public supports the
concept of trade expansion, but opposes the status quo trade model. The
actual results of trade pacts since the controversial North American
Free Trade Agreement (NAFTA) have fueled this trend.
Over 21 years, a series of trade agreements not only have failed to
meet their corporate and political backers’ glowing promises of job
creation, but instead have contributed to unprecedented and
unsustainable trade deficits, the net loss of nearly 5 million U.S.
manufacturing jobs and more than 55,000 factories, the offshoring of
higher-wage service sector jobs, flat median wages despite significant
productivity gains and the worst U.S. income inequality in the last
century. Even for U.S. agriculture, a sector that consistently has been
promised gains from trade pacts, U.S. food exports have stagnated while
U.S. food imports have surged under NAFTA-style deals. Given that the
Trans-Pacific Partnership (TPP) pact now under negotiation replicates
and expands on the same model, opposition in Congress and among the
public is deep and broad.
The United States has a $178 billion goods trade deficit with its 20
free trade agreement (FTA) partners. The job-displacing U.S. trade
deficit with FTA partners has surged 427 percent since the pacts took
effect, as imports have ballooned and exports to FTA partners actually
have lagged behind exports to the rest of the world. Even eliminating
trade in fossil fuels, the United States has a more than $92 billion
trade deficit with its NAFTA partners alone. In contrast, the United
States had a small surplus with Mexico and a $30 billion deficit with
Canada before NAFTA. A 2011 study found that the ballooning trade
deficit with Mexico alone under NAFTA resulted in the net loss
of about 700,000 U.S. jobs, and more than 850,000 specific U.S. jobs
have been certified as NAFTA casualties under just one narrow U.S.
Department of Labor program called Trade Adjustment Assistance (TAA).
The U.S. trade deficit with China has grown from $112 billion in 2001,
when China joined the World Trade Organization (WTO) with U.S.
congressional approval, to $350 billion today, spurring an estimated 3.2
million U.S. job losses. U.S. manufacturing workers who lose jobs to
trade and find reemployment are typically forced to take pay cuts. Three
of every five displaced manufacturing workers who were rehired in 2014
took home smaller paychecks, and one in three lost more than 20 percent,
according to U.S. Department of Labor data.
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