One day after presidential candidate Hillary Clinton strongly underscored her opposition to the Trans-Pacific Partnership in a speech in Detroit, President Obama officially started the clock on a lame-duck congressional vote on that agreement.
The White House put Congress on notice Friday morning that it will be sending lawmakers a bill to implement President Barack Obama’s landmark Trans-Pacific Partnership agreement — a move intended to infuse new energy into efforts to ratify the flatlining trade pact.
The submission of the draft Statement of Administration Action establishes a 30-day minimum before the administration can present the legislation, but it is unlikely to do so amid the heated rhetoric of a presidential campaign that has depicted free trade deals as major job killers.
Democratic presidential candidate Hillary Clinton says she opposes the Trans-Pacific Partnership (TPP) but is having trouble convincing people to believe her. Imagine the trouble Hillary Clinton will have trying to build support for her effort to govern the country if TPP is ratified before her inauguration.
According to Politico’s Wednesday Morning Trade, the Obama administration is launching a “TPP blitz” push to pass the Trans-Pacific Partnership (TPP),
Commerce Secretary Penny Pritzker last week said the administration is planning at least 30 trade events by the end of the month. That effort, similar to last year’s “all of Cabinet” push for trade promotion authority, is expected to shift to Capitol Hill in September when lawmakers return from their summer break.
In spite of the opposition of much of the public, both presidential candidates, all of labor, almost all Democrats, all progressive-aligned consumer, human rights, environmental and other organizations and even the Tea Party right, what is happening here is that Wall Street, the multinational corporations, most Republicans and unfortunately President Obama are preparing to insult democracy by pushing to ratify TPP. This undermine’s Clinton’s credibility while campaigning for election, and if it passes it harms her ability to govern if she is elected.
There is something Clinton can do to bolster her credibility on the TPP. Clinton on Thursday is giving an economic speech near Detroit. This speech is an opportunity for Clinton to put this behind her for good. She should loudly call on President Obama to withdraw TPP now, and call on Democrats to vote against the TPP if he does not do that.
Clinton has stated her opposition to TPP, but has not asked Democrats to join her in opposition, particularly during the “lame-duck” session of Congress that follows the election. This is one reason that Clinton continues to have a credibility problem on TPP.
Donald Trump repeatedly tells audiences that Clinton isn’t really against TPP; she is just saying it for votes. He says she will “betray” us. This is Trump in his Monday “economy” speech in Detroit:
The next betrayal will be the Trans-Pacific Partnership. Hillary Clinton’s closest friend, Terry McAuliffe, confirmed what I have said on this from the beginning: If sent to the Oval Office, Hillary Clinton will enact the TPP. Guaranteed. Her donors will make sure of it.
Along with McAuliffe, who is the governor of Virginia, Chamber of Commerce President Tom Donohue has said she will reverse herself. And it was Clinton delegates who blocked putting specific TPP opposition in the Democratic platform. So yes, there is a credibility problem.
Clinton came out against the agreement last year to put herself in alignment with Sen. Bernie Sanders … But in doing so, she put herself at odds with the views enunciated by her husband, Bill Clinton, when he was president, and raised questions about whether her change of heart was mere political expedience.
Which is why her position on trade and global economics has remained suspect to those on the left…
What does Clinton really think about this aspect of economic policy? How do her views today square with what she has thought and advocated during her public career? …
Those are issues about which she has so far been relatively silent. … Trump has presented her with a challenge; is she is prepared to take it up?
… In her responses to Trump’s Detroit speech, Clinton did not address what the GOP nominee said about trade. It’s difficult to believe that was an oversight.
… Does Clinton not owe the public a fuller explanation of her views on a topic that her rival has made central to his candidacy?
Passing TPP Would Destroy Clinton Presidency Before It Starts
Polling shows that Clinton continues to have a problem with “unfavorables” and credibility with the electorate. As of now it appears Clinton will almost certainly win the election – maybe even in a blowout. But this will not necessarily be due to overwhelming support of Clinton. Instead it will be at least partly because of the ugly words and actions of her reprehensible opponent. After the election, much of the public will likely remain divided, looking for signs that things will be OK after all under a Clinton presidency.
Imagine if TPP does come up for a vote in the lame-duck session and passes. The public, particularly progressives, will certainly feel betrayed. It will also bolster the opposition, who will say, “I told you so” because of Trump’s predictions of a betrayal on TPP. If that happens, it won’t matter that Clinton has said she opposes TPP. People will feel she just said it to get votes, and now that the election is over…
This is a terrible recipe for beginning a presidency of a divided country.
Progressive Groups Asking Clinton To Lead Opposition To Lame Duck TPP Vote
Progressive groups are urging Hillary Clinton to publicly announce that she opposes a lame-duck session vote on the Obama administration’s Pacific Rim trade deal.
After initially supporting the Trans-Pacific Partnership (TPP), Clinton reversed after Bernie Sanders made his opposition to the deal one of the cornerstones of his insurgent campaign for the presidency.
On Wednesday, the grassroots liberal groups Democracy for America and CREDO will begin circulating petitions urging Clinton to go further by making a public statement “urging the White House and Democratic congressional leadership to oppose any vote on the TPP, especially during the post-election lame duck session of Congress.”
The groups would like Clinton to make that declaration in her policy address on the economy this Thursday outside of Detroit.
“Right now, Donald Trump is running around the country using the specter of a lame-duck vote on the job-killing Trans-Pacific Partnership to divide Secretary Clinton from the millions of voters who agree with her that this disastrous trade deal has to be stopped,” Robert Cruickshank, a senior campaign manger at Democracy for America, told BuzzFeed News in a statement.
CREDO’s Murshed Zahee also weighs in:
“Now we need her help to stop it from being jammed through Congress in a lame duck session. A personal and public statement from Secretary Clinton in opposition to a lame duck vote would provide huge momentum in the fight to stop the TPP once and for all,” CREDO’s political director Murshed Zaheed said in a statement to BuzzFeed News.
Sign The Petition
You can add your own voice to this effort to get Clinton’s help stamping out TPP by adding your name to this CREDO petition:” Tell Sec. Clinton: Lead against lame-duck vote on TPP“: “Make a public statement urging the White House and Democratic congressional leadership to oppose any vote on the TPP, especially during the post-election lame-duck session of Congress.”
One of Republican presidential candidate Donald Trump’s stronger economic appeals to working-class voters is his position on trade. Trump understands that people are upset that “trade” deals have moved so many jobs out of the country and he offers solutions that sound like he is saying he will bring the jobs back so wages can start going up again.
But a deeper look at what he is really saying might not be so appealing to voters.
Trump says the U.S. is not “competitive” with other countries. He has said repeatedly we need to lower American wages, taxes and regulations to the point where we can be “competitive” with Mexico and China. In other words, he is saying that business won’t send jobs out of the country if we can make wages low enough here.
Trump even has a plan to accomplish this. He has said the way to make U.S. wages “competitive” is to pit states against each other instead of using China and Mexico to do that. He has said, for example, that auto companies should close factories in Michigan and move the jobs to low-wage, anti-union states. After enough people are laid off in one state, he has said, “those guys are going to want their jobs back even if it is less.” Then companies will be able to “make good deals” to cut wages. He says that companies should continue this in a “rotation” of wage cuts, state to state, until you go “full-circle,” getting wages low enough across the entire country. Then the U.S. will be “competitive” with China and Mexico.
Yes, Trump Actually Said These Things
Trump discussed this in an August 2015 interview with The Detroit News headlined, “Trump suggests moving some car production from Michigan.“ In the interview, the subject of moving jobs out of the country because other places offer lower wages, “free or nearly free land on which to build, and fewer regulatory hurdles” came up. “Trump suggested one way to stop automakers’ expansion to Mexico is by moving some production out of Michigan to lower-wage states.”
He said U.S. automakers could shift production away from Michigan to communities where autoworkers would make less. “You can go to different parts of the United States and then ultimately you’d do full-circle — you’ll come back to Michigan because those guys are going to want their jobs back even if it is less,” Trump said. “We can do the rotation in the United States — it doesn’t have to be in Mexico.”
He said that after Michigan “loses a couple of plants — all of sudden you’ll make good deals in your own area.”
Saying the United States needs to be able to compete in a global economy, Republican presidential candidate Donald Trump said Thursday having a low minimum wage isn’t a bad thing for the country.
“… I think having a low minimum wage is not a bad thing for this country.”
… “It’s such a nasty question because the answer has to be nasty,” Mr. Trump said. “You know, we’re in a global economy now. It used to be people would leave New York state and companies would leave New York state or leave another state and go to Florida, go to Texas, go to wherever they go because the wages … you know, all sorts of different things.”
“Well now, it’s not leaving New York or New Jersey or wherever they may be leaving — now they’re leaving the United States, and they’re going to other countries because they’re competing for low taxes and they’re competing for low wages and they’re competing for all sorts of things …”
“So what’s happening now is people are shopping, companies are shopping. … They’re shopping their companies to [other] places, and we can’t have a situation where our labor is so much more expensive than other countries that we can no longer compete.”
Mr. Trump said if he wins the White House, he would “make us so competitive as a country.”
“We are a country that’s being beaten on every front, economically, militarily. There is nothing we do now to win,” said Mr. Trump, adding at another point that “our wages are too high.”
… “Our taxes are too high. Our wages are too high. We have to compete with other countries.”
Again and again, Trump says U.S. taxes, regulations and wages are too high for American companies to “compete.”
Trump repeated the same argument in his “Economic Speech” Monday at the Detroit Economic Club, saying that high taxes and regulations make America uncompetitive so businesses move away. He left out his – and every other Republican’s – position on wages.
Run The Country Like A Business?
Trump talks about how he is a “businessman” who is a great “negotiator.” He wants to run the country like a business.
But people who run businesses always push for lower taxes, fewer regulations and lower wages. Trump used to talk openly about his desire to cut all three, in order to make America more “competitive” with Mexico and China. Lately he only promises to radically cut taxes and regulations on businesses. Of course, he has learned to keep quiet about his desire to cut the third leg of that argument, wages.
But Trump is, after all, the Republican candidate. He is, after all, a businessman. He has, after all, openly expressed his wish to bring American wages down in the past and even voiced his plan to pit states against each other to accomplish that.
So we should, after all, understand that a Republican businessman who has made it clear that he thinks wages need to go down does not suddenly have the best interests of American workers at heart. He is also a politician, and in this one instance he has learned to keep his mouth shut, at least when it comes to his argument that wages are too high. That doesn’t mean his argument has changed.
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.”
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:
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.
Our country’s “free trade” agreements have followed a framework of trading away our democracy and middle-class prosperity in exchange for letting the biggest corporations dominate.
There are those who say any increase in trade is good. But if you close a factory here and lay off the workers, open the factory “there” to make the same things the factory here used to make, bring those things into the country to sell in the same outlets, you have just “increased trade” because now those goods cross a border. Supporters of free trade are having a harder and harder time convincing American workers this is good for them.
Free trade is when goods and services are bought and sold between countries without tariffs, duties and quotas. The idea is that some countries “do things better” than other countries, which these days basically means they offer lower labor and environmental-protection costs. Allowing other countries to do things in ways that cost less “frees up resources” which can theoretically be used for investment at home.
“Free trade”: The elites are selling it but the public is longer buying it. Look at the support for Democrat Bernie Sanders and Republican Donald Trump, especially in light of Sanders’ surprise 20-point comeback in this week’s Michigan primary. With primaries coming soon in Ohio, Illinois, Missouri and North Carolina, will Sanders’ trade appeal resonate again?
Voters See Free Trade Killing Their Jobs And Wages
Voters have figured out that our country’s current “free trade” policies are killing their jobs, wages, cities, regions and the country’s middle class. Giant multinational corporations and billionaires do great under free trade, the rest of us not so much.
Elites say increasing trade is always good. But when you close a factory here, then open the factory “there” and bring the same goods back to sell in the same outlets, you have “increased trade” because those goods now cross a border. The differential between wages paid here and there goes into the pockets of the executives and shareholders. Those unemployed American workers add to wage pressures on the rest of us. Inequality increases.
There are other bad consequences as the effects of free trade ripple through local economies. The stores and gas stations and restaurants where the workers shopped and dined have to cut back. The factory’s suppliers have to cut back and lay off, too. Property values drop in the neighborhoods where all of those workers lived. The local tax base erodes. Roads and buildings and downtowns deteriorate… (The old lead pipes going to the houses do not get replaced.)
On a national scale, these local effects add up to a tragedy.
The national industrial ecosystem collapses as well. The manufacturing “know-how” migrates out of the country. The schools that taught people how to do what the factory did drop those classes. The investors who know how to evaluate manufacturing proposals go away. The raw materials pipeline migrates away. Reviving the outsourced industries will require tremendous and nationally coordinated investment.
For decades we’ve been told all this is actually good for “us.” But people have come to understand that the “us” this is good for doesn’t include about 99 percent of “us” or our country.
Trade Behind Sanders’ Michigan Upset
Sanders’ Michigan primary upset was most likely driven by his repeated trade message. Michigan’s primary upset demonstrates again that voters have caught on that our country’s trade policies have sent millions of jobs out of the country, put tremendous downward pressure on wages, decimated regions of the country (Flint, Detroit, the “rust belt”) and are dealing a death blow to America’s middle class.
Watch this Sanders ad on the damage our trade deals have done:
While people talk about “NAFTA” (the North American Free Trade Agreement) the term is really used as a shorthand for all of our country’s disastrous trade policies, including the millions of jobs and tens of thousands of factories outsourced to China.
The exit polling from Michigan indicates that most voters there are wary of free trade agreements — and that Sanders and Trump drubbed their opponents among those voters.
According to CNN, 58 percent of Democratic voters polled after casting ballots said they believe U.S. trade with other countries takes away U.S. jobs, compared with just 30 percent who said they believe it creates them. Among that group, Sanders won by a whopping 17-point margin: 58 percent to Democratic rival Hillary Clinton’s 41 percent. He won the primary overall by less than a 2-point margin.
[. . .] Trade — and resentment toward U.S. trade policy — has been the sleeper issue in 2016. By eliminating trade barriers with low-wage countries, the North American Free Trade Agreement and subsequent treaties over the past two decades have encouraged U.S. companies to move jobs to countries where workers are paid less.
Sanders has made a point of pressing Clinton on trade throughout the Democratic debates, including just days ago. The Vermont independent has been a vocal opponent of the Trans-Pacific Partnership, a trade deal with 12 Pacific Rim countries championed by President Barack Obama. Clinton’s stance on the deal hasn’t beennearly as clear.
Mr. Sanders pulled off a startling upset in Michigan on Tuesday by traveling to communities far from Detroit and by hammering Mrs. Clinton on an issue that resonated in this still-struggling state: her past support for trade deals that workers here believe robbed them of manufacturing jobs. Almost three-fifths of voters said that trade with other countries was more likely to take away jobs, according to exit polls by Edison Research, and those voters favored Mr. Sanders by a margin of more than 10 points.
The salience of trade, in a state where unemployment had tumbled more than half since the start of the Great Recession, blindsided a Democratic Party that has struggled to find coherence between its labor base and its neoliberal leadership. It also worried Republicans, whose leaders and donors are resolutely in favor of free trade.
“There has been a bipartisan conventional wisdom that the damage done to working-class jobs and incomes are simply part of inevitable changes, ones we cannot and should not challenge,” said Larry Mishel, president of the left-leaning Economic Policy Institute. “Even President Obama is blaming inequality problems on technological change, which is not even a plausible explanation for post-2000 America. People correctly understand that many elites simply believe that wage stagnation is something we cannot change.”
… In Michigan, exit pollsters for the first time asked voters whether they thought trade created or took away American jobs. The “take away” faction made up 55 percent of the Republican primary vote and 57 percent of the Democratic primary vote. Trump won the GOP faction with 45 percent, and Sanders won the Democratic side with 56 percent.
A YUGE part of Donald Trump’s appeal is his position on trade. A new poll shows that 66% of Republican voters oppose TPP.
Last week’s post, Trump Taps Into Economic Anxiety Resulting From ‘Free Trade’ noted that “Trump is tapping into an economic anxiety felt by many, many Americans. Our trade policies are at the root of this anxiety, and Trump knows it and says it, and people nod their heads.” Here is Trump speaking after the “Super Tuesday” primaries:
Our nation is in serious trouble. we’re being killed on trade, absolutely destroyed, China is just taking advantage of us. I have nothing against China, I have great respect for China but their leaders are just too smart of our leaders, our leaders don’t have a clue. And the trade deficits at 400 billion dollars and 500 billion dollars, are too much, no country can sustain that kind of trade deficit. It won’t be that way for long, we have the greatest business leaders in the world, on my team already, and believe me we’re going to redo those trade deals and it’s going to be a thing of beauty.
Trump has been sounding this message throughout his campaign. Here is Trump on trade from last November:
“I’ll tell you, there’s one thing that we’ve very similar on,” Trump said during a town hall hosted by MSNBC’s Joe Scarborough and Mika Brzezinski. “He knows that our country is being ripped off big league, big league, on trade.”
1. A message of economic populism, particularly protectionism, is much more potent in the Rust Belt than we understood.
Most Michiganders feel like they are victims of trade deals, going back to NAFTA under Bill Clinton, and they’re deeply suspicious of the Trans-Pacific Partnership. Outsourcing has helped hollow out the state’s once mighty manufacturing core.
Trump and Sanders both successfully tapped into this.
Six in 10 Michigan Democratic primary voters said international trade takes away U.S. jobs, and Sanders won these voters by roughly 20 points, according to preliminary exit poll data reported by CNN. Only 3 in 10 thought trade creates jobs; Clinton won that group.
One-third of voters said Clinton is too pro-business. Sanders won more than four in five of them.
… Clinton, after speaking supportively of the TPP, flip-flopped once the agreement was signed.
4. Free trade is Clinton’s albatross. Just as the cable networks were calling the shocker for Sanders, an email popped into my inbox from one architect of Obama’s 2008 triumph, who was travelling overseas. “Americans really hate free trade,” he wrote. “Don’t know how else to explain it. Same thing running through republican race.”
Clinton … has the burden of schlepping the albatross of NAFTA with her throughout the Midwest. This is where voters’ lack of trust and her core belief in the value of open markets for American manufacturers collide: When Clinton questions free trade nobody really believes her; Sanders’ thunderous anti-free trade talk taps a vein of deep grievance, his cash advantage allowed him to saturate markets with word of his opposition to TPP and NAFTA – and his debate-stage answer on the topic was pithier and more convincing than Clinton’s.
Will Sanders’ Trade Position Resonate In Upcoming Primaries?
And a new statewide poll of likely Ohio voters finds trade will likely be a dominant issue in the March 15 primary, as vast majorities of respondents worry that the United States has “lost too many manufacturing jobs” and think it would be effective to “crack down on foreign countries that violate their trade agreements.”
… Conducted Feb. 27 to March 2 by Public Opinion Research and The Mellman Group, the poll looked at voter opinion on trade, manufacturing and the presidential candidates. Researchers discovered that while support for American manufacturing is nearly universal, majorities of respondents are worried about a shrinking middle class and the impact of manufacturing job loss.
Most participants are also concerned about foreign trade, including with China. Ninety-one percent agreed that it’s time for crack down on countries that violate trade agreements, and 83 percent said that it is important that China is officially declared a currency manipulator.
… Other key findings:
● 93 percent of participants worry that the U.S. has “lost too many manufacturing jobs in this country.”
● 74 percent of participants have unfavorable views of “manufactured goods made in China,” including 77 percent of “conservative” respondents.
● 96 percent of participants are favorable of “manufactured goods made in America,” including 98 percent of “conservative members of the GOP.”
● 92 percent of participants think that “too many jobs are being shipped overseas” and 86 percent are worried they “don’t seem to manufacture anything here in America anymore.”
Illinois, Missouri and North Carolina have also been hammered by outsourcing of jobs caused by trade policies and likely have similar sentiments.
There Is A Better Way To Do Trade
Current U.S. trade policies are written by representatives of multinational corporations with the intent of locking in their dominance while driving wages and environmental costs down. The resulting agreements are clearly in their interests and not the rest of us. Our country’s enormous, humongous trade deficit is a metric for understanding the damage being done to our country.
Now that the public is clearly rejecting the current trade approach, there are alternatives available. Just having non-corporate stakeholders including representatives of labor, consumer, human rights, environmental and other groups at the table would bring about a more fair and just trade regime.
● Protect Congress’ Authority to Set Trade Policy
● Restore Balanced trade
● Put Workers First
● Stop Currency Manipulation
● Expand Buy America Procurement Practices
● Protect the Environment for Future Generations
● Prioritize Consumers above Profits
● Protect Nationhood Rights
● Secure Affordable Access to Essential Medicines and Services
● Respect Human Rights
● Provide a Safety Net for Vulnerable Workers
● Create shared gains for the workers whose labor creates society’s wealth.
● Strengthen protections for the environment. Companies must not use trade rules to pit one country’s environmental rules against another, as they seek the lowest-cost place to produce.
● Protect the freedom to regulate in the public interest.
● Set rules for fair competition. Workers of a nation must not be unduly disadvantaged by unfair economic competition resulting from choices about how to organize their economies.
● Include strong rules of origin so that trade agreements are not merely a conduit to ease the global corporation’s race to the bottom.
● Not provide extraordinary privileges to foreign investors.
● Effectively address currency manipulation.
● Retain the ability for all nations to stimulate their economies through domestic infrastructure and spending programs.
● Protect the right of governments to choose the scope and level of public services to provide.
● Protect intellectual property (IP) in a fair and balanced manner.
● Protect the unique U.S. transportation regulatory and legal structure.
● Protect the right of governments to secure the integrity and stability of their financial systems.
● Be negotiated in an open, democratic and accountable manner.
● Be flexible and responsive.
A grassroots/labor/faith/community coalition called Silicon Valley Rising on Monday went to the San Jose, Calif. City Clerk’s office to submit the “Opportunity to Work” ballot initiative.
The purpose of the initiative is to require employers to offer qualified part-time employees the opportunity to work additional hours before hiring new part-time or temporary employees.
The Problem: Too Much Part-Time Work
Currently one way (of so many ways) employers nationwide take advantage of their workforce is by limiting the hours they can work in order to avoid providing any benefits that might accrue to full-time employees. Instead of upgrading employees to full-time status when they need more work done, they hire additional part-time or temporary workers. The result is that people have to take on multiple jobs just to (barely) get by. The “Opportunity to Work Initiative” is the first such initiative in the country to limit this abusive practice by requiring employers to expand the hours of their current workforce before hiring new people.
Ben Field, Executive Officer of the South Bay AFL-CIO Labor Council said at the event, “A number of employers avoid providing health care and other benefits by hiring new part-time workers instead of giving more hours to current part-time employees. It’s unfair.”
Poncho Guevara, Executive Director of Sacred Heart Community Service explained, “We are seeing so many parents working hard, willing to do whatever they can to support their families, but most part-time workers are unable to cover their most basic needs, such as food and rent. When part-time workers are denied hours, they are pushed further into poverty, making it impossible for them to support their families without the safety net we provide. They want to work. The ‘Opportunity to Work Initiative’ would help many of the families that we serve by giving them the chance to work more hours and hopefully achieve economic stability.”
Fr. Jon Pedigo, Pastor of Our Lady of Guadalupe Parish and member of the Silicon Valley Rising coalition said, “Every day I see how my parishioners struggle to make ends meet because they do not have access to sufficient work hours. This initiative would help these workers support their families by getting enough hours so that their paychecks cover their bills and they can put food on the table.”
Sara Delete, a fast food employee said, “Despite the fact that I work three part-time jobs, I struggle to make ends meet. Every week the number of hours I get changes, so I am never sure what my paycheck will be. Not having access to more work hours means that I am constantly worried about being able to provide for my son, cover my rent and pay the bills.”
Chava Bustamante, Executive Director of Latinos United for a New America said, “The majority of individuals working part-time jobs are people of color. As such, they are disproportionately impacted by the lack of hours, low wages and non-existent benefits.”
Companies everywhere use all kinds of schemes to keep “labor costs” low. One way the wages of lower-skilled workers are kept low is through maintaining intentionally high un- and under-employment levels. Public investment in infrastructure and other job-creating areas is reduced, limiting job availability. Teachers, police, health care, child care and other employees and services are cut back. The result is a surplus “reserve army” of hungry people who can be exploited and set against each other in competition for any private-sector jobs that do exist.
In Silicon Valley there is particular demand for workers skilled in such fields as engineering and programming, so tech employers engage in various schemes to keep tech-specialist pay lower than it should be. One scheme is the use of H1-B visas for bringing in workers from other countries. Higher-paid and older American-born tech workers are laid off or their pay is reduced as these workers are brought in at lower pay rates.
Sometimes the tech companies engage in more direct wage suppression. A number of Silicon Valley companies were caught engaging in a conspiracy that worked in a way similar to price-fixing, except it was pay-fixing. The companies made private, illegal deals between each other to limit the pay of their employees by agreeing not to recruit or hire people already at one of the other companies. This kept down competition for these employees, which limited their pay.
Of course the higher-skilled tech workers are not left in poverty and/or struggling to get by, as the (often people of color) lower-skilled workers are. But it is part of the same “rigged” system where the government, “captured” by wealthy interests, not only does not step in with investment that would correct abuses, it is forced to cut back on spending on the very things – such as antidiscrimination, antitrust and other enforcement – that would make a difference in wages, as well as public services to help people affected by the resulting inequality.
The “Google Bus” Effect Of Tax-Dodging On Communities
The use of these and other schemes drive up profits, which the companies then move out of the country to tax havens using various schemes. This defunds government’s ability to provide regulatory enforcement, badly needed public services, and other things that would help fight the inequality that is hurting so many people.
One example of the effect of this government defunding is Silicon Valley’s poor transportation system. There is minimal investment in public transportation options. The rail, road and other infrastructure is poorly maintained and overwhelmed. Meanwhile the wealthy tech companies provide their employees with a private transportation system. Modern, usually white buses known generically as “Google buses” (though companies like Facebook, Genentech, Apple and others have their own fleets as well) take employees from home to work to areas with popular restaurants, etc. while the rest of the people are stuck in traffic jams, squeeze into already-filled trains on their limited routes or wait for the few public buses that operate.
Silicon Valley Rising‘s website states: “Silicon Valley Rising is taking on occupational segregation and severe income inequality with a comprehensive campaign to raise wages, create affordable housing and build a tech economy that works for everyone.”
What is the purpose of our government and economy – to serve a few already-wealthy people and their corporations or to serve We the People? If passed, Silicon Valley Rising’s “Opportunity to Work Initiative” would help hard-working families by helping providing the work hours they need to get by.
The initiative requires 20,000 signatures to make it onto the November ballot.
The Trans-Pacific Partnership (TPP) will likely be back in the news at least for a brief moment next week, when the treaty comes up for a formal signing ceremony involving representatives of the 12 participating countries, including the United States.
The agreement has largely been out of the news since the release of the text in early November. President Obama did mentioned it briefly in his State of the Union address earlier in January. Other than that, there have been no dramatic headlines.
Meanwhile, the public and much of Congress remain solidly opposed to the agreement – as have presidential candidates in both political parties. That, hopefully, means the politics do not line up for a vote on the agreement before the 2016 election. But there’s always the risk that Wall Street will find a way to force a vote sooner. So people should continue pressing Congress to oppose the TPP.
Formal Signing Feb. 4 In New Zealand
The date for the big signing ceremony for TPP was announced last week. It will be Feb. 4 in Auckland, New Zealand. Ministers from participating countries, including U.S. Trade Representative Michael Froman, will participate.
Note that this ceremony does not “trigger” any timeline forcing Congress to vote within a certain number of legislature-in-session days. That clock starts when President Obama submits authorising legislation to Congress.
Report On TPP’s Economic Effect
Next up for the U.S. process is the International Trade Commission’s (ITC) report on TPP’s economic impact. The commission is expected to produce this report by May 18.
For three consecutive days last week, in eight-minute segments spanning nine hours each day, lobbyists for some of the nation’s biggest corporations, labor unions and trade groups testified before the panel of six appointed bureaucrats.
They included lobbyists for Walmart and Gap Inc., who praised the deal for lowering tariffs on beef, cheese, pencil cases and cotton sweaters. Leaders of the U.S. Chamber of Commerce and National Association of Manufacturers framed the pact as a chance for U.S. companies to sell more goods abroad. Representatives for the AFL-CIO, United Steel Workers and other unions urged the commission to consider the deal’s potential to erode labor conditions and wages.
Corporate lobbyists might frame TPP as “a chance for U.S. companies to sell more goods abroad” because they have to say that in public. What they really mean is that TPP will encourage them to lay off even more U.S. workers, close even more U.S. factories and move even more production to countries with near-slave-labor conditions and no costly protections for the environment. This offshoring lets them pocket the wage and protection differential while enabling them to use havens to dodge U.S. taxes.
The congressionally created Labor Advisory Committee for Trade Negotiations and Trade Policy (LAC) has just released a scathing report that urges President Obama “in the strongest possible terms” to send the Trans-Pacific Partnership “back to the negotiating table” instead of to Congress, saying the treaty “will harm our economy overall.”
… “The TPP is likely to harm U.S. manufacturing interests, cost good jobs, suppress wages, and threaten our democracy and economic security interests,” the report said.
Note that laying off U.S. workers, closing the factory, moving production out of the country, then importing the same goods to sell in the same outlets to the same customers “increases trade” because now those goods cross a border.
Negotiating Implementing Legislation
After the ITC report is released, the administration will formally send Congress an official, final TPP text. Even though TPP’s text has been released to the public, this is a formal action, and will be accompanied by details of how the administration plans to implement TPP.
The administration has begun negotiating with Congress to finalize an implementing legislation bill. The administration is deciding when to submit this formal, final implementing legislation to Congress. That does start a countdown clock as specified in the “fast track” trade legislation passed last year. The White House will do this based on when they think they have the best chance to get TPP passed. Currently, it looks for a number of reasons as if this is likely to be delayed until after the election – but it could come at any time.
Significant Public Opposition
The optimism that a vote on the TPP might not happen until after the election, if ever, is directly related to significant public opposition to the agreement. For example, earlier this month The Washington Post, in “Hundreds of advocacy groups ask Congress to block Obama’s Pacific Rim trade pact,” reported that a “coalition of more than 1,500 interest groups is sending a letter to Congress on Thursday demanding that lawmakers block the Trans-Pacific Partnership (TPP), the 12-nation Pacific Rim trade pact championed by the Obama administration.”
Labor unions, environmental groups, consumer advocates and faith groups are among the 1,525 organizations that signed onto the document, which was organized by the Citizens Trade Campaign. Hundreds of local labor union affiliates have signed on.
Presidential candidates Bernie Sanders and Donald Trump are actively and vocally campaigning against TPP, with Sanders also continuing to attend rallies and lobby other members of Congress to oppose it. Candidates Hillary Clinton and Ted Cruz have gone on record as opposing it because of the public opposition.
Republicans Demanding More Corporate-Favoring Language
Another barrier potentially in the way of a near-term vote is Republican opposition based on TPP not being favorable enough for corporations. For example, Republicans leaders are demanding changes that favor big corporations like tobacco. TPP has a “tobacco carve-out” that can keep countries from being sued when they try to protect public health by helping citizens stop smoking or keep children from starting. This interferes with corporate profits, which under the investor-state dispute settlement “corporate court” provisions countries cannot do.
Non-tobacco companies say that allowing any such “tobacco carve-out” is a bad precedent, opening up a slippery slope of allowing countries to protect citizens from other products that harm or defraud their citizens. They are joining with tobacco companies to demand side letters from participating countries saying they will allow these suits even as TPP’s formal text gives them a choice of opting out of them.
Republicans are also demanding even longer patent monopoly terms for pharmaceutical companies.
Election Issue Risk – Or Lame-Duck Risk?
Usually public opposition does not matter in Congress if Wall Street is in favor of something, as it is with TPP. But in an election year there is a risk of something as overwhelmingly unpopular as TPP becoming an election issue. For example, Sacramento-area Representative Ami Bera is facing opposition after he voted in favor of “fast track” trade legislation. Local Democratic clubs are refusing to endorse him, and there will be a full floor fight over endorsing him at the February statewide Democratic convention. With the election coming up, other “corporate Democrats” are taking note of this.
However, the big corporate lobbying organizations, the Business Roundtable, the Chamber of Commerce and National Association of Manufacturers (NAM) are pushing the administration to move the TPP toward passage as soon as possible. Under the fast-track trade legislation passed last year, the timing of a vote is in the administration’s hands, not those of congressional leaders. If there is a reason to think Congress will pass TPP, the administration will move very fast to get a vote.
But it currently looks like Wall Street, the big corporations, the Obama administration and the Republican Party are lining for a TPP vote in the “lame duck” session after the election. In a lame-duck session members who have retired or been kicked out of office are still allowed to vote – but there is no way for the public to hold them accountable. So for them a TPP vote would be like an audition for a lucrative corporate lobbying position. Also members who have been elected or re-elected with Wall Street financing will be asked to repay their contributors, with two whole years before the public can do anything about it.
Rep. Brad Sherman (D-Calif.) explained on a press call earlier this month why a TPP vote might come in the “lame duck” session. “Wall Street has the money that our current campaign finance system requires,” he said. “Members can take the money for their campaigns, get elected in November, then deliver the votes in December to reward those contributors after the election.”
Either way – whether the vote is orchestrated to come before or after the elections – everything that people can do to push Congress to line up on the side of the public will could prevent a vote from happening at all, or ensure a vote defeating the TPP. Contact Congress today to let your representative know you want that person to come out publicly in opposition to the TPP.
The Trans-Pacific Partnership (TPP) has provisions that allow corporations to sue governments for laws and regulations that limit profits. The cases bypass national court systems and are heard by “corporate courts” with the governments allowed no appeal. These investor-state dispute settlement (ISDS) provisions are also in trade agreements like the North American Free Trade Agreement.
When fast-track trade promotion authority was being debated, people like Sen. Elizabeth Warren raised warning flags about the ISDS provisions in TPP.
[. . .] In her letter, Warren raises concerns that the deal could include provisions that would allow foreign companies to challenge U.S. policies before a judicial panel outside the domestic legal system, increasing exposure of American taxpayers to potential damages.
After a decades-long effort to place ideologically committed “movement” members in the judicial branch of government, funded by extremely wealthy individuals and their corporations, it looks like the resulting corporate/conservative wing of the Supreme Court is ready to make a ruling that would bankrupt public-employee unions. And clearly already-decimated private-sector unions will be the next target.
The Supreme Court heard oral arguments Monday in the case of Friedrichs v. California Teachers Association. In this case the Court is asked to overturn a unanimous 1977 decision that said public-employee unions can charge nonmembers a fee to cover the cost of the services the unions are required by law to provide those nonmembers. The fee does not cover political activities of the union, only the cost of services the unions must, by law, provide.
If the corporate/billionaire class gets its way – and it looks like it will – the terrible inequality you see in the country today is nothing compared to what’s coming. Having grabbed all the income gains since the recession, having wiped out the middle class, having pushed so much to the top that a few families now have more wealth than all of the rest of us combined, now the corporate/billionaire class is coming after the rest of the money in the economy.