Op-Ed: Trade deal would hurt hoosier workers and businesses


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Op-Ed piece from the Indiana AFL-CIO:

Trade deal would hurt hoosier workers and businesses
By Brett Voorhies, President, Indiana State AFL-CIO

Dear Editor:

Fifteen years ago, there were roughly 17 million American manufacturing jobs. Today the number of those manufacturing jobs, which pay a significant wage premium for middle-skill workers without a college degree, is closer to 12 million. In Indiana alone, one out of every five manufacturing jobs disappeared during that time.

Nowadays there are a lot more of us working in minimum-wage retail positions at places like Wal-mart.

If you buy the line that America’s share of these jobs were gobbled up by robots or naturally swamped by an international economy, then please sit tight; I also have some magic beans for sale. The real reason for their loss has been years and years of falling behind the curve of globalization rather than riding its wave. Our trade policies haven’t focused on reciprocity and 21st century problems. Our domestic policies have largely turned away from supporting private sector jobs in the productive sector of our economy.

And wouldn’t you know it? Here comes a deal that is supposed to set the table for all trade agreements to come. It’s called the Trans-Pacific Partnership – TPP, for short – and it’s a deal including the United States and 11 of its closest Pacific Rim neighbors. I’m all for trade and more of it, provided it’s fair. I’m far from convinced that this TPP deal is, and I’m not the only one.

There are lots of TPP critics out there, but one big point of contention runs like a thread through groups of liberals, Republicans, conservatives, Democrats, labor activists, business leaders, and economists of every political tilt: there isn’t anything in the hundreds of pages of TPP text that deters currency manipulation, which is the most pervasive form of protectionism in this century. And that’s a big problem for beleaguered U.S. manufacturing jobs.

Here’s why: When a foreign government intentionally devalues its currency against the American dollar – like Japan does with its yen, which it has made artificially cheap in the past – it makes the American competition’s goods more expensive and its own exports comparably cheap.

It’s an outrageous practice that essentially allows a foreign government to subsidize its goods exports by “taxing” similar American-made goods and it has added billions to America’s trade deficit over the years. That job-draining deficit was a whopping $505 billion in 2014. What’s more, the trade deficit with the 11 TPP countries has more than doubled from $110 billion in 1997 to roughly $261 billion last year. Many of them play with their currencies and I assure you that’s not a coincidence.

President Barack Obama had a lot to say about currency manipulation – back when he was a senator. In a 2007 letter to Bush administration officials, he said that “refusing to acknowledge this problem will not make it go away.” Since he’s assumed office, though, the president has ignored his own advice. His administration has shrugged off questions about currency, doing its best to pretend the growing chorus of concerns about this issue won’t affect the TPP.

That would be a mistake. Our trade deficit is only going to get larger if we sign a trade pact that, for all intents and purposes, blesses a card game that’s played with a stacked deck. Who will lose if we agree to a TPP deal that doesn’t fix the currency question? American manufacturers and American workers. The president can refuse to acknowledge that, sure, but that’s a fact.


Brett Voorhies is the president of the Indiana State AFL-CIO (American Federation of Labor and Congress of Industrial Organizations). The Indiana State AFL-CIO represents more than 300,000 working Hoosiers in 800 local unions across the state belonging to 50 International Unions.

For more information on please visit www.inaflcio.org or call 1-800-638-1217.



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