For immediate release:
Sara Haimowitz, Development and Membership Coordinator
CPA Statement in Opposition to Permanent Normalized Trade Relations with Russia
The CPA Board met yesterday to consider a recent Senate bill which would offer Permanent Normalized Trade Relations (PNTR) status for Russia, effectively paving the way for Russia to be admitted into the WTO. The Board voted unanimously to oppose the bill.
CPA opposes PNTR for Russia because it remains a state-directed economy, rather than a free market economy. The Russian government has reasserted a dominant role in key industries. Further, Russia maintains the ability to manipulate its currency, subsidize its state-favored companies and increase its value added taxes charged to imports from the U.S.
In 1999, the same proponents of PNTR for Russia argued for and pushed through a bill granting Permanent Normalized Trade Relations for China. The same export growth arguments were made while ignoring the potential import explosion. The import explosion that materialized was made possible by those same proponents outsourcing American jobs to China. China has now become the biggest source of our trade deficits with the U.S. economy and the European economy. Both economies are losing middle class jobs and the consequences are evident.
The U.S. has been running record trade deficits for several years, thereby depressing job creation, industry growth and wealth creation. We under produce in relation to consumption. This problem has been caused by America’s inability or unwillingness to neutralize foreign unfair trade practices, including state capitalism and its inherent barriers and subsidies. The U.S. cannot afford to continue making the same mistakes again and again.
American leaders have long asserted speculative future trade benefits from agreements with state managed and state directed economies. Time after time, those benefits have not appeared. Rather, the result has been worsening trade deficits, due to imports increasing faster than exports, and the resulting loss of industry and jobs.
CPA has, with other associations and companies, developed principles for 21st Century Trade Agreements. The Principles, including neutralizing state capitalism, are a clear roadmap for America to become a successful trading nation. We believe the Administration, the Congress and the Office of the US Trade Representative should adopt and further those Principles to correct, rather than magnify, past trade mistakes.
The Coalition for a Prosperous America is a nonprofit organization representing the interests of 2.7 million households through our agricultural, manufacturing and labor members.