Tuesday, February 14, 2012

Biggest obstacle to U.S. jobs: China

China and five other Asian countries cause 80 percent of the U.S. trade deficit in  manufactured goods -- and they do it by manipulating their currencies and other illegal trade practices, according to our friend Rob Scott at the Economic Policy Institute.

The other countries -- South Korea, Hong Kong, Taiwan, Indonesia and Malaysia - are forced to artificially undervalue their currencies so they don't lose market share to China, Scott writes.

He points out that our overall trade deficit more than tripled between 2000 and 2009. In 2011, our deficit with China in "non-oil manufactured goods" hit a record of $326.1 billion.

What does all that mean? A loss of about 2 million good American manufacturing jobs. (He calculates we lost 2.3 million manufacturing jobs between December 2007 and January 2010, and only gained back 354,000 through December 2011.)

Scott's conclusion:
What China has in common with most, if not all, of its Asian trading partners are a set of illegal trade practices including currency manipulation and subsidies and other markets barriers ... China’s unfair trade policies “are now the single largest impediment to job growth in America.” It is time for the United States to get tough with China and other unfair traders and put an end to these policies. The first and most important step is to get tough with currency manipulators.
Read the whole thing here.