Search publications by Robert E. Scott
The small increase in the overall goods and services trade deficit, and its downward trend over the past decade, mask important structural shifts in U.S. trade.
The United States has a massive trade deficit with China. It has grown since the end of the Great Recession. The growth of that deficit almost entirely explains the failure of manufacturing employment to fully recover along with the rest of the economy.
Last week, President-elect Donald Trump took to Twitter to claim that Masayoshi Son, CEO of SoftBank of Japan, had agreed to invest $50 billion in the United States toward businesses and create 50,000 new jobs, and that “Masa said he would never do this had [Trump] not won the election!” As usual, the claim that Trump negotiated this deal is disputed, since SoftBank had announced plans to create a $100 billion technology investment fund, together with a public investment fund of Saudi Arabia, in October, before the election.
President Obama has built his closing case for the Trans-Pacific Partnership on a political argument, saying “…we can’t let countries like China write the rules of the global economy.
The White House is making one last push for passage of the Trans-Pacific Partnership agreement. However, growing imports of goods from low-wage, less-developed countries, which nearly tripled from 2.9 percent of GDP in 1989 to 8.4 percent in 2011, reduced the wages of the typical non-college educated worker in 2011 by “5.5 percent, or by roughly $1,800—for a full-time, full year worker earning the average wage for workers without a four-year college degree,” as shown by my colleague Josh Bivens.
The single largest cause of the growing manufacturing trade deficit is malign neglect of currency manipulation over the past 20 years by the U.S. government.
Given the modestly of net benefits and the large, regressive redistribution of income created by growing trade flows, it is puzzling why TPP is such a priority for the Obama administration—especially when it, like trade agreements before, is quite likely to do disproportionate harm to the people who make up his and his party’s political base.
In a story in the Wall Street Journal last Friday, reporter Eric Morath notes that the recovery from the Great Recession has been historically slow.
Donald Trump’s hubristic pledge to save American workers and manufacturing by negotiating “great trade deals” and imposing tariffs on Chinese imports will fail. Here’s what will work.
Brexit is a moment of crisis for the global economy, one which demands a fundamental re-examination of our core values. It is time to develop alternatives to the current model of globalization, which benefits only those who are most well-off in our society.
Yesterday, the U.S. International Trade Commission (ITC) released a long-awaited report on the projected economic impacts of the TPP agreement. The report is remarkable for its frank estimates of the costs of the agreement, and the minimal benefits it identifies.
When the U.S.-Korea Free Trade Agreement (KORUS) was passed just over four years ago, President Obama said that the agreement would support 70,000 U.S. jobs. Things are not turning out as predicted.
Almost two-thirds of people in the labor force (65.1 percent) do not have a college degree. In fact, non-college educated people make up the majority of the labor force in every state but the District of Columbia.
The failure to include provisions to stop currency manipulation alone casts the Trans-Pacific Partnership as a fatally flawed trade and investment deal. U.S. trade deficits with the 11 other members of the proposed agreement eliminated 2 million U.S. jobs in 2015, and reduced U.S. GDP by nearly $300 billion (1.6 percent).
The economy has added nearly 5 million jobs in the private sector since the Great Recession began in December 2007, but construction and manufacturing—two key sectors that provide good jobs and high wages, particularly for workers without 4-year college degrees—continue to lag behind the recovery.
Most U.S. goods trade consists of manufactured products. In 2015, manufacturing constituted 86.9 percent of total U.S. goods trade, and 94.3 percent of total trade in non-oil goods. Because manufacturing is such a large employer, rapidly growing trade deficits in non-oil goods are a threat to future employment in this sector.
The Trans-Pacific Partnership will likely result in growing trade deficits, trade-related job losses, and downward pressure on wages of the majority of U.S. workers.
U.S.-based Wal-Mart is a key conduit of Chinese imports into the American market, and its trade deficit with China eliminated or displaced over 400,000 U.S. jobs between 2001 and 2013.
If high wages hurt manufacturing competitiveness, Germany's manufacturing sector would be doing worse than the United States.
The strategy of pushing manufacturing into low-wage, nonunion states is a race-to-the-bottom strategy that should be rejected in favor of high-road strategies: fighting currency manipulation and doing more to rebuild American manufacturing.
Century Buy American Act is smart manufacturing policy and a good first step towards rebuilding American manufacturing.
U.S. jobs and the recovery are threatened by a growing trade deficit in manufactured products, which is on pace to reach $633.9 billion in 2015.
Statement from EPI Director of Trade and Manufacturing Policy Research Robert E. Scott on the announcement that the United States and other countries reached an agreement on the Trans-Pacific Partnership (TPP).
An EU decision to grant MES to China would put between 1.7 million and 3.5 million EU jobs at risk by allowing Chinese companies to flood the EU with cheap goods.
Congress should take advantage of the groundswell of bipartisan concern about the negative impacts of the devaluation of the yuan to pass new laws and resolutions.
By choosing to devalue its currency, Chinese officials are trying to solve their domestic economic problems by exporting unemployment to the rest of the world. The United States will be hardest hit by the devaluation of the yuan.
The United States lost 5 million manufacturing jobs between January 2000 and December 2014 due to growing trade deficits in manufacturing products prior to the Great Recession and then the massive output collapse during the Great Recession.
Fast-track trade legislation is the first step in the process of greasing the skids for the proposed Trans-Pacific Partnership (TPP), and any other trade deal proposed by this president or any other for the next six years. Last month, the 13 democrats listed in the table below voted to end debate on fast track (Trade Promotion Authority, or TPA), allowing a final vote to take pace. There are strong arguments against the TPP, which will increase inequality and hurt the middle class.
In a jointly authored statement, former EPI board members and U.S. Labor Secretaries F. Ray Marshall and Robert Reich called on Congress to reject Trade Promotion Authority and the Trans-Pacific Partnership because that deal will “harm America’s working people.” Despite this statement, the House today approved a truncated version of Fast Track (TPA) that excludes funding for Trade Adjustment Assistance for displaced workers.
The House is expected to vote this week on fast track authority to negotiate two massive trade deals, including the proposed Trans-Pacific Partnership (TPP) and the Transatlantic Trade and Investment Partnership (T-TIP).