A Red Herring

A RED HERRING -- (House of Representatives - June 10, 2008)

The SPEAKER pro tempore. Under a previous order of the House, the gentlewoman from Ohio (Ms. Kaptur) is recognized for 5 minutes.

Ms. KAPTUR. Madam Speaker, the New York Times CBS spring poll has reported that 68 percent of Americans favor putting restrictions on what is called free trade to protect our domestic industries. That is the highest level of concern since the poll began asking the question in the 1980s, and a 12 percent rise just since 2000.

Only 14 percent of Americans surveyed last year by the Pew Global Attitudes Project said increase in trade was very good for our country. And the American people, by a healthy majority, view NAFTA and NAFTA-like trade agreements as flawed and costing our people more job washout every day. In other words, a majority of people in our country not only believe something is wrong with current U.S. trade policy, enough of them have now been hurt directly by unfair trade that they now know personally what a bad trade deal can yield. When you are almost $1 trillion in trade deficit, something is fundamentally wrong.

So what does one of America's premier newspapers place on its editorial page this week in response? Do they look inside the gaping job loss and trade deficits our Nation is experiencing and attempt to reshape the policy to again produce a better yield in jobs for our people and Nation? No. They put their head in the sand. And they do so in the form of an editorial that is nothing more than a red herring. Actually, this looks like a herring to me. A red herring. You've heard that old expression which means someone distracts attention from the real issue. They state a half-truth and then wage a fierce argument against that falsehood as if the falsehood were true. It is an old trick.

The New York Times article written by Eduardo Porter, is a complete red herring. He said that people who worry about job loss in America related to trade want to stop trade. He said that those people are isolationists. Nothing could be more untrue.

I say to Mr. Porter the vast majority of the American people want to fix what is wrong with these trade deals. And there is plenty wrong. If he fails to grasp that, he might, as the old expression goes, ``fail to see the wall in front of his face and run right into it.'' Mr. Porter alleges that the majority of Americans who favor putting restrictions on free trade to protect domestic industries will push the new President to be undiplomatic and unreasonable when it comes to what Porter calls economic protectionism.

Mr. Porter, reciprocity is not protectionism. With nearly $1 trillion net trade deficit sucking more and more jobs out of this country, he should be championing balancing our trade agreement and creating jobs here in America again. But he opines that other countries, like Canada, Sweden and Germany, in which fewer people favor such measures, are scared that a new trade model would bring about what he calls a trade war. Yeah, you scare them, right? Try to scare the American people.

What Mr. Porter does not understand is that America's hostility is not to international trade, but to trade agreements and deficits that cause job outsourcing, job losses and cuts to middle-class benefits and health coverage. Americans support trade that wins for them and that brings prosperity to America again. They want trade that builds a middle class here at home and abroad. They are tired of being jerked around by the multinational companies that trade them for $1 an hour worker in China who has no hope of a better life. They want that worker to get a fair deal too. They support trade that creates jobs, America used to do that before we fell into deficit, and exports American products again to customers around the world. They broadly oppose the failed NAFTA model that has sucked jobs and money away from America to corrupt and closed markets that keep their boot on the necks of workers around the world who have no rights. Porter claims trade hawks want to disengage from the world. Wrong again. Nothing could be further from the truth. Americans wants to engage. They want reciprocal trade, balanced trade and free trade that builds a middle class, not shatters it.

That is why a number of us introduced a bill he mentions offhand, the trade act, H.R. 6180 which currently has over 50 sponsors and sets guidelines for responsible trade that encourages free trade among free people. Porter says that Europe and Germany don't share our point of view and we should be more like them. I will agree with him on one account. We should be more like them because they have trade balances, not trade deficits. They are sitting pretty compared to ours. We have a $711.6 trade deficit in 2007, and they, in fact, have surpluses. So Mr. Porter ought to be fighting for a strong America. And that means free trade among free people.

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Indeed, the latest monthly trade figures from April show our nation has just gone further in the hole at $60.9 billion deficit. More red ink = more lost jobs and more workers falling out of the middle class. Yet Canada and Sweden both managed surpluses of about $30 billion in U.S. dollars. Their trade numbers are moving in the right direction. Germany commanded a trade surplus of more than $185 billion. I ask Mr. Porter, why shouldn't America move its accounts to balance and surplus? Why does he favor more job washout? More loss of income for our people? More red ink? Furthermore, workers in those countries need not worry about losing their healthcare since the government provides assistance. Those countries trade in order to make money, but our trade policies have resulted in a hemorrhage of our resources.

The New York Times and Mr. Porter ought to be fighting for a strong America--and that means a strong economy evidenced by balanced trade accounts, not deficits. A strong America means keeping and creating good jobs, with living wages and benefits like healthcare. And a strong America means trade relationships that bring strength to our economy and our trading partners', not a race to the bottom or human rights violations.

America ought to be fighting for opening the closed markets of the world, like Japan's and China's, not putting our heads in the sand while our competitors levy non-tariff barriers against America's goods and services. If we are not trading with a free country with a free market and free people, we are not trading freely at all. We are paying these countries to continue unfair economic and political practices at the cost of our own prosperity and standard of living.

We ought to be fighting for America's middle class, not outsourcing their jobs to China, India, and Mexico. We should not oppose free trade; we should support free trade among free people.

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[From the New York Times, June 7, 2008]

Europe Fears a Post-Bush Unilateralism, This Time on Trade
(By Eduardo Porter)

The Democrats' vocal hostility to trade is starting to scare many of America's best friends. As Barack Obama and Hillary Clinton have bashed China and a variety of free trade agreements, allies who have been yearning for an end to President Bush's in-your-face unilateralism are worried that a Democratic president may be just as undiplomatic, and unreasonable, when it comes to economic protectionism.

``It is very irresponsible, in my view, to pretend to people that we can disengage from international trade,'' Peter Mandelstam, the European trade commissioner, warned in a May interview with the BBC.

It would be a mistake to brush all this off as mere campaign posturing. The United States remains as open to trade as its European allies, and in some areas it has even fewer restrictions. But the question is, for how long?

Despite economists' assurances about trade's many benefits, American workers increasingly view globalization as a losing battle against China's cheap labor and a very personal threat to their wages and jobs. According to a poll this spring by The New York Times and CBS News, 68 percent of Americans favor putting restrictions on free trade to protect domestic industries. That is the highest share since they began asking the question in the 1980s, and 12 percentage points more than in 2000.

Workers in other rich nations feel less threatened. Only 14 percent of Americans surveyed last year by the Pew Global Attitudes Project said increasing trade was ``very good'' for the country. That's less than half the share in Canada, Germany or Sweden. Even among the French, who tend to see capitalism as gauche and occasionally drive tractors into their local McDonalds, 22 percent said more trade was very good.

The issue isn't the amount of trade. European countries actually trade much more than the United States. But their citizens appear to be more comfortable with the idea because their governments provide a stronger safety net to catch workers undercut by foreign competition and redistribute the gains from trade more equitably.

In the United States, public spending on social programs, from unemployment insurance to health care, amounts to about 17 percent of the overall economy. This is about half the level in Germany and less than almost every other rich nation. America's meager social safety net and its winner-take-all distribution of riches means workers have less to gain from trade's benefits and more to lose from any disruption.

Most economists agree that trade plays a small role in the deteriorating fortunes of less educated American workers. But as their wages have sagged, their pensions have shrunk and their health insurance has disappeared, trade has become the scapegoat. Politicians, especially but not solely from the Democratic Party, have been eager to capitalize on those anxieties.

Just this week, Democrats in the House and Senate proposed a bill that would require the president to submit plans to renegotiate all current trade agreements--before Congress considered any pending agreements and before the president negotiated any new ones. In April, House Speaker Nancy Pelosi decided to change the rules guiding approval of free trade agreements to stall the approval of one with Colombia.

The United States has an enormous stake in maintaining an open global economy. Trade means export markets for American products, as well as cheap imports for American companies and consumers. Foreign competition helps spur productivity, which has driven the spectacular increase in American living standards since World War II.

Before this country stumbles into a trade war, all political leaders would benefit from a careful examination of how other wealthy democracies have found ways to cushion economic blows on the most vulnerable and make trade more palatable to their workers.

More generous social policies are a far better choice than protectionism.

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