International Association of Machinists and Aerospace Workers : Local Lodge 2003: Trade Offsets Threaten U.S. Jobs, National Security

Trade Offsets Threaten U.S. Jobs, National Security
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IAM&AW International on April 17, 2008 05:03pm
 
“Over the 14-year period 1993-2006, U.S. companies reported over 8,500
transactions, valued at $42 billion, that involved the transfer of production
and technology to 42 countries,” says Herrnstadt. “A U.S. government report
concludes that over 16,000 jobs were lost each year between 2002 and 2005 due to
offset transactions in the defense industry.”
The report (http://www.sharedprosperity.org/bp201.html
), issued as part of the Economic Policy Institute (EPI) Agenda for Shared
Prosperity, points out that demand for such deals is increasing steadily in all
regions.
Offsets “can and do assist in the creation of enterprises in other countries,
ultimately resulting in greater competition for U.S. companies and their
workers,” says Herrnstadt. “At the same time, other countries develop
powerful companies that come back to compete fiercely with U.S.-based
companies.” Herrnstadt cites the aerospace industry in China as a growing
concern.
U.S. policymakers should immediately adopt policies that will enable the United
States to aggressively use offsets to its own advantage. Additional measures
recommended in the report include: strengthening prohibitions on offsets in all
multilateral and bilateral trade agreements; shining a light on current offset
transactions in both the defense and commercial industries and creating a
meaningful commission to devise an effective policy.