NAFTA blamed for trade deficit

A new study tallies the number of American jobs lost or displaced to Mexico as a result of the U.S. trade deficit with its neighbor to the south.

As of 2010, U.S. trade deficits with Mexico have cost the U.S. 682,900 jobs, with the economy claiming nearly one-fifth of that in just the last four years. Robert Scott, senior international economist for the Economic Policy Institute (EPI), explains that the hardest hit industries are "electronics, electrical components, and also autos and auto parts." And he says it is a problem for every state.

"All 437 congressional districts, including the District of Columbia and Puerto Rico, lost jobs as a result of the growth of U.S. trade deficits with Mexico," Scott assures.

He points out that the $97 billion trade deficit with Mexico developed after the North American Free Trade Agreement (NAFTA) took effect in 1994. Prior to that, the U.S. had a $1 billion trade surplus with Mexico. So the EPI economist recommends that Congress and the White House rethink NAFTA and the NAFTA model.

"Promoters of these agreements claim that they're going to lead to growing exports, and that's going to support jobs; what they really lead to is tremendous growth in outsourcing of production," he contends.

And that, says Scott, results in imports growing much faster than exports, which leads to large trade deficits and more jobs lost.

May 11^th, 2011

Source: onenewsnow.com