The First Slippery Steps : GATT and NAFTA

Do you wonder when America really started into decline?  It was back in 1994.  We were warned, many like myself tried to stop it.  Many were sidelined by the likes of Limbaugh as being fear mongers, kooks, tin hat isolationists.  The mockery was effective because people don’t like to be identified as such and called names.  This could have been stopped then and it can be stopped now.

America is suffering as predicted with loss of manufacturing jobs and opportunities.  Business has been put under onerous regulations that other nations do not have to comply with which increases costs and thus makes competition difficult thus encouraging companies to leave the country, set up shop in third world nations that do not have these regulations and offer slave labor to produce the products American’s purchase.

I applaud you who will spend an hour or two educating yourself to provide armor against the lies of those who claim to be for liberty, freedom and prosperity and yet they themselves paved the way for GATT and NAFTA.  Learn the facts, and remember, politicians making back room deals, becoming millionaires with special rights sold us out.  My recent posts should help you see through them.  The left is in control.  The Marxist long plan is coming to fruition, and when we are broken and on our knees wondering what happened, you will know and understand and thus be able to beg your children for forgiveness as we slept and allowed tyranny to take over America and thus the world!  The long night is approaching, the hour of temptation is at hand, and 99% will beg for salvation and the solution will appear which you will grab onto as you learn too late that too is a lie.

NAFTA was not just harmful to America.  This video explains how it affected our neighbor south of the border.  This in turn benefited some very large American corporations and also drove a certain population in Southern Mexico to run into the North, and we see the outcome.  I will add another video about the loss of American jobs.  This fits the goal to cause massive illegal immigration and the need to offer a solution which will naturally boost the voting roster of the Democrat party.

You see, our marxist controllers think 10 chess moves ahead, and while we are busy reacting as they expect us to, they are making laws, treaties, and creating havoc in various nations which keeps us off balance, over-whelmed, and arguing about what to do.  In all this distraction, things get worse and push us into their end game.

I have decided to add this video first because the second brings in more subtle issues and I want to get to the meat of the matter, but the second video is equally important:

Growing trade deficits and job losses

NAFTA’s impact in the United States, however, has been often obscured by the “boom-and-bust” cycle that drove domestic consumption, investment, and speculation in the mid- and late 1990s. Between 1994 (when NAFTA was implemented) and 2000, total employment rose rapidly in the United States, causing overall unemployment to fall to record low levels. But unemployment began to rise early in 2001, and 2.4 million jobs were lost in the domestic economy between March 2001 and October 2003 (BLS 2003). These job losses have been primarily concentrated in the manufacturing sector, which has experienced a total decline of 2.4 million jobs since March 2001. As job growth has dried up in the economy, the underlying problems caused by U.S. trade deficits have become much more apparent, especially in manufacturing.

The United States has experienced steadily growing global trade deficits for nearly three decades, and these deficits accelerated rapidly after NAFTA took effect on January 1, 1994. For the purposes of this report it is necessary to distinguish between exports produced domestically and foreign exports, which are goods produced in other countries but exported to the United States, and then re-exported from the United States. Foreign exports made up 11.6% of total U.S. exports to Mexico and Canada in 2002. However, because only domestically produced exports generate jobs in the United States, our trade calculations are based only on domestic exports. Our measure of the net impact of trade, which is used here to calculate the employment content of trade, is the difference between domestic exports and total imports.3 We refer to this as “net exports,” to distinguish it from the more commonly reported gross trade balance. However, both concepts are measures of net trade flows.

Although U.S. domestic exports to its NAFTA partners have increased dramatically—with real growth of 95.2% to Mexico and 41% to Canada—growth in imports of 195.3% from Mexico and 61.1% from Canada overwhelmingly surpass export growth, as shown in Table 1. The resulting $30 billion U.S. net export deficit with these countries in 1993 increased by 281% to $85 billion in 2002 (all figures in inflation-adjusted 2002 dollars). As a result, NAFTA has led to job losses in all 50 states and the District of Columbia, as shown in Figure 1. Through September 2003, the U.S. goods trade deficit with Mexico and Canada has increased 12% over the same period last year (U.S. Census Bureau 2003a). Job losses for the remainder of 2003 are likely to grow at a similar rate.

Figure 1

Figure 1

Long-term stagnation and growing inequality

NAFTA has also contributed to growing income inequality and to the declining relative wages of U.S. workers without college degree, who made up 72.1% of the workforce in 2001 (Mishel et al. 2003, 163). NAFTA, however, is but one contributor to a larger process of globalization and growing structural trade deficits that has shaped the U.S. economy and society over the last few decades.6 Rapid growth in U.S. trade and foreign investment as a share of U.S. gross domestic product (GDP) has played a large role in the growth of inequality in income distribution in the last 20 years. NAFTA has continued and accelerated international economic integration, and thus contributed to the growing tradeoffs that have accompanied this integration process.

The growth in U.S. trade and trade deficits has put downward pressure on the wages of workers without a college degree, especially those who have no formal education beyond a high school degree. This group includes most middle- and low-wage workers, including the 68.5% of the total workforce with the lowest pay, those earning a wage that is e
qual to 200% or less of poverty level wages in 2001 (Mishel et al. 2003, p. 134). In March 2000, the base year used for data, these workers earned wages of $16.93 or less per hour (See Appendix 1). These U.S. workers bear the brunt of the costs and pressures of globalization (Mishel et al. 2003, 181-89).

Globalization has put downward pressure on the wages of less-educated workers for three primary reasons. First, the steady growth in U.S. trade deficits over the past two decades has eliminated millions of manufacturing jobs and job opportunities in this country. Most displaced workers find jobs in other sectors where wages are much lower, which in turn leads to lower average wages for all U.S. workers. Recent surveys have shown that, even when displaced workers are able to find new jobs in the United States, they face a reduction in wages, with earnings declining by an average of over 13% (Mishel et al. 2001, 24). These displaced workers’ new jobs are likely to be in the service industry, the source of 98% of net new jobs created in the United States between 1989 and 2000, and a sector in which average compensation is only 81% of the manufacturing sector’s average (Mishel et al. 2003, 177). This competition also extends to export sectors, where pressures to cut product prices are often intense.

Second, the effects of growing U.S. trade and trade deficits on wages goes beyond just those workers exposed directly to foreign competition. As the trade deficit limits jobs in the manufacturing sector, the new supply of workers to the service sector (from displaced workers plus young workers not able to find manufacturing jobs) depresses the wages of those already holding service jobs. The growth in import competition and capital mobility under NAFTA has also contributed to stagnant and falling wages in the United States (Bronfenbrenner 1997a).


Watch Al Gore pushing for NAFTA…. short part.. full video for those interested following:

Did they buy a million cars a year from the United States?  Is trade better for America or worse?  Combine NAFTA with GATT and it’s worldwide and now you know why we have a trillion dollar trade deficit!


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