Ohio Needs a New Approach to Trade Policy

by Gordon Barr, President, NewKor, Inc. and Chairman, NE Ohio Campaign for American Manufacturing. 

 

The Plain Dealer May 24 editorial (“Clearing the way for trade”) regarding the recently foreign trade deal between Congress and the Bush Administration, concluded that the deal “appears to make sense for both parties and for the American people”.  However, appearances aren’t always what they seem.

 

This plan will do no more to create US jobs than did NAFTA.  The US is not enforcing existing regulations, so how will we enforce abuses in thousands of new Chinese and east European factories?  And contrary to what appearend to make sense then, China’s entry into the World Trade Organization has netted the US no additional jobs, instead displacing production and nearly 1.8 million US jobs since 2001.

 

Officials like Senator Sherrod Brown, Congresspersons Betty Sutton, Zack Space and over 25 others were elected because they see a fundamental flaw at the core of US trade policy.  Look no further than the all-but-hollow-shell of Hoover in Canton and you can see it is far from apparent how Ohio voters will find any sense in this deal that learns so little from past experience. 

 

Americans want two things from our foreign trade policy.

 

First, Americans want a trade policy that creates jobs.  Foreign protectionism creates competitive advantage that has put US manufacturing companies and workers on the endangered species list.  If China had been effectively pressured to stop manipulating their currency, Hoover vacuum cleaners and other US products would have a cost advantage of between 25-40% working for us instead of against us.   This is the hidden “currency tax” on US made products. 

 

Second, Americans want a level playing field.  In our current system, everything from intellectual property, to the “unofficial” red tape that stalls US imports at the dock, and currency manipulation are all deployed to protect foreign industries, jobs, and markets and keep US made goods and services out.  Foreign protectionism in China, Korea, Japan and elsewhere is rampant and it is costing Ohio jobs, while our markets are flung open to the world.

 

Here are two immediate actions Congress should take now to get our Trade Policy on-track: 

 

1.      Pass the Hunter-Ryan Fair Currency Act, giving us the tools needed to hold accountable non-market economies, like China, that undermine the competitiveness of US made products through currency manipulation;

 

2.      End Fast Track trade authority.  The Congress should end the President’s Fast Track Trade Authority. Given Washington’s penchant for wrongheaded foreign trade deals, a “time out” on further trade agreements makes sense until we can build a new approach to US trade policy for the 21^st century.

 

A trade policy based on fairness, combined with a commitment to growing our own manufacturing base (as the Chinese, Germans, Koreans and every other nation does), will allow us to demonstrate that the US economy is the greatest in the world, one that works to the benefit of communities, workers and investors across the nation. 

 

Give us a level playing field.  As American manufacturers, we can do the rest.