ReMaking America in NYC
Alliance for American Manufacturing (AAM) President Scott Paul visited New York City yesterday to talk shop with a pair of economic policy experts.
Jared Bernstein, of the Center on Budget and Policy Priorities; Leo Hindery, Jr., of the New America Foundation; and Paul covered topics including jobs, manufacturing, and trade policy. And Hindery mentioned the cost differential between a manufactured good in China and one in the US, a comparison he also noted in AAM’s book, ReMaking America:
Right now, fully 90 percent of the cost differential between an average good manufactured in China and a similar good manufactured in the United States is accounted for by various Chinese subsidies, most of them illegal under the World Trade Organization (WTO). Only about 10 percent of the difference is due to the differences in wages — which, of course, is contrary to popular belief.
Theses subsidies are an unfair trade practice similar to currency manipulation. Unfair trade practices drive up the U.S. trade deficit with China which reached an all-time high of $30.1 billion in July. Bernstein stated that balancing the trade deficit would boost our own economy.
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