by Richard A. Cass

 

August 1988, after three years of intense struggle, Congress passed and President Ronald Reagan signed into law the Omnibus Trade and
Competitiveness Act of 1988. The act, successor to a bill vetoed by the president just two months before, was the fruition of considerable hard work by politicians, industry; and prominent labor representatives who were disturbed by the perceived change in competitiveness between American and foreign goods.

Beginning in the late 1970s, the U.S. balance of trade began to move rapidly from a modest surplus to a massive deficit. Lamenting this turn of events, commentators blamed excessively high foreign
barriers to U.S. exports and inadequate U.S. barriers to imports. In the face of increasingly strong foreign competition, organized labor moderated its demands for higher wages and even accepted wage cuts in some important sectors. As unions called for government
action, they were joined by industries suffering through the recession of the early 1980s, especially those that had been declining relative to foreign competitors over many years.

 

Officials of the Reagan administration along with