I have spent a lifetime championing the benefits of free trade, and for the most part my views have been vindicated by the facts on the ground. The United States has benefited greatly in terms of general economic growth, increased opportunities and a veritable cornucopia of low cost consumer products that have enhanced the quality of life for our citizens. It has also enabled the U.S. to maintain its world leadership despite all of our difficulties.
But without question, free trade has taken a toll on certain sectors of our economy, most notably manufacturing which has lost millions of jobs. It is cold comfort to observe that these were mostly low skill jobs consigned to oblivion anyway by advancing technology. To the people who lost those jobs, and once enjoyed middle class status, their loss has had a dreadful impact. Many of them have been unable to find equivalent opportunities in the new high tech/service economy. Their frustration is very much on display in the political campaigns as the major candidates compete with each other to condemn free trade. The North American Free Trade Agreement (NAFTA) was and is a great stimulus for growth, but the anti-trade people have never accepted that reality.
I and others can and do cite hard statistics left and right all day long to defend free trade and its positive impact on economic growth, but in the current political environment factual data does not carry very well. The majority that benefits from free trade simply does not see the benefits amid the hoopla on the hustings.
There is a groundswell of opposition to free trade afoot in the land and the most conspicuous target of that incoherent wrath is the proposed Trans-Pacific Partnership (TPP). In reality, the TPP would have a beneficial impact on our country. A recent study by the U.S. International Trade Commission concluded, in an 800-page report released last week, that the TPP would boost the nation's gross domestic product nearly $57.3 billion by 2032 and create an estimated 128,000 additional jobs.
More importantly, the global political benefits from TPP are enormous, from opening up all of Asia to increased U.S. economic activity to increasing the intellectual property protection for U. S. Firms. TPP will also enable the U.S. to offset China's excessive influence in the region. The nations of Southeast Asia are fearful of growing Chinese influence and looking to us for leadership.
But economic and political reality are not driving this campaign. The demagogues have the stage and their admiring crowds are not to be denied. Both of the likely major party candidates have come out against TPP, and it seems unlikely even a third party candidate would take up the TPP cause in the face of so much irrational hostility.
Thus, it is imperative that the Obama Administration and the cooler heads on Capitol Hill who still carry a torch for TPP act quickly. If they want to make the TPP a reality, and the arguments for it clearly outweigh the arguments against it, they need to do it now. If the issue should linger over into the next administration, its chances are slim indeed.
Jerry Jasinowski, an economist and author, served as President of the National Association of Manufacturers for 14 years and later The Manufacturing Institute. Jerry is available for speaking engagements. May 2016