Despite nearly three years of growth, we have over 20 million people in need of full-time work. Wages are declining. This economy is not working for working people.
To recover from this economic downturn, we requires more than a short-term stimulus and certainly not more ruinous austerity. It requires a new strategy for growth in a competitive global economy. The news that our economy contracted in the fourth quarter, with declining exports contributing to that, only adds to the imperative.
That is why Campaign for America’s Future calls on the president to use his State of the Union address to lay out elements of a new strategy for the United States to enable us to compete sensibly in the global marketplace.
In March 2009, the leading industrial nations of the world met in Pittsburgh. They left with a consensus that extreme trade imbalances were destabilizing, unsustainable and had contributed directly to the excesses that blew up the global economy. Germany and China joined in the agreement that both surplus and deficit nations had to change their policy.
Since then, little has changed. The U.S. trade deficits are back up – over $1 billion a day. For all the talk about insourcing, companies have used the recession to continue to ship good jobs abroad. China and its Asian trading partners make up over 80 percent of the non-oil manufacturing trade deficit. Our trade relationship with China is the most unequal in the history of nations.
The reason is clear. China and other nations have a national economic strategy and a national manufacturing strategy. They target industries that they want to capture. They subsidize investment, research and development, and worker training. The Chinese are infamous for manipulating their currency, stealing intellectual property and forcing companies to partner with Chinese companies if they want access to Chinese markets and more.
Our companies are competing with countries. Not surprisingly, while multinational companies may find a way to profit, our country is not represented in that equation. And our people are not served well by being dealt out of the table.
It is time for the U.S. to move to balancing its trade, as pledged in Pittsburgh, and to adopt a sensible national manufacturing strategy for the global economy.
This should be a centerpiece of the president’s State of the Union address, calling on the country to move from its increasingly self-destructive focus on austerity towards building a new foundation for growth.