Darkness at the End of the Tunnel

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We are being controlled and directed – told what to do – by other nations, for their benefit and to our detriment. Our direction in so-called “free trade” is not just hurting us – it is destroying us. One look at our condition and direction will clearly show we are in a mode of self destruction. When will we wake up to the realization that some of the agreements we have signed, most specifically NAFTA, KORUS and our agreement with the WTO, are preventing us from doing what is in our best interest? 

Every year the U.S. spends $1 trillion on the military, stretched too thin all across the globe, yet we have no one protecting us at home economically. Despite all our fire power, we absolutely cannot determine our own fate as members of the WTO. We are now guided economically by the agreements we signed.  We must, must, must be our own masters. We must be able to run our own country for our own benefit, which we, attributable to our agreements with the WTO and NAFTA, are not allowed to do.

We must not let other nations act with predatory intent, which prevents us from competing on a global scale. Our “free trade” agreements are only giving our competitors the freedom to deliver their goods to our country with prices deliberately devalued to predatorily put our companies out of business. This has made us jobless – a servant economy reliant on foreign debt and foreign products.

Other countries absolutely do not allow our companies to move products into their nations as freely. They do not want our products harming their companies in any way. Rather, they allow our companies to move our production and manufacturing to their shores, giving them the manufacturing and production they need for a strong and vibrant economy – like the one we formerly had.

With their new wealth, these foreign businesses and nations buy powerful, and now well financed, lobbyists. These lobbyists benefit the interests of an elite few – those that pay them – to the detriment of our country as a whole.

Now, thanks to our downward spiral:

Banks won’t lend money to any company if that company can’t produce a product in the U.S. as inexpensively as they can in China – no one can and almost no company is.

States fight each other to the benefit of foreign companies. We give foreign-owned companies subsidies to insource their production in the United States. These foreign owned factories provide very few American jobs in relation to their output since nothing is produced in these factories – they are merely assembly facilities that put together imported foreign parts whose total cost winds up being much less to produce. We are shooting our own American-owned auto facilities in the foot for a few menial jobs in foreign-owned car plants. American subsidies give foreign car companies an even greater advantage against our few remaining companies – i.e. The plant in Indiana that provided a mere 2,000 jobs, but will put out 200,000 cars a year.

Thanks to NAFTA many of our other trading partners have relocated facilities to Mexico to circumvent other trade agreements with the U.S.

Illegal immigrants in the U.S. have increased to 12 million today from 3.9 million in 1993, accounting for an overall increase of over 300%.

Thanks to the WTO, since 1993 we have lost jobs, 561,000 in computer and electronic products, 153,000 in apparel and accessories, 139,000 in administrative support services and 128,000 in professional, scientific and technical services just to name a few. (Numbers current as of 2008)

We give China free reign to enter our county to sell its products to us as cheaply as they want until we can’t compete in our own country due to Chinese mercantilism.

The U.S-China trade deficit is exploding, more job losses are forecast every year.

American manufacturing has lost over 3 million jobs in the past 10 years as U.S. companies have also moved to Mexico, China and other foreign countries for lower wages and lax regulations.

300,000 American family farms have been put out of business. Overall, net farm incomes are down 13%.

Attributable to KORUS, trade, banking and finance are now under foreign control. Any law Korea sees as limiting a corporation’s profitability can be challenged. Even prevailing wage laws can be challenged.

We Can and Must Get Out Of the WTO

Amending the agreement with the WTO requires submitting a proposal to the Ministerial Conference. Once the amendment has been accepted, it should only take 90 days to render a consensus. If the United States opts to withdraw, the president would only be required to send a letter to the Congress and the Director General of the WTO and we would be free of any obligations to the WTO in six months. Until then, per Article VI of the United States Constitution, our agreement with the World Trade Organization “shall be the Supreme Law of the Land; and the Judges in every State shall be bound thereby.” Likewise, withdrawing from NAFTA would only require a letter from the president to Congress letting them know we would be out in 90 days.

It is time we started negotiating new trade deals with these foreign nations, ones that will benefit American workers and American employers. We need new deals that will make it profitable to manufacture and produce in the United Sates again. If we do not, our nation may never recover from the damage we are doing to ourselves.

During the 1990’s, the People’s Republic of China was searching for a way to achieve economic and global stability. Chinese leadership was reform-minded, making efforts to increase annual GDP and rescue Chinese peasants from poverty. Favor would come their way in 2001, when former U.S. trade representative Charlene Barshefsky led the delegation that negotiated China’s entry into the World Trade Organization (WTO). After ten years and a change in leadership, China has evolved into an economic superpower that often plays by its own set of rules. Meanwhile, the United States is feeling the ill effects of China’s entry into the WTO — and lamenting the previous decision to endorse it.

China did tear down its protectionist walls, opening up its markets in preparation for WTO membership, but those practices changed abruptly in the years following. Foreign imports have been met with strict regulations, often so vague in nature that they are impossible to penetrate. WTO deadlines to open up Chinese markets have been blatantly ignored. Private intellectual and technological property has been copied, then remade cheaply by Chinese industries. And most famously, China has prevented their currency from increasing its value, giving them an unfair edge in the global trade market.

These customs have simultaneously bolstered the economy of China and ravaged that of the United States. The saturation of cheaply produced Chinese goods in the U.S. market has taken a massive toll on American manufacturing: since China’s admission to the WTO, the amount of factory jobs in the U.S. has decreased by 25%, and the wages for existing jobs have defied inflation by not rising at all. The United States’ trade deficit with China has rocketed to $318 billion in 2013 — four times more than with any other single nation. America does 72% of its trade with China!

Meanwhile, penetrating the massive Chinese market has been burdensome and often downright infeasible. Many major U.S. companies have spoken out on the challenges the Chinese government has created to protect their economy. These practices have made it next to impossible for non-Chinese companies to succeed there, in spite of WTO sanctions. Whereas China was once headed toward the realm of market capitalism employed by the U.S., they have shifted to a rigid form of state mercantilism.

This means the interest of the Chinese government to protect its businesses is substantial. Nearly every Chinese company is state-owned, including the three that made the top 10 in the Fortune 500 list. In fact, the amount of Fortune 500 companies owned by China has nearly quadrupled to 61 since 2005. The U.S. has seen a steep drop on the list since then, falling from 176 to 133 companies. On the business end of things, China and the U.S. are clearly headed in opposite directions over the last decade.

Government officials say they had no way of predicting China’s massive shift in economic policy after inviting them to join the WTO. And it’s likely that former Trade Representative Barshefsky truly believed she was advocating a move that would ultimately benefit both countries. But after a ten-year losing battle against a country that refuses to play fair, it’s clear that trade with China can do no good for the United States. Their protectionist barriers, currency manipulating practices, unfair subsidies and overflow of cheap exported goods make them seem like a just target for WTO expulsion. But this is not viable.

A far more prudent course of action for the United States is to end our own membership in the WTO. This could rescue the American market from the scourge of Chinese practices, as well as any other iniquitous competition. There is no way to control how China runs its market, but we have a responsibility to manage how we control ours — and the previous decade is more than enough proof that trade relations with China cannot remain on this course.

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