Episode 750: Retraining Day

Enlarge this image toggle caption Doug Benz/Bloomberg via Getty Images Doug Benz/Bloomberg via Getty Images

Trade has winners and losers. The winners are American consumers. We all get cheaper goods from abroad. American companies benefit too; they sell more products overseas, even hire extra workers. But there are also people who lose, and those people tend to lose big and lose in big groups. In parts of the country, factories have been closing and jobs have been moving overseas for decades.

So to make trade really benefit everyone, there's this idea that makes a lot of sense. Take some of the money, some of the gains, from the people who are better off because of trade and give it to the losers. This isn't just a theoretical idea. It's an entire government program.

Since 1974, the Trade Adjustment Assistance (TAA) program has been helping workers who have lost their jobs due to trade policy. TAA is sometimes called the Cadillac of retraining programs. In one sense, workers who lose their jobs to trade are in a far better position than workers who lose their jobs to pretty much anything else: recession, bad management, whatever. Because if they lose their jobs to trade they can qualify for TAA and that means the government will help them find a job in an industry that isn't dying. TAA will pay for school, relocation and job-seeking expenses, pretty much whatever it takes to help a former factory worker find a new job that won't be outsourced.

So why don't we hear more about this program? Why does it seem like there's nothing left behind for workers after a factory closes up because of trade?

On today's show, we visit one of the cities where trade has had a big impact: Erie, Pennsylvania. When General Electric downsized a locomotive factory in Erie, 1,500 people lost their jobs. Many of them were eligible for TAA benefits. Things aren't going so smoothly, though. We try to find out why.



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