James T. Brett: New England needs approval of new NAFTA
BOSTON
While the U.S. economy continues to show steady signs of growth, there is considerable concern in the business community about current U.S. trade policies and their potential to stunt that growth. And rightly so – with 95% of the world’s consumers located outside of the U.S., it is critical that we have policies in place to promote international trade and expand access to foreign markets for American businesses.
Fortunately, our leaders in Congress have the opportunity to take an important step to bolster U.S. exports and drive continued economic growth by approving the new U.S.-Mexico-Canada Agreement (USMCA), which was signed earlier this year. Approval of this agreement is of particular consequence here in New England, where two of our region’s top trade partners are our neighbors to the north and south.
The USMCA makes critical updates to modernize the previous trade pact between our three nations – the North American Free Trade Agreement, or NAFTA.
NAFTA, which was approved and has been in place since 1994, was written before many of the digital technologies that drive our 21st century global economy, such as cloud computing and online commerce, even existed. The USMCA includes important provisions to address such topics as cross-border data flow and data localization, and takes key steps to protect U.S. intellectual property.
The importance of trade with Canada and Mexico to the New England economy cannot be overstated. Canada is a top-three trade partner for all six New England states, and Mexico is in the top 10 for five of the six states in the region.
Exports from the six New England states to Canada and Mexico totaled nearly $13 billion in 2018 alone. That includes $420 million in exports from New Hampshire alone. Some of the top exports from the Granite State include computer and electronic products, machinery and transportation equipment.
At the same time, trade with our North American neighbors supported over 600,000 jobs in New England in 2017, including nearly 55,000 jobs in New Hampshire.
Some members of Congress have expressed reservations about the USMCA, particularly on such issues as labor and environmental protections, patent exclusivity for certain medicines and enforcement mechanisms.
While the business community appreciates these concerns, walking away from the USMCA because of them would be, simply put, disastrous.
Fortunately, House Speaker Nancy Pelosi has taken the initiative to establish a working group to negotiate with Ambassador Robert Lighthizer, the U.S. trade representative, to address these concerns. Several New Englanders – House Ways & Means Committee Chairman Richard Neal of Massachusetts as well as Connecticut Representatives Rosa DeLauro and John Larson – have been named to this nine-member group, so our region’s interests are certainly well-represented, and we are confident that the working group will reach a satisfactory resolution.
In our 21st Century global economy, access to foreign markets is vital to the success of American businesses. It is imperative, therefore, that the U.S. continue to maintain and expand trade relationship with key partners around the globe, and in particular, with our immediate neighbors here in North America. The New England Council is hopeful that Congress will consider the impact trade with Canada and Mexico on our nation’s economic well-being, and will take swift action to approve this important trade deal.
James T. Brett is the president and CEO of The New England Council, a non-partisan alliance of businesses and organizations.
Ben Lilliston: Trump's trade fights expose fragility of the farm sector
From ecoRI News (ecori.org)
Over the last year, President Trump has taken farmers on a roller coaster ride that’s finally gone off the rails.
Escalating trade fights have kicked farmers, already mired in a five-year slump, in the gut. Now, the administration is working up a new trade aid package, while simultaneously opposing aid for farmers recovering from recent Midwest flooding.
What’s going on? If there’s a plan, it’s hard to see from here.
Just in the last few weeks, Trump tweeted a dramatic escalation in new tariffs on China, which immediately announced an escalation of tariffs on U.S. goods, including agriculture products.
A week later, without notice or explanation, Trump ended steel tariffs (based on dubious national security concerns) on close trading partners Mexico and Canada. Yet the same day, Trump signed an executive order threatening new auto tariffs on Japan and the European Union.
If the auto tariffs move forward, Japan and the E.U. will almost certainly retaliate with tariffs on, you guessed it, agricultural products.
In a hasty attempt to put a Band-Aid on these self-inflicted wounds, the Trump administration is proposing another round of trade aid for farmers. The new round comes after promising that a $12 billion trade aid package last year would be a one-time thing, because a China trade deal was just around the corner.
But, surprise surprise, it wasn’t. So the administration backtracked and recently unveiled another $16 billion aid package for farmers hurt by its policies.
The first aid package doesn’t appear to have focused on the mid- and small-sized farm operations that needed it most. The Financial Times found that half of the trade aid money went to just 10 percent of farmers, who used loopholes to elude payment caps.
Moreover, nearly 10,000 people and businesses based in cities — rather than the countryside, where you expect to find farms — accessed the aid. And it was multinational agribusiness firms like Tyson Foods, Cargill, and the Brazilian-owned JBS that benefited when the USDA made large purchases of pork, chicken, and beef.
Trump’s trade disruptions come amid much larger challenges in the agriculture economy. Rising farm bankruptcies, the loss of thousands of mid- and small-size dairies, farm lenders getting tighter with loans, and plummeting land values are all part of the current crisis.
And when it rains, it pours. A series of extreme, climate-related weather events — severe Midwest floods this year, wildfires and hurricanes last year — also hit farmers. Yet the Trump administration has opposed allowing farmers to access disaster aid from these events.
The drivers of our slumping farm economy are longstanding and structural.
We’re flooding the market — too much corn, soy, wheat, and milk. Meanwhile the government has approved a steady series of agribusiness mergers, leading to less competition and fewer choices for farmers.
Federal Farm Bill programs support this system, which precariously relies on expanding trade. If we don’t grow exports, the system collapses — at least for family farmers. It works just fine for the global agribusiness firms that operate in multiple countries and benefit from below-cost corn and soy.
Trump’s dizzying trade disruptions are inflicting real short-term damage, but they’re also exposing the frailty of an agriculture economy built for big business. Instead, we should be looking for ways to reduce overproduction, lift prices to fair levels that keep farmers on the land, and invest public money in climate resilient strategies on the farm.
A different farm economy is possible, but we must come to terms with past mistakes that created this roller coaster.
Ben Lilliston is a senior policy analyst for the Minnesota-based Institute for Agriculture and Trade Policy.
Chuck Collins: Learn a trade!
From OtherWords.org
BOSTON
In the classic 1960s movie The Graduate, a family friend offers the recent college graduate, the the character played by Dustin Hoffman, one word of advice in choosing a career: “plastics.”
My advice for today’s high school graduates: “Learn a trade.”
Unfortunately, there’s a historic stigma about “voc-ed,” the result of snobbery toward certain occupations.
Yes, there’s also the shameful practice of tracking low-income whites and people of color into blue-collar jobs while encouraging wealthier white students to attend college. But now there are millions of rewarding, high-paying trade jobs sitting empty.
Instead of training for those, tens of millions of high school graduates are on college autopilot, loading up an average of $37,000 in debt, and graduating without any practical skills.
Not only is our economy suffering for lack of skilled workers, but also a huge number of workers are unhappy and earning below their financial potential.
There are legions of depressed Dilberts out there in cubicle land, sitting in front of computer screens, wondering who will be laid off next. And there are millions of young people sitting in college classrooms dreaming of being somewhere else.
Put these same people in an apprenticeship with a skilled adult and they’ll thrive. Instead of wasting their intelligence in an office, they could deploy it in a bicycle or auto repair garage, woodworking shop, or on a farm or construction site.
Princeton economist Alan Blinder says the job market of the future won’t be divided between people with college degrees and those without, but between work that can be outsourced and work that can’t. “You can’t hammer a nail over the Internet,” he observed. “Nor can you fix a car transmission, rewire a house, install solar panels, or give a patient an injection.”
The value of a liberal arts college education is exposure to a wide range of ideas and knowledge, along with social networks. But college is certainly not the only path to such learning. And four-year residential college today has more in common with a party on a luxury cruise ship than a platform for learning a vocation.
True, today the lifelong earnings of college graduates exceed those who don’t attend college. But there’s no evidence this will be the case going forward. Have you paid an electrician or a plumber anytime lately? There’s a reason they’re hard to find and can command a high wage. It’s called scarcity.
Millions more “green collar” jobs are emerging in our transition to the renewable energy economy. And at some point, our nation will have to repair our aging bridges, roads, and transportation facilities and retrofit buildings to be more energy efficient.
According to the Bureau of Labor Statistics, one third of all new jobs through 2022 will be in construction, health care, and personal care. The fastest growing occupations are solar and wind energy technicians, followed by plumbers, machine tool programmers, HVAC mechanics, and iron and steel workers.
Changing attitudes about different occupations is part of the challenge.
Parents and guidance counselors can start by respectfully talking about the opportunities in trades. They can introduce students to people with satisfying careers in the trades and steer them to useful web resources on the path to trades.
Congress could help by making Pell grants available for short-term job training courses, not just college tuition. It could also restore funding for Tech-Prep, a neglected federal program that supports vocational education.
Let’s dump the old class-biased stereotypes. It takes all kinds of intelligence and advanced training to do a trade. And it can be financially rewarding and enormously satisfying.
Chuck Collins directs the Program on Inequality and the Common Good at the Institute for Policy Studies.