Thursday, December 10, 2009

Dan Griswold: Free Trade Is A Main Street Issue

San Diego, CA (Dec. 10, 2009) --Daniel Griswold stood before members of the World Trade Center holding a Swingline stapler in one hand and an iPod in the other. The stapler was manufactured a 15-minute subway ride from Manhattan, NY. The iPod, designed in California by Apple, produced in China. "The value added in China is a few dollars," said Griswold, while the remainder of the price paid goes to Apple and the retailer who sold it. His point: most of the value from the design and sales of the iPod goes to American firms, while the consumer benefits from the lower price of producing it overseas. He rhetorically asks, holding both products in his hands, would you rather live in a society that designs staplers or the iPods?

Griswold is the author of "Mad About Trade: Why Main Street America Should Embrace Globalization" and Director of the Center for Trade Policy Studies at the Cato Institute. His research shows that American consumers are the biggest beneficiaries of world trade, and the money saved by main street from lower prices from the global economy is far greater than any Washington stimulus plan. Globalization elevates the quality of life of everyone. "Consumers are the biggest winners from free trade," he said. "Working families benefit from lower prices." And while he expressed for workers who have lost their jobs to factory closures, according to his research "imports are responsible for 3% of joblessness. For every one person who looses their job to trade 30 people loose their jobs for other reasons." As an example, thousands of people from Kodak lost their positions because of the rise of digital photography -- a technology shift -- not because of the imports of digital cameras. And while 4-million manufacturing jobs have were lost to trade (prerecession), his research indicates 18 million service jobs were created from economic growth with pay higher than manufacturing wages. "Globalization is in the interest of Americans," he said.

Griswold recounted a globalization moment that occurred while doing a case study of his closet. Of the 120 items he inspected--mostly clothes--10 were made in the U.S., and 9 of those were neckties. Of particular note was an item from Mexico labeled: "Hecho en China."

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