A picture of Representative Marcy Kaptur
Marcy K.
Democrat OH 9

About Rep. Marcy
  • America’s Free Trade Deficit

    by Representative Marcy Kaptur

    Posted on 2015-01-12

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    KAPTUR. Mr. Speaker, I rise this evening to paint a picture of U.S. job loss resulting from our trade policies extending back now almost three decades.

    I rise because America has a huge ``good jobs'' deficit because we have a gigantic trade deficit. That means more imports come in here than our exports go out, largely because markets and other places are closed. Our workers and our communities have paid a tremendous price for this.

    I oppose any further NAFTA-like trade agreements, such as the Trans- Pacific Partnership, which the administration is proposing. That will ship out more U.S. jobs. We have had enough. The American people have had enough.

    Since 1975, when Wall Street's free trade job outsourcing roulette began, America has amassed a $9.3 trillion trade deficit with the world. If you look at this chart, we have on here every single trade agreement that was signed and all of the lost jobs that resulted from the growing trade deficits we are amassing with countries around the world. This has never happened before over our history in the United States of America. It is a very serious problem.

    The staggering loss of productivity associated with this deficit translates into a huge job loss here at home. In fact, that $9.3 trillion of accumulated trade deficit of more imports coming in here than exports going out has actually cost us over 47,500,000 lost American jobs.

    Most of those were really good jobs that paid living wages, jobs that just evaporated from our communities, jobs that were shipped to Mexico or to China, Korea, Bangladesh, Honduras, Guatemala, Turkey, El Salvador--everywhere in the world--largely to the Third World, and, frankly, to undemocratic countries where workers are treated like a bonded class.

    Our workers, no matter how loyal or hardworking, became expendable as this began. In fact, they were treated like expendable widgets. What is being hurt in the process is the belief of the public that the value of hard work has any meaning. There are some workers who have simply dropped out.

    Yes, American jobs are being outsourced year after year--for over a quarter century now--and workers are being treated like a game of musical chairs. Our jobs have been shipped out to penny-wage sweatshops hidden behind the Iron Curtain of anonymous towns in distant places most Americans will never visit. Anonymity, exploitation, and hidden squalor are as fundamental to free trade as the hollowing out of American jobs, our communities, and our middle class.

    Those who exploit workers in our country and globally believe they are so powerful that the American people won't be able to rein them in, and they think this Congress will continue to behave as it did before, despite the evidence that this doesn't work for the American people.

    Some of those very powerful interests are asking for another Fast Track trade deal to do it all over again in something called the Trans- Pacific Partnership, on an even bigger scale, including nations with the grossest violations of basic human rights.

    Let me turn first to the broken promises of NAFTA, which was really the fundamental agreement passed--over my objections--in the early 1990s and another agreement, CAFTA, that dealt with Central America. Fast-forward to this past summer when thousands of migrant children from Central America swarmed our southern border. Remember that? The American press acted surprised upon their arrival, and some people even threw tomatoes at buses that carried children from one detention facility to another.

    These children had lived under 20 years of NAFTA and CAFTA in Mexico, Guatemala, El Salvador, and Honduras. They had experience with the NAFTA trade agreement and the CAFTA trade agreement, which covers those countries, trade agreements that were sold as opportunities that would rise the tide of all boats, of all workers.

    What happened? Here in the United States, we had a huge loss of jobs to those countries, and Mexico's and Central America's infrastructures were not modernized. Their standard of living was not raised.

    In fact, the promise that those countries somehow would turn into stylistically rustic versions of the American consumer market never happened. They were told new jobs would abound, but our Nation began to hemorrhage jobs to Mexico as wages in Mexico and throughout Central America began to drop. Those deficits became part of the overall total.

    The problem is that in most of these countries where the free trade agreements were signed, what you see happening is more goods coming in here than our goods going out, a little trickle going to some places. In Mexico, what happened ever since NAFTA's passage was that we were promised trade balances. Every single year, it has gotten worse and worse and worse.

    This week, the broken promises sold to the American public and their elected officials is that these agreements would really work. The people who voted for those agreements should pay some attention to the debate of trying to withhold funding for the Department of Homeland Security because of the President's action on immigration.

    The stories of the youth being shipped back by the planeloads tell of families' lands being stolen from under them. The land was handed over to multinational corporate agricultural groups that come in and grow, for example, palm oil.

    Local displaced farmers were forced into urban settings--desperate, in search of food, in search of work at factories where jobs that were promised in return for the land--guess what--never materialized. Here on our own continent, the children became the refugees of transnational economic policies that harmed the entire continent.

    Hardly anyone even talked about that; but when you have this kind of disruption, when you have so much job loss, and when you have land, transferring title with millions of farmers disrupted from their way of life, what do we expect? Millions of displaced people in Mexico and Central America living in the shadow of border plants and urban factories exist in a state of peonage that makes older versions of slavery look positively beneficent, squatting on poisoned ground in jerry-rigged plywood and tar paper shacks.

    I have been in those shacks. I have gone to those places. When you do, you never forget it. Next door, water in gullies that surround these places is so polluted that communities smell of a rancid odor, and even chickens that they keep to try to feed themselves die from the drinking water. We have seen it. We have been there.

    The displaced population on the run is surging, thanks in large part to NAFTA and CAFTA's agricultural provisions, those very flawed provisions [[Page H222]] that provided no opportunity for adjustment as a First World nation met the economy of Third World nations.

    The terms of the agreement forced the revocation of land and allowed multinationals to begin buying up vast tracts in the interior, pushing untold millions of peasant farmers, who remain nameless, off their land and into the labor pool of the maquiladoras; yet we, as Americans, are surprised when their children, as migrants, flock to our southern border.

    If we seriously looked at the impact of our free trade agreements, we would easily see the havoc wrought on local economies throughout the lands on the other side of the border. Those who forced this to happen should know the consequences of their policies and what they reap: legions of desperate workers willing to do anything to survive.

    Now, let me turn to the Trans-Pacific Partnership that proposes to expand trade into regions with the worst labor violations and working conditions.

    We can't be fooled into thinking expanding trade agreements with 11 new nations in the Pacific rim will actually be the end to American jobs being shipped overseas. Of the 11 nations with which the United States is negotiating the Trans-Pacific Partnership, nine have wage levels significantly lower than our own.

    This will only intensify the already real reduction in wages American workers are experiencing year after year as our jobs are shipped overseas to increase profits of shareholders as they take advantage of impoverished laborers.

    Worse yet, for the immigration debate, as those who run the maquilas of Mexico and Central America realize, the next move will be to Vietnam for even cheaper labor. Factories on this continent will shut down, further exacerbating the poor economic conditions of our southern neighbors, leaving even fewer options other than for those individuals to flee north, seeking any economic opportunity to sustain themselves.

    I wanted to spend a moment looking at the Korean agreement because that was one of the latest ones they brought up here as a free trade agreement. They promised there would be thousands of jobs and that America would be able to sell 50,000 vehicles to Korea.

    {time} 2145 Well, guess what. We haven't even hit 10,000, while there have been over 561,000--half a million--vehicles sent from Korea here. So look at what is happening with the Korean agreement, another free trade agreement which just passed a couple of years ago. The proof is in the pudding.

    The Fast Track procedure, which allows no amendment here on the floor, yields this--more red ink for the United States.

    We were promised that the Korean agreement would create jobs and help balance our trade deficit in an effort to strengthen our economy and rebuild the American auto industry. Nothing could be further from the truth, as with every other agreement.

    We are in a deep trade deficit with Korea. The U.S.-Korean free trade agreement promised 70,000 jobs. In actuality, we have already lost 40,000. It is going in exactly the opposite direction.

    The U.S. Census Bureau recently revealed that the United States had a $2.8 billion monthly trade deficit with Korea just in November of last year, the highest monthly U.S. goods trade deficit with Korea on record. The historic U.S. trade deficit with Korea was driven by a record-setting $6.3 billion in imports from Korea and a lackluster $3.5 billion in exports to Korea from the United States. Auto sales did not surge, as we were promised. Exactly the reverse is true.

    And now we can look at China. You know, the story is no different. You would think we would have learned something. But if you look at trade with China--and China became a member of the World Trade Organization in 2001--Americans were promised, again, that that deal would expand market opportunities for United States companies, thereby increasing jobs here and American prosperity.

    How has this worked out? Let me share some specifics: The United States has lost over 64,000 manufacturing firms and at least 5.8 million manufacturing jobs to China. In the year 2013, the latest complete year of data, America actually racked up a $319 billion trade deficit with China. And you know this to be true because everything you buy--coffee cups, clothing, electronics, even solar panels--are all made in China. And the massive deficit we have racked up with China just in 1 year--that 1 year--amounted to a loss of 1.5 million American jobs. And that is just 1 year's damage.

    What America needs is not more of the same NAFTA-styled trade agreements. What America and American workers need is a trade policy that creates jobs, opportunity, and wealth in this country first. We need balanced trade accounts, not trade accounts that are in the red with every single country with which we have racked up these deficits. The American people--not just the global corporate elite--need to be in the driver's seat again, and that is where Congress has to do its job. Our Nation needs a trade policy that is results-oriented, that will yield jobs in America.

    We must open closed markets of the world. We must grow our exports. We must hold those who wrote these agreements accountable for the damage that they have done, and we must not create any more free trade agreements that dig the hole deeper.

    We must create jobs here in our country by moving our Nation toward economic independence--not dependence--by rebuilding our own manufacturing base here at home, by restoring our domestic energy security, and by making sure that these agreements result not in deficits, but in trade balances and, even more importantly, trade surpluses.

    Mr. Speaker, there are ways that a developed nation can trade with the developing world without gutting its own economy. America has got to figure out how to get there. And no trade deal should be brought up here under that Fast Track procedure where Congress can't amend until we fix what is wrong with these agreements. Haven't we learned in three decades that that flawed trade model just simply isn't working? Pushing huge trade agreements, like the Trans-Pacific Partnership, through Congress on a Fast Track course with no opportunity for amendment is not the way to create a strong middle class, rising wages, and real opportunity for the American people. Now is the time to hold this administration and this Congress accountable for changing course and start to invest in this country again and make sure that these trade partners with whom we do business open their markets. To do any less is to continue to harm the American people and continue to have this enormous downward pressure on job creation in this country and wage levels and benefit levels in this country, where the average American hasn't seen a raise in years. We have to change. This is too great a price for the American people to pay.

    So this evening, I thank those who are listening for their time. I thank the Speaker for the time this evening.

    I yield back the balance of my time.


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