Monday, March 10, 2014
NORRIDGEWOCK — The new U.S. trade representative offered no promises Monday to an anxious crowd of New Balance shoe factory employees, whose jobs may hang in the balance of a foreign trade deal being brokered among 12 nations, including the U.S.
Trade Representative Michael Froman, right, examines a sneaker in front of some of Maine’s elected officials and New Balance company officials at the production plant in Norridgewock on Monday.
David Leaming/Morning Sentinel
Trade Representative Michael Froman told the workers that the question of shoe manufacturing is one of the most difficult, and most sensitive, issues at stake in efforts to craft a Trans-Pacific Partnership, which would reduce trade barriers between the U.S. and other nations.
If the United States wants to sell American-made products to Asian consumers, it may have to open domestic markets to Asian businesses, said Froman.
Vietnamese athletic shoe manufacturers, which operate under fewer labor and environmental regulations, are pushing for the elimination of about 20 tariffs that bump up the price of their products before they become available to the American consumer.
If the Vietnamese are successful, their products will undercut the price of athletic footgear, threatening New Balance's share of the domestic shoe market.
U.S. Rep. Mike Michaud, Sen. Angus King and New Balance President Rob DeMartini joined Froman on a tour of the factory and later took questions from workers.
DeMartini urged Froman to do what he can to protect the jobs of his workers.
"We're asking the administration to do everything they can to focus on jobs in America, not jobs in Asia," he said.
Worker Sue Burns, a fourth-generation shoemaker, said she wanted to finish out her career at New Balance.
She also told Froman that he could better understand her nervousness if he imagined that his job was at stake while New Balance workers considered eliminating it.
"I want my face to be the one that haunts you," she said.
Burns was one of many who tried to convince Froman that their jobs were worth saving.
Froman said repeatedly that he values maintaining American manufacturing jobs, but that the domestic shoe manufacturing industry, which employs about 4,000 people, is a single piece of a much larger puzzle.
"I understand that you would like us to exclude your shoes altogether from the Trans-Pacific Partnership, but I also understand New Balance imports about 20 percent of their product from Vietnam, paying millions of dollars in tariffs on those products," he said. "So whatever we negotiate on tariffs will have a direct impact on this company, its ability to invest in domestic production here in Norridgewock or in other factories."
The large majority of the world's buying power lies outside the United States' borders, he said, making it important to negotiate deals that will give U.S. products a tariff-free path into foreign markets.
"We've got importers and retailers and consumers on one side, all arguing that their ability to add jobs depends on lowering tariffs," he said. "And we've got stakeholders who say walling off parts of the U.S. economy will only lead other countries, like Malaysia and Japan, to wall off parts of their economies from our exports, and those are areas where Maine and others have a lot of interest."
Froman said Maine's exports are growing at double the rate as Maine's overall economy and triple the U.S. one.
"As I understand it now, New Balance now exports about 700,000 products and wants to double that in five years," Froman said. "One of the key markets are places like Japan. There are footwear tariffs there that we'll be working to eliminate."
Froman made no promise to protect the New Balance jobs, but he did say that the visit had been helpful and that he would continue to involve the company in the process.
"We'll be consulting with you and the other Maine companies to make sure to come up with a balanced and ambitious outcome for the Trans-Pacific Partnership," he said.
After the meeting, King said he thought the visit had gone as well as it could have.
"He wasn't in a position to make promises," King said. "My mission was to get him here to meet these people and look them in the eye. I want to make this as hard a decision for him as possible."
King objected to Froman's appointment to the post in mid-June and only withdrew it after Froman agreed to the visit. Former trade representative Ron Kirk visited the factory last year.
Other countries involved in the negotiations, 18 rounds so far, are Australia, Brunei Darussalam, Canada, Chile, Malaysia, Mexico, New Zealand, Peru, Singapore and Japan. The next round is scheduled Aug. 22-30 in Brunei.
Matt Hongoltz-Hetling can be contacted at 861-9287 or at firstname.lastname@example.org