Fact-Checking the Obama Administration on Trade

Debunking Data Distortions from Obama's Trade Representative

By Public Citizen's Global Trade Watch

Years of unfair, corporate-rigged “trade” deals have contributed to ballooning U.S. trade deficits, mass offshoring of good U.S. jobs, and a historic increase in U.S. income inequality.

But rather than change our failed trade policies, the administration appears bent on trying to hide the facts — by changing the data.

As U.S. Trade Representative (USTR) Michael Froman pushes for the largest expansions of the corporate-rigged “trade” model to date — the proposed Trans-Pacific Partnership (TPP) and Transatlantic Trade and Investment Partnership (TTIP) — his office has resorted to data distortions to obscure the dismal outcomes of past trade deals.

Here’s a sampling of USTR’s outlandish claims, based on data distortions and omissions, alongside the sobering realities about our trade policies, based on official U.S. government data.

Check out these myth-debunking resources from Public Citizen:

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• Don’t Believe the Hype: Agricultural Exports Lag under Trade Deals, Belying Empty Promises Recycled for the TPP (July 2, 2015)
• Raw Deals for Small Businesses: U.S. Small Firms Have Endured Slow and Declining Exports under “Free Trade” Deals (June 22, 2015)
• U.S. Polling Shows Strong Opposition to Fast Tracking More of the Same U.S. Trade Deals from Independents, Republicans and Democrats Alike (June 9, 2015)
• Why Warren Is Right and Obama Is Wrong on Fast Track’s Threat to Wall Street Reform (May 12, 2015)
• Debunking Ten Common Defenses of Controversial Investor-State Corporate Privileges (May 11, 2015)
• Only One of 41 Attempts to Use the WTO’s “General Exception” to Defend a Domestic Policy Has Ever Succeeded (April 30, 2015)
• Talking Point in Defense of TPP Is 95% Irrelevant (April 29, 2015)
• Myth v. Fact on the 2015 Fast Track Bill (April 20, 2015)
• Unpacking USTR’s Attempt to Hide Our Large Trade Deficit with FTA Partners (March 15, 2015)
• Forthcoming TPP Sales Pitch So Predictable, We Decided to Predict It (February 26, 2015)
• Corporate FTA Boosters Omit Imports, Use Errant Methods to Claim Higher Exports under FTAs (February 25, 2015)
• If Pinocchio Were Trying to Sell a Controversial Trade Deal (February 3, 2015)
• 10 Tall Tales on Trade: Fact-Checking Obama’s Top Trade Official (January 28, 2015)
• Infographic: Obama vs. Obama (January 21, 2015)
• Obama vs. Obama: The State of the Union’s Self-Defeating Trade Pitch (January 20, 2015)
• Debunking USTR’s Absurd Assertion that the U.S. Has a Trade Surplus with NAFTA Countries (January 13, 2015)
• Infographic: NAFTA Terms Replicated in TPP (January 9, 2015)
• TPP Government Procurement Negotiations: Buy American Policy Banned, a Net Loss for the U.S. (January 6, 2015)
• Obama Laments Inequality, Calls for Another Inequality-Spurring Trade Deal (December 4, 2014)
• USTR’s Omissions and Data Distortions Aimed at Hiding the Dismal Realities of the Korea Free Trade Agreement (December 20, 2014)
• Report Funded by Big Business Explains to Small Businesses What’s Best for Them (November 14, 2014)
• Defending Foreign Corporations’ Privileges Is Hard, Especially When Looking At The Facts (November 11, 2014)
• Buy American Would Be Gutted under the TPP: Unraveling the Spin from USTR (October 21, 2014)
• USTR Ignores Congressional Request to Stop Using Distorted Data (October 15, 2014)
• Report: Myths and Ommissions: Unpacking Obama Administration Defenses of Investor-State Corporate Privileges (October 2, 2014)
• Chamber of Commerce Uses “Weird Facts” to Claim a $106 Billion Trade Deficit Isn’t There (September 18, 2014)
• Pharmaceutical CEO: This Controversial Deal Will Be Great for Us…And You (Trust Us) (September 17, 2014)
• U.S. Trade Officials Defy Post-Crisis Consensus Backing Capital Controls (July 25, 2014)
• Let’s Just Pretend We Didn’t Offshore Manufacturing (July 3, 2014)
• Corporate America’s Mysterious Affinity for the Number 700,000 (June 25, 2014)
• Nixon Hatched Fast Track, Not FDR (June 18, 2014)
• Chamber Resorts to Cartoonish Analogies to Defend Corporations’ ‘Right’ to Attack Policies (May 30, 2014)
• Corporate Group Launches “Fact-Based” Trade Series, Avoids Facts (April 17, 2014)
• Data Debunk for USTR Froman’s Thursday Committee Hearing (April 2, 2014)
• The 2014 Trade Agenda: What Hole? Keep Digging. (March 4, 2014)
• Report: The Rising Use of the Trade Pact Sales Pitch of Last Resort: TPP Foreign Policy Arguments Mimic
• False Claims Made for Past Deals (April 10, 2014)
• New Polls Reveal that U.S. Public Supports Trade in General, while Opposing Current “Trade” Policy Agenda (March 31, 2015)
• Don’t Be Fooled: NAFTA Proponents Use Flawed Methods to Try to Hide Enormous NAFTA Trade Deficit (February 24, 2014)
• Fact-checking Froman: The Top 10 Myths Used by Obama’s Top Trade Official (February 19, 2014)
• TPP Corporate Factsheet Flurry – Many Sheets, Few Facts and the Same Old Promises that Have Proven False (November 6, 2013)
• Gussying Up Old Assumptions: Today’s TAFTA-Touting Report Is a Re-Run (September 24, 2013)
• Obama’s Corporate Export Council Ignores Dismal Export Data, Backs More-of-the-Same “Trade” Deals (September 20, 2013)
• Fast Track: New Report Proves Difficulty of Defending the Indefensible (October 10, 2013)
• Factsheet: Debunking Bogus Claims of TAFTA Economic Gains (October 4, 2013)
• TAFTA’s Trade Benefit: A Candy Bar (July 11, 2013)
• Don’t Be Fooled by Data Tricks: The Case of the Dueling Korea FTA Press Releases (March 18, 2013)
• The Obama Administration Wants to Sell You a Used Trade Policy (March 1, 2013)
• A Shiny Quarter per Day: New TPP Study Uses Sweeping Assumptions to Project Tiny Benefit (January 9, 2013)

USTR’s Trade Myths  | “Factoryless Goods”

 

USTR’s Trade Myths	Reality
“Almost 95% of the world’s consumers are outside America’s borders.”	Less than 4 percent of the world’s consumers live in TPP countries with consequential tariffs. Most of those consumers live in Vietnam, where minimum wages average less than 60 cents an hour, meaning they earn too little to afford U.S. exports.
The TPP is “the most progressive trade deal in history.”‘	The TPP includes NAFTA’s offshoring incentives, Bush’s environmental and labor standards, Wall Street’s deregulatory rules, and corporations’ parallel legal system to challenge environmental and health protections. What’s progressive about that?
“If we don’t write the rules, China will.”	“We” did not write the TPP’s rules – multinational corporations did. They did not write them to counter China. They did not write them to benefit us. They wrote them to benefit their own narrow interests, at the expense of the majority.
See the tricks behind USTR’s TPP myths.
“The driver on our trade balance with Canada and Mexico… is fossil fuels.”	The fossil fuels share of our trade deficit with Mexico and Canada has declined under NAFTA, while the total NAFTA deficit has soared 523 percent, topping $170 billion.
We have a manufacturing trade surplus with our NAFTA partners, Mexico and Canada.	We have a manufacturing trade deficit with our NAFTA partners of more than $100 billion.
See the data tricks behind USTR’s NAFTA trade myths.
“Largely due to these two external factors [declines in corn and fossil fuel exports], total U.S. goods exports to Korea were down 4.0% in 2013 compared to 2011 (pre-FTA).”	Our trade deficit with Korea has ballooned 99 percent under the FTA, and exports to Korea have fallen. Without corn and fossil fuels, the deficit rise and export fall remain.
“U.S. exports of key agricultural products benefiting from tariff cuts and the lifting of other restrictions under KORUS continued to post significant gains.”	Total U.S. agricultural exports to Korea have fallen 19 percent under the FTA.
“U.S. vehicle exports have more than doubled, increasing from 16,659 vehicles in 2011 to 37,914 vehicles in 2014.”	U.S. imports of passenger vehicles from Korea have ballooned by 597,607 vehicles in the first three years of the Korea FTA, dwarfing the 36,580-vehicle increase in U.S. passenger vehicle exports to Korea.
See the data tricks behind USTR’s Korea FTA trade myths.

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The Obama Administration’s “Factoryless Goods” Scam
A Proposal to Disguise the Offshoring of U.S. Manufacturing

One administration proposal would even further distort government trade data. By counting products made offshore as ‘U.S. exports,’ this scam would hide the devastation of U.S. manufacturing. It would obscure the U.S. job offshoring that unfair trade deals incentivize.

Under this Orwellian “factoryless goods” rebranding initiative, U.S. firms like Apple that have offshored their production jobs would be reclassified as “factoryless goods” manufacturers. An iPhone made in China and sold in Europe would somehow perversely count as a U.S. manufactured export. This would deceptively deflate the reported U.S. manufacturing trade deficit — and artificially inflate the number of U.S. manufacturing jobs. Apple’s brand managers and programmers would suddenly be counted as “manufacturing” workers!

Thankfully, a groundswell of public opposition has helped to stall this proposal. But it has yet to be permanently buried. As we push to change our failed trade policies, we will need to keep pushing against efforts to try to take away the evidence that such a change is direly needed. Learn more.