Millions of jobs lost due to trade imbalance with China
Over the years, hundreds of news stories have chronicled the imbalance of trade between China and the United States, and a couple of times each year we’ve been compelled to editorialize on the issue.
But now there’s been a comprehensive study of the growth in the trade deficit with China between 2001 and 2013 by the Economic Policy Institute in Washington, D.C., that should serve as a wake-up call, especially for those members of Congress who, for one reason or another, pretend that trade deficits don’t matter.
The study, “China Trade, Outsourcing and Jobs,” shows that during a 12-year period beginning in 2001, when China entered the World Trade Organization, 3.2 million U.S. jobs were eliminated or displaced. Imagine how much better the U.S. economy would be if it had an additional 3.2 million people at work, more than two-thirds of those in high-paying manufacturing jobs. How about if Ohio had another 106,400 jobs, or Pennsylvania another 122,600?
But perhaps the most surprising thing about the study is its demonstration that the effects of the U.S. trade imbalance with China do not necessarily fall hardest on rust belt states. Or on “blue” states.
The trade imbalance with China has caused job losses in all 50 states and in 434 of the nation’s 435 congressional districts.
The hardest hit states by job numbers are: California, 564,200; Texas, 304,700; New York, 179,200; Illinois, 132,500; Pennsylvania, 122,600; North Carolina, 119,600; Florida, 115,700; Ohio, 106,400; Massachusetts, 97,200 and Georgia, 93,700. The hardest hit states by job loss as a percentage of the total work force are Oregon, California, New Hampshire, Minnesota, Massachusetts, North Carolina, Texas, Rhode Island, Vermont and Idaho. Pennsylvania and Ohio rank 23rd and 24th on that list.
While Ohio suffers losses in metal and rubber products and motor vehicle parts, among others, the highest job losses nationwide are in apparel and textiles, followed closely by electrical components and appliances and furniture products.
U.S. Rep. Tim Ryan of Howland, D-13th, says it makes it more difficult to pursue local economic development initiatives when jobs are being lost through unfair trade practices. Ryan and U.S. Rep. Bill Johnson of Marietta, R-6th, recently urged the Commerce Department to be vigilant against “dumping,” which is the exportation of products at less than the cost of making the product. It’s a tactic by which China and other countries are willing to lose money on the sale as long as jobs are being saved. It’s a method of exporting unemployment as well as products.
No legislative support
The surprising thing is that every member of Congress (with the possible exception of that one who represents the only district in the country that hasn’t lost jobs to China), isn’t supporting legislative efforts to level the playing filed and calling on the Obama administration to be more aggressive in its dealings with trade “partners.” As we’ve said before, it’s hardly a partnership when one party consistently wins at the expense of the other.
The EPI report shows that since China joined the WTO, U.S. imports from China rose from $102 billion in 2001 to $438.2 billion in 2013. U.S. exports rose from $18 billion in 2001 to $114 billion in 2013. Cumulatively, the difference between imports and exports has siphoned more than $2 trillion from the American economy.
The 60-page EPI briefing paper should be required reading for every member of the House and Senate over their holiday break. If it were, congressmen might convene with a better understanding of why there are fewer jobs in their districts, and, perhaps, with a new commitment to do something about it.
That would provide hope for more U.S. workers in the New Year and the new Congress.