Workers pay for flawed trade policies

SOURCE: Wardsauto.com and Automotive Trade Policy Council

With lower wages, the American worker can't afford to buy merchandise, and with the 'free' trade agreements that are in place and protectionist policies of many foreign countries, we have no place to sell our merchandise," said Dave Chegash, a UAW Local 412 member and veteran industrial engineer who has worked at Chrysler's Warren (Mich.) Truck Plant for more than nine years.

Many conservatives and their corporate allies in Congress argue that the only way America can remain competitive in the global marketplace (and to protect the investments of Wall Street speculators) is to slash workers' wages and benefits.

Chegash said those who benefit most from these policies are Wall Street investors, CEOs and executive-level employees – not UAW members.

"Someone once said, 'There's no such thing as a free lunch.' The same thing applies to 'free' trade. Except this time, it's the American worker who pays and pays and pays," said Chegash, 57, who lives with his wife, Vicky, and daughter, Anne, in Richmond Township, Mich.

"I can't think of anyone who hasn't feared losing their job due to the unfair trade laws that affect U.S. jobs, especially in the auto industry," said Chegash, adding that his wife, an occupational therapist in the seemingly safe health care field, isn't immune to the threat of layoffs.

"With so many autoworkers laid off and retiree benefits cut, they simply cannot afford to pay for medical care and they don't seek proper medical attention. With fewer patients to treat, the need for therapists is reduced," he added.

While economists debate the finer points of trade, workers like Chegash know that one of the primary causes of the current economic crisis is the decline in consumer purchasing power caused by the loss of decently paid manufacturing jobs over the past few decades. This trend can be, in turn, blamed on international trade imbalances produced by misguided free-trade agreements negotiated by the United States.

Auto-producing nations as diverse as Brazil, Japan, Germany and South Korea, to name a few, have pursued trade agendas far different in scope and nature than we have in the United States, where free-market, free-trade ideology trumps any interest in helping the American worker.

These other countries have adopted economic programs to promote automotive exports, and thereby have protected their own domestic employment and living standards. In some cases, this has also involved discouraging automotive imports from the United States.

You'd think new trade agreements would seek to fix this imbalance, but the Bush-negotiated U.S.-South Korea Free Trade Agreement (KORUS FTA) will make the problem worse. Instead of opening Korean markets to U.S. products, it will allow unfair trading practices to continue.

Both the Korean government and the U.S. International Trade Commission have forecasted that passage of the KORUS FTA would result in a $1 billion annual increase in the U.S. auto trade deficit with Korea.

The auto trade imbalance with Korea is part of a larger story: the dramatic deterioration of our nation's international trade balance over the past two decades. In 1988 the U.S. trade deficit was $127 billion. In 2008 it was $840.2 billion.

These staggering deficits, which are a direct consequence of decisions by U.S. policy makers to abandon domestic manufacturing, are more than just numbers on a page.

The result is enormous pain for millions of workers, fewer manufacturing jobs, declining real wages, erosion of health care and retirement benefits, increasing poverty, devastated communities and dramatic increases in income inequality.

"We have done enough to stimulate the economy of foreign nations. Now it's time for the United States to implement a worldwide fair trade policy," said Chegash. "We should have the same access to sell our products in other countries as they do in ours: no tariffs, surcharges or other protectionist measures."

Jennifer John contributed to this report.