February 25: Address the Trade Deficit
We all believe in free trade so long as it is fair trade,and I believe most of all in free trade among free people. Our Nationboasts the most open markets in the world, but one must recognize thatAmerica hasn't had a balanced trade account since 1975, yes, 1975.
That's 34 years of regression on the jobs and trade front,34 years of wandering in the wilderness, 34 years of deluges of importsdwarfing our exports, 34 years of outsourcing our good jobs by themillions. Thousands of America's best companies have been sacrificed,Maytag, Trico, Playtex, Levis, Zenith, Georgia-Pacific, Champion SparkPlug. The list is endless.
Now we are watching major segments of our banking systemdisintegrate while we buy foreign televisions, foreign clothing,foreign automobiles, foreign food, all while our beautiful Nation begsChina, undemocratic China, for money.
It's pretty clear we need to focus on our trade deficits asa causal factor in our other deficits. The human and economic tragediescontinue to mount. The massive hemorrhage of U.S. wealth instructs usin its raw truth. So-called free trade agreements began in 1975. Backthen we had a surplus of $12.4 billion in goods with the world. We havenow sunk in 2008 to $677 billion in trade deficit, three-quarters of atrillion dollars, and all the lost jobs that go with it just disappear.
The evidence is all around us. Americans are working hardereach year, increasing their productivity but then seeing no increasedwages. More lost purchasing power, the dollar isn't worth as much.Their health and pension benefits, disappearing. This is not a recipefor a healthy economy, a strong nation or a middle class.
The challenge is trade is not a zero sum game. Othernations don't play by the same rules. Other nations manage theirmarkets. Other nations manipulate their currency. Other nations aren'tdemocratic and they have no rule of law.
Let's look at the raw facts, as ignoring our trade deficitswon't help our Nation crawl out of our deep economic hole. Let's stopdigging and start crawling out.
When you focus over a quarter of a century on moreoutsourcing of jobs and importing goods than on exporting goods andcreating jobs here, our country ends up indebted and we are indebted toChina, indebted to Mexico, indebted to Japan and all the othercreditors who will be knocking on our grandchildren's doors.
When you conduct two wars and don't pay for them, you makeit even worse. But not to recognize those two deficits, the tradedeficit as well as the budget deficit, is to live in a world ofdelusion.
In 2008, our largest trade deficit was in oil withcountries in the Middle East, and the bottom line is that that tradeadvantages them, not us.
If you look at overall trade between the United States,Canada and Mexico, that's governed by NAFTA, the North American FreeTrade Agreement. We are now at record imports from both countries, notexports, record imports, $74.2 billion in the red with Canada last yearand $63.5 billion in the red with Mexico.
The same is true with Communist China, where we are in a$266 billion deficit, a record high. Japan is no different, $72.6billion there.
The top trade gap we continue to face is imported oil.Overall, the U.S. imported 3.6 billion barrels of crude oil in 2008worth $342 billion, our chief strategic vul ner a bil ity.
Unemployment continues to rise nationally, over 7.2percent, and in districts like mine and many counties over 12.5percent. Dr. Peter Morici of the University of Maryland has written,``Lost growth is cumulative. Thanks to the record trade deficitsaccumulated over the last 10 years, the U.S. economy is about $1.5trillion smaller. This comes out to about $10,000 per worker,'' andevery American middle class family feels it.
How are we going to change this, Mr. President? Americaneeds balanced trade accounts, not delusion. We need open markets, notclosed markets. We need a rule of law, not undemocratic practices. Weneed realism, not delusion.