Cato Institute Director Dan Griswold: Unionization Made America Less Competitive in Global Trade

Cato Institute Director Dan Griswold Racism was the issue that kicked off Neal Asbury’s nationally syndicated “Neal Asbury’s Truth for America Show” on WZAB-AM. He opened the show by noting that despite the fact that he was proud that America elected an African-American president, it did not mean that he had to agree with President Obama’s policies. But this has nothing to do with race, Neal quickly pointed out, but rather some administration policies that he believes are undermining the country. What is disturbing is the re-emergence of racism, largely spurred by the story of the forced resignation of Georgia State Director Shirley Sherrod over supposed racist remarks she made about a white farmer. While she has since been exonerated and has been offered back her old job, any discussion of racism sets this country back. “Race has no place in this country. For me, or for any American. Using race is divisive, and is wrong and just plain immoral. Racism must stop becoming an issue because it distracts us from more important issues,” said Asbury.

Joining the show as a return guest was Daniel Griswold, Director of the Center for Trade Policy Studies at the Cato Institute in Washington, DC. who since joining Cato in 1997, has authored or co-authored major studies on globalization, trade and immigration, including the 2007 study, “Trading Up: How Expanding Trade has Delivered Better Jobs and –Higher Living Standards.” He is the author of the best-selling book “Mad About Trade.”

While Griswold is disappointed about President Obama’s economic policies and failed stimulus program, he is encouraged that American trade continues to prosper in spite of the inattention it gets from the White House. He points to the fact that half of US exports now go to emerging markets such as China, India and Brazil.

“Trade continues to confuse most Americans, including elected officials. Trade is not just about creating jobs, it’s about creating better jobs in the US – jobs with higher salaries that reflect a better educated workforce,” said Griswold. “It’s also not about finding cheaper labor – its opening new markets for US goods. When we export, the goods are being bought by foreign customers, which bring dollars back to America.”

As an example, Griswold noted that GM sells more Buicks in China than in the US.

Griswold noted that 250,000 US companies are doing business overseas, the majority of which are small and medium-sized companies. The growth for US companies will be in the service sector, predicted Griswold, since China will be surpassing the US in manufacturing output.

In the meantime, the US is ranked number one in car manufacturing, computers, semiconductors and books. Best of all, the US continues to grow these sectors with a smaller workforce, due to productivity improvements.

“One of the overlooked benefits of foreign exports is that it lifts millions of foreign consumers out of poverty and helps create a middle class. This creates better, more stable neighbors, and the US is less likely to engage in a fight with a country that has become a friend and ally,” said Griswold

Griswold contends that unions make America less competitive overseas. “Exports do not kill US jobs. It is unions that are killing US jobs because they make those companies less competitive. Look at unionized US auto companies that have been yielding market share to non-union foreign manufacturers operating plants in America. There is a reason unionism is down across the country,” suggested Griswold.

He is concerned that Obama has tipped the scales in favor of the unions to reward them for their financial contributions to the Democratic Party. As a result, unions have been able to press ahead on their Card Check program, and stall passage of three key free trade agreements that are hung up in Congress. Griswold believes that if the South Korean free trade agreement was passed, it would add $10 billion to US revenues, and the Colombia free trade agreement would add at least $1 billion. However, Griswold sees little hope that the trade agreements will be passed before the November elections, although he believes that the period leading up to the elections would be a perfect time for the Congress to demonstrate some bipartisan thinking and pass the pending three agreements.

Griswold also wants to see an end to the US picking fights with key trading partners such as China and Mexico, which actually winds up punishing US exporters.

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2 Responses to “Cato Institute Director Dan Griswold: Unionization Made America Less Competitive in Global Trade”
  1. Libertarian says:

    As long as we keep putting people into racial categories we will continue to believe those categories are different. We need to stop it. What if, for instance, we started putting people into categories based on levels of poverty or wealth. Do you think that would make any difference in our prejudices – I don’t.

    I only offer one example of the decline of the nation with the rise of Unions – consider what happened to our education system with the rise of the NEA. Need I say more?

    Several people I’ve recently spoken to that were members of a union indicate that they pay dues and get little return on investment (except of course for the compensation of union organizers).

    Nuff said?

  2. Karen G says:

    I belonged to a union for five and a half years. During that time I had a manager who did not pay me scale wages, and when I complained to the union I was brushed off. The union took my money and used it to promote politicians who take even more of my money, but they didn’t do anything of value for me.

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