Yup — it’s true. Believe it or not, our manufactured goods deficit with NAFTA and the other U.S. free trade partners is shrinking. And not just a little, either. The manufacturing deficit with those countries has shrunk an impressive 25%. (Lou Dobbs, are you listening….?) The countries with which we have free trade agreements – NAFTA (Canada and Mexico), Australia, Chile, Israel, Jordan, and Singapore – account for 43% or our manufactured goods exports, and only 6% of our deficit. Bet you didn’t know that.
But now that you know, you understand why the NAM is such a big fan of free trade agreements. U.S. tariffs (taxes on imports) average only 3%, while the average for the rest of the world is 30%. So if we go from 3% to zero, and they go from 30% to zero, it makes sense that we would gain a lot of exports. That’s what is happening, and that’s why we want more trade agreements. Trade agreement lower barriers to entry to US-made goods, not the other way around. When we export, we create more jobs here and strengthen manufacturing right here at home.
All these facts and more are in the new NAM report, “Interim Report on 2005 U.S. Manufactured Goods Trade“. Come get the facts.
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