Non Profits World — 09 January 2012

The U.S. has lost nearly two million jobs because of NAFTA.

President Obama pushed free trade agreements with South Korea, Panama and Columbia as part of his jobs-creating legislation. Congress went along for the ride because this was the only path where Republicans and Democrats could agree. But this path is the wrong path. This is trade insanity.

Albert Einstein defined insanity as doing the same thing over and over again and expecting different results. That is a summary of our trade policy: negotiating trade agreements and expecting different results. We have lost jobs with every trade deal that has been negotiated and it is clearly insanity to expect that result to change.

Every trade agreement that we have entered into in the past forty years has led to a destruction of American jobs. The North American Free Trade Agreement, the largest free trade agreement that we have signed, caused nearly two million jobs to shift from the United States to Mexico. Even Hillary Clinton, whose husband signed NAFTA into law, admitted during the 2008 Democratic presidential debates that NAFTA was a failure.

Before NAFTA, in 1992, we had a $5 billion trade surplus with Mexico. That same year we had an $8 billion trade deficit with Canada. Before NAFTA trade with both nations was fairly equal.

After NAFTA our trade deficit with Canada ballooned to $80 billion a year. Similarly, trade with Mexico exploded to a trade deficit of $75 billion. The Great Recession has brought those numbers down a bit: according to the U.S. Census Bureau, our trade deficit with Canada was “only” $28 billion in 2010 and $66 billion with Mexico, a staggering $94 billion deficit with our NAFTA partners. Based on the standard that each $1 billion of deficit costs 20,000 jobs, we have lost 1.88 million jobs because we entered into the North American Free Trade Agreement.

Mexico is not too happy about NAFTA either. Victor Suarez, a representative for the Democratic Revolutionary Party, or PRD, is in the Mexican House of Representatives. Suarez said, “With NAFTA we had promises of economic prosperity, and now we have the facts,” Suarez told United Press International. He emphasized that “NAFTA was a failure for the farmers and it failed to slow down the migration that was already under way.”

Richard Nixon opened the door to trade with China in 1972. Before 1972 we had virtually no trade with that communist nation. Now we have a massive trade deficit with China that has cost us more jobs than NAFTA trade expansion has cost the United States.

Free trade with China and Vietnam didn’t create jobs in the United States. Trade with both of those Asian nations has been a one-way street to unemployment in the United States. Our trade deficit last year was $11 billion with Vietnam, and a staggering $273 billion with China. Is our trade policy insane?

AFL-CIO President Richard Trumka said in a recent speech in Washington, D.C. that the Korean, Columbia and Panamanian agreements would destroy 159,000 jobs by encouraging companies to send work overseas. While these job losses pale by comparison to our job losses with Mexico and China, the new trade agreements will not create jobs in the United States.

These trade agreements have led to the vast disparity between rich and poor in the United States. Trade agreements have undermined our middle class, those working in factories, while making the rich who control international trade richer and richer. They have done the same to Mexico, driving poor farmers out of business and into the United States.

Do we ever learn from our mistakes? We should get tough with China. China has stolen our intellectual property. China manipulates its currency to favor

Joel D. Joseph is chairman of the Made in the USA Foundation

exports over imports. We need to renegotiate NAFTA. And we need to get out of these new trade agreements before they steal more American jobs.

The Made in the USA Foundation is a non-profit organization dedicated to promoting products manufactured in the USA, as well as products assembled in the USA.

Joel D. Joseph, Chairman, Made in the USA Foundation


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Joel D. Joseph

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