The Building Tradesman Newspaper

Friday, July 10, 2015

A New Trade Vision is Sorely Needed

By The Building Tradesman

By Leo Gerard

President, United Steel Workers

Editor's note: The U.S. House on June 25 gave final Congressional approval to the so-called Trade Promotion Bill, granting President Obama enhanced power to negotiate major trade agreements with Asia and Europe.

In a close vote last week, a majority in the U.S. House chose to continue glomming onto the same tired old broken-down trade tactics that have closed American factories, cost American jobs and caused massive trade deficits.

The majority voted to sustain for the next six years trade policies that failed American workers for the past 20. The majority abdicated Congress’ constitutional responsibility to supervise international trade.

Instead, they agreed to allow presidential administrations to once again negotiate trade deals in secret, then whip those corporate-appeasing, clandestine schemes through the congressional approval process with absolutely no amendments, no changes, no improvements.

That’s the “fast-track” process under which Congress has averted its eyes and approved one job-killing, deficit-ballooning trade deal after another, starting with the North American Free Trade Agreement (NAFTA) in 1994.

The result of that indolent, duty-shirking process since then has been 57,000 shuttered American factories and 5 million lost jobs. Now, instead of conceding failure and forging a new path on trade, the House cleared the way to destroy more American manufacturing and family-supporting jobs.

These backward-facing lawmakers would benefit from stepping out of lobbyist-infested D.C. and speaking to small town manufacturing workers who lost their livelihoods because fast-tracked free trade schemes encouraged corporations to off-shore factories.

Maybe these pro-trade deficit politicians should listen to American steel and paper and tire workers describe what happened to them and their families and their communities when fast-tracked trade schemes pitted them against child workers and forced laborers in foreign factories.

Maybe those politicians should hear formerly middle-class workers tell of unenforced provisions in Fast-tracked free trade schemes that enable foreign manufacturers that violate international trade regulations to steal market share from American businesses.

They should, for example, pay attention to Kori Sherwood. When she got a job two years ago as a millwright at U.S. Steel’s Minntac facility in the Minnesota Iron Range, it changed her life and that of her young daughter.

But in March, U.S. Steel sent layoff notices to 680 of Minntac’s 1,500 workers, citing an international glut of steel. Prices are at a 12-year low as mills in China continue to produce and ship massive amounts of steel and sell it at below market prices made possible by improper government subsidies and support.

Under international trade law, countries can prop up industry with government subsidies when the products are sold internally. Beijing may give its steel industry no-interest loans and free electricity when the rebar or pipe or I-beams are sold for construction projects in China.

But international trade law forbids such subsidies when the goods are sold internationally because government aid suppresses product prices in what is supposed to be a free market. Some countries, however, routinely flout the rules. Then American companies that don’t get no-interest government loans or free electricity or other subsidies can’t compete on price.

They shut down mills and lay off workers. Unions and manufacturers are forced to pay millions to petition for import duties on the subsidized foreign goods to level the playing field. To win such a case, industry must prove financial injury and workers must suffer layoffs and lost income.

My union, the United Steelworkers (USW), has repeatedly petitioned for trade law enforcement. In too many cases, however, decisions arrive so late that factories are permanently closed and workers seriously scathed.

Communities suffer as well. In March 2014, International Paper permanently shuttered its 43-year-old uncoated paper mill in tiny Courtland, Ala. It was the area’s largest employer. More than 1,100 workers lost their jobs. Suddenly gone was an annual payroll of $86 million and $2.3 million in tax payments that the town, county and schools depended on every year.

Four of the uncoated paper mills applied for Trade Adjustment Assistance, a federal program that retrains workers if it can be proved that they were sacked because of international trade. All four qualified. That helped. But it did not restore good, family-supporting union manufacturing jobs.

American workers and American manufacturers don’t oppose trade. They can compete on a level playing field with anyone in the world. But the current trade regime, swept in without serious analysis on the back of fast-track authority, has failed to provide a level playing field. America needs a new vision for trade. And to achieve that, lawmakers must slow track proposed trade deals.