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Paul Streitz

Does Tancredo Understand Foreign Trade? No!
By Paul Streitz
Mar 13, 2007 - 5:30:50 AM

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Tom Tancredoís website shows a remarkable naivetť about foreign trade.  He would be well to listen to some of the programs of Lou Dobbs and read up on his Pat Buchanan. His positions both damage the average citizen in the United States and prevent him from gaining a huge political advantage over his political rivals in both political parties.
Further, Tancredo would be wise to extend his political campaign that "For A Secure America" means securing every personís ability to have a job, not simply protecting the border.

To put it in discrete choice, which would you rather have: 1) no illegal immigrants and no job; 2) illegal immigrants, but a good job.  With most people, making a living comes first. They call it a "livelihood" because it means the ability to make a living. Certainly, illegal immigration negatively impacts directly and indirectly on our livelihoods, but the direct loss of a job through outsourcing and moving industries to China is even more immediate and destructive.

The section of Tancredoís website that deals with foreign trade is a jumbled mess.

"Falling U.S. taxes on imported products and slowly crumbling foreign barriers to U.S. commerce have provided a number of benefits for Americans and American businesses. American consumers have unprecedented choices when it comes to everything from cars and computers to cell phones and coffee.

This is half wrong, and then the part that is right is also wrong.

"Slowly crumbling foreign barriers to U.S. commerce," donít seem to have crumbled very much at all. This is why the U.S. runs a negative trade balance with the world and especially with Japan and China. The average idiot can figure out that it is better to have more money coming in than going out, but this paragraph seems to ignore this reality.

What is right is that Americans "have unprecedented choices."  Well, not really. If you try to buy a computer that is made anywhere but China, you are out of luck.  Half the American auto industry has disappeared abroad and the rest is getting ready to leave.

American workers understand that jobs that move abroad donít mean cheaper products, but only higher profits made by low-wage foreign workers. Team Tancredo and Tom Tancredo donít seem to understand this.

Nor does he even address the issue of outsourcing. That is having foreigners in India answer the phone, or have accounting and financial work processed in back offices in India.

"U.S. manufacturing and agricultural exports have grown strongly over the last decade."  The United States is facing the largest trade deficits in its history. The dollar is bound to fall in value and gas prices will double or triple. The U.S. is so in debt to China that it is the largest owner of U.S. issued government securities.
Yet, Team Tancredo is giving the U.S. happy talk.

Team Tancredo and Tom Tancredo do not seem to understand that "Falling U.S. taxes on imported products" are exactly the cause of this problem. Alexander Hamilton and Abraham Lincoln wanted high tariffs that protected American industry and American jobs. An invasion of foreign products made by low-wage labor is just as dangerous to America as is an invasion of low-wage workers. In fact, they are the same thing.

However, when Tancredo does talk about trade, it is in terms of immigration. As if it would all right, if the immigration section was not included. "In fact, CAFTA is more than a just trade agreement about sugar and bananas; it is a thinly disguised immigration accord."  This is true, but the guy laid off in Connecticut because of this trade agreement, or all the others, does care about the immigration.  He wants his job back.

Tancredo should study a little more about economic history, Alexander Hamilton and the Republican Party.  The Republican Party had it right in when in 1912 it said, "We reaffirm our belief in a protective tariff. The Republican tariff policy has been of the greatest benefit to the country, developing our resources, diversifying our industries, and protecting our workmen against competition with cheaper labor abroad."

A high tariff that keeps out foreign competition has two great advantages and it is what built the American middle-class standard of living. The first is that it keeps the wealth within the country. Foreign trade is great when you are selling more than you are buying, but even then every industry in which you are buying goods from abroad because of cheaper labor, the American workers in that industry will suffer.

Second, the high tariffs will start to equalize labor rates and reduce the differences between the wealthy and the poor. From 1929 to 1965, it was the combination of high tariffs and low immigration rates that produced the vast middle-class of America. Since that date, Free Trade and massive legal and illegal immigration have had the opposite effect of increasing the difference between economic groups, reducing the standard of living or the middle-class and impoverishing low-wage earners. At the same time, the wealthiest fractions of our society become wealthier.

We are moving toward the economy and social stratification of the Confederacy: a thin layer of very wealthy people, an impoverished middle-class and a vast pool of unskilled, semi-slave labor.

Having immigration as the main concern of his political career, Tom Tancredo has not focused on the issues of foreign trade. His knowledge of the issues seems rudimentary at best. What he does not understand is that immigration is a labor and trade is a labor issue. Immigration damages American workers by importing cheat labor directly into the country. Free trade damages the American worker by importing the goods made by the cheap labor. If something can be made and shipped from abroad, then you donít need the labor in the country. But if it cannot in certain industries, and the labor has to be in the country, then it is cheap labor immigrants.

Massive immigration and free trade are different sides of the same cheap labor coin.

If Tancredo wants to get a chorus of applause from the blue-collar working class Americans, he should extend his campaign to "Secure American Jobs."  He should be fundamentally against free trade and outsourcing. Most Americans agree with Tancredo on immigration, he would add to those ranks by including a strong message on trade.  He needs to say two things:

"Stop outsourcing!"  Pass a law that prevents any work being done off shore via electronic means and shipped into the United States.  Congress can end this abominable practice in a minute, but does not do so.  Tancredo should put a bill forward to end this cancer.
 "End free trade." It is a bogus economic theory that benefits multinational corporations and dooms American industry and American workers. Or in words that American workers will cheer, "KILL NAFTA."

Paul Streitz
CT Citizens for Immigration Control

He is the author of America First, Why Americans Must End Free Trade, Stop Outsourcing and Close Our Open Borders.

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