The following is an excerpt from The Huffington Post.

Bio: Chairman
U.S. Economy/
Smart
Globalization
Initiative
at the
New America
Foundation

With every good intention and with one of the most precise ‘promise-full’ agendas in the history of American electoral politics, Barack Obama sailed his new ship of state into the White House in January 2009. And then the “gang who couldn’t (or didn’t want to) steer the ship straight” almost immediately ran his jobs and trade promises aground.

His key economic advisors – Larry Summers, Tim Geithner, Cristina Romer and Rahm Emanuel – must have, in this order, told the new President something like the following, for how else to explain the fact that over the succeeding eighteen months the defining commitments he made during his campaign were either abandoned or largely went for naught:

1) “Pass the economic stimulus package we’ve designed, Mr. President, and the official unemployment rate won’t get any higher than 8.5%. And because every earlier administration since 1947 did so, we’re also going to keep ignoring the real unemployment figure even though for the first time since then there are as many uncounted unemployed Americans (15 million) as there are counted ones (15 million).”

2) “We know you emphatically promised workers that EFCA would be one of the first things your new administration would tackle, but we’re not going to do so. It isn’t as if the Republicans in Congress are going to take up this mantle.”

3) “Larry is giving a speech today [June 19, 2009] to the Foresight Symposium which is going to largely define our job creation efforts on your behalf during your first term. He plans to say that essentially a job is a job and that America’s loss of manufacturing exports and jobs can be made up with exports of ‘software, movies, medicine, university degrees, and management consulting and law firm services’, which of course defies reality and contradicts every speech you gave during the Campaign in proud towns like Dayton and Flint.

4) “Even though the issue of America having an industrial policy and trade policies that mirror the mercantilist practices of our major trading partners came up repeatedly during your campaign, we want you instead to repeatedly say that the combination of green energy technologies, exported services, and new free trade agreements or FTAs will sufficiently revitalize the American economy.”

5) “Despite your even more explicit promise about immediate and complete reform of our trading with China, we want you to effectively ignore China’s massive illegal subsidies and its abusive labor and environmental practices. Instead, let’s wait 18 months, all the way until June 2010, and then get China to commit only to a meager 5% or so annual revaluation of the yuan and to nothing else. Of course, since the yuan is about 40% undervalued right now, it will take until 2018 for even this commitment to get the yuan to where it should be today.”

6) “We know you promised workers that you would immediately end the massive ‘tax breaks for companies that ship jobs overseas and give them to companies that create good paying jobs here in America’. However, the multinational corporation members of the Business Roundtable, Business Council and U.S. Chamber of Commerce really hate this idea, so we’ve decided to heed their objections instead.”

7) “Even though you specifically said that ‘one size doesn’t fit all’ when it comes to FTAs and that the three Bush-era FTAs pending with Korea, Panama and Columbia are the bad spawn of the much-discredited NAFTA agreement, we’re going to adopt them anyway, with very few changes.”

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If Obama’s “gang” didn’t say and do these things, then how else to explain the President’s obviously well-intentioned but disheartening speech last Wednesday announcing his Export Council. In this speech he again asserted that doubling U.S. gross exports within five years and making a few extremely undersized investments “in upgrading our critical infrastructure from high-speed rail to high-speed internet” are sufficiently addressing the massive 22-million “jobs gap” we need to fill today in order for our workforce to be fully employed in real terms.

Yet in the President’s own words, doubling gross exports will create at most 2 million jobs over five years. And as the United States Business and Industry Council (USBIC) has repeatedly identified, merely increasing U.S. gross exports will accomplish no economic good per se. Growth and employment can only result from increasing U.S. net exports, which the recent rise of America’s trade deficit shows is not happening.

In his speech, the President also obviously ignored his prior words when he said that the “pending Korean Free Trade Agreement [is] an agreement that will create new jobs and opportunity for people in both our countries”, while implying the same thing about the Panama and Colombia FTAs, all of which is untrue. And after completely ignoring China’s myriad trade abuses, except for giving it the slightest slap on the hand for its 40% currency manipulation which Secretary Geithner just declared to be a “significant development”, how could he then at the end of the speech laud China for “reopen[ing] their market to American pork and pork products”?

Have any of you ever seen the ecological disasters called ‘hog farms’, which we now get to robustly expand in our country while China, in its, gets to manufacture high-value Apple iPads and export them to the U.S?

Only net exports on the one hand and very large-scale imports substitution on the other matter, because only large-scale imports substitution can create millions of new jobs. The only goal now must be massive job creation of the sort that sustains economic prosperity, for which an exports strategy is but a single tool. And with China alone responsible for 75% of America’s trade deficit in manufactured goods, the solution is absolutely not going to be found in our exporting more pork rinds to Beijing.

We’re in the midst of a protracted jobless recovery, Mr. President, and we’re facing an unprecedented “jobs gap” and the high likelihood of a what’s called a “low growth/high unemployment trap”. It’s past time for you to declare a full-scale jobs emergency and to demand that Congress get on board.

And with respect, it’s time for you to go back to the July 2008 version of your Jobs & Trade Manifesto and abandon this half-hearted July 2010 version which your advisors foisted on you.

Click here to read the article in its entirety.

Leo Hindery, Jr. is Chairman of the US Economy/Smart Globalization Initiative at the New America Foundation and a member of the Council on Foreign Relations. Currently an investor in media companies, he is the former CEO of Tele-Communications, Inc. (TCI), Liberty Media and their successor AT&T Broadband. He also serves on the Board of the Huffington Post Investigative Fund.

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