Bernie

[grantcart]

31. Well I didn't really go into the TPP like I would like to lol

There are two key points that people should understand about the TPP above everything else.

I know a little about international manufacturing as I owned a factory of 400 at one point and we were the largest manufacturer of leather furniture for IKEA.

1) "I am against the TPP"

This is one of the most hilarious phrases ever uttered by an American politician. I can assure you that no one outside of the United States would utter such nonsense. The Brits, for example, would never state "I am against the European Union to exist", but rather "the UK should leave the European Union".

It is only in the US that an American would say "I am against the TPP" as if everything is defined by its perception in the US. Whether or not the US joins the TPP it will in fact exist. It will include Australia, NZ, Canada, Mexico, Japan, Taiwan, Singapore and some developing economies like Thailand and Vietnam.

The only question should be "will the US be the only major Pacific Country (besides China who is purposely being excluded) to NOT belong". Trump and Sanders stating that they are against the TPP as if without their assent that it would cease to exist.

2) Leaving the TPP is, at its core results in tax on American workers.

I know this is completely counterintuitive but it is. One of the problems is in the misunderstanding (again by uninformed populists) about the cost and benefit of NAFTA. NAFTA was fundamentally a readjustment of tariffs in favor of the US. The reality is that most of the tariffs of goods coming into the US WERE ALL READY LOWERED FOR MEXICO PRIOR TO NAFTA. There were a number of programs, including the Maquiladora Program which lowered tariffs for Mexican product into the US prior to NAFTA.

While some factories did move to Mexico (and most of these then moved to China) these are factories that largely did not fit our profile for our work force. The big auto assembly factories like Toyota, Nissan, and Ford were already there because of Maquiladora, I know because I toured them.

So low skill, low paying, labor intensive jobs would likely move south but product requiring high skill, high paying, high tech, capital intensive would move north. In the furniture business you would expect that leather furniture would go south (by the way most of the furniture manufacturing jobs had already moved away from the mid west. The industry moved from Chicago to North Carolina and finally to Tupelo Mississippi, so those jobs would never return to the 'industrial midwest' let alone Vermont.)

In fact those jobs stayed in Mississippi but IF a factory closed and went south you would see a visible building and jobs lost. But in the furniture part of NAFTA almost all the business moved from Mexico to the US. Wood tables now use very expensive machines costing tens of millions to shave wood service on a thin veneer and then glue that to cheap particle board. That increase in business didn't mean a new factory would be built but that additional production time and jobs would go to that factory.

So, in furniture manufacturing, all the losses to the US would be visible and all of the gains invisible.

Pretend that GM invents a great new electric motor scooter that is a significant advancement in that market.

That market will be in Asia; Vietnam, Thailand, Indonesia etc.

If we manufacture that in the US it will be more expensive to make because of duties of raw material coming into the US and face a 35% tariff going to those countries.

GM doesn't have to stay here and pay the tariff they can move it to existing factories in Canada, Australia or Thailand and Vietnam. So the Tariffs aren't applied to the companies who can put their factory anywhere but are only really applied to American workers.

This is what happened with Harley Davidson who moved their export only factory from the US because once we left the TPP it was no longer viable.

Good multilateral trade agreements benefit American workers more than it helps them.

And then there is this: lower tariffs force US industry to continue to upgrade manufacturing technology which increases worker productivity. Why is Canadian Steel cheaper than US steel when Canadian manufacturer has to pay for comprehensive universal health care? Because US steel hasn't kept up with the major capital investment needed.