Another Fight Over Trade and Jobs
The latest fight between the Democrats and Republicans is centered around jobs and trade. The pigskin both sides are fighting over is the extension of the Trade Adjustment Assistance Program (TAA). The fifty year old program, which provides retraining and financial aid to trade-displaced workers,expired last Saturday. Over the last two years, the program has expanded and now, according to White House economic adviser Gene Sperling, approximately 155,000 Americans will be impacted if the program is not expanded.
Republicans want to shrink the program to its pre-Obama size. But Democrats are demanding the Republicans approve the expanded version in exchange for supporting free-trade agreements with South Korea, Panama and Colombia. In retaliation for holding up the free-trade agreements, Senate Republicans are refusing to confirm the next Commerce Secretary John Bryson.
House Republicans are saying the delay in approving the trade agreements will hurt the American worker.
GOP Deputy Whip, Rep. Kevin Brady (R-TX) stressed his party's first priority is to create more American jobs by passing those trade agreements without the TAA program attached.
"I caution, however, that we will not reach a bipartisan way forward as long as Democrats insist on the 2009 version of the TAA program.
Trade means jobs, and in this economy it is beyond me why anyone would want to prevent American workers and companies from winning new sales and creating new American jobs,” he said.
I caught up with the conservative grassroots organization, Heritage Action and asked CEO Michael Needham what this politicking could mean for future jobs generation.
LL: One of the biggest reasons why the GOP does not want to renew the TAA program is because of $2.5 billion price tag. What do you think the government should do in its place if anything? Has this program been effective?
MN: There is no evidence to suggest the program’s assistance and training improves workers’ future earnings. Simply put, the program has failed. The small fraction of laid off workers in this program can simply move into the current system of unemployment insurance.
LL: Free Trade Agreements have been opposed by union leaders for years with the argument that the deals would export manufacturing jobs, white-collar jobs as well as impact salaries. You argue by stalling these trade agreements jobs are being killed. By your analysis, how many future jobs are hanging in the balance?
MN: Estimates on job creation, but whether the FTAs create 70,000 or upwards of 300,000, they are a net positive for the economy. Opening new markets and reducing tariffs on American goods will be good for American employers and employees.
LL: The President has repeatedly said he was committed to doubling exports by 2014. Given the fact, Gene Sperling, his director of the National Economic Council says unless the TAA is passed, the three trade agreements are off the table isn't this another example of the President's actions and words contradicting themselves?
MN: By holding the FTAs hostage, President Obama’s deeds are contradicting his words not only on trade, but job creation. It says a lot about the President’s priorities.
LL: I have been hearing from numerous contacts the President continues to lead from behind- delegating rather than being out there himself.
Do you want so see more of the President in this fight?
MN: This is President Obama’s standard operating procedure—lay out a broad idea or goal, and leave it to others. Given his 2008 campaign was heavy on rhetoric and short on specifics, this should not be surprising. If President Obama is committed to increasing exports and jobs, he should lead on this, not play politics.
LL: In this 2012 election, the American people are going to want to see a checklist and a track record of things accomplished, not just rhetoric. Can you list all the things the Obama administration has done to help spark job creation?
MN: I think the administration will be hard pressed to make the case that they have sparked job creation. Shovel-ready projects weren’t actually ready. Regulations are increasing the cost of doing business. And the uncertainty surrounding our debt—and potential tax increases —has employers holding onto their money. “It could have been worse” is not exactly an inspirational campaign slogan.
LL: These pending trade agreements would open new markets for business. Can you quantify how much these agreements mean for the US economy?
MN: The agreements will certainly not overcome the jobs we’ve lost during President Obama’s tenure. However, these jobs will be real jobs that are not dependent on government largess. And just take the agreement with South Korea. American companies have missed out on more than $40 billion in potential exports.
LL: Do you believe the President is more concerned about his re-election and losing union support rather than doing what's right for generating jobs?
MN: Union leaders are openly threatening to abandon the President and Democrats in 2012. I would certainly hope this is not a cynical political ploy to pull them back into the fold, but one has to wonder why the President is willing to jeopardize job-creating free trade agreements.
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A Senior Talent Producer at CNBC, and author of "Thriving in the New Economy:Lessons from Today's Top Business Minds."