Posts Tagged ‘Fast Track Authority’

Is there a Relationship Between our Trade Deficits and our National Debt?

Tuesday, January 27th, 2015

In his State of the Union address, President Obama asked Congress for Fast Track trade authority to move forward on the two trade agreements that have been in negotiations behind closed doors for the past four years: The Trans-Pacific Partnership Agreement and the Trans-Atlantic Trade Agreement. I have already written several articles about why Fast Track Authority should not be granted and the dangers of the TPP. The purpose of this article is to show that there is a relationship between our trade deficits and our national debt. As shown by the chart below, we now have a more than $18 trillion national debt.

Source: http://en.wikipedia.org/wiki/History_of_the_United_States_public_debt

Notice how it sharply ramps up starting in 2001. The recessions of 2001-2002 and 2008-2009 obviously played a significant factor in the increase in the national debt from $5.8 trillion in 2001 to its present level, because during recessions, there is a decrease in tax revenues and an increase in spending for unemployment benefits, food stamps, and other assistance, as well as spending on programs to attempt to stimulate the economy.

However, 2001 also coincides with the first full year of trade with China under the rules of World Trade Organization after “Congress agreed to permanent normal trade relations (PNTR) status,” which “President Clinton signed into law on October 10, 2000,” paving “the way for China’s accession to the WTO in December 2000.”

According to Alan Uke’s book, Buying Back America, the United States now has a trade deficit with 88 countries. Of course, some deficits are small, but some are enormous, such as China. According to the Census Bureau, our top seven trading partners are: Canada, China, Mexico, Japan, Germany, South Korea, and the United Kingdom. These seven countries represent 50.9% of our total trade deficit $ -461.3 billion for January – November 2014. At an average deficit of $40 billion per month, the 2014 trade deficit will exceed $500 billion. Our 2014 trade deficit with China alone was $-$314.3 billion for January – November, representing 68% of the total.

Some may claim that we are still the leader in advanced technology products, but this is no longer true. The U. S. has been running a trade deficit in these products since 2002, which has grown to an astonishing average of nearly $90 billion per year since 2010.

Even our most recent trade agreement, the Korea U. S. Free Trade Agreement (KORUS FTA), which went into effect on March 2012 has had negative impact. The Office of the   Last March, the U. S. Trade Representative for the Obama Administration touted, “Since the Korea agreement went into effect, U.S. exports to Korea are up for our manufactured goods, including autos, exports are up for a wide range of our agricultural products, and exports are up for our services.” However, the reality is that our imports continued to exceed our exports, and the U. S. trade deficit with Korea jumped from -$13.62 billion in 2011 to -$22,838.3 billion through November 2014, which is a 60% increase in two and a half years.

china trade deficitSource:  http://www.businessinsider.com/chart-us-trade-deficit-with-china-2013-4

Notice that there is a similar upward slope on the above graph to the upward slope of our national debt chart. Anyone can see that our trade deficits have a significant impact on our national debt.

The only thing that kept our trade deficits from being higher than they have been is that fact that we have increased the exports of services to balance our imports of goods as shown by the following chart:

 

Year Total Goods Services
1999 -$258,617 billion -$337,068 billion $78,450 billion
2000 -$372,517 billion -$446,783 billion $74,266 billion
2002 -$418,955 billion -$475,245 billion $56,290 billion
2004 -$609,883 billion -$782,804 billion $68,558 billion
2006 -$761,716 billion -$837,289 billion $75,573 billion
2008 -$708,726 billion -$832,492 billion $123,765 billion
2010 -$494,658 billion -$648,678 billion $154,020 billion
2012 -$537,605 billion -$742,095 billion $204,490 billion
2014 -$461,336 billion -$673,612 billion $212,277 billion

Source: https://www.census.gov/foreign-trade/statistics/historical/exhibit_history.pdf

As you can see, our trade deficit in goods more than doubled from 1999 to 2004 and reached astronomical heights just before the worldwide recession.

So how do our trade deficits add to the national debt? One way is that many products, especially consumer products, which were previously made in the U. S., are now made in China or other Asian countries, so we are importing these products instead of exporting them to other countries. The offshoring of manufacturing of so many products has resulted in the loss 5.8 million American manufacturing jobs and the closure of over 57,000 of manufacturing firms. These American workers and companies paid taxes that provided revenue to our government, so now we have less tax revenue and pay to pay for the benefits and public assistance for the unemployed and underemployed.

Our balance of payments indebtedness for trade and the additional cost to the government paid by taxpayers for these benefits has resulted in our escalating national debt. The cheaper China price of goods that we import instead of producing here in the U. S. results in a cost to society as a whole. We need to ask ourselves: Is the China price worth the cost to society?

I say a resounding NO! We need to stop shooting ourselves in the feet. We need to stop benefiting the one percent of large multinational corporations to the detriment of the 99% percent of smaller American companies.

Beyond stopping Fast Track Authority and the Trans-Pacific Partnership from being approved, we need to focus on achieving “balanced trade” in any future trade agreement. Until we change the goal of trade agreements, we should refrain from negotiating any trade agreement. The last thing we need is to increase our trade deficit more than it already is.

In addition, we need to facilitate returning more manufacturing to America by changing our tax policies and making regulations less onerous to manufacturers, without compromising our commitment to protect our environment. This is the only way that we will simultaneously reduce our trade deficit and the national debt.

 

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We Must Stop Fast Track Trade Authority from Being Granted!

Tuesday, January 7th, 2014

President Obama had hoped to be able to announce that he had been granted Fast Track Authority before the Asia-Pacific Economic Cooperation (APEC) meeting in Bali, Indonesia on October 8, 2013, but due to budget issues and the government shutdown, the bill wasn’t introduced and approved in the fall. He had also hoped to complete negotiations for the Trans-Pacific Partnership (TPP) Agreement at this meeting, but no agreement was reached by the countries involved. For the last three years, the Obama administration has conducted negotiations behind closed doors through the offices of U.S. Trade Representative Ron Kirk without any involvement with Congress.

Eleven nations have participated in the negotiations: Australia, Brunei, Canada, Chile, Malaysia, Mexico, New Zealand, Peru, Singapore, the United States and Vietnam. Japan announced its intention to join the agreement last spring. Because the TPP is intended as a “docking agreement,” other Pacific Rim countries could join over time, and the Philippines, Thailand, Colombia, and others have expressed interest. China could join the TPP at a later date without suffering any disadvantage even though this would negate the original reason for the TPP as a counter to China’s hegemony in the Pacific.

Reliable sources have revealed that a bill to grant the president Fast Track Authority under the Trade Promotion Authority will be introduced on January 8th in the Senate Finance Committee and the House Ways and Means Committee. It appears that there is sufficient support to pass these bills out of the committees for a vote on the floor.

Earlier this year, I published three blog articles on the dangers of the Trans-Pacific Partnership agreement and granting the president Fast Track Authority:  “The Trans-Pacific Partnership Would Destroy our National Sovereignty;” “Why the Trans Pacific Partnership Would Hurt American Manufacturers;” and “The Trans Pacific Partnership Trade Agreement Would Harm our Environment.”

In my first article, I commented on the many articles that Lori Wallach of Public Citizen had written about the Trans-Pacific Partnership:  “Ms. Wallach opines that U.S. multinational corporations have the goal of imposing on more countries a set of extreme foreign investor privileges and rights and their private enforcement through the notorious “investor-state” system. ‘ This system elevates individual corporations and investors to equal standing with each TPP signatory country’s government- and above all of us citizens.’ This would enable ‘foreign investors to skirt domestic courts and laws, and sue governments directly before tribunals of three private sector lawyers operating under World Bank and UN rules to demand taxpayer compensation for any domestic law that investors believe will diminish their ‘expected future profits.’”

With regard to “Buy American” laws in my second article, I wrote, “What this means is that the TPP’s procurement chapter would require that all companies operating in any country signing the agreement be provided access equal to domestic firms to U.S. government procurement contracts over a certain dollar threshold. To meet this requirement, the U.S. would have to agree to waive Buy America procurement policies for all companies operating in TPP countries.”

I also noted that as far back as May 3, 2012, a letter from Rep. Donna Edwards (D-Md.) and 68 other Congressional Reps to President Obama stated in part, “We are concerned about proposals we understand are under consideration in the Trans-Pacific Partnership (TPP) agreement negotiations that could significantly limit Buy American provisions and as a result adversely impact American jobs, workers, and manufacturers…We do not believe this approach is in the best interest of U.S. manufacturers and U.S. workers. Of special concern is the prospect that firms established in TPP countries, such as the many Chinese firms in Vietnam, could obtain waivers from Buy American policies. This could result in larger sums of U.S. tax dollars being invested to strengthen other countries’ manufacturing sectors, rather than our own.”

In a commentary article on October 15, 2013, Lt. Col (Retired) Allen West wrote, “TPP would subject the U.S. to the jurisdiction of foreign tribunals under the authority of the World Bank and United Nations. These unelected, unaccountable panels would constitute a judicial authority higher than the U.S. Supreme Court. They would have the power to overrule federal court rulings and order payment of U.S. tax dollars to enforce the special privileges granted to foreign firms that would be exempt from EPA and other regulations that strangle American firms.”

He added, “We’re also told TPP shows our Asian allies we’re serious about confronting China. But it would actually weaken the U.S. As the Chinese People’s Liberation Army uses every means possible to infiltrate our command and control systems, TPP bans Buy American policies that require crucial equipment for our troops be produced in the U.S. We don’t need TPP to stop China’s military expansion – we need to tell the same crowd pushing TPP to stop transferring their capital and technology to that communist dictatorship.”

In a commentary on the Economy in Crisis website, economist Pat Choate outlined the reasons why we should oppose President Obama being granted Fast Track Authority:

  • Allows the President to select countries with which to enter into trade agreements, set the substance of the talks and then sign those pacts without prior Congressional approval.
  • Allows the President to negotiate and include in these trade agreements not only tariffs and quotas, but also changes in federal, state and local laws on taxes, food and health safety, patents, copyrights, trademarks, immigration, Environment, Labor standards, and Buy America provisions, among many other issues.
  • Creates a Presidential advisory system, comprising 700 industry representatives appointed by the President. These advisors have access to confidential negotiating documents that are kept secret from most members of Congress and the public.
  • Empowers the President to draft the agreements to implement legislation without Congressional input.
  • Requires House and Senate Leaders to introduce the President’s bill on the first legislative day following the President’s submission.
  • Requires that the legislation be discharged from Committee 45 days after submission.
  • Requires a floor vote 15 days after the bill is discharged from Committees.
  • Allows only 20 hours of debate in each House.
  • Prohibits any amendments either in Committee or during the floor debate.
  • Eliminates several floor procedures, including Senate unanimous consent, normal debate and cloture rules, and the ability to amend the legislation.
  • Prevents a Senate filibuster.
  • Requires only a simple majority vote in each House for enactment.

In conclusion Mr. Choate states, “These trade pacts will have the effect of a treaty, though the Constitution requires a two thirds majority vote by the Senate for the United States to enter into a treaty.”

It is precisely this sort of amassing of powers that defines a dictatorship. Our Founding Fathers wisely chose to keep governmental power separated in a system of checks and balances, but by utilizing the Fast Track Authority, our Constitutional system of checks and balances would be destroyed and our national sovereignty would be given to foreign nations and multinational corporations in the name of “free trade.”

A letter addressed to President Obama, signed by 24 Republican Representatives in the House, stated, “Under Fast Track, the executive branch is empowered to sign trade agreements before Congress has an opportunity to vote on them, and then unilaterally write legislation making the pacts’ terms U.S. federal law. Fast Track allows the president to send these executive branch-authored bills directly to the floor for a vote under rules forbidding all floor amendments and limiting debate. And by requiring the House to vote on the bill within a preset period of time, it takes the floor schedule out of the hands of the House majority and gives it to the president.

Given these factors, we do not agree to cede our constitutional authority to the executive through an approval of a request for “Fast Track Trade Promotion Authority.”

The signatories were:  Jones, Bachmann, Joyce, Gohmert, Cook, McKinley, Jimmy Duncan, Stockman, LoBiondo, R. Bishop, C. Collins, C. Smith, Rohrabacher, Bentivolio, Grimm, Mica, Broun, Brooks, D. Young, Jeff Duncan, Gibson, Denham, Hunter and Fitzpatrick.

On the Democrat side of the aisle, Representatives Rosa DeLauro (D-CT) and George Miller (D-CA) took the lead in getting a total of 151 Democrats in the House to oppose the use of “Fast Track” procedures that usurp Congress’s authority over trade matters. Their opposition stands for both the Trans-Pacific Partnership (TPP) agreement and any future trade agreements. The letter in part states, “Congress, not the Executive Branch, must determine when an agreement meets the objectives Congress sets in the exercise of its Article I-8 exclusive constitutional authority to set the terms of trade. For instance, an agreement that does not specifically meet congressional negotiating objectives must not receive preferential consideration in Congress. A new trade agreement negotiation and approval process that restores a robust role for Congress is essential to achieving U.S. trade agreements that can secure prosperity for the greatest number of Americans, while preserving the vital tenets of American democracy in the era of globalization.”

If Fast Track Authority is approved, it would allow President Obama to essentially have dictatorial control over the country in many respects. Fast Track Authority gives the executive branch legislative powers, something expressly forbidden by the Constitution. We must deny the President Fast Track Authority. If this is granted, it will be even more difficult to stop the Trans-Pacific Partnership from being approved.

It would be the final nail in the coffin for U.S. sovereignty. Contact your Congressional representative and urge them to oppose the Fast Track Authority and forward this article to your friends and ask them to do the same!

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The Trans-Pacific Partnership Trade Agreement Would Harm our Environment

Tuesday, July 9th, 2013

Proponents say that the Trans Pacific Partnership (TPP) trade agreement would be a platform for economic integration and government deregulation for nations surrounding the Pacific Rim and facilitate free trade to counter China’s financial influence in Asia and the Pacific. The negotiating parties include Australia, Brunei, Canada, Chile, Malaysia, Mexico, New Zealand, Peru, Singapore, Vietnam, and the United States. Japan also announced its intention to join the agreement last spring. Because the TPP is intended as a “docking agreement,” other Pacific Rim countries could join over time, and the Philippines, Thailand, Colombia, and others are already expressing interest.

The TPP is poised to become the largest Free Trade Agreement in the world. The ongoing, multi-year negotiations over the TPP are supposed to conclude this year, so the window of opportunity for preventing this free trade agreement is rapidly closing.

Among other reasons about which I have written previously, opponents of the TPP say it would harm our planet’s environment, subverting climate change measures and regulation of mining, land use, and biotechnology. The Pacific Rim is an area of great significance from an environmental perspective. It includes Australia’s Great Barrier Reef, the world’s largest coral reef system, home to more than 11,000 species. It includes Peru and its Amazon Rainforest—one of the most biologically diverse areas on Earth.

In May 2007, citizen-led advocacy groups including the Sierra Club forged a bipartisan consensus   that set the minimum standards for environment, labor and other provisions to be included in future trade agreements. According to sections of the TPP that have been leaked, it appears that these minimum standards are being ignored.

It is essential that the environment chapter of the TPP build on the environmental protection progress that has been made. “At a minimum, the environment chapter should be binding and subject to the same dispute settlement provisions as commercial chapters; ensure that countries uphold and strengthen their domestic environmental laws and policies and their obligations under agreed multilateral environmental agreements; and include biding provisions to address the core environment and conservation challenges of the Pacific Rim region, such as efforts to combat illegal trade in wood, wood products, and wildlife and to strengthen fisheries management.”

If you “Google” TPP and the environment, you come up with more than 20 pages of articles by one organization after another and one author after another expressing reasons why the TPP would harm the environment. The opposition to the TPP began as early as 2011 when the first drafts were leaked and intensified in 2012. These organizations include the Sierra Club, Public Citizen group (founded by Ralph Nader), the Citizens Trade Campaign, and Economy in Crisis, among many others.  A common thread of the articles is either a subtle or overt accusation that President Obama has “sold out” to Wall Street/big banks and multinational/transnational corporations.

On their website, Union-backed We Party Patriots states, “…the Trans-Pacific Partnership (TPP) is being put together in extreme secrecy. This secrecy comes complete with a total lack of mainstream media coverage despite serious potential long-term effects. Leaked documents show that the TPP will have a chilling effect on the ability of the United States government to take legal action against multi-national corporations for their abuses of environmental, agricultural, and labor laws.”

The Fair World Project’s website states that in late 2012, “a group of labor leaders, trade justice advocates, family farmers, environmentalists, food sovereignty groups and others from the U.S., Canada and Mexico created a ‘North American Unity Statement Opposing NAFTA Expansion through the Trans-Pacific Partnership (TPP),’ with the goal of uniting 1,000 organizations in opposition to the TPP.”

On March 7, 2013, Friends of the Earth announced that it had released a new video, “Peril in the Pacific: Trans Pacific trade agreement threatens people and the planet.” The video illustrates these threats by telling the story of “Chevron v. Ecuador” international investment suit brought under an existing U.S. treaty. The video raises questions like: “Who should pay to clean up what has been called the “Rainforest Chernobyl” in the Ecuadorian Amazon? Why are the people of the rainforest who suffered the most not represented at the international tribunal hearing the case? Is it U.S. policy to favor the financial interests of multi-national corporations over people and the environment in such disputes?”

The video also asks why the negotiating framework for the TPP favors Wall Street and multinational corporations at the expense of current U. S. environmental and climate policy and why does it  allow multinational corporations to challenge laws that protect our air, land and water.

Because the Asia-Pacific region accounts for about one third of all the threatened species in the world, Friends of the Earth is concerned that the TPP trade agreement potentially checkmates many of our country’s past environmental victories and would block new initiatives. The natural environment and rich biodiversity of the Pacific Rim are threatened by illegal and/or unsustainable commercial exploitation of the ocean, natural resources, and forests.

Friends of the Earth recommends that the TPP negotiators must address the following issues to avoid the most serious environmental harms by:

  • Including an environment chapter that would obligate countries to enforce domestic environmental protections and abide by global environmental agreements that are enforceable through international lawsuits.
  • Rejecting the proposed TPP investment chapter that would authorize foreign investors to bypass domestic courts and bring suit before special international tribunals biased in favor of multinationals to seek awards of unlimited monetary damages in compensation for the cost of complying with environmental and other public interest regulations.
  • Rejecting “provisions of the TPP intellectual property chapter that would provide international legal protections for corporate patents on plant and animal life, granting companies ownership and sole access to these building blocks of life.”
  • Rejecting the regulatory coherence chapter that could hamstring environmental regulation and “encourage cost-benefit analysis that exaggerates financial costs and minimizes the intrinsic value of protecting living things, wild places, and the stability of the ecosystem.”

Friends of the Earth urges that the TPP “must serve to strengthen environmental protection and support the biodiversity in the Pacific Rim and not facilitate a race to the bottom in environmental deregulation.”

What surprises me is that all of the above organizations supported President Obama in his bid for re-election last year despite the fact that he had gone back on his pledge “to oppose Bush-style free trade agreements that lead to thousands of lost American jobs”  and his word to ”not support NAFTA-type trade agreements” in his 2008 campaign. Now that he is elected for his second and last term, what incentive does he have to listen to the opinions of these organizations that oppose the Trans-Pacific Partnership agreement? None!

A few conservative news outlets such as WorldNet Daily began to recognize the dangers of the TPP early this year, beginning with the article, “Obama skirting Congress in globalist plan?” in which Jerome Corsi warn that “the administration apparently plans to restrict congressional prerogatives to an up-or-down vote” utilizing the  “fast-track authority,” a provision under the Trade Promotion Authority that requires Congress to review a FTA under limited debate, in an accelerated time frame subject to a yes-or-no vote. Under fast-track authority, there is no provision for Congress to modify the agreement by submitting amendments to ensure foreign partners that the FTA, once signed, will not be changed during the legislative process.

In a more recent article, “Obama’s 2-ocean globalist plan,” Jerome Corsi writes, “Quietly, the Obama administration is systematically putting into place a two-ocean globalist plan that will dwarf all prior trade agreements, including NAFTA, with the goal of establishing the global sovereignty envisioned by New World Order enthusiasts. The two agreements are the Trans-Pacific Partnership, or TPP, and the Transatlantic Trade and Investment Partnership, or TIPP. WND has learned the Obama administration plans to jam the TPP through Congress no later than Dec. 31.”

We certainly cannot expect to influence the President to oppose the TPP near the end of three-years of negotiations that took place under his direction. With the virtual black out  of coverage about the TPP in the mainstream media, the best we can do is make our opinions heard loud and clear to our Senators and Congressional representatives and urge our family, friends, and  members of our personal and business network to do the same. We must urge our elected representatives to vote against granting President Obama “fast track authority” under the Trade Promotion Authority. There is no time to waste. Contact your congressional representative and tell them we cannot afford another damaging “free trade” agreement that would destroy our national sovereignty, hurt American manufacturers, and harm our environment. Tell them to vote “no” to granting the President “fast track authority.”

 

 

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