Outsourcing U.S. Jobs and Wages

Floor Speech

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Ms. DeLAURO. Mr. Speaker, I rise to bring much-needed attention to a critical issue: the outsourcing of U.S. jobs and wages.

I have been fighting on behalf of working people to stop outsourcing, to stop sending our jobs overseas; and fighting against low-income wages that outsourcing has caused since the day I came to the Congress.

Right now, we have an opportunity to make real progress, pushing back against outsourcing. But in order to make that opportunity reality, we cannot accept the status quo on the North American Free Trade Agreement.

Any renegotiated NAFTA must eliminate the incentives for outsourcing jobs, raise wages, and level the playing field for North American workers. It is our job to ensure that the Trump administration keeps its promises to the middle class, and put an end to the outsourcing of jobs by fighting for strong, enforceable labor and environmental standards.

The U.S. labor proposal in NAFTA must dramatically improve to stop the outsourcing of good-paying jobs and the suppression of wages for working people. Unless we rewrite NAFTA with the workers at the center of our goals, we will repeat the same mistakes that we have made in the past.

The North American Free Trade Agreement has already facilitated the outsourcing of a million American jobs to Mexico where corporations can pay workers poverty wages and dump toxins into the environment before bringing products back into the U.S. for sale.

American workers and the environment lose. In fact, in 2004, in my district in Connecticut, we lost 300 good jobs at the BIC plant in Milford, Connecticut, because the company moved their razor operation to Mexico.

Beyond BIC, NAFTA had a tremendously negative impact on my home State in Connecticut. In fact, we lost more than 100,000 manufacturing jobs since it was enacted and since China was allowed to join the WTO--the period between 1994 and 2016, according to the Bureau of Labor Statistics. That amounts to nearly 40 percent of the manufacturing jobs in Connecticut, taking into account both jobs created by exports and jobs displaced by imports.

As these jobs moved overseas, the percentage of all private sector jobs that are manufacturing jobs in Connecticut declined from 20 percent to 11 percent during the NAFTA-WTO period. I watched and I fought against the slow death of the Ansonia Copper and Brass Company as they suffered under these policies.

In Connecticut, more than 25,000 workers are certified as having lost their job due to imports or outsourcing under the Trade Adjustment Assistance program--companies such as Carrier, Exxon Mobil, General Electric, Honeywell, Northrop Grumman, Dow Chemical, The Hershey Company, 3M, and others.

So manufacturing jobs, good-paying jobs that you can support a family with, took a big hit in Connecticut because of NAFTA--workers who made electrical products, medical products, machined parts, printing products, clothing, automotive parts, aircraft parts, and the list goes on.

When negotiated with the workers in mind, trade agreements can create jobs in America, and I will hold the Trump administration to that standard, just as I have done with every administration, no matter which party occupies the White House.

Turning to investor-state dispute settlement, or ISDS, in trade agreements, ISDS makes it easier to outsource jobs from the United States by making it less risky. It makes it less risky for companies to move their manufacturing to places that have a weaker rule of law and an underdeveloped court system. The assumption is that, instead of relying upon rule of law and the courts, corporations can just sue the taxpayers of the host country.

ISDS undermines the home advantage of a relatively well-developed court system and the rule of law like what we have here in the United States. Furthermore, ISDS can be wielded as a weapon to threaten and discourage efforts to raise wages, which encourages outsourcing. For example, the Egyptian Government was recently challenged by a multinational corporation because of a raise in the minimum wage.

President Trump ran on a platform that called for an end to the outsourcing of good-paying jobs, yet his tax law, arguably his proudest achievement thus far, incentivizes outsourcing, encourages companies to export jobs by creating a lower rate for multinational corporations to invest abroad. This is nowhere near the corporate tax rate for domestic investments. This is a job killer.

Right now, a company that makes their wares outside of the United States pays up to 13 percent in U.S. taxes. The same company making their wares in the United States pays 21 percent in taxes on their operations. I have recently introduced a bill striking the sections of the law that create this incentive to outsource.

In closing, the biggest economic issue of our time is that too many people who play by the rules are in jobs that do not pay them enough to live on. They are struggling with rising costs of healthcare, with childcare, and some can't even put food on the table. We need to fight for these workers. We should not be sending their jobs and their wages overseas, and I will continue to fight outsourcing for hardworking middle class Americans. The stakes could not be higher.

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