Bernie Sanders on Trade

Bernie Sanders believes that the top priority of any trade deal should be to help American workers. Unfortunately, as Bernie has warned year after year, American trade policy over the last 30 years has done just the opposite.  Multinational corporations – who have helped to write most of these trade deals – have benefited greatly while millions of American jobs have been shipped overseas.

Keeping Jobs in the U.S.

Bernie has stated repeatedly that his top priority is making sure that all Americans have access to good paying jobs. For this reason he has been a leader in Congress in the fight against the free trade agreements that have been negotiated over the past three decades. Bernie’s passionate warnings against these deals have, unfortunately for American workers, all been proven right as these trade deals have offshored a massive amount of decent paying jobs and have closed tens of thousands of factories across our country.

What is a trade agreement?

Trade agreements are pacts between countries that concern tax, tariff, and trade — in other words, how business will be conducted between the countries signing the agreement. These pacts usually include some kind of investment, the most common of which is the free or preferential trade agreement, which aims to reduce or completely eliminate tariffs, quotas, and various other sorts of restrictions between the signatories.

Why is Bernie against most trade agreements?

He believes that free trade agreements like NAFTA, Permanent Normal Trade Relations with China, and the U.S.-Korea Free Trade Agreement have allowed too many American jobs to move overseas.

In an op-ed in the Huffington Post in May 2015, Bernie explained:

“Since 2001, nearly 60,000 manufacturing plants in this country have been shut down and we have lost over 4.7 million decent paying manufacturing jobs. NAFTA has led to the loss of nearly 700,000 jobs. PNTR with China has led to the loss of 2.7 million jobs. Our trade agreement with South Korea has led to the loss of about 75,000 jobs. While bad trade agreements are not the only reason why manufacturing jobs in the U.S. have declined, they are an important factor.”

Is it true that these trade deals have cost American jobs? Where’s the evidence?

You don’t have to look far to find evidence backing Bernie up. Here is a study from the Economic Policy Institute (EPI) showing that NAFTA cost nearly 700,000 American jobs. While supporters of NAFTA will point to studies like this one from the Congressional Research Service which found that the net effect on the U.S. economy was tiny, this same study cites the aforementioned EPI study, explaining that “there are both winners and losers from [trade] adjustments.”

This is exactly Bernie’s point – these trade deals may or may not be technically good for our national GDP, but all of the benefits are going to business owners at the expense of American workers. As he said in 1993 on the House floor before voting against it, “NAFTA may be a good deal for the people who own our corporations, but it is a bad deal for American workers, for our family farmers, and it is bad for the environment.”

And Bernie is nothing if not consistent. Here he is over 20 years later warning against the Trans-Pacific Partnership:

“Let’s be clear: the TPP is much more than a “free trade” agreement. It is part of a global race to the bottom to boost the profits of large corporations and Wall Street by outsourcing jobs; undercutting worker rights; dismantling labor, environmental, health, food safety and financial laws; and allowing corporations to challenge our laws in international tribunals rather than our own court system.”

How does Bernie propose we keep jobs in the U.S.?

Bernie has introduced the Rebuild America Act to the Senate which would create over 13 million good-paying jobs by investing $1 trillion in our crumbling infrastructure. It would be paid for by closing corporate income tax loopholes and overseas tax havens. See our Infrastructure page for more information.

Find out more about Bernie’s plans for creating American jobs on our Economy and Jobs page.

NAFTA

The United States should not have passed NAFTA.

Bernie predicted that NAFTA, which went into effect in 1994, would eliminate jobs in the United States and would only benefit multinational corporations.

What is NAFTA?

The North American Fair Trade Agreement (NAFTA) is a trilateral trade agreement between Canada, the United States, and Mexico. The law’s purpose was to eliminate barriers to trade and investment between the three countries, mainly by reducing and  eliminating tariffs (taxes on imported products). It was signed into law in 1993 and went into effect the following year.

Why were some people for NAFTA?

Trade liberalization, more commonly known as “free trade”, is a very popular economic policy among both Democratic and Republican politicians. It goes without saying that removing barriers to trade increases the amount of trade. Supporters of trade deals like NAFTA argue that the increase in trade spurs competition, investment, innovation, and ultimately economic growth. Gary Clyde Hufbauer and Jeffrey J. Schott, experts at the Peterson Institute for International Economics and the authors of NAFTA Revisited: Achievements and Challenges, argued as much in the following quote:

“NAFTA was designed to promote economic growth by spurring competition in domestic markets and promoting investment from both domestic and foreign sources. It has worked.”

Why were some people against NAFTA?

Many labor, environmental, consumer and religious groups pushed back against NAFTA, arguing that it would create a “push-to-the-bottom in wages, destroy hundreds of thousands of good U.S. jobs, undermine democratic control of domestic policy-making and threaten health, environmental and food safety standards.

The concern that the deal would undermine national sovereignty was a big one (as is currently the case with the TPP). As described by public advocacy group Public Citizen, “NAFTA contained 900 pages of one-size-fits-all rules to which each nation was required to conform all of its domestic laws – regardless of whether voters and their democratically-elected representatives had previously rejected the very same policies”.

What did Bernie say about NAFTA?

Bernie spoke against NAFTA, saying that this fast track agreement with Mexico “will be a disaster for our working people, for our farmers, and for the environment in general.” In 1993, saying that in his view, “NAFTA will accelerate all of these negative economic trends, and will only benefit the ruling elites of the United States, Mexico, and Canada.”

Here he is speaking against NAFTA in 1993

Hilariously, Bernie put his fellow Representatives on the spot before the NAFTA vote by introducing a bill that if NAFTA were to pass, the members of the House would have to lower their wages to be competitive with politicians in Mexico. Here he is introducing the bill:

What were the results of NAFTA?

In 2011 while speaking on the Senate floor, Bernie reminded his colleagues that Sen. Mitch McConnell (R-KY) claimed in 1993 that “American firms will not move to Mexico just for lower wages.” Bernie then pointed out how over the next ten years after the passing of NAFTA, Mattel, Lexmark International, Texas Instruments, General Electric, Tyco Electronics, and Levi Strauss laid off a total of 3,176 employees and shifted their production to Mexico.

Recent studies have shown that because of NAFTA Americans have lost over 680,000 jobs. A senior economist at EPI stated the following about the disastrous results from NAFTA:

“The growing U.S. trade deficit with Mexico has displaced a large number of jobs in the United States and is a significant contributor to the current crisis in U.S. manufacturing, which lost 5.6 million jobs between February 2000 and February 2011.

Trade Policy With China

Bernie firmly believes that current trade relations with China are detrimental to job growth and wealth equality in the United States. Referring specifically to the 2015 Trans-Pacific Partnership, Bernie has decried trade deals with China as being “designed to protect the interests of the largest multi-national corporations at the expense of workers, consumers, the environment and the foundations of American democracy.”

A growing trade deficit with China has led to the loss of over 2 million U.S. manufacturing jobs since 2001.

What does Bernie’s track record look like with regard to Chinese trade policy?

Time and time again, Bernie has voted against free trade deals with China. In 1999, Bernie voted in the House against granting China “Most Favored Nation” status. In 2000, Bernie voted against Permanent Normal Trade Relations with China which aimed to create jobs, but instead lead to the loss of more than 3 million jobs for Americans.

“Let’s be clear: one of the major reasons that the middle class in America is disappearing, poverty is increasing and the gap between the rich and everyone else is growing wider and wider is due to our disastrous unfettered free trade policy.”

Maybe these trade agreements aren’t all great for Americans, but don’t they provide millions of jobs for Chinese workers?

Bernie firmly rejects the idea that America’s standard of living must drop in order to see a raise in the standard of living in China. When asked about the impact of these trade agreements for Chinese workers in a July 2015 interview, Bernie said:

“I want to see the people in China live in a democratic society with a higher standard of living. I want to see that, but I don’t think that has to take place at the expense of the American worker. I don’t think decent-paying jobs in this country have got to be lost as companies shut down here and move to China. I want to see the Chinese people do as well, but I do not want to see the collapse of the American middle class take place, and I will fight against that as hard as I can.”

So what does Bernie propose we do?

Point number seven of Bernie’s Presidential agenda is ending such trade policies. Instead of passing such trade deals again and again, Bernie argues we must “develop trade policies which demand that American corporations create jobs here, and not abroad.” Visit our Job Creation page for specifics on how Bernie wants to do this.

In addition, Bernie is a founding member of the Congressional Progressive Caucus (CPC), and has at times adopted the CPC’s position papers regarding trade deals. The CPC’s principles on trade highlight a commitment to put workers first, stop currency manipulation, and respecting human rights.

Watch Bernie discuss these topics on MSBNC:

Trans-Pacific Partnership

Most recently, Bernie has been a vocal opponent of the Trans-Pacific Partnership, or TPP, which he argues “follows in the footsteps of other unfettered free trade agreements like NAFTA…[which] have forced American workers to compete against desperate and low-wage labor around the world.”

What is the TPP exactly?

The Trans-Pacific Partnership (TPP) is a massive trade deal between many countries around the Pacific ocean, involving 650 million people. These countries include Australia, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, and Vietnam. These countries would be able to trade with each other much more freely, without large tariffs paid to the government for moving goods around.

Wait — I thought it was called TPA, or TAA, or something like that.

There are several bills moving through congress as different pieces of the deal. In this explanation, we see that the TPP is the main trade treaty, the TPA (Trade Promotion Authority) is the “fast track” part of the bill, preventing congress from amending the bill, and the TAA (Trade Adjustment Assistance) is intended to help workers who lose their jobs because of the treaty. As of August 11th, 2015, over 90% of the TPP had been negotiated.

Remind me – what’s so bad about lower barriers to trade?

See NAFTA and PNTR with China above. All of the previous trade deals had disastrous consequences for American workers, so there’s no reason to expect anything different this time.

Anything else?

As Sen. Elizabeth Warren explains in this article, there is a clause in the TPP called “Investor-State Dispute Settlement (ISDS)” which would allow corporations to sue governments for actions hurting their profits. This could be easily abused to limit governments’ abilities to keep their citizens and the environment safe. Most alarmingly, the international lawsuits would be judged and decided by corporate lawyers.

Wait. That sounds crazy. How is that real?

Here’s the explanation from the U.S. Trade Representative:

Governments put ISDS in place for at least three reasons:

  1. To resolve investment conflicts without creating state-to-state conflict
  2. To protect citizens abroad
  3. To signal to potential investors that the rule of law will be respected

While that sounds reasonable enough, the history of corporations suing governments over health and safety regulations gives plenty reason to be concerned. One unnerving example of this is Phillip Morris suing governments around the world for their regulations on cigarette sales. If you have 20 minutes, check out this funny and informative exposé by John Oliver.

So what’s Bernie saying?

Bernie outlined ten specific objections leading him to join other progressives such as Elizabeth Warren in voting against the TPP, three of which are listed below:

  • The TPP will allow corporations to outsource even more jobs overseas.
  • Wall Street would benefit at the expense of everyone else.
  • The TPP has no expiration date, making it virtually impossible to repeal.

Bernie also opposes the secrecy surrounding the TPP:

“If TPP was such a good deal for America, the administration should have the courage to show the American people exactly what is in this deal, instead of keeping the content of the TPP a secret.”

Bernie wrote in an article for The Guardian that “the TPP is simply the continuation of a failed approach to trade — an approach which benefits large multinational corporations and Wall Street, but which is a disaster for working families.”

In 2015, Bernie spoke out in congress about the TPP:

 

And what’s the deal with it being “secret”?

The TPP has been kept almost entirely secret. The public has not been given access to the bill. The public is only able to know what has been leaked, or explained by congressional representatives. Members of congress cannot photograph or copy the bill, and their staff are not allowed to see the bill.

Bernie has spoken out against this secrecy.

In this letter to the U.S. Trade Representative, he writes:

“It is incomprehensible to me that the leaders of major corporate interests who stand to gain enormous financial benefits from this agreement are actively involved in the writing of the TPP while, at the same time, the elected officials of this country, representing the American people, have little or no knowledge as to what is in it.”

Also, he explains his position in this video:

What other groups oppose the TPP?

The AFL-CIO group of unions has spoken out against the TPP, and many environmental groups, including the Sierra Foundation, have stood against “fast track” Trade Promotion Authority (TPA). Doctors without Borders believes the TPP contains “rules that would restrict access to affordable, lifesaving medicines for millions of people,” and is urging the United States, and other countries, to withdraw from the deal.

What about the other countries? Don’t they need jobs?

In his op-ed for the Guardian, Bernie writes:

“[T]wo of the countries in the TPP are Vietnam and Malaysia. In Vietnam, the minimum wage is equivalent to 56 cents an hour, independent labor unions are banned and people are thrown in jail for expressing their political beliefs or trying to improve labor conditions. In Malaysia, migrant workers who manufacture electronics products are working as modern-day slave laborers who have had their passports and wages confiscated and are unable to return to their own countries. American workers should not have to ‘compete’ against people forced to work under these conditions. This is not ‘free trade’; it is a race to the bottom.”

So what does Bernie think we should do?

Of course, it would be detrimental for us to close all doors to trade. Bernie believes that trade agreements can be successful, as he wrote in an op-ed for the Huffington Post in 2007:

“Nobody I know believes we should place a wall around this country. Trade is a good thing, but what we must begin doing is negotiating fair trade agreements that reflect the interests of working families in America, working families in other countries, and not just large multinational corporations and the CEOs who help write these trade agreements.”

Bernie reiterated this in his op-ed in the Guardian this year, “The TPP must be defeated, but our overall trade policy must also change for corporations to start investing in America and creating jobs here again, and not just in China and other low wage countries.”

From Bernie’s Senate web page, “Rebuilding the country’s infrastructure, transforming America’s energy system, rebuilding the nation’s manufacturing sector, and helping small businesses create jobs are the most effective ways to create jobs and expand the ranks of the middle class.”

For more information about Bernie’s economic policies, check out our Economy and Jobs page.