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An Open Letter in support of H.R. 2165, a bill to repeal the Trade Adjustment Assistance (TAA) programs under the Trade Act of 1974.

July 5, 2011

The Honorable Dennis Ross
United States House of Representatives
404 Cannon House Office Building
Washington, D.C. 20515 

Dear Representative Ross:

On behalf of the 362,000 members of the National Taxpayers Union (NTU), I write in support of your bill, H.R. 2165, a bill to repeal the Trade Adjustment Assistance (TAA) programs under the Trade Act of 1974. Your legislation would end an unnecessary and costly federal program that gives undue preferences to a minuscule, politically-favored section of the American workforce.

The TAA program provides workers “displaced” by foreign trade with an array of compensatory remuneration, far beyond traditional unemployment benefits, under the rationale that they were left unemployed due to economic factors beyond their control. Not only does this perpetuate the wrongheaded assumption that free trade is harmful, but also creates an awkward distinction between jobs lost due to foreign competition and jobs lost due to a host of other reasons including new technologies, changing consumer tastes, or domestic competition. Rather that denigrate free trade, policymakers should consider the plight of U.S. workers displaced by a lack of vigorous commerce with other nations.

Unfortunately, extensions of the wasteful TAA program have long been the cost of support for the free-trade policies that have allowed American consumers to enjoy more choices better value. In similar fashion, the Obama Administration is insisting that an extension of TAA be tied to the ratification of the pending free trade agreements with South Korea, Panama and Colombia. This is nothing more than a political handout to a small but powerful group (organized labor) at the expense of economic growth, jobs, and lower prices that would benefit all taxpayers. With our government mired in an overspending crisis and America’s economic recovery sputtering, now is the time to promote job growth, not saddle taxpayers with TAA’s $2.4 billion price-tag.

Recently, NTU has strongly been supportive of legislative efforts to allow for an up or down vote on the pending free trade agreements without a renewal of the Trade Adjustment Assistance program. H.R. 2165 would go one step further, not only ensuring separate votes, but repealing the wasteful TAA program altogether. Doing so is an appropriate response not only to current fiscal conditions but also to concerns that both the Office of Management and Budget and the Government Accountability Office have raised over the program’s effectiveness.

The liberalization of trade is a goal that should transcend parties and politics. It not only engenders innovation and lower prices on our shores, but is a powerful force to propagate the virtue of freedom and the benefits of economic development around the globe. For these reasons, NTU supports H.R. 2165 and hopes to work with you toward ensuring a stand-alone vote on the free trade agreements with South Korea, Panama and Colombia.

Brandon Greife
Federal Government Affairs Manager