Alfonse D'Amato

On U.S. trade, it’s déjà vu all over again

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It looks more and more like the U.S. is heading toward a showdown with our Mexican and Canadian trading partners over the renegotiation of the North American Free Trade Agreement. There’s a basic reason for this. Donald Trump is sitting in the Oval Office instead of Hillary Clinton, thanks to voters in key industrial states like Michigan, Pennsylvania, Ohio and Wisconsin.
Those Rust Belt voters responded to Trump’s forceful defense of American manufacturing in the face of too-often unfair competition from our trading partners. Especially when he chastises American companies for shifting production out of America, Trump strikes a chord with working middle-class men and women.
For sure, this fight isn’t new. American manufacturing has been on the decline for decades, handicapped by cheap foreign labor, lax worker protection and lower environmental standards abroad. Whether it’s Chinese dumping of steel, South Korean dumping of solar panels or Mexican dumping of cars into the U.S. market, the pattern is almost always the same: American jobs are sacrificed and American businesses are undercut. Free traders would have us believe that this is just the way free markets work, and they might be right if markets were in fact free, but they’re not.
I found that out personally a quarter century ago, during a bruising trade battle that ended in the loss of an iconic American company and the shift of its jobs outside the U.S. Smith Corona was a major manufacturer of typewriters and early-generation word processors. It had a plant in upstate New York that was under attack by a Japanese competitor, which was found to be dumping below-cost machines into the American market. Because the U.S. response to this unfair trade was so slow and ineffective, Smith Corona announced that it would close its New York plant and move its production to Mexico, where low wages would help keep the company competitive and profitable.
I was a senator at the time, and had the painful task of meeting with the managers and workers at the New York plant as they digested the news that their jobs were gone and their lives changed forever. These were proud working-class people who are the backbone of America. Some had worked at Smith Corona all their lives, as had their parents.

As it happened, a tax bill was wending its way through Congress at the time. I offered an amendment to the bill that would have forced the U.S. Commerce Department to stop dragging its bureaucratic feet and fast-track the imposition of “countervailing import duties” against the foreign companies that were dumping typewriters here. I then took to the Senate floor in a marathon 15-hour filibuster to force it to take a stand on the amendment. My colleague Sen. Pat Moynihan and I spent an entire night trying to make the case for protecting American workers from unfair trade practices.
The argument against this effort was the same we’ve heard for decades before and since: The free market must be allowed to work, even when it displaces workers and dislocates lives. As is the case today, this pitted economic purists against pragmatic realists in a fight that usually ended badly.
In the case of Smith Corona, the free traders edged out the fair traders, and American jobs were lost. The same thing happened to steel mills in Pittsburgh and Buffalo, to textile mills in North and South Carolina, and to a score of other industries. American manufacturing was hollowed out by countries whose industries are heavily protected and subsidized by their governments. The U.S. response was slow and ineffectual. By the time our trade regulators recognized that we were being flooded by unfair foreign competition, it was too little, too late: The factories were shuttered, the jobs bled away.
Fast-forward to today, and as Yogi Berra famously said, “It’s déjà vu all over again.” When multinational corporations like Carrier and Ford announce that they’re moving factories to Mexico to reduce production costs; when Apple announces a new $1,000 iPhone that’s made at a plant in China, where wages are a few dollars a day; when one American industry after another is under siege in foreign state-sponsored economic warfare; is it any wonder that NAFTA is now in the president’s cross hairs?
It might be that the best way to bring our trade system back into balance is to revisit this and other trade agreements and take a stronger stand in defense of U.S. economic interests first, not last.

Al D’Amato, a former U.S. senator from New York, is the founder of Park Strategies LLC, a public policy and business development firm. Comments about this column? ADAmato@liherald.com.