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Despite Union Leader Complaints, Michigan Exports Exploding

Free trade boosts the economy

In a recent op-ed in The Detroit News, Teamsters President James Hoffa criticized trade deals in the United States saying, “It is time America’s major import wasn’t cheap foreign goods and its major export wasn’t good U.S. jobs.” 

Hoffa used the South American country of Colombia to make his point, saying that exports to the U.S. from Colombia fell 4.5 percent between May 2012 and March 2013.

But if Hoffa is implying that the U.S., and Michigan, are being hurt by trade deals, he won’t find much support from the Department of Commerce.

For example, exports from the U.S. to Colombia have increased from $5.6 billion in 2005 to $16.4 billion in 2012. U.S. imports from Colombia have increased from $8.8 billion in 2005 to $24.6 billion in 2012.

And in Michigan, exports to Colombia have increased from $58.6 million in 2005 to $224.9 million in 2012, with most of that coming from transportation equipment and chemicals. Michigan’s biggest trade partner is Canada, which receives $25.4 billion of Michigan’s exports in 2012.

“The story is the incredible growth of globalization and the U.S. has been in the forefront of that,” said James Hohman, assistant director of fiscal policy at the Mackinac Center for Public Policy. “We are trading much more internationally than ever before.”

In the last four years, Michigan exports have grown five times faster than the state’s economy (Gross Domestic Product), said Mark Perry, a professor of finance and business economics at the University of Michigan-Flint, and a member of the Mackinac Center’s Board of Scholars.

Perry said Michigan’s exports lead the growth in the state’s economy. In 2009, exports were 9.3 percent of Michigan’s GDP and that increased to 14.2 percent in 2012. Michigan’s exports were $57 billion of the state’s $400 billion state GDP last year.

Perry said Michigan’s total international trade activity (the state’s imports and exports combined) increased 48 percent from 92.5 billion in 2009 to $136.6 billion in 2012.

“We have to remember that 95 percent of the world’s consumers are outside of the U.S. and foreign markets are vital to Michigan’s economy, especially its car industry,” Perry said.

Hoffa said in his Detroit News column that: “Workers on both sides of the deal get screwed while corporations rake in record profits.”

Perry said that was not true. More than $360 million in profit sharing checks will be paid by Detroit’s Big Three automakers to hourly workers with millions more in profit sharing bonuses going to salaried workers.

Hoffa did not respond to requests for comment.


See also:

Despite Rhetoric, United States Outsourced Less Than 3,000 Jobs in 2012

Michigan Exports to China Grow

Should China Stop Buying From Michigan?

Exports Critical For Michigan's Recovery

China and Saudi Arabia Two of Michigan's Best Customers