Here is a real shocker. AARP (formerly the American Association of Retired Persons) has been a paying member of the notorious right-wing, Koch-tied lobbying organization American Legislative Exchange Council (ALEC) since at least 2014.
Yes, that AARP, once known for protecting the interests of senior citizens and fighting to protect Social Security and Medicare. Yes, that ALEC — an organization dedicated to, among so many other things, privatizing Social Security and Medicare, and getting rid of public-employee pensions. AARP apparently joined ALEC even as many corporations were fleeing thanks to exposure of ALEC’s reprehensible actions.
AARP, the non-profit seniors organization that exists to promote the financial security, pensions and healthcare of those over 50, is secretly funding the American Legislative Exchange Council (ALEC), an organization whose bills have acted against the interests of ordinary Americans, including retirees and their families.
The Center for Media and Democracy has learned that AARP has recently joined ALEC, and that it is a named sponsor of the ALEC annual meeting taking place in Indianapolis, Indiana from July 27-29, 2016.
Among the policies that have been promoted by ALEC are several that arguably undermine the interests of seniors and retirees, AARP’s core constituency. ALEC has pushed for the repeal of the Affordable Care Act, which has saved Medicare enrollees millions of dollars by closing the Medicare drug benefit “donut hole.” It has opposed Medicaid expansion under Obamacare. It has targeted public pensions, pushing to cap benefits and shift workers toward defined contribution plans, which layer more market risk on individual workers’ shoulders.
ALEC’s right-wing, corporate agenda is all about privatizing Social Security, gutting pension plans, turning Medicare over to insurance companies and pushing laws that would make prescription drug prices even higher for seniors.
Talk about selling out your constituency. Just wow.
Many companies dropped ALEC after the organization’s right-wing ties were exposed by CMD. These companies include Coca-Cola, Pepsi, Kraft, Google, Facebook, Amazon and Microsoft. (Click here for a list.) And then AARP apparently decided this all sounded good, and joined up.
Is This Even Legal?
Hiltzik’s column contains a revealing statement from AARP,
AARP’s statement acknowledged that it paid a fee to ALEC in 2016 to provide “an opportunity to engage with state legislators and advance our members’ priorities from a position of strength at ALEC’s annual meeting. AARP added, “given that Republicans control one or more chambers in 39 of the nation’s 50 state legislatures, we believe having a seat at the table at the ALEC annual meeting was necessary to our mission of representing the interests and needs of people 50-plus and their families.”
AARP says it paid a fee to “engage” with legislators and get “a seat at the table.” Paying the fee gives them a “position of strength.” This statement reveals how ALEC is set up as a “pay-to-play” corruption operation; the organization charges companies a fee for access to legislators, companies pay a fee so they can influence legislators, conservative legislators show up so they can be influenced. The public loses out on every side of that pay-to-play triangle of corruption.
Really? Paying a fee for an opportunity to engage with legislators? Or the other side of that equation, charging a fee? If this blatant corruption is legal at all, it is what is known as “lobbying.” But ALEC is a tax-exempt 501(c)3 charity that is prohibited from lobbying or engaging in politics at all. (Never mind a license for corruption.) Various complaints have been filed with the IRS, but nothing happens… Just wow.
For decades, ALEC has plied state legislators with disinformation about Social Security, climate change, and other issues along with bills and resolutions that undermine Americans’ financial security and our future.
Please sign the following letter (and if you are a member of AARP, please also contact the organization directly and ask that they DUMP ALEC).
The Center for Media and Democracy investigates and exposes corruption. You might know CMD for ALEC Exposed, which brought ALEC to public attention. You might know them for PR Watch, which keeps an eye on how corporations use “spin.” They also operate the SourceWatch wiki.
However you know them, they do great work. Check them out.
I have been hounded for months by a company attempting to collect money for a gym membership that I canceled more than 15 years ago.
I was paying $150 a year for the membership before I correctly canceled the membership in writing. That “fitness center” was bought by a national chain that is known for hounding people for unpaid memberships, even if the membership has been canceled and nothing is actually owed.
In my case, they say I owe $2,500, but they will “settle” for less. And I can’t stop the calls.
The Consumer Financial Protection Bureau (CFPB) is now proposing new rules that would put a stop to this kind of behavior and give consumers who have been victimized options for relief.
The CFPB is a new agency of the government that protects regular people from scams, frauds and abuses by the financial industry. The bureau came about as part of the minimal Dodd-Frank re-regulation of Wall Street and the rest of the financial industry following the 2008 crash.
One such often-abused financial scheme is debt collection. It’s an entire industry. Many people don’t know that there is a market where “debt buying” companies can actually buy “bundles of debt.” A company can actually purchase a “portfolio” of old debts like loans, installment car or store loans, even gym membership contracts that have been written off because a company has decided it is just too much trouble and expense to try to collect.
Instead of just giving up, though, the original lender “sells” the debt for pennies on the dollar to companies that specialize in doing nothing but collections. The collection company is all set up with “boiler rooms” full of people and phones, where they have refined techniques to hound the debtor, trying to collect what they can.
Often the collection companies don’t even verify that the debt is even legitimate.
Another scam is “fraudulent service” where the debt company falsely claims they served papers on a debtor, and when the debtor doesn’t show up in court they get a judgment allowing them to garnish paychecks and extend the legal period for collecting debt.
The U.S. watchdog for consumer finances unveiled on Thursday a major proposal to toughen regulation of the multibillion-dollar debt collection industry, with a focus on keeping agencies from pushing people to pay debts they do not owe, informing borrowers of their rights and cutting down on calls to debtors.
“Today we are considering proposals that would drastically overhaul the debt collection market,” said Consumer Financial Protection Bureau Director Richard Cordray in a statement. “This is about bringing better accuracy and accountability to a market that desperately needs it.”
… Roughly 13 percent of consumers have a debt currently in third-party collection, with an average amount of $1,300, data from the Federal Reserve Bank of New York shows.
Some 77 million people — roughly one in three adults with a credit report — have a delinquent debt in collections, according to an estimate by the Urban Institute.
… Susan Macharia, 39, an administrative worker who lives in Buena Park, Calif., said she was blindsided in January when she got a call from a collector saying that her wages would be garnished unless she paid off a $10,000 credit card debt that she allegedly ran up in 2003.
A debt so old would normally be beyond the statute of limitations, and legally uncollectable, but the company had a copy of a 2006 default judgment that was entered against her when she failed to respond to a collection lawsuit.
But Ms. Macharia, who opened her first credit card account just three years ago, had no recollection of being notified of a lawsuit, and she was living in Atlanta when the papers were said to have been served on her in California. …
While Ms. Macharia tried to figure out how to contest the debt, the collector began garnishing nearly $800 a month from her paychecks.
It’s about time the government starting acting like a government again. Meanwhile Republicans in Congress are trying to gut the CFPB’s effectivenessbecause the bureau cracks down on scams like these.
The long-abused cafeteria workers of the U.S. Senate, who risked their jobs to fight to earn a living wage only to have the private contractor that runs the cafeteria renege on an order to increase their pay, won a key victory this week.
The Labor Department declared that the contractor had engaged in wage theft from 674 of its workers, deliberately misclassifying them so that they would earn less than their actual work entitled them to earn. The contractor also forced employees to do unpaid work “off the clock.” As a result, the multinational conglomerate Restaurant Associates and a subsidiary will have to give the workers back pay totaling $1,008,302.
Senate food service vendor Restaurant Associates and its subcontractor, Personnel Plus, improperly classified workers in order to pay them for lower-wage positions and required them to work overtime without compensation in violation of federal and local labor laws, the agency said in a news release. The contractors also failed to pay required health and other benefits.
“Workers in the restaurant industry are among the lowest-paid workers in our economy,” said the department’s Wage and Hour Division Administrator David Weil . “Most struggle to afford life’s basic expenses and pay their bills; they shouldn’t have to deal with paychecks that don’t accurately reflect their hard work and the wages to which they are legally entitled.”
The Privatization Scam
“Privatization” transfers something that We the People publicly own for OUR benefit, and hands it over to private interests so a few can make a profit for THEIR benefit. The scheme is sold with claims that privatization “saves money” because the private contracting company is “run like a business.” The bet is that no one will think through just how a private company might “save money” when they have to “run like a business” and make a profit that government doesn’t have to make.
Of course what happens is the private company “saves money” by laying off the government employees and hiring them back or replacing them at minimum wage with no benefits, then transferring the wage and benefit differential into a few pockets at the top of the company. But guess what? Now those workers make so little they qualify for government benefits, other poverty programs are strained, local stores are selling less, homes are foreclosed so local property values drop, the tax base is reduced … so the government didn’t “save money” at all, it just cut its own revenue and shifted spending from one part of the government to another – all at the expense of working people. And the money that was “saved” went into a few private pockets.
Beyond impoverishing workers with low wages, there are even worse ways private corporate contractors “save money,” such as cutting service, cutting quality, cutting corners, fighting unionization – all of which hurt the public that is supposed to be served. Plus, because it is “run like a business,” contracting corporations cut some of those corners by doing things like committing outright wage theft.
The Privatized Senate Cafeteria
In 2008 the U.S. Senate “saved money” by privatizing its food services. At the time California Democratic Sen. Dianne Feinstein said, “There are parts of government that can be run like a business and should be run like businesses.”
The Senate cafeteria was, indeed, “run like a business.” The company paid low wages, fought against unionization efforts and engaged in various schemes to keep the workers down. After a while things got so bad that workers had to work two, even three jobs just to get by. Some of the workers were even homeless. In April 2015, the Washington Post reported on that:
For a week’s work at the Senate cafeteria — sweeping floors, mopping bathrooms, cleaning dishes, composting leftovers, transporting laundry — he says his take-home pay is about $360. And while he takes enormous pride in serving the country’s public servants, he is not sure these public servants are returning the favor.
“Our lawmakers, they don’t even realize what’s going on right beneath their feet,” he says. “They don’t have a clue.”
The usual ways to “run like a business” were not enough for the Senate cafeteria contractors. SO they added another way to “run like a business”: wage theft. When after months of protests the Senate cafeteria workers secured a wage agreement from Restaurant Associates, with the help of Good Jobs Nation and members of the Senate who voiced support for the workers, Elizabeth Warren of Massachusetts and Sherrod Brown of Ohio, the company immediately worked to undermine the agreement by reclassifying Senate cafeteria jobs so that the workers ended up not getting the wage increases the agreement called for. The jobs themselves did not change; Restaurant Associates changed what the jobs were called in order to justify not increasing the workers’ pay.
If This Is Happening Literally Right Under The Senate’s Nose …
The Huffington Post has a great quote from Joseph Geevarghese, director of Good Jobs Nation. “This is symptomatic of a larger problem,” Geevarghese is quoted as saying. “If federal contractors believe they can get away with breaking federal laws right under the nose of lawmakers, imagine what they’re doing all across the U.S., where workers don’t have access to power and access to the media. I would argue that what we’re seeing in Washington is just the tip of the iceberg.”
The Washington Post report, “Senate workers will get $1 million in back pay after Labor Department probe,” highlights a wider need this wage theft ruling points to: a “Model Employer” policy of contracting with employers that pay good wages and recognize workers’ right to form a union. In the Post, Geevarghese notes that “the truth is the Labor Department cannot investigate every federal contractor in the U.S. – we need a systemic solution, not just case-by-case fixes.”
Democratic Platform Demands “Model Employer”
The 2016 Democratic Party Platform calls for an executive order “or some other vehicle” directing the U.S. Government to spend taxpayer dollars on “Model Employers” and not on corporations that violate workers’ rights. From the platform:
Democrats support a model employer executive order or some other vehicle to leverage federal dollars to support employers who provide their workers with a living wage, good benefits, and the opportunity to form a union without reprisal. The one trillion dollars spent annually by the government on contracts, loans, and grants should be used to support good jobs that rebuild the middle class.
“Currently, the federal government is America’s leading low-wage job creator, funding more poverty jobs than McDonald’s and Wal-Mart combined. 60% of federal contract workers are women and 88% are women of color working contracted jobs in areas like food service, janitorial work, or landscaping.
A Model Employer Executive Order would begin to reverse the federal government’s low-wage contracting policies by providing as many as 21 million people– 8 million workers and their families who rely on low-wage jobs in the federally supported economy – with good jobs that provide a path into the middle class.”
“Comparative advantage.” It used to mean that one region can grow bananas, another region can grow cotton. So they trade, and both regions can have cotton AND bananas. That is not what the term means today. Now it means low wages and lack of environmental protection.
In the US we (used to) have democracy. When people get to say what they want, they say they want good wages, good schools, good infrastructure, protect the environment, good courts, things like that. These of course cost money, but they money comes from the advanced business environment supported by good schools and infrastructure… So the prosperity from businesses growing due to good infrastructure and schools and courts etc is the fruit of democracy.
In places without democracy people are told they can’t have those things so wages are low and there is no cost to protect the environment.
If we let companies just close factories here and open them there and bring the same goods back to sell in the same stores, what we have done is made democracy a “comparative disadvantage.” “Free trade” lets those companies escape the costs of good wages and protecting the environment while still enjoying open access to the good market that democracy had created.
“Free trade” turns democracy into a comparative and competitive disadvantage. Over time it erodes the tax base that gave us good schools and infrastructure — the fertile soil in which businesses can grow. Also known as “look around you.”
All of us suffer consequences when corporations cheat. Silicon Valley’s tech companies make a lot of money, but many of them dodge paying taxes. San Francisco is going to try to do something about it. Three supervisors are proposing that the city tax tech companies to help pay the costs these companies impose on the city.
Silicon Valley housing costs have skyrocketed thanks to the high salaries and stock options tech companies pay to attract skilled workers. In San Francisco and much of the area, the median rent for a one-bedroom apartment is over $3,500. The median home sells for over $1 million. This has pushed many long-term residents to the edge of or even into, homelessness.
San Francisco is a mecca for young, affluent tech workers. In some areas of San Francisco the streets are lines with sidewalk restaurants, brewpubs, great shops, all the things that make an urban environment a fun place to be. In other parts of the city the streets are literally lined with homeless people, many pushed out by the lack of housing that people making only double or triple the national median income can afford.
Three supervisors have proposed a ballot proposal to approve a 1.5 percent payroll tax on “tech companies” with more than one million dollars in gross revenue. This would raise around $115 million annually for the city, which would go to homelessness programs and affordable housing projects. Also in the proposal as many as 75,000 small businesses would have their business registration fee cut in half.
Eric Mar, a member of the city’s Board of Supervisors, announced the proposal last week for a 1.5 percent payroll tax that would serve as a form of indemnification for what he described as the downside of the technology boom.
Tech companies have been “a tremendous benefit to the city in many ways,” Mr. Mar said. “But I don’t think they’ve been paying their fair share.”
The proposal for what has become known as the tech tax comes as officials struggle to fill growing gaps in the city budget. Money from the tech tax would go toward paying for programs for the homeless and the housing “affordability crisis,” Mr. Mar said.
Opponents say it is hard to define what a “tech company” is. But according to SFGate’s Emily Green:
Causa Justa/Just Cause, “a multiracial, grassroots organization building community leadership to achieve justice for low-income San Francisco and Oakland residents. … [W]e are a force for justice and unity among Black and Brown communities. … We provide tenant rights advocacy and information to tenants through our Housing Committee/Tenants’ Rights Clinic. We build our membership through recruitment in the tenants’ rights clinics and through neighborhood door knocking and outreach. We fight grassroots campaigns to win immigrant rights and housing rights and work toward building a larger movement for social transformation.
San Francisco Rising, which organizes “in African-American, Latino and Asian/Pacific Islander communities in San Francisco. … [T]he members of SFR seek to build a new, community-based political infrastructure and to make lasting change on a broad set of issues impacting their communities.”
Jobs with Justice, which “believes that all workers should have collective bargaining rights, employment security and a decent standard of living within an economy that works for everyone. We bring together labor, community, student, and faith voices at the national and local levels to win improvements in people’s lives and shape the public discourse on workers’ rights and the economy.”
The Coalition on Homelessness “brings together homeless folks, front-line service providers, and their allies to build a San Francisco that everyone can call home. We are working every day to expand access to housing in one of the richest cities in the country, protect the rights of the poorest people on our streets, and to address the root causes of homelessness and poverty.”
Tax-Dodging And Extortion
Many of the giant tech companies use various schemes to dodge paying their taxes. Apple, for example, pretends that an Irish subsidiary owns the “intellectual property” behind the company’s products, and this subsidiary charges high fees, so Apple’s profits are in Ireland. This enables Apple to dodge paying U.S. taxes. Apple also pretends that it is based in a mailbox in Nevada to avoid paying corporate taxes in California. Google, for example, notoriously makes billions of dollars of profits in low-population Bermuda.
Businesses in San Francisco’s Mid-Market district skirted nearly $34 million in city payroll taxes last year thanks to a controversial incentive program known as the “Twitter tax break” intended to keep tech firms from fleeing for Silicon Valley.
That sum, published in a report released Monday by the San Francisco Controller’s Office, increased by about $30 million from 2013 and is five times greater than the amount of taxes companies avoided in the two previous years combined.
The aforementioned New York Times report explained what Twitter did to get this: “Twitter received the tax breaks after threatening to leave the city, creating resentment among tech companies in other parts of the city that did not get such incentives.”
Opponents are also using extortion to fight the proposed “tech tax,” calling it a “job-killer.” They say the small payroll tax will cause companies to pack up and leave the city so the city has to give in (a.k.a extortion). But the reality is these companies are desperate to bring in tech-skilled employees. So tech companies offer many perks to attract tech-trained employees. Aside from very high pay, employees get free lunches, snacks and beverages. At many companies even dinner is free. They get child care. They get stock options and generous benefit packages. Some even offer backrubs and yoga classes.
One of the biggest perks a tech company can offer is being located in San Francisco itself, instead of having to use their private bus network to bring employees from San Francisco.
The traffic in Silicon Valley is absolutely terrible. We the People sit in traffic, with few alternatives. The Caltrain line that runs between San Jose and San Francisco is standing room only during the hours people are trying to get to work. The Bay Area Rapid Transit (BART) rail system doesn’t go where it needs to go, and its parking lots are full where there are stations further north. Light rail is limited. The bus system is a few buses on a few of the main roads.
… But companies like Google, Facebook, Apple and others have built their own private bus lines. These are mostly shiny, white luxury buses that bring employees to work and take them home. Locally, we call them all “Google Buses.” There have even been protests because these buses bring affluent tech employees up to San Francisco neighborhoods, causing rents to soar.
There’s a relationship between those “Google Buses” and the rest of us sitting still, stuck in traffic.
Why can’t we afford to maintain our 1970s-level public transportation system? (Never mind bringing it into the 21st century.) Where did the money go? You’ve heard about companies like Apple using schemes and scams like the “Double-Irish With a Dutch Sandwich” to dodge paying taxes. Remember when an Apple executive said to The New York Times that these tax scams are just fine, because giant multinationals “don’t have an obligation to solve America’s problems.”
Commuters sit in traffic jams because tax-dodging corporations are not helping pay for transportation options. Meanwhile those companies use their tax-dodger money for beautiful, modern private transportation “Google bus” systems for themselves. They extort tax breaks. They externalize problems onto communities and offer little help – because giant multinationals “don’t have an obligation to solve America’s problems.”
This proposal needs six of the eleven members of the Board of Supervisors to get on the November ballot, which is unlikely. The measure singles out “tech” companies and not others, and only those based in San Francisco. Giant companies like Facebook, Google, Apple and others are not based in San Francisco, but they deliver their high-paid employees to San Francisco’s housing market in their private bus networks.
This modest, local tax is not likely to pass, but should serve as a warning shot to giant companies – whether defined as tech companies or not – that people and communities are more than fed up with their tax dodging and their ducking responsibility for their practices.
The Trans-Pacific Partnership (TPP) is likely to come up for a vote in the “lame-duck” session of Congress that follows the November presidential election. Will the Democratic Party vote to put the platform on record against this, or will corporate interests win out yet again? This is an either-or, whose-side-are-you-on moment that will define the election campaign.
If the Democratic National Committee does not put TPP opposition into the platform it will lead to a public, televised convention floor fight.
Will The Democratic Party Platform Oppose A Lame Duck TPP Vote?
This weekend the full Democratic platform drafting committee meets in Orlando. Delegates will be debating an amendment offered by columnist and progressive activist Jim Hightower, a Sanders delegate, putting the party on record opposing a vote on the TPP during the “lame-duck” session of Congress that follows the election.
The amendment calls for striking platform language that effectively blesses Democrats who “have expressed support for the agreement” and replaces it with this: “It is the policy of the Democratic Party that the Trans-Pacific Partnership must not get a vote in this Congress or in future sessions of Congress.”
Presidential candidates Hillary Clinton, Bernie Sanders and Donald Trump have all announced opposition to a TPP vote in the lame-duck session, but Wall Street interests, corporate groups like the Chamber of Commerce, many Republicans – and, unfortunately, President Obama – are pushing for this anyway.
Despite statements of opposition to the TPP from both Clinton and Sanders, a subset of the committee recently voted down the proposal to oppose the TPP. A majority of delegates (all Clinton backers) expressed concern that this would bring the party in opposition to President Obama.
If the committee does not put this into the platform this weekend, there will be enough convention delegates opposing the TPP to guarantee a “floor fight” – a televised debate and a vote – over this at the convention. The outcome is fairly certain because all Sanders delegates support this amendment, and it is almost unthinkable that Clinton delegates will vote against Clinton’s own stated opposition to the TPP.
Progressive Coalitions Deliver Petitions To Pelosi, Platform Committee
A coalition of progressive organizations on Thursday delivered hundreds of thousands of petition signatures asking House Democratic Leader Nancy Pelosi to declare her opposition to a lame-duck TPP vote. The coalition includes organizations ranging from Campaign for America’s Future to People’s Action to MoveOn to CREDO to Daily Kos and Demand Progress.
On Friday, another coalition will deliver more than a million signatures to the platform committee itself, demanding that it add an amendment opposing a lame-duck TPP vote.
The coalition hosted a Thursday press call featuring radio and TV personality Ed Schultz. Shultz began the call, saying this is about support of middle-class families in this country. He said there has never been a more damaging trade agreement than the TPP. Speaking to the platform committee, he said, “If you are for American families and want to correct course of inequality you have to oppose this deal. … This is not about Obama’s legacy, this is about American families that are struggling.”
Also on the call, Murshed Zaheed, vice president and political director of CREDO said that its members have signed over 1 million petitions to stop the TPP, and have made over 50,000 calls. “There’s a reason every major presidential candidate opposes TPP,” he said. “TPP is an undemocratic corporate power grab.”
“This also a political battle,” said Campaign for America’s Future co-founder Roger Hickey. “Tomorrow we are hoping that members of the Democratic platform committee will amend the platform and put the Democratic Party clearly on record against a lame-duck vote. … Without this, it allows Donald Trump to continue to say Democrats are not serious.”
A Lame Duck TPP Vote Insults Democracy
The “lame duck” is a term used for the Congressional session between the election and the next Congress. People who follow politics understand that political accountability to constituents is at its absolute lowest at this time. Senators and representatives who have been voted out (many for supporting the TPP) and are looking for lobbying jobs, and those who were re-elected with corporate money and need to repay their donors, will be voting. Members who were elected because of their opposition to the TPP will not yet be sworn in and voting. This all happens two years before there is any chance for the public to hold members of Congress accountable.
With the TPP enormously unpopular, with candidates Clinton, Trump and Sanders all opposed, with 83 percent of Democrats in Congress voting against fast-tracking the trade agreement last year, the lame-duck Congressional session is the best chance for corporate interests to push TPP around the interests of democracy. So they are going to try to do exactly that.
Leaders should care deeply about the will of the public, not scheme to subvert it. This push for a vote on TPP after the election is an insult to democracy. It is an insult to our economy. It is an insult to the candidates. It is an insult to voters. Don’t do it.
Whose Side Are They On?
It is clearly time for Democrats to decide and declare whether they are on the side of working people and the American middle class, or on the side of Wall Street, giant multinational corporations, the Chamber of Commerce and other corporate lobbying interests. They have to decide if they are on the side of the 99 percent 1 percent. They have to decide if they are on the side of protecting the environment or protecting corporate profits.
Hillary Clinton and Bernie Sanders have said they oppose the TPP. The Democratic Party platform should reflect this and go on the record that Democrats oppose a rigged “lame-duck” vote.
Donald Trump is selling himself as the champion of working-class voters. He says Democrats and their presumptive presidential nominee, Hillary Clinton, are selling them out with trade deals. But Trump is just a fraud.
Unfortunately, President Obama is pushing the Trans-Pacific Partnership (TPP) agreement and Clinton is not confronting him for doing so.
That has to change – fast. Clinton must publicly, directly and loudly challenge President Obama and demand that he withdraw TPP from consideration by Congress.
Trump’s Trade Speech
Trump’s speech on trade and “globalization” issues attempted to frame Clinton and Democrats as being on the side of the “Wall Street” forces that have pushed low-wage policies on working-class Americans. He is using the upcoming and hated TPP being pushed by President Obama as an example of this, saying Clinton is only “pretending” to oppose TPP in order to get votes.
From the speech:
The legacy of Pennsylvania steelworkers lives in the bridges, railways and skyscrapers that make up our great American landscape.
But our workers’ loyalty was repaid with betrayal.
Our politicians have aggressively pursued a policy of globalization — moving our jobs, our wealth and our factories to Mexico and overseas.
Globalization has made the financial elite who donate to politicians very wealthy. But it has left millions of our workers with nothing but poverty and heartache.
[. . .] The people who rigged the system are supporting Hillary Clinton because they know as long as she is in charge nothing will ever change.
In Trump’s usage, the words “trade” and “globalization” mean one and only one thing: moving American jobs and factories to low-wage countries. This movement of jobs in recent decades, pitting American workers against exploited workers who are paid squat and can’t do anything about it, has been used as one lever to intentionally create unemployment, break the unions and force down wages. (Inflation panic leading to Federal Reserve interest rate increases, deficit scares leading to austerity — especially the refusal to spend on infrastructure – and obstruction leading to minimum wage stagnation are others.)
Trump is appealing to disaffected working class workers who used to vote Democratic, but have seen their jobs shipped out of the country and/or their wages cut or stagnate. These workers see Democrats as complicit in adopting free-trade deindustrialization policies. The North American Free Trade Agreement (NAFTA), pushed and signed by President Clinton, has become a catchall symbol of this disaffection with free-trade policies, but Democrats are generally seen as having done little to fight such policies.
President Obama contributed to the problem by campaigning with a promise to renegotiate NAFTA, then reneging on this promise once elected.
Pressing his staunch opposition to trade deals, Donald J. Trump escalated his attacks on the U.S. Chamber of Commerce on Wednesday, saying it was “totally controlled by the special interest groups.”
“They’re a special interest that wants to have the deals that they want to have,” he told a packed arena at a rally here, to whoops and cheers. “They want to have T.P.P., the Trans-Pacific Partnership, one of the worst deals, and it’ll be the worst deal since NAFTA.”
[. . .] saying the Chamber was “controlled totally by various groups of people that don’t care about you whatsoever.”
Obama Pushing TPP As Election Nears
Clinton has said she is opposed to TPP, and opposed to letting TPP come up for a vote in the “lame duck” session of Congress that follows the election. But as Trump makes trade a centerpiece of his campaign, her opposition and trade focus has not been particularly vocal. She has not asked Democrats in Congress to oppose the TPP, and thanks to past Democratic betrayals many in the public just do not believe her.
Unfortunately, as the election nears, President Obama is pushing and pushing hard to get the TPP passed. Doing this directly conflicts with Clinton’s need to show that Democrats are on the side of working people and provides Trump with powerful ammunition.
Making matters worse, efforts to write TPP opposition into the Democratic Party platform were voted down – by Clinton delegates. Unlike Trump, Democrats do not appear to understand how much this matters to voters.
The recent “Brexit” vote should serve as a warning to Democrats to take issues like this more seriously. Working-class voters in the UK voted to leave the European Union (EU) for reasons similar to the appeal Trump is making to working-class voters here.
Analyzing the “Leave” vote in “A Working-Class Brexit,” University of Kent Professor Tim Strangleman writes the following. As you read it, substitute “Democrats” for “Labour”, “Bill Clinton” for “Blair”, “elites supporting free trade agreements” for “remain”, “anti-TPP” for “leave” and “Trump” for “UKIP”:
Resignation, despair, and political apathy have been present in many former industrial regions since the wholesale deindustrialisation of the … economy in the 1980s and 1990s. The election of the Blair-led Labour administration … masked the anger felt in these areas as traditional labour supporters and their needs were often ignored, while traditional Labour supporters were used as voting fodder. Over the … years of Labour power, that support ebbed away, first as a simple decline in votes, but gradually turning into active hostility to the Labour party. Many embraced the UK Independence Party (UKIP).
…for unskilled workers with only a secondary school education, three decades or more of neo-liberalism has left deep scars socially, politically, and culturally, with little hope or expectation that anything would change for the better.
This opposition, so skillfully drawn on by the leave campaign, is in part a working class reaction not only to six years of austerity but also to a long and deep-seated sense of injustice and marginalisation. Most of the remain side, which was a cross party grouping, didn’t seem to understand this before the referendum and, even more depressingly, doesn’t seem to understand it fully now. A stock characterisation of working-class people who intended to vote leave was to label them as unable understanding the issues, easily manipulated, or worse, racist ‘little Englanders’.
Doesn’t this sound just like the working-class voters in places like Ohio, Michigan, Indiana, Pennsylvania and other “deindustrialized” parts of the country? These voters used to reliably vote for Democrats, the party that watched out for working people. Donald Trump is appealing directly to these voters. Democrats should not dismiss these voters as “ignorant” or “racist.”
Trump Is A Fraud On Trade
The Economic Policy Institute’s (EPI) Robert Scott, speaking to VICE, summed up why Trump only appears to have the correct analysis on trade:
“Like a drive-by shooting, he fires enough bullets, he’s going to hit some things that might look like a policy that works,” Scott told VICE. “But it doesn’t have a coherence.”
“The problem with NAFTA is that we failed to effectively help Mexico develop as part of the agreement,” Scott continued. A good model, he said, was what wealthier European nations did for their neighbors like Greece and Spain decades ago, pumping money into their economies to create new markets for goods, thus making a Pan-European economy possible.
“We could create such a vision and implement a truly united North American economy that worked for everybody but nobody’s put that on the table,” he said. “Certainly Trump is not talking about that—he’s talking about building walls.”
It’s true that the way we have undertaken globalization has hurt the vast majority of working people in this country—a view that EPI has been articulating for years, and that we will continue to articulate well after November. However, Trump’s speech makes it seem as if globalization is solely responsible for wage suppression, and that elite Democrats are solely responsible for globalization. Missing from his tale is the role of corporations and their allies have played in pushing this agenda, and the role the party he leads has played in implementing it. After all, NAFTA never would have passed without GOP votes, as two-thirds of the House Democrats opposed it.
Republican efforts to drive wages down are the real culprit here:
Furthermore, Trump has heretofore ignored the many other intentional policies that businesses and the top 1 percent have pushed to suppress wages over the last four decades. Start with excessive unemployment due to Federal Reserve Board policies which were antagonistic to wage growth and friendly to the finance sector and bondholders. Excessive unemployment leads to less wage growth, especially for low- and middle-wage workers. Add in government austerity at the federal and state levels—which has mostly been pushed by GOP governors and legislatures—that has impeded the recovery and stunted wage growth. There’s also the decimation of collective bargaining, which is the single largest reason that middle class wages have faltered. Meanwhile, the minimum wage is now more than 25 percent below its 1968 level, even though productivity since then has more than doubled. Phasing in a $15 minimum wage would lift wages for at least a third of the workforce. The most recent example is the effort to overturn the recent raising of the overtime threshold that would help more than 12 million middle-wage salaried workers obtain overtime protections.
Trump in his “trade” speech also called for getting rid of corporate taxes and getting rid of regulations on corporations. He also opposes having any minimum wage at all. Trump and the Republicans are hardly friends of working people.
Opposing TPP Must Be In The Democratic Platform
British elites were surprised when working-class voters decided to “Brexit” and “Leave” the EU. They had been more-or-less complacent about the anger that working people are feeling out there as jobs leave the country, wages are stagnant or falling, work hours get longer for those who have jobs, and the rich just get richer.
Voting against opposition to TPP in the Democratic platform shows that Democrats appear to have the same complacency on trade.
Democrats must get this right. They have to stand up for working people and demand that our trade policies start helping people instead of hurting them. That starts with Clinton demanding that the president withdraw TPP from consideration by Congress.
Clinton must pledge to renegotiate all of our trade agreements, this time with labor, environmental, consumer, human rights and other “stakeholder” groups at the table. This is the best way to show the public that she is on their side.
Here are ways to help Democrats get to the right place on this, and put TPP opposition in the platform:
Colombia is allowing local production of a generic form of a cancer drug that is ultraexpensive because of a government-granted monopoly handed to a giant, multinational pharmaceutical corporation. The U.S. government is stepping in on the corporation’s side with a modern form of “gunboat diplomacy” — even though the giant corporation isn’t even “American.”
Last week the Treasury Department released a new rule and several proposals they said are intended to address the problem of corruption and dirty money in secret U.S. shell companies. A White House press release claimed, “Today, the Administration announced several important steps to combat money laundering, corruption, and tax evasion, and called upon Congress to take additional action to address these critical issues.” (A White House fact sheet is available here.)
The new rules initially appeared to be strong. But after examining the details several watchdog groups are warning that the new regulations and proposals leave open several glaring loopholes, and even practically provide instructions for how to get around the regulations.
There are 39,000 Verizon workers on strike right now. They are not just striking for better pay and conditions from Verizon; this is also about how all of the giant corporations are treating all of us, their workers and customers. It’s just that the workers at Verizon have a union that is still strong enough to carry out this fight for the rest of us.
Is it really “extreme” to think we should have fair trade policies?
The New York Times on Tuesday published a story by Nelson D. Schwartz and Quoctrung Bui, “Where Jobs Are Squeezed by Chinese Trade, Voters Seek Extremes,” reporting that, “research to be unveiled this week by four leading academic economists suggests that the damage to manufacturing jobs from a sharp acceleration in globalization since the turn of the century has contributed heavily to the nation’s bitter political divide.”
By “sharp acceleration in globalization since the turn of the century” they mean millions and millions of manufacturing jobs, and more than 60,000 factories, all moved to China since 2000 to take advantage of China’s non-democracy that allows exploitation of workers and the environment. (But China doesn’t really “trade” with us by buying things, resulting in a record $365.7 billion trade deficit with China just last year.)