The Seattle region has 16,000 jobs at risk due to Chinese tariffs alone.
Amid efforts to renegotiate the North American Free Trade Agreement, continued talks between U.S. and China leaders, a spate of new tariffs on various countries and products, and even the potential to reconsider joining the Trans-Pacific Partnership, this much is clear: The United States stands at a critical juncture regarding its place in global commerce.
The lines are increasingly clear as well: Either choose retrenchment from a global economy performing well by most statistical measures — due in large part to free trade — or opt for a sensible approach to ensure that trade deals are fair and balance the interests of U.S. workers and companies with the larger goal of economic opportunity.
The latter should be encouraged as the Trump administration evaluates existing and potential trade agreements, but it must not needlessly upend established supply chains, relationships with ally nations or the ability of U.S. companies and workers to compete abroad.
Privately owned freight railroads, a key player in supply chains that serve almost every industrial, wholesale, retail and resource-based sector of the economy, do not arrive at this conclusion because of self-interest. Rather, we see firsthand the trends and needs of our diverse customers — automakers and suppliers traversing North America to build cars, soy and grain farmers producing exponentially more product than past generations given their access to export to Asia and Mexico, or forestry products generated in the Pacific Northwest and moved by rail to the Port of Seattle. The net effect is clearly positive.
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The Peterson Institute for International Economics says that U.S. incomes are 9 percent higher today due to markets opened since World War II than they would have been if the U.S. walled itself off from other nations. Today, 41 million jobs — more than 20 percent of all workers — depend on trade.
Perhaps no region is more versed in this weighty discussion than Seattle, as its diverse economy is deeply tethered to liberalized trade policy. According to a recent report from the Brookings Institution, the region has 16,000 jobs at risk due to Chinese tariffs alone. Greater Seattle today maintains a staggering 138,271 jobs directly tied to exports, according to the same report. One recent study says that 40 percent of the Evergreen state’s total job market is tied to international trade, a number that towers over almost every other state in the nation.
While it will take time for this administration to clearly define its overarching trade agenda, we believe that U.S. leaders can take a major step in the right direction by finalizing an updated NAFTA, the trilateral pact between Canada, Mexico and the U.S. This will not only impart confidence to global markets — purchasers of Boeing or Honeywell products, for instance — but will help cement the 14 million jobs tied to the deal today.
It will also send a message that Washington understands that the deal, which has boosted the U.S. economy by $127 billion annually, ultimately benefits the U.S. and key sectors that undergird our way of life. Since NAFTA took effect, trade between Canada, Mexico and the U.S. has nearly quadrupled, reaching $1.3 trillion in 2014, while farmers exported nearly $43 billion in goods in 2016 alone to these three nations — a third of all U.S. agricultural exports.
Manufacturing, meanwhile, has boosted output by nearly 80 percent since the deal took effect.
Private freight railroads such as BNSF and Union Pacific in Washington, move large sums of these agricultural and manufacturing products. The industry today attributes more than 40 percent of its traffic to trade, as well as a third of its labor force. Trade continues to succeed in this country.
We must all understand that in an integrated global market, no trade policy happens in a vacuum. Let’s finalize NAFTA now to help define the United States’ trade vision. For the sake of economies such as Seattle, let’s all hope the vision seeks to open more markets — not close existing ones.