• Home
  • Latest
  • Fortune 500
  • Finance
  • Tech
  • Leadership
  • Lifestyle
  • Rankings
  • Multimedia

Trendingnow

1

Jeff Bezos wants the bottom half of earners to pay zero income tax—he says nurses making just $75K should save $12K a year

2

Despite a $500 million net worth, Shaq just finished his fourth degree. He warns graduates: 'Your character will take you further than your resume'

3

Bolt CEO says he let go of his entire HR team for creating problems that didn’t exist: ‘Those problems disappeared when I let them go’ 

1

Jeff Bezos wants the bottom half of earners to pay zero income tax—he says nurses making just $75K should save $12K a year

2

Despite a $500 million net worth, Shaq just finished his fourth degree. He warns graduates: 'Your character will take you further than your resume'

3

Bolt CEO says he let go of his entire HR team for creating problems that didn’t exist: ‘Those problems disappeared when I let them go’ 
Finance

Big cities benefit from free trade—so why are Democrats stalling it?

By
Nina Easton
Nina Easton
Down Arrow Button Icon
By
Nina Easton
Nina Easton
Down Arrow Button Icon
September 4, 2014, 7:32 AM ET
International
contract armin harrisKyle Bean for Fortune

You wouldn’t know it from the behavior of leading Washington Democrats, but guess who benefits most from free-trade pacts? Workers in unionized, Democratic strongholds: America’s big cities. Labor-backed protectionists insist that America’s factory towns were devastated by the North American Free Trade Agreement.

Now, together with a contingent of Tea Party Republicans, they want to stop pending trade deals with Europe and Asia. But the numbers show that these same bastions of blue voters are thriving on exports—especially to NAFTA partners Mexico and Canada. Indeed, trade is what’s driving post-recession economic gains—and job growth—in big cities. In the first two years of recovery, exports grew at five times the rate of output in America’s 100 largest metro areas and were responsible for more than half of those cities’ economic recovery, according to data collected by J.P. Morgan Chase’s Global Cities Initiative.

Take Chicago. The Windy City’s exports to Mexico and Canada exploded from $12 billion in 2005 to $20 billion in 2012. And a substantial portion of that came from categories such as electronics, machinery, and vehicle parts that benefited from NAFTA’s elimination of tariffs and other trade barriers.

You’ll recall it was Chicago Mayor Rahm Emanuel who, as President Clinton’s senior adviser in 1993, helped squeeze NAFTA through a Congress packed with skeptical Democrats. Today Chicago and Mexico City are among the largest North American trading partners, with more than $1.7 billion in local products traded between them each year, according to J.P. Morgan. And last year Emanuel and Mexico City Mayor Miguel Ángel Mancera signed an economic partnership agreement strengthening that relationship.

Now two new pacts—one with Europe, the other with Asia—are on the table. They, too, would expand free-trade zones for cities like Chicago. But before those deals can pass, Congress needs to extend “fast track” so that carefully negotiated pacts with other countries are considered on an up or down vote rather than amended to death. Democrats, though, are standing in the way.

URBAN RENEWAL THROUGH EXPORT America's big cities have prospered under existing free-trade accords. They'll do even better in a freer global marketplace.
URBAN RENEWAL THROUGH EXPORT America’s big cities have prospered under existing free-trade accords. They’ll do even better in a freer global marketplace.Graphic Source:

Senate Majority Leader Harry Reid has refused to bring free-trade legislation to the floor. The new Senate Finance Committee chair, Ron Wyden, is slow-walking it toward what he calls a “smart track.” Senators like Elizabeth Warren and Sherrod Brown are outspoken free-trade skeptics, while in the House, 150 Democrats have signed a letter opposing fast track. President Obama supports the legislation but shows few signs of making it a top priority. “There’s an interesting disconnect between Democratic mayors, who realize their economic growth is in large part tied to greater access to foreign markets, and many national Democrats who seem to be missing that,” says J.P. Morgan Chase executive vice president Peter Scher.

For Scher, that disconnect is especially sensitive. He’s a loyal Democrat who served President Clinton and Capitol Hill Democrats before joining the private sector. He managed John Edwards’s vice presidential campaign in 2004. Now as corporate responsibility chief at J.P. Morgan Chase, where he launched the Global Cities Initiative with the Brookings Institution, Scher is heartily making the case that free trade is boosting America’s old factory cities like Chicago, Detroit, and Cleveland. “What is driving the economic growth of these metro areas is trade,” says Scher.

Even in a hard-left political bastion like Portland, Ore., a quarter of the city’s GDP comes from exports—and the top destination is Mexico. “We’re seeing every day the benefits of NAFTA for jobs and the economy all over the U.S.,” says Scher, citing industry estimates that the controversial trade pact eventually created 5 million net new jobs.

And plenty of those jobs are well paid, with manufacturing exports at record highs. “Income inequality is one of the most critical challenges facing our country,” he tells me. “We’re not going to address it without creating a high-wage economy—and what’s clear is that higher-wage jobs are overwhelmingly tied to exports.”

Spoken like a true 21st-century liberal.

This story is from the September 22, 2014 issue of Fortune.

About the Author
By Nina Easton
See full bioRight Arrow Button Icon

Latest in Finance

Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025

Most Popular

Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Fortune Secondary Logo
Rankings
  • 100 Best Companies
  • Fortune 500
  • Global 500
  • Fortune 500 Europe
  • Most Powerful Women
  • World's Most Admired Companies
  • See All Rankings
  • Lists Calendar
Sections
  • Finance
  • Fortune Crypto
  • Features
  • Leadership
  • Health
  • Commentary
  • Success
  • Retail
  • Mpw
  • Tech
  • Lifestyle
  • CEO Initiative
  • Asia
  • Politics
  • Conferences
  • Europe
  • Newsletters
  • Personal Finance
  • Environment
  • Magazine
  • Education
Customer Support
  • Frequently Asked Questions
  • Customer Service Portal
  • Privacy Policy
  • Terms Of Use
  • Single Issues For Purchase
  • International Print
Commercial Services
  • Advertising
  • Fortune Brand Studio
  • Fortune Analytics
  • Fortune Conferences
  • Business Development
  • Group Subscriptions
About Us
  • About Us
  • Press Center
  • Work At Fortune
  • Terms And Conditions
  • Site Map
  • About Us
  • Press Center
  • Work At Fortune
  • Terms And Conditions
  • Site Map
  • Facebook icon
  • Twitter icon
  • LinkedIn icon
  • Instagram icon
  • Pinterest icon

Latest in Finance

morris
CommentaryEntrepreneurship
My startup hit $200 million ARR. But first I walked away from 2.5 million YouTube subscribers and nearly went bankrupt
By Joel MorrisMay 23, 2026
54 minutes ago
Beyond the diploma: Skills that actually get graduates hired
Future of WorkWorkplace Innovation Summit
Beyond the diploma: Skills that actually get graduates hired
By Ashley LutzMay 22, 2026
15 hours ago
Sam Altman standing in a lift.
AIOpenAI
The big questions looming over OpenAI’s trillion-dollar IPO
By Beatrice NolanMay 22, 2026
15 hours ago
Walmart shoppers are filling their gas tanks with less than 10 gallons for the first time since 2022, and its CFO calls it ‘an indication of stress’
EconomyRetail
Walmart shoppers are filling their gas tanks with less than 10 gallons for the first time since 2022, and its CFO calls it ‘an indication of stress’
By Marco Quiroz-GutierrezMay 22, 2026
15 hours ago
Musk may already be a trillionaire while these SpaceX employees and investors will hit multibillion-dollar jackpots after blockbuster IPO
Startups & VentureSpaceX
Musk may already be a trillionaire while these SpaceX employees and investors will hit multibillion-dollar jackpots after blockbuster IPO
By Jason MaMay 22, 2026
16 hours ago
ta
EconomySocial Media
They created AI nudes that got millions of views online. Now they’re being charged with crimes
By Jake Offenhartz and The Associated PressMay 22, 2026
17 hours ago

Most Popular

Jeff Bezos wants the bottom half of earners to pay zero income tax—he says nurses making just $75K should save $12K a year
Success
Jeff Bezos wants the bottom half of earners to pay zero income tax—he says nurses making just $75K should save $12K a year
By Preston ForeMay 21, 2026
2 days ago
Despite a $500 million net worth, Shaq just finished his fourth degree. He warns graduates: 'Your character will take you further than your resume'
Success
Despite a $500 million net worth, Shaq just finished his fourth degree. He warns graduates: 'Your character will take you further than your resume'
By Preston ForeMay 20, 2026
3 days ago
Bolt CEO says he let go of his entire HR team for creating problems that didn’t exist: ‘Those problems disappeared when I let them go’ 
Workplace Culture
Bolt CEO says he let go of his entire HR team for creating problems that didn’t exist: ‘Those problems disappeared when I let them go’ 
By Preston ForeMay 19, 2026
3 days ago
Indeed chief economist says we’re entering an era of ‘great mismatch’ thanks to a generational imbalance of workers
Success
Indeed chief economist says we’re entering an era of ‘great mismatch’ thanks to a generational imbalance of workers
By Emma BurleighMay 22, 2026
16 hours ago
Microsoft reports are exposing AI's real cost problem: Using the tech is more expensive than paying human employees
AI
Microsoft reports are exposing AI's real cost problem: Using the tech is more expensive than paying human employees
By Jake AngeloMay 22, 2026
15 hours ago
Pay transparency is exposing a bigger problem: Most companies can't explain why they pay what they pay
Workplace Culture
Pay transparency is exposing a bigger problem: Most companies can't explain why they pay what they pay
By Sydney LakeMay 20, 2026
3 days ago

© 2026 Fortune Media IP Limited. All Rights Reserved. Use of this site constitutes acceptance of our Terms of Use and Privacy Policy | CA Notice at Collection and Privacy Notice | Do Not Sell/Share My Personal Information
FORTUNE is a trademark of Fortune Media IP Limited, registered in the U.S. and other countries. FORTUNE may receive compensation for some links to products and services on this website. Offers may be subject to change without notice.