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Trading Down

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by Sallie James

Sallie James is a policy analyst at the Cato Institute’s Center for Trade Policy Studies.

This week, the House of Representatives will consider expanding the federal program for workers who lose their jobs, or whose jobs move offshore, due to competition from imports. But Trade Adjustment Assistance is increasingly a relic of the past, and Congress should end the program altogether.

Today, only one in 30 unemployed workers can point to import competition or offshoring as the cause of their predicament. The Council of Economic Advisers estimates that these factors are responsible for less than three percent of “mass layoffs” (those of more than 50 people). Changes in technology and consumers’ tastes, domestic competition, and simple business failure are much more common reasons for changes in industries’ (and workers’) fortunes. It is grossly unfair to single out a group of workers as deserving of special assistance.

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