President Barack Obama still intends to pass the Trans-Pacific Partnership (TPP) in the “lame duck session” after the November election, the New York Times reports, despite opposition from both major party presidential nominees.
Research by economist Josh Bivens demonstrates that from the time Bill Clinton became President in 1992, imported goods from third world low-wage countries almost tripled from 3.1 to 8.4 percent of GDP by 2011.
The vast majority of that increase in U.S. imports is directly related to Clinton’s negotiation of the North American Free Trade Agreement and the granting of Most Favored Nation status to China.
Bivens calculates that the impact on the after-inflation wage for a typical non-college educated American worker from 1992 to 2011 was negative “5.5 percent, or by roughly $1,800 — for a full-time, full year worker.” With about 100 million American workers without a 4-year degree, that was a major blow.
Although traditional trade theory claims that trade liberalization increases the economic welfare of both trading partners, it is clear that over the last 25 years, wage losses for U.S. workers “amount to a full percentage point of GDP—roughly $180 billion per year.”
It should not be surprising that that the quasi-judicial U.S International Trade Commission, which notoriously supports the interests of multi-national corporations, can only claim that the TPP would generate cumulative net gains of $57.3 billion over the next 16 years, or less than $4 billion in GDP per year.
The USITC claimed that NAFTA and Most Favored Nation for China would generate much bigger benefits than the Trans-Pacific Partnership, but both have since become substantial losers for American workers.
Workers without a 4-year degree account for slightly less than 70 percent of the overall U.S. workforce. But 75.5 percent of black workers and 85.0 percent of Hispanic workers do not have a 4-year degree. Because blacks and Hispanics are less likely than white workers to have 4-year degrees, they have suffered even more harm from trade deals.
With many white non-college educated workers are joining Republican Trump’s movement, the Democrat Party has become even more reliant on non-white working class voters.
But despite TPP’s tiny benefits and huge regressive redistribution of income from blacks and Hispanic Democrats to low-wage countries, the White House website still trumpets TPP as “Leveling the playing field for American workers & American businesses.”