The Trade Partnership: Everyone Has a Stake in Trade

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From USA-ITA OFF THE CUFF for July 27, 2012

On July 17th, The Trade Partnership, an Associate Member of USA-ITA, hosted a lunch roundtable at the Heritage Foundation in Washington, D.C., titled, “Everyone Has a Stake in Trade: A Review of U.S. Exports by Congressional District.” With a number of Congressional staffers in attendance, The Trade Partnership explained what, exactly, America exports—and why trade is important to both exports and jobs. 

The discussion highlighted a May 2012 report by The Trade Partnership with the same title. According to Daniel Anthony, research director at the firm and author of the report, “As policy makers seek to promote initiatives and legislation that would enable the United States to meet the goal of doubling U.S. exports by 2014, it is useful for Members of Congress to know what America exports, from where, and the impact of those exports on jobs in their districts. This paper provides some answers.”

Indeed, the answers may be surprising to some—but of course, not to those who are advocates of opening trade and global markets. Every congressional district exports something—and in fact, 93% of congressional districts had merchandise exports exceeding $1 billion in 2011. What may be more surprising is that 75% of congressional districts exported at least $500 million in services that same year, totaling $606 billion nationwide in 2011. Congress may be surprised to learn that one in eight districts in the country are larger exporters of services than they are of goods—and we shouldn’t discount this in discussions about trade and the economy. It’s likely no surprise to our industry that the leading congressional districts in the export of services include New York’s 14th district and 8th district. (Other leading services-exporting districts include those in and around San Francisco, San Jose, Seattle, Boston, Atlanta, Las Vegas, and of course, Washington, D.C.)

The report also highlights the fact that jobs are not always determined by the number of exports, but the type. “We’re not talking about a handful of people here and there, but thousands or tens of thousands of direct jobs throughout the district,” the report notes.

Why does this matter to trade policy, and opening markets? We need somewhere to sell those exports, whether those exports are goods or services. To create jobs, we need trade. To increase trade, we need to:

  1. Open new markets for goods and services. (Trans-Pacific Partnership, anyone?)
  2. Develop the rest of the world, so they become our customers for goods and services. (This is why the African Growth & Opportunity Act is so important to USA-ITA. By helping Africa manufacture goods, like apparel, we create jobs there, and in turn, create potential customers for our goods, too.)
  3. Increase education about the benefits of trade. (Thanks, Trade Partnership!)

But, we can’t have exports without imports, as John Murphy, Vice President of International Affairs at the U.S. Chamber of Commerce, noted. While millions of jobs are supported by exports, as the study shows, millions are also supported by imports—and U.S. producers are some of the biggest importers, as imports of materials help them to remain competitive. (USA-ITA members know this!)

In short, as we export more, we import more, and vice versa. It’s the nature of trade, and the reason why both exports and imports are important to the economy and jobs.