Workers need training, not tough talk

Commentator and economist Glenn Hubbard

TEXT OF COMMENTARY

Kai Ryssdal: House Ways and Means Committee Chairman Charlie Rangel was in Peru earlier this week. While he was there, he promised quick action on a proposed trade deal with Lima when Congress gets back to work in September. It has bipartisan support, Rangel said.

For decades, there has been support in Washington for factory workers who've lost their jobs as a result of those trade deals. It's called the Trade Adjustment Assistance Program. It's set to expire next month. There's talk in Congress about about extending it and including service industry workers this time.

Commentator Glenn Hubbard says he's got a better idea.


Glenn Hubbard: Congress should drop the tough trade talk as a way to protect American jobs. And that's because trade isn't the only, or even biggest, reason people lose them.

The real reasons are far more complex. To hear the talk in Washington, it all boils down to China, free trade agreements and other foreign competition.

In fact, we can't tell whether trade is entirely to blame. Indeed, reasons like falling demand, corporate restructuring and efficiency gains perhaps unrelated to trade are very much in the mix.

But even if we could tell the difference, why is losing a job to trade worthy of assistance, while losing a job because of, say, technology improvements, isn't?And that's not just an academic distinction. Congress's shift toward protectionism reflects trade-related job insecurity.

But protectionism won't just destroy gains from trade — it will make things far worse by chilling job creation.

And there's a better way: A strong commitment to training support and to aggressive funding of Personal Reemployment Accounts. Those are funds for individual training assistance to workers likely to be unemployed for long periods of time.

Current government programs and support for college education only miss opportunities for more specific training. We could broaden the benefits Congress has sanctioned for workers who prove they lose their jobs to trade to all workers facing the need to change lines of work.

We should add funds for customized training through community colleges and vocational institutes — that is, training for skills in production management, machinery, logisitics management and so on. Now that would be an important reform of our antiquated labor market policies.

Protectionism may feel good in the short run, but skill development is the better route to our continuing collective prosperity.

Ryssdal: Glenn Hubbard is the dean of the business school at Columbia University. He used to be the chairman of the Council of Economic Advisors for President Bush.

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