Free trade agreements are economically sound
The acrimony surrounding the raising of the national debt limit made for good political theatre but did little to address the more systemic problems that are keeping the country in its current economic depression.
While our longterm financial solvency is certainly important, the concept is rendered meaningless without significant job growth to drive the economy forward.
Both Congress and the White House have offered relatively little in the way of programs and policies designed to spur job creation. Where such proposals do exist, they have often failed to advance them due to political ideology.
Of particular note are trade agreements between the US and several foreign countries that Congress has yet to approve, and, as a result, hundreds of thousands potential jobs remain inaccessible to American workers.
First negotiated in 2007 by the Bush administration, the Free Trade Agreements (FTA) between the US and South Korea, Panama and Columbia wait in bureaucratic limbo while Democrats and Republicans bicker over concessions to labor unions and other special interest groups.
Such disagreements are not only costing the US economy well over $12 billion a year in lost earnings, but are placing significant limitations on the labor market as well. Supporters of the agreements estimate that over 250,000 domestic jobs would be created as a result of increased demand for our exports and additional foreign investment in US industries.
Opponents claim that rather than add jobs, these deals would actually cost the US 159,000 jobs. However, this dire prediction is grossly misleading because the majority of these lost jobs consist of workers who would simply be moved from their existing position to a new job opening. There would be no net loss of domestic jobs, and every new position would only help bring down our current 9.1 percent unemployment rate.
If passed, the FTAs will phase out tariffs on US imports, making our products cheaper and increasing their demand in foreign markets. In addition, the quotas that South Korea currently has in place on our agricultural products will vanish, instantly expanding our consumer base.
As another condition of the FTA with South Korea, President Obama has secured a guaranteed purchase order of, at minimum, 25,000 automobiles a year. While this number may not sound all that impressive, it serves as both an entry way into a previously inaccessible market and evidence that further concessions can be obtained in the future.
An agreement with Panama will offer us the ability to better compete for lucrative construction projects on the Panama Canal, with the potential to earn billions of dollars for US companies.
In Columbia, a stronger US presence will assist in stabilizing the nation as a whole by providing legitimate employment opportunities to those who would otherwise turn to drug and gun trafficking.
Simply stated, the economic and geopolitical gains obtained by approving the FTAs cannot be replicated in any other fashion.
Indisputably, some US workers will lose their jobs, a fact that has caused labor unions and many Democrats to push for additions to the Trade Adjustment Assistance (TAA) program.
This program offers training and financial assistance to US workers that lose their job due to outsourcing to a foreign trading partner, but serves as a point of contention for Republicans because of its associated costs to the federal government.
In efforts to expedite the immediate creation of jobs, Republicans have offered to hold separate votes on the trade agreements and the TAA program itself. Given the present economic situation, Democrats would better serve the country and themselves by taking up this offer.
The fiasco surrounding raising the debt limit should remind Democrats that Republicans are all too willing to torpedo economic recovery in order to publicly adhere to a no-new-spending policy.
With Congress now in recess until September, the price of their inaction will further be felt by the nation’s unemployed and the economy as a whole.
When they return, it is incumbent upon Congress to swiftly and decisively approve these Free Trade Agreements, as they have waited far too long to enact policies that promote real and long term economic recovery.
Marc Anderson is a third-year cell biology Ph.D. student and may be reached at [email protected].