At the height of the recession, the economy was shedding jobs at a terrifying rate. Millions of jobs simply disappeared in the last year of the Bush administration. Under the Obama administration the economy has been slowly and steadily coming back, month by month.
However, we are not out of the woods yet. The gap between the number of Americans at work and those who want a job but cannot find one is still massive.
The recently released employment numbers for June place the official U.S. jobless rate at 8.2 percent, which means that there was a gap of 12.7 million jobs last month.
The real story is more complex. The official jobless rate does not count discouraged workers or those marginally attached to the work force or those employed only part time for economic reasons. The just released Labor Department jobless data, termed, "Alternative measures of labor underutilization," reveals that as of June the total unemployment rate was still at 14.9 percent.
An even closer look at the numbers reveals that while the private market is continuing to add jobs, public sector jobs are actually disappearing. In June the federal government shed another 7,000 jobs. Across the entire public sector, employment is down by over 600,000 jobs since 2009.
If the U.S. is to cut unemployment to about 4.5 percent, which most economists consider to be full employment, the nation must ultimately create more than 16 million new jobs across the entire economy. That is in addition to finding jobs for the 12 million net new entrants into the work force, which the Labor Department estimates we will have by 2018.
The big policy and political question our country faces is how do we create that many jobs?
The missing element in all the existing plans is a robust trade policy that creates jobs here in the United States. For more than three decades, U.S. trade policy has tolerated closed foreign markets and encouraged the outsourcing of work. The consequences of this longstanding omission on U.S. job formation are enormous.
Let's begin with the arithmetic of jobs. The U.S. Department of Commerce estimates that every $1 billion of trade equates to 14,000 U.S. jobs. Thus, a net trade surplus of $1 billion means 14,000 more American jobs and a net trade deficit of $1 billion means 14,000 fewer jobs. The math is that direct and simple.
In 2011, the U.S. ran a trade deficit of $560 billion dollars, which translates into more than 7.8 million lost American jobs. In 2012, the deficit will rise to more than $600 billion -- that equates to more than 8.4 million lost jobs. The three major sources of deficit we see are imported oil with a $149 billion deficit, autos with a $117 billion deficit, and products from China that add a deficit of $295 billion.
This trade deficit, moreover, does more than harm U.S. employment; it also creates a drag on the overall economy. In 2011, the trade deficit reduced overall economic growth by almost 3 percent.
Put another way, if the U.S. had run a balanced trade account last year, the economy would have produced not only more than 7.8 million more jobs, it would have created an additional $500 billion of goods and services in the Gross Domestic Product, and almost $200 billion more revenue for the federal, state and local governments. Take note, deficit hawks.
How to create a balanced trade program is not rocket science. It begins by demanding reciprocity in trade with other nations, what we call fairness. It means confronting foreign government's currency manipulation to gain a price advantage in world markets. It means stopping foreign counterfeiting, product piracy and theft of U.S. intellectual property rights. And certainly it means ending U.S. tax and regulatory policies that encourage the offshoring of our domestic production and jobs.
The Obama Administration has taken some important steps in the right direction. Most recently, the U.S. Trade Representative announced that we will finally challenge China's unfair targeting of U.S.-made automobiles. It is unfair trade when the cost of a U.S. automobile can be tripled by a complex series of foreign government actions obviously meant to keep U.S. products out of the Chinese market place. Other major markets like Japan's remain largely closed to U.S. auto products.
Nevertheless, the big question is why is this issue not front-and-center in this year's political campaigns? The effects of unequal trade relations between the United States and other nations have far too little attention in this election cycle. Without a new trade policy that effectively opens closed foreign markets and brings the U.S. trade accounts in balance, the United States will be unable to create the millions of new jobs our economy so desperately needs.
Hopefully, the national media will soon give this trade and jobs issue the attention it merits and ask candidates for President, the Senate and the House to describe their solutions.
By Representative Marcy Kaptur (D-OH) and Dr. Pat Choate
1. plant, grow and/or harvest something of commercial value from the earth;
2. extract something of commercial value from the earth;
3. manufacture something of commercial value that is consumable
4. construct a building that is permanently useful for rental income;
5. provide professional services (medical, legal, dental, engineering, architecture, land surveying, technology, accounting, etc.);
6. collect payment for patent and copyright uses;
and if they then trade, sell, lease or rent these items and/or services to parties outside of their family, in return for a net transfer of gold, currency or commodities from other parties outside of their family into their own family, then that family is enriched.
The members of that family (tribe, city, state, nation) can then reflect the amount of their real NATIONAL WEALTH and financial security with their net positive accumulation of privately owned grain, gold, cattle, jewels, land, buildings, hotels, casinos, factories, commodities and/or other marketable products that are then available to be used for economic security for reserve use in times of emergency, and/or to redeem any printed paper bonds or currency that they might care to issue.
He was the lone voice in the wilderness opposing NAFTA which was the first FTA with a third world nation (Mexico).
He was our last chance to keep US jobs in the USA.
Maybe the US Congress needs to create legislation to repeal President Clinton's NAFTA, GATT, WTO, MFN trade with China, Financial Services Modernization Act of 1999, H-1b visas, and all of his other similar laws that ECONOMICALLY REQUIRED US businesses to relocate to foreign nations.
Maybe the US Congress needs to create legislation to repeal George W. Bush’s 14 additional FREE TRADE AGREEMENTS (with Jordan, Morocco, and other young democracies of Central America).
Maybe the US Congress needs to create legislation to repeal President Obama’s multiple new FREE TRADE AGREEMENTS with Vietnam, Brunei, Singapore, Malaysia, New Zealand, Australia, Chile and Peru plus several other Asian and South American nations.
US Retail Businesses did not benefit from the US "FREE TRADE AGREEMENTS " that were created in the last 20 years because these US retail businesses still have to compete with each other on an equal product cost footing as before (with US made products) to supply the US consumer's demand for the very lowest price possible for each product purchase, but US businesses most now compete at the lower price/costs of imported foreign manufactured products because US consumers will not pay anything extra for US made products.
Foreign manufacturers, foreign workers employed in foreign factories, US congressmen and Senators that took "perks and gifts" from lobbyists to create the free trade legislation benefitted, plus the US consumers who benefitted from lower prices that were created from foreign imported products that were made with less expensive labor and less expensive environmental compliance costs!
I cannot think of any other beneficiaries of the FTAs, can you?
If President Obama wants US jobs to be created and/or stay in the USA, then why did President Obama create all of his new FREE TRADE AGREEMENTS that will economically require more US businesses to relocate their jobs to foreign nations?
We must have successful private businesses to create wealth and non-government jobs so that the governments can confiscate some of that new wealth to pay for government activities, or else all of those government activities and government jobs will not exist.
Workers work for and are hired by greedy businesses and greedy corporations that create JOBS ONLY to CREATE WEALTH for those same respective businesses and corporations!
Employees don't get a share?
Why should they?
Did the workers share in the loss when their employer lost money?
Employees are not owners, and employees do not have any skin in the game.
To restore the USA to economic health and prosperity, huge changes are needed in the very political and economic structural systems that created these problems.
I think that Milton Friedman said something similar to, "Free markets have brought more people out of poverty than any other system devised."
All of these "FREE TRADE AGREEMENTS" destroyed jobs for the blue collar working citizens of the USA, so why did our elected presidents and congressmen create all of these "Free Trade Legislation" laws?
Were our elected congressmen ignorant, stupid, dishonest, or some combination of these factors?
How do you think that these "FREE TRADE AGREEMENTS" were created?
How do you think that US Government environmental damage liability limits, Free Trade Agreements, Most Favored Nation designations, pharmaceutical liability limits, product liability limits, tax exemption loopholes, agricultural subsidies, and/or any other laws benefiting only a few people were created by our elected US congress and US senate, and then enforced by our elected presidents and their bureaucratic administrators?
Bribery of individual members of the US congress by Professional Lobbyists is institutionalized bribery!
How many more Taxpayer Paid for "Solyndra" type "Pay to Play" business deals did these political contributions buy as a part of our politician’s re-election campaign funds?
Bribes are not always cash in a brown paper sack. These days insider trading advice is much less obvious and harder to detect instead of cash payments.
We need to outlaw taxpayer paid congressional aides for congressmen and senators also! Let the legislators pay for the aides themselves, and/or read and study the proposed legislation themselves.
I truly believe that all new US Federal legislation concerning any topic will also be written by the lobbyist's clients, and then the lobbyists will spend hundreds of thousands of dollars on wine, food, prepaid sexual services, women, song, jobs for the congressmen's (plus their congressional aids') unemployable wives, girlfriends, and children, plus campaign contributions, and exotic vacations to entice (bribe) our congressmen (and their congressional aids that "advise" the congressmen how to vote on each issue) to enact whatever legislation that the lobbyist's clients desire.