Trans-Pacific Partnership: A Race to the Bottom


The United States seems to possess the unique ability to hurt its own economy. We have passed numerous detrimental trade agreements in recent decades because we have not learned from the mistakes of past agreements. Politicians have railed against NAFTA in their campaigns, but once they take office they do not act on their campaign promises. Instead, they pass more free trade agreements. The Trans-Pacific Partnership (TPP) is next on their radar, and if passed it will accelerate America’s economic race to the bottom.

The Trans-Pacific Partnership is modeled after NAFTA and the more recent South Korea – U.S. free trade agreement (KORUS). Both of these agreements are job-killers for the United States. NAFTA has cost us nearly 700,000 jobs; KORUS is expected to cost us 158,000 more. NAFTA is clearly the more damaging of the two, but its negative effects may seem small compared to the damage the TPP could do. Free trade has allowed companies to seek out the lowest standards in wages and regulatory conditions, and the TPP would give these companies even more low-wage, low-regulation countries to do business in. Americans will either have to lose their jobs, or be willing to work in horrendous conditions for little pay.

One of the countries included in the TPP is Vietnam.  According to the U.S. State Department, the per capita income in Vietnam was only $1,068 in 2010. This compares with a per capita income of $40,584 for the United States in the same year. This massive differential shows the skewed nature of the agreement. Of course companies are going to choose to manufacture items in a country where they can pay pennies on the dollar for labor. America as we know it would not exist if workers labored for those kind of wages, but if the TPP is passed companies will have a choice between hiring a worker in the United States, or hiring a much cheaper worker in Vietnam. America will lose this battle in all but the strangest of situations.

The United States does not have to go down this path. Our politicians are leading us into a horrendous economic situation that is avoidable. Lobbyists are pushing for this new agreement, but if our politicians focused on the voters who elected them rather than the lobbyists that donate to them, we would stop negotiations on this new agreement immediately.

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