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May
2016
24

Typically Optimistic Trade Commission Admits the Gravity of TPP Outlook; $21B Deficit Projected

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The U.S. International Trade Commission (ITC) must write a report for each free trade agreement the United States enters into.  In the past they have come under fire for reaching to produce overoptimistic results.  For example, the group said that wages would grow for American, Mexican, and Canadian workers under NAFTA. They also projected that trade balance would improve under the U.S.-Korea free trade agreement (“KORUS”).  They were wrong on both counts.

So, when the ITC was tasked with painting a rosy picture of the Trans-Pacific Partnership (TPP), what optimistic findings did they generate?

That the TPP will increase the U.S. trade deficit by $21.7 billion.

Yes. Billion. The group most likely to be pro-TPP says the TPP will be a massive failure.

The AFL-CIO highlighted some of the report’s not-so-optimistic 15-year projections:

1. U.S. manufacturing output will decrease by more than $11 billion and manufacturing employment will go down .2%.
2. U.S. auto parts output will decrease by $1.4 billion and auto parts sector employment will fall by .3%.
3. U.S. services exports (a supposed “strength” of the U.S. economy) will be $2.2 billion less than services imports.
4. Job losses also are projected in sectors, including forestry, coal, oil, gas, textiles, transportation, logistics, electronic equipment, tourism and recreation. Two of the hardest hit sectors for job losses are titanium products and leather goods.
5. Despite all these losses, the overall U.S. economy is expected to grow—by a mere .15%! That’s basically a rounding error.

The findings don’t require much interpretation. Read the very expansive report if you dare.

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