Trade deals have hit North Carolina harder than Michigan

Invoking job losses from past trade deals, last year the North Carolina AFL-CIO pressured Rep. David Price (D-NC) to oppose a plan to "fast-track" the Trans-Pacific Partnership, a global economic pact involving 12 Pacific rim countries. (Photo: NC AFL-CIO.)

This week, Democratic presidential hopeful Sen. Bernie Sanders scored a surprise victory in Michigan over Hillary Clinton, the party front-runner who before the state's primary was favored in polls by 25 points.

Key to Sanders' victory was the Vermont senator's criticism of Clinton's support for "free trade" deals, beginning with the North American Free Trade Agreement (NAFTA) signed into law by her husband, President Bill Clinton, in December 1993.

According to exit polls, 58 percent of Democrats voting in Michigan's primary believe trade deals take away U.S. jobs; of those voters, Sanders won by 10 points. Sanders hit Clinton hard on her frequent support over the years of trade pacts including NAFTA, the Colombia Free Trade Agreement, and more recently the Trans-Pacific Partnership. As Sanders told a rally in Traverse City, 250 miles north of Detroit:

If the people of Michigan want to make a decision about which candidate stood with workers against corporate America and against these disastrous trade agreements, that candidate is Bernie Sanders.

But Michigan isn't the state that has suffered the most economic dislocation due to global trade agreements. That distinction belongs to North Carolina — a state where Clinton currently enjoys a 20-point lead in the polls heading into the March 15 primary.

By any measure, trade deals have had a unique and significant impact on North Carolina. Since the 1990s, North Carolina has seen more than 350,000 manufacturing jobs shuttered in textiles, furniture and other industries.

How many of these can be attributed to plant closures and other disruptions linked to global trade policies? One set of data comes from the federal government's Trade Adjustment Assistance program, which provides job training and other assistance to displaced workers.

From 1994 to 2015, the Labor Department certified that more than 216,000 workers in North Carolina were displaced by global economic pacts and qualified for assistance — making it the hardest-hit state in the country. As a 2014 analysis of TAA data in the Washington Post noted, "North Carolina had the largest average share of its workforce threatened by trade over the past two decades."

However, those are just the cases where job losses from plant closures and other displacements certified for federal assistance. Critics argue that the "race to the bottom" wrought by corporate-friendly deals has affected jobs and wages in other ways as well. For example, a 2014 analysis by the Economic Policy Institute argued that nearly 120,000 North Carolina jobs were lost or displaced due to the trade deficit with China since that country entered the World Trade Organization in 2001.

Because North Carolina has historically had a greater share of jobs in manufacturing, the state's workers have been especially vulnerable to deals which force them to compete with low-wage labor. As a 2012 report by the North Carolina Justice Center found [pdf], trade deals accelerated a devastating round of offshoring to countries with cheap labor:

In North Carolina, offshoring has had a significant, direct, and negative impact on the state's economy over the past decade, clearly contributing to stagnant wage growth and job creation during the 2000s, and especially to the state's sluggish recovery from the Great Recession … Offshoring in North Carolina has been accompanied by the emergence of a two-tier labor market, in which many workers in offshored industries — particularly manufacturing — are increasingly shunted into fast-growing low-wage and low-skill occupations.

While North Carolina's trade-related job losses have been more severe than any other state, others in the South that have had more than 90,000 TAA-certified disclocations are Texas (172,423), Tennessee (118,833), Georgia (94,225) and Alabama (93,994) according to data compiled by Public Citizen, a group critical of the deals.

Hillary Clinton's views on trade deals have evolved over time. Initially enthusiastic about NAFTA, in 2008 she said that in practice "it has not lived up to its promises." While similarly supportive of the Trans-Atlantic Partnership, which in 2012 she called the "gold standard in trade agreements," in a debate with Sanders last month she stated she did "not currently support it as it is written."

Sanders, for his part, has seized on what he argues is Clinton's inconsistency on the matter. As he said in a debate last weekend:

Secretary Clinton has discovered religion on this issue, but it's a little bit too late. I was on a picket line in the early 1990s against NAFTA, because you didn't need a Ph.D. in economics to understand that American workers should not be forced to compete against people in Mexico making 25 cents an hour.