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Congress' Task--Reduce Deficit, Regain Jobs
| Article
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12950 |
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Section : |
CURRENT ISSUES
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| Issue
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5 / 1987 |
4,675 Words |
| Author
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Lane Kirkland
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For the first time in our history, we have a generation of Americans who cannot reasonably expect to do as well as their parents did. The middle class is shrinking. Scores of domestic industries and millions of American workers have been left defenseless against an onslaught of imports spurred by foreign government practices and the vagaries of U.S. macroeconomic policy. The absence of a strong and predictable U.S. trade policy has contributed significantly to their fate.
Legislation to deal with this crisis will be a hollow shell if it does not have a strong deficit-reduction provision. Such a provision would require any major trading partner that maintains excessive surpluses with the United States and is found to engage in unfair trade practices to reduce those surpluses. It is clear that negotiations alone will not provide the answer. We have been negotiating with Japan, for example, for 10 years, and during that time, the Japanese trade surplus with us grew substantially and goods made in the United States still have little access to Japanese markets.
Changes in trade law and policy to provide timely and predictable relief to workers and industries injured by imports are also long overdue. America's unfair trade laws must be strengthened to address new discriminatory commercial practices. The denial of worker rights by our trading partners can no longer be ignored. The international debt crisis must be addressed, ensuring that lenders accept their proper share of the burden. Legislation is also required to deal with the problems of specific industries devastated by trade. While these and other measures are needed to build the foundation of an effective policy in the upcoming years, it is essential that Congress take steps to begin the immediate reduction of America's trade deficit.
Worldwide economic expansion, falling dollar exchange rates, or successful negotiations are by themselves unlikely to achieve reduction of America's trade deficit. The dollar has fallen for two years, negotiations don't deal with the real problems in manufacturing, and even if worldwide economic expansion took place it doesn't follow that other nations would import more U.S. goods.
Impact of deficits
Unlike a few years ago, there is now general agreement that America's massive trade deficit presents a clear and present danger to the domestic economy. Those who in the past denied the very existence of a problem, or counseled patience to the victims of trade, have been largely silenced by the enormity of the shift in U.S. trade patterns. The figures are stark.
U.S. trade deficits the last few years have been the largest every recorded by any country and in 1986 reached $170 billion. This is more than four times higher than the 1980 level. For manufactured goods alone, America has gone from a surplus of $17 billion in 1980 to a deficit of $145 billion in 1986.
That record $170 billion deficit was reached between 1980 and 1986 because imports into the United States increased 51 percent while, incredibly, U.S. exports dropped by 2 percent.
No sector of the economy is untouched. Mines are closing, manufacturing communities are devastated, and
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