President Obama has spent the past six years negotiating a Trans-Pacific Partnership (TPP) trade deal behind closed doors. The agreement, repeatedly touted as a boost for America’s manufacturers and workers, would open the U.S. market to a slew of imports from 11 nations, including Vietnam, Japan, Singapore, and Malaysia.
In order to craft the TPP package, which now runs to thousands of pages, the president has relied on the advice of 600 non-governmental organizations, including many multinational corporations. Unfortunately, he has refused input from the one voice that should matter – the U.S. Congress. And that’s a real problem.
Since 2000, the U.S. has lost more than five million manufacturing jobs and 57,000 manufacturing establishments. This lost manufacturing has come at a real cost for America's middle class. What should be paramount on the minds of our elected officials is how to rebuild this lost industrial capacity.
The TPP is emphatically not the answer. Instead, it’s simply the latest in a long line of trade deals (like NAFTA, China, CAFTA, South Korea, etc.) that have opened the door to predatory trade with countries that have only their own interests at heart.
For example, Japan, Malaysia, Singapore, South Korea, and China continually engage in currency manipulation in order to gain an advantage for their exports.
In fact, Beijing has used an undervalued Yuan to boost its trade surplus with the U.S from $83 billion in 2001 to $342 billion in 2014, costing the U.S. more than 3 million jobs.
Similarly, Japan has intervened in currency markets 376 times since 1991 to increase exports.
This unbalanced trade has led to America no longer producing enough steel to supply its own defense and infrastructure needs.
Currently, our steel industry is facing a wave of subsidized foreign steel at nearly unprecedented levels. And the U.S. also faces dependencies in such vital defense industries as propellant chemicals, batteries, and specialty metals.
Where will Americans work, and how will we defend our nation, if these trends continue?
President Obama, however, is insistent on “fast tracking” a completed TPP agreement past a submissive Congress. Worse, the president’s plan overlooks the concerns of bipartisan majorities in both the House and Senate who have explicitly requested strong provisions on currency manipulation in the final agreement.
Unfortunately, the president has ignored Congress’s instructions, and one result of a signed TPP might well be the surrender of America’s automotive sector to a Japanese car industry strongly aided by currency manipulation.
The TPP represents another giant step in the industry-by-industry giveaway of American manufacturing.
Thankfully, the president’s request for fast track authority has met stiff opposition on Capitol Hill, mainly from Democrats, but also from a sizable group of Republicans. All are justifiably troubled because the president has negotiated the TPP without incorporating a congressionally vetted set of instructions, and is simply seeking fast-track authority to slam-dunk the finished package.
If the past 20 years of “free trade” deals offer any preview, TPP won’t increase America’s sales to third world consumers, most of who exist on a few dollars a day and can’t afford U.S. wares. However, they can flood our already import-saturated market with more goods produced at slave labor wages. And so Congress should say no to President Obama’s request for “fast track” authority and the poorly conceived TPP agreement. Otherwise, U.S. manufacturers and their workers could be among the losers.
Kevin L. Kearns is President of the U.S. Business & Industry Council, a national business organization advocating for domestic U.S. manufacturers since 1933.