December 27, 2013
Morning Edition had a segment on the Trans-Pacific Partnership and EU-U.S. trade agreement today. The piece began with a speech by President Obama in which he asserted that exports have been one of the fastest growing sectors of the economy. This is not true in any meaningful sense.
What matters for the economy is net exports, not exports alone. If GM shuts down an auto assembly plant in Ohio and replaces it with one in Mexico, which then ships the cars back to the United States, this would show up as an increase in exports. However, it would be associated with a loss of jobs and output in the United States since it means that imports will have grown by even more.
Much of our trade has this character. If we look at net exports, trade has actually been a drag on growth in 2013. Presumably President Obama understands this fact and was simply trying to deceive his audience to promote his trade agenda. NPR should have exposed this deception rather than assisting President Obama in accomplishing this goal.
The piece also repeatedly refers to these deals as “free trade” agreements. This is inaccurate. Many of the provisions in the proposed agreements have little to do with trade, as was explained in the segment, and some will actually increase barriers, as is the case with rules that will lead to strengthened copyright and patent protection.
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