Manufacturing Alliance Chief: TPP Brings ‘Minimal’ Gains, High Costs

The head of the Alliance for American Manufacturing, who has just coauthored a book that offers proposals for revitalizing American manufacturing, has added his voice to the broad coalition opposing the Trans-Pacific Partnership and calling on Congress to not “fast-track” it to approval.

AAM president Scott Paul told a lunch discussion at the AFL-CIO in Washington on Friday that he hoped that the TPP “will go nowhere,” but warned “there’s going to be a fight, a big fight.”

Legislation is currently pending in Congress that would require the treaty to be considered by a simple up-or-down vote, with no opportunity for amendments. Many members of Congress, concerned about an agreement negotiated behind closed doors with heavy input from corporate lobbyists, want the ability to protect the interests of American workers and consumers.

“Suffice it to say that any trade agreement that is done in secret and is dealing with more than just tariffs, you have to take a close look at what they are doing, and raise a lot of questions,” Paul said. “Even from a U.S. industrial perspective, the gains are potentially very minimal in comparison with the costs. The costs could be ceding large swaths of auto production, losing the last American footwear maker of athletic shoes (an apparent reference to Maine-based New Balance) and downward pressure on wages, because I don’t think there’s likely to be an enforceable mechanism.”

Paul said that the TPP “is more about corporate power, it’s not about trade.”

Paul was with American Prospect writer and syndicated columnist Harold Meyerson to talk about their new book, “ReMaking America,” a collection of manufacturing policy essays.

“Ask any mayor if they would rather have a factory, a hospital, or a Wal-Mart, and they will almost unanimously say a factory,” Paul said, “because they will then probably get a Wal-Mart.”

Local officials recognize that the benefits of manufacturing come in many forms, not just from the goods produced in the factory, but also from the paychecks that the factory provides to its workers. That was one of the reasons that so many states were beating down the doors to bid on factories from, in the most recent case, Boeing. “It is still the go-to choice for local economic development,” Paul said.

Meyerson writes on the decreasing power of the worker in the manufacturing sector despite the recovery of American manufacturing from its nadir in 2009. At the AFL-CIO, he compared American manufacturing to that of Germany, a historically strong manufacturing country.

“Germany has been able to keep wages higher, even though they are in a globally competitive market. They are able to pay the kind of wages that are comparable to the top wages that American unionized workers get, and with better benefits, and nonetheless have a huge export surplus,” Meyerson said.

While in the book Meyerson laments the fact that American workers do not have a seat on the board as do their German counterparts, he does note that in some industries in America, like those in Germany, the workers’ unions come together with companies to update the skills of the factory workers, and both parties have gained significantly. Germany, Meyerson says, has benefitted from keeping its most highly valued workers in the country. The best jobs, in other words, are still in Germany, making the globally competitive German companies all the stronger in the long run.

With chapters on capital formation, worker empowerment, trade enforcement, innovation and more, “ReMaking America” is filled with policy suggestions that the authors argue will strengthen America, and provide the basis for a stable future for the current generation and beyond.

To see more about the book, including information on purchase, click here.

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