Trade deals have benefits and risks, Nevadans say

WASHINGTON -- The trade agreements that Congress approved Wednesday will mean more business for Nevada exporters, state officials say. But not everyone believes the deals will be beneficial on balance.

Nevada's representatives split on ratifying free trade treaties with South Korea, Panama and Colombia. The three Republicans -- Sen. Dean Heller and Reps. Joe Heck and Mark Amodei -- voted for them. Sen. Harry Reid and Rep. Shelley Berkley, both Democrats, voted against them.

As the state's economy grew, Nevada companies dramatically increased exports to those nations over the past 16 years, and the trade agreements could accelerate sales, according to the state Office of Economic Development.

"The impact of the (deals) with Korea, Colombia and Panama will all have a positive effect on Nevada's exports to these countries and in new job creation," the office said in an export fact sheet.

Gov. Brian Sandoval signed a letter with 24 other governors endorsing the agreements. IGT, which manufactures electronic gaming equipment and said it exported 10,251 machines last year, lobbied for their passage as did Henderson Mayor Andy Hafen in a letter to lawmakers.

"Nevada businesses will directly benefit from these trade agreements," Heck said. "For example, Thunder Power in Las Vegas will no longer pay an 8 percent tariff on the batteries it exports to Korea."

But labor groups argued the trade deals fail to protect American workers and the U.S. economy. The Economic Policy Institute, a liberal think tank, estimated that 214,000 net U.S. jobs will be lost or moved overseas in the first seven years of the agreements, while the U.S. trade deficit will deepen by $16.8 billion.

"Trade both adds to and subtracts from the demand for workers," Robert Scott, EPI director of trade and manufacturing policy research, said in a report Wednesday. "The growth of exports supports domestic employment, but the growth of imports displaces domestic jobs."

Berkley cited the EPI study in opposing the agreements.

"How much more job loss can Nevadans be expected to stomach before we stand up and say enough is enough?" she said in a House speech. "Congress needs to get our priorities straight."

Zac Petkanas, a spokesman for Reid, said: "As Nevada's economy continues to recover, one job lost is one too many. We can't afford to take that risk right now."

Nevada exports to South Korea, led by sales of electronic products and machinery, grew from $15 million to $86 million from 1994 to 2010, according to the Office of Economic Development and the Nevada District Export Council in Las Vegas. Sales to Colombia jumped from $1 million to $14 million, while Panama exports grew from $232,000 to $12 million.

The export growth created 529 jobs, the state office calculated by a Department of Commerce formula that equates $181,000 in export value per job.

It is difficult to project what the free trade deals will mean to future exports, the office said. But according to state figures, after the North American Free Trade Agreement was implemented in 1994, Nevada exports to Mexico grew 16 times over, and sales to Canada went up from $170.5 million to $803 million.

But NAFTA has gotten mixed reviews. The trade agreement with Canada and Mexico "cost the U.S. more than 1 million jobs," according to the AFL-CIO, while it "allowed violations of core labor standards to continue unabated."