Transcript Environmentalism Through the Enforcement of Trade Laws

Major Issues in International Trade

Currency manipulation


Subsidies


China has provided billions of dollars in subsidies, directly and
indirectly, to its steel industry
Attempts to weaken the trade laws


China and other Asian countries keep the value of their
currencies artificially low to make their exports cheaper and
imports more expensive
Multinational corporations that want to be able to rely on
dumped and subsidized merchandise
Climate change

Some solutions would encourage U.S. manufacturing to move to
China and elsewhere, leading to greater greenhouse gas
emissions
U.S. Dollar per Chinese Yuan
Exchange Rate
0.18
0.17
0.16
0.15
0.14
0.13
0.12
0.11
Dec-07
Sep-07
Jun-07
Mar-07
Dec-06
Sep-06
Jun-06
Mar-06
Dec-05
Sep-05
Jun-05
Mar-05
Dec-04
Sep-04
Jun-04
Mar-04
Dec-03
Sep-03
Jun-03
Mar-03
Dec-02
Sep-02
Jun-02
Mar-02
Dec-01
Sep-01
Jun-01
Mar-01
Dec-00
Sep-00
Jun-00
Mar-00
Dec-99
Sep-99
Jun-99
Mar-99
Dec-98
Sep-98
Jun-98
Mar-98
Dec-97
Sep-97
Jun-97
Mar-97
Dec-96
Sep-96
Jun-96
Mar-96
Dec-95
Sep-95
Jun-95
Mar-95
Dec-94
Sep-94
Jun-94
Mar-94
Dec-93
Sep-93
Jun-93
Mar-93
0.10
U.S. Dollar per
Chinese Yuan
Source: Pacific Exchange Rate Service
Illegal and Abusive Subsidies

Discounted Land Costs

Discounted Energy Costs

Low Cost Loans

Debt Forgiveness

Lack of Environmental Compliance
Chinese Steel Production
1996-2010
700
Estimated
647 mmt by 2010
Millions of Metric Tons
600
500
400
300
200
100
Total Production of Crude Steel – International Iron & Steel Institute (IISI), Steel Statistical Yearbook 2007 and Crude Steel Statistics 2007
2010
2009
2008
2007
2006
2005
2004
2003
2002
2001
2000
1999
1998
1997
1996
0
U.S. Trade Deficit
1997-2007
900
Billions of Dollars
800
700
600
500
400
China
accounted
for over 32%
of the U.S.
Trade Deficit
in 2007!
300
200
100
U.S. Trade in Goods with World (Seasonally Adjusted) in Billions of Dollars through December 2007; U.S. Census Bureau
2007
2006
2005
2004
2003
2002
2001
2000
1999
1998
1997
0
Trade Deficit
U.S. Manufacturing Jobs vs. Trade Deficit (2000-2007)
900
18000
600
16000
500
400
15000
300
200
100
0
13000
U.S. Trade in Goods Deficit in Billions of Dollars
(Over Previous 4 Quarters)
700
17000
14000
U.S. Employees in Manufacturing (in Thousands)
Manufacturing Jobs
Source: U.S. Census Bureau
800
Dec-07
Sep-07
Jun-07
Mar-07
Dec-06
Sep-06
Jun-06
Mar-06
Dec-05
Sep-05
Jun-05
Mar-05
Dec-04
Sep-04
Jun-04
Mar-04
Dec-03
Sep-03
Jun-03
Mar-03
Dec-02
Sep-02
Jun-02
Mar-02
Dec-01
Sep-01
Jun-01
Mar-01
Dec-00
Sep-00
Jun-00
Mar-00
U.S. Manufacturing Jobs
(in thousands)
20,000
17,500
15,000
12,500
Jan-07
Jan-06
Jan-05
Jan-04
Jan-03
Jan-02
Jan-01
Jan-00
Jan-99
Jan-98
10,000
Almost 4 million manufacturing jobs have been lost
since manufacturing peaked in 1998
Alabama Manufacturing Jobs
400,000
350,000
300,000
250,000
200,000
1997
1999
2001
2003
2005
2007
Nearly One of Every Five Alabama Manufacturing
Jobs Has Been Lost in the Last Decade.
42%
30,000
42%
48%
52%
34%
54%
41%
Office Machinery
Hand & Edge Tools
Hardware
Pottery Ceramics
Rolled, Drawn,
Extruded Copper
Auto Parts
(Carboreturs Pistons)
Small Electrical
Appliances
Plumbing Fixtures
Source: U.S. Bureau of Labor Statistics
Glass Containers
1994
2007
0
52%
20,000
37%
40,000
Manufacturing Jobs
Endangered Manufacturing
Industries
60,000
50,000
10,000
The State Crisis: Manufacturing Jobs Lost
June 1998 to December 2007
The Multinationals’ View




Large multinational manufacturers and trading
companies (“MNCs”) generally oppose any
strengthening of the trade laws
Their chief focus is maximizing worldwide
profits, not achieving maximum production and
employment in the United States
These companies have a vested interest in
bringing dumped and subsidized imports into the
United States
Because of their size, they have substantial
political clout
U.S. - China Direct Investment
(2000 – 2006)
25
China Direct
Investment in U.S.
U.S. Direct
Investment in China
Billions of U.S. Dollars
20
15
10
5
Source: The U.S. Bureau of Economic Affairs, Direct Investment, Direct Investment Position on a Historical-Cost Basis
2006
2005
2004
2003
2002
2001
2000
0
Major Issues in International Trade

Currency manipulation


Subsidies


China has provided billions of dollars in subsidies, directly and
indirectly, to its steel industry
Attempts to weaken the trade laws


China and other Asian countries keep the value of their
currencies artificially low to make their exports cheaper and
imports more expensive
Multinational corporations that want to be able to rely on
dumped and subsidized merchandise
Climate change

Some solutions would encourage U.S. manufacturing to move to
China and elsewhere, leading to greater greenhouse gas
emissions