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  • Morning Bell: A Trade Free Zone

    Barack Obama has frequently called the North American Free Trade Agreement (NAFTA) “a bad deal.” During one Democratic primary debate, Obama even said he would unilaterally “use the hammer of a potential opt-out” to “renegotiate” the entire treaty. But after he secured the nomination, Obama changed his tune, admitting that NAFTA was not so bad after all, and telling Nina Easton: “Sometimes during campaigns the rhetoric gets overheated and amplified.” If you find Obama’s rhetoric on trade inconsistent, do not expect to learn much from his voting record either. He has voted with the Bush Administration for free trade in Oman and supported free trade with Peru, but has opposed free trade with Panama, Colombia and South Korea. To be as generous as possible, Obama has a evolving position on trade.

    Considering that the No. 1 issue in this election is the global economic downturn we are slipping into, one would think debate moderators would press the candidates to clarify their positions on trade. No such luck. We have had three debates so far (two presidential debates and one vice presidential debate). There have been approximately 100 questions directed at all four candidates over the course of the three debates. None have pressed the candidates to explain to the American people where they stand on free trade.

    International trade has been one of the biggest drivers of economic growth in recent years. The one bright spot in the American economy this past year has been the continued growth in U.S. exports. Exports generated an impressive two-thirds of U.S. economic growth over the past year. With the Doha round of trade talks grounded, bilateral free trade agreements (like those Obama voted against for Panama, Colombia and South Korea) are one of the only options for expanding trade. Although they comprise only 7.5% of global GDP (not including the U.S.), the countries the U.S. has free trade agreements with accounted for more than 42% of U.S. exports. Shutting down free trade now would be disastrous for the U.S. economy. The last time the U.S. reverted to protectionism in a time of economic turmoil President Herbert Hoover’s Smoot-Hawley Tariff helped usher in the Depression. This is not the direction our country needs to go.

    It is the direction the left wants to take us. Doing the bidding of her labor union masters, Speaker Nancy Pelosi (D-CA) destroyed over thirty years of American credibility on trade when she gutted the legal framework of U.S. Trade Promotion Authority this April. The next president of the United States will have to fight hard against organized labor just to repair the damage Pelosi has caused, let alone advance new trade gains worldwide. Americans deserve to know where the next president stands on this issue. Hopefully they can get at least one question on it.

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    Posted in Ongoing Priorities [slideshow_deploy]

    16 Responses to Morning Bell: A Trade Free Zone

    1. RickFromMichigan says:

      Im sorry but F.T.A. hurts very badly blue collar American workers.It has driven down pay and benefits for them.It was only setup to help the bottom line of some greedy American corporations.Personally I'd like laws requiring country of origin labels and where a product was assembled.If more than 50% of the assembled product was in the United States a made in America label could be used.Americans would then be encouraged to promote that fact in advertising.Also the place of the majority of the raw material should be listed. In this way we would not be outlawing foreign products,but we would encourage American products.

    2. Michael J O'Bri says:

      I am glad that the London School of Economics will be providing free courses in Economics 101 to members of Congress. The first 2 to sign up should be John McCain and Larry Lindsey.

      Senator McCain last night in the Presidential debate surprised, in fact startled nearly everyone when he stated that as soon as he took office he would order his Treasury Secretary to buy all the mortgages where home owners owe more than the house is worth. This would recover the housing market and these home owners could remain in their homes and now pay their mortgage. This is insanity and reckless and shows his and Washington’s lack of understanding of even basic economics. First, the laws of economics are stronger than anyone in Washington cares to believe. The housing market will not recover until supply and demand come into equilibrium, and demand begins to out strip supply. This will occur when home prices move the demand curve to the left, or upward clearing excess home inventory. Then and only then will supply decline and prices begin to stabilize and then rise. Buying mortgages will not create demand, other than to wish home owners paying their mortgage on time wish that they were as reckless and bought bigger houses.

      Secondly, McCain does not fully understand the intervention of government. Intervention has egun to show unwanted consequences: Financial stocks continue to drag on the DOW because Investors are becoming increasingly concerned that should the government intervene in any financial institution, the government will take stock or warrants thereby diluting the stock base and price. As a result, investors are beginning to move away from the financial sector investing until these balance sheets are cleared of toxic MBS and CMO, etc.

      Additionally, what is enough? Senator McCain had just finished stating that it is he that will go to Washington to stop this out of control spending. Surprisingly in the next answer he stated he would buy mortgages for a certain class of home owners. Does he not realize that an entire class of home owner pays their mortgage on time each month, while another class of home owner and many of these people took out sub prime and no doc, no down payment, option ARMS are walking away from their homes and he is looking to reward them? This is not the tone of a fiscally conservative Republican. Consider $75 bn for AIG, $200 bn for Fannie and Freddie, $700 bn for the MBS bail out, $300 bn for the Frank housing bill. That is $1.25 trillion. Some of this has potential payback to the taxpayer however. How does the Senator plan to pay for this? It is just beyond good fiscal reasoning.

    3. T. Finstad says:

      The United States should be involved with FREE and FAIR trade; however, FREE and UNFAIR trade hurts our country. A lot depends on the details of the agreements that are negotiated. Many years ago now, I heard Margaret Thatcher provide an explanation of NAFTA in an interview. Her explanation made sense if the trade is fair. She was in favor of NAFTA and said that all would benefit. Those in other countries (for instance, Mexico) would have better jobs to buy the more sophisticated goods and services of the U.S. However, that theory doesn't hold if the people in Mexico (using my example) that are given the jobs live on poverty wages with no benefits because the companies they work for are simply held to much lower standards in Mexico than they would be in the U.S. Again, trade has to be negotiated to be free and fair in order for all to benefit.

    4. Dave, laguna niguel, says:

      Just when will we be free of the evil wicked witch of the west, Nancy Pelosi? She is a PERFECT example of COMPLETE INCOMPETENCE and the destruction just one moron like her can cause. And what about her refusal to do anything about our energy crisis, or rather our LACK OF ENERGY? Did you notice the whole country caving in on MS PELOSI'S WATCH? And she blames Bush?! If McCain had any brains he would correct Obama's idiotic remarks about the present condition of our economy is the result of "BUSH's FAILED ECONOMIC POLICIES OF THE LAST 8 YEARS". MCCAIN needs to put the blame AT LEAST EQUALLY on the demorats shoulders…THEY are the ones who wanted mortgages approved for those who could not pay for them, and THEY are the ones who made millions including OBAMA HIMSELF, and ALL PAID FOR BY THE AMERICAN TAXPAYER!!! And McCain, don't call Obama a liberal, HE IS A SOCIALIST!!! JUST READ HIS BOOKS!!! Look at his proposals..exactly what does economic equallity mean? It means SOCIALISM and we have just witnessed the destructive power of SOCIALISM when you grant mortgages to people who can't pay for them, NOW WE GET TO PAY THEIR MORTGAGES!!! DUH!!!!! Sombody better get a grip on this soon and run these democrats out of town or we will never get out from under the mess they have created! Now they want a health care system thats as good as the social security system! GET THIS FREAKIN GOVERNMENT OUT OF OUR LIVES AND GET BACK TO YOUR "ONLY JOB"…PROTECTING THE AMERICAN PEOPLE(not illegals!)!!!

    5. Michael J O'Bri says:

      Mr, Dave from california…you could not be more on target..Pelosi and her cohorts, Frank, Reid, Dodd have alot of explaining to do to the American people. Frank especially, considering his relationaship [lover] with a top executive of Fannie Mae, Herb Moss that promoted risky lending from 1991 mto 1998. Mr. Moss was in charge of product development and championed affordable housing and home improvement lening. The press and congress is affraid because of politically senstive reasons to touch this. Mr. Frank and Mr. Moss lived together until 1998, when they broke up and Mr. Moss left Fannie Mae. Pelosi and the Dems know more than they are willing to say about this mess.

    6. Willliam, Midland, M says:

      Free Trade? Baloney

      America has opened its doors to just about every nation to trade here. Most nations use this as an opportunity for trade warfare not mutually beneficial trade. To stop that we need to have a law that requires all trading nations to buy an equivalent dollar amount that they sell here and in an equivalent technological or higher category. For example, Japan will sell cars here but it will not even buy plywood… it will only buy logs and ship them home to make plywood. Japan has harmed us a hundred times more with trade than with Pearl Harbor if you look beyond loss of human life and merely economically. As an example, I met a gentleman who programs America's most advanced radar. the chinese bought one system with a warrenty. They shipped it home and disassembled it to reverse engineer it. The project failed and their reassembly left it broken. They cried foul and demanded the american manufacturer ship technitions to asia to fix it. When they got there they saw what the chinese had been doing… stealing high tech stuff.

      The chinese lied and demanded it be fixed at American expense. That is the type of trading partners we are dealing with. When I went to MTU I met a chinese engineering student and attempted to befriend him and he said he was not interested. He said he was here to get the technology to annhilate america in world war III and repay us for stopping them in Korea.

      Trading partners are not exactly friends and America has no laws to demand they buy from us. The world is free to trade its way to the destruction of america.

    7. Pingback: Morning Bell: A Trade Free Zone

    8. Duke Lynch Redding C says:

      Credit has been leaveraged out of contol by Congress, financial institutions, people like Kravitz, Boesky, Milken, Paulson and until it can be "deleveraged" by the market we gotta wait!

    9. Duke Lynch Redding C says:

      All of the foregoing are correct but I think missing the casic reason…credit has been leaveraged out of control by congress, financial institutions,scammers like Kravitz, and greedy little leeches buying homes they thought they could get for free.

    10. Michael J O'Bri says:

      Could this be capitalism and Adam Smith reaching out and fixing the markets. It is surely not government intervention working.

      Pending sales of existing U.S. homes unexpectedly jumped in August to the highest level in over a year, data from a real estate trade group showed on Wednesday.



      The National Association of Realtors Pending Home Sales Index, based on contracts signed in June, rose 7.4 percent in August to 93.4 from an updwardly revised index of 87.0 in July.

      The August reading was 8.8 percent higher than a year earlier, and the highest level since 101.4 in June 2007.

      Economists polled by Reuters ahead of the report were expecting pending home sales to drop by 1.8 percent.

    11. Duke Lynch Redding C says:

      I admit to great ignorance so would someone please tell me what happened to all the money that was paid out by lenders to the sellers of houses and mortgage holders on balance of loans on the the houses sold ,including the real estate brokers, agents, title companies, termite inspectors etc and how much is it? Was it massive Ponzi, Pyramid, Pigeon Drop, or Scam?

    12. Pingback: FREE TRADE « Ragamuffin08’s Weblog

    13. Dennis Math Independ says:

      We need to quit wasting resources fighting drugs. Instead of continuing to fight a losing battle, tax the crap and take some of the burden off of "straight" folks to some degree by doing so. We want a free trade agreement with Columbia? Lets have a completely free trade agreement with Columbia and import their drugs and tax the sales.

      How long and how much money are we going to continue to fight this losing "war on drugs"?

    14. Gary T - Round Rock, says:

      What will it take for McCain to tie Obama directly to Ayers and their (at least) 7 year close relationship?

      All Obama does every day is tie McCain to Bush.

      Ayers is a radical domestic terrorist that wants capitalism destroyed and goes (personally) promoting Chavez education efforts..

      Will McCain wake up in time?

      What about Heritage? How about a massive "vote fact" section in major newspapers about a presidential candidate lying about his very close on going relationship with a bomber and terrorist.

      The same terrorist who launched his 1st political campaign in his house, and was hand picked by the terrorist to handle a $5o million dollar eduction grant. That's a little more than a neighbor and someone who's served on a board with.

      If McCain won't — someone has to before we have a radical, lying, socialist, far left President!

    15. Pingback: Shopfloor » Blog Archive » Trade, Yet Another Missing Issue in that Presidential Debate

    16. Becky K. Sanford, Fl says:

      Yeah, Gary T.We will have radical,lying,socical,far left president and out control Dem.Congress. Is there anyone who would be willing to stand beside our famiily & pay $1-50 for ads in the N.Y. Times, Wall St. Journal,U.S.A.Today,etc.???? In jiont effort to expose Obama before Nov.4th. McCain says things on the campain trail,in interviews,& let's Sarah!!!!Oh why didn't he Tues. night!!! Where did his passion and drive go? Does he really want to be President or WHAT!!!

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