Wall Street And Big Corporations Got What They Wanted – This Time

Fast track passes. Our Congress – the supposed representatives of We the People – voted to cut themselves and us out of the process of deciding what “the rules” for doing business “in the 21st Century” will be.

How do the plutocrats and oligarchs and their giant multinational corporations get what they want when a pesky democracy is in their way? They push that pesky democracy out of their way.

Because of fast track, when the secret Trans-Pacific Partnership (TPP) and any other secretly negotiated “trade” agreements are completed Congress must vote in a hurry with only limited debate, cannot make any amendments no matter what is in the agreement, and they can’t be filibustered. Nothing else coming before our Congress gets that kind of skid-greasing, only corporate-written “trade” agreements – and it doesn’t matter how far the contents go beyond actual “trade.”

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Cheap Labor — The Engine Of Wealth

… “brainstorming about ways to find a source of cheap labor to create an engine of true wealth. The obvious path forward was to acquire slaves.”

From The Dark History of Race and Terror over at Talking Points Memo.

Cheap labor, the engine of wealth. Does this sound like an economy near you?

53% of Americans can’t come up with $400 for an emergency.

The top 0.1% of Americans have as much wealth as the bottom 90%.

Cheap labor – great wealth at the top.

My Post That Krugman Links To

Paul Krugman links to a post I wrote last year. With the revote on Fast Track possibly coming up soon I think it is a good post to repeat. So here it is.

Democrats Who Move Right Lose Elections – There Is No “Center”

Mainstream Democratic campaign consultants and pollsters typically tell candidates they should “move to the right” and campaign to the “center” with positions that are “between” the “left” and the “right.” This is the way, they say, to “attract swing voters” who would be “scared off” by a candidate who takes populist positions that favor the interests of the 99 percent over the interests of the 1 percent.

Polling and experience show that exactly the opposite might be true.

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Will TPP Kill The Post Office?

Corporations are notorious for sneaking things into laws and regulations before the public can find out and rally to stop it. And we know from the conservative Supreme Court arguments against the Affordable Care Act that even what amounts to a typo can be used to change the obvious meaning and intent of a law.

These are reasons we need to see the text of the Trans-Pacific Partnership before Congress votes to preapprove it with fast track trade promotion authority (TPA). They are pushing what is literally a pig in a poke on us. We the People need to open that bag and have a good, long look inside before fast track buys the TPP pig in our name.

Negotiated in secret by corporate representatives, it is probable that the Trans-Pacific Partnership (TPP) is loaded with things the big corporations have snuck in. We already know from leaks that TPP contains provisions allowing companies to sue our government in “corporate courts” if they feel a law or regulation is cutting into their profits. What else is in there?

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All Hands On Deck: House Fast Track Vote Could Come This Week

ALL HANDS ON DECK. This is not a drill. The vote in the House of Representatives on fast track trade authority, preapproving the Trans-Pacific Partnership (TPP) before the public finds out what is in it, is coming up very soon. It is even possible it could happen later this week. The Senate has already passed fast track; if the House passes this it goes to President Obama and he will sign it. That will make TPP a done deal.

Fast track is a weird procedure, invented by President Richard Nixon, whereby Congress sets aside the normal procedures for considering, debating and voting on a bill – but only for so-called “trade” agreements. Under fast track Congress agrees to rush the agreement through with little debate, agrees not to make any amendments, and not to filibuster it. (How else could they get approval for deals that allow companies to ship jobs and factories out of the country to places where workers and the environment are not protected?)

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Trade Deficit At Root Of Negative Economic Growth Report

The Bureau of Economic Analysis reported today that the gross domestic product (GDP) fell at an annual rate of 0.7 percent in the first quarter of 2015. Much of the reason is our trade deficit.

The Bureau of Economic Analysis reported today that the gross domestic product (GDP) fell at an annual rate of 0.7 percent in the first quarter of 2015.

Our enormous, humongous trade deficit is literally draining our economy. The trade deficit is because we import things we used to make here and sell there, but we allowed companies to move the factories and jobs there in order to force wages down here. This makes a few plutocrats vastly wealthy but it is killing jobs, wages, factories and our middle class.

Trade Deficit Subtracted 2 Percent From Growth

The White House issued an analysis by Jason Furman, Chairman of the Council of Economic Advisers, explaining this was because of “harsh winter weather, tepid foreign demand, and consumers saving the windfall from lower oil prices.” The statement largely (and correctly) blamed “net exports.”

From the White House analysis: “A decline in the trade balance was another major contributor, partially reflecting the continued drag on U.S. exports from the slowdown in foreign growth. Indeed, net exports subtracted nearly 2 full percentage points from quarterly GDP growth.”

“Decline in the trade balance,” “tepid foreign demand” and “net exports” are other ways of saying our “trade” policies have caused an enormous, humongous trade deficit that sends away jobs, factories and our ability to maintain a middle class. A negative “net export” balance means we import more than we export, which means we have a trade deficit. We have had a trade deficit every year since the neoliberal “free trade” and “free market” ideology ascended in the late 1970s. But you won’t find the words “import” or “trade deficit” anywhere in the statement.

Now that we know what “net exports” really means, here it is again: “net exports subtracted nearly 2 full percentage points from quarterly GDP growth.” The trade deficit subtracted almost 2 percentage points from the quarter’s growth.

Close Factories Here And Move Them There = Trade Deficit

We have a trade deficit because we make “trade” deals with countries that sell to us without buying from us and then we don’t do anything to fix it. A lot of this “trade” deficit is because companies here close factories in the U.S. that made goods to sell in our retail outlets and move them to countries with little democracy, resulting in low wages and few pollution regulations. They send the goods back here to sell in the same outlets. Our “trade” deals let them do this with no cost or penalty. The executives and investors then pocket the difference in wages and cost of controlling pollution for themselves. This is why the plutocrat class that now controls our government supports these so-called “trade” deals. (It’s also why these “trade” deals have to be kept secret until Congress preapproves them with Fast Track.)

The Wall Street Journal’s At A Glance blog explains how the trade deficit cut into growth:

Trade was the biggest drag on top-line GDP figures in the opening months of the year. U.S. exports of goods fell by the most since the first quarter of 2009–the midst of the recession–while overall imports climbed. The widening deficit subtracted 1.9 percentage points from economic growth. A stronger dollar has tamped down overseas demand for U.S.-made goods while making foreign products cheaper to import. Meanwhile, congestion at West Coast ports constrained trade earlier in the year.

In “Yes, Trade Deficits Do Indeed Matter for Jobs,” Josh Bivens explains (in economese) at the Economic Policy Institute how the trade deficit is creating jobs, but not here – especially in manufacturing. He blames the trade deficit largely on currency manipulation by our so-called “trading partners”:

Trade deficits occurring when the U.S. economy is stuck below full employment and at the zero lower bound (ZLB) on short-term interest rates are a drag on economic growth and overall employment, period. And this describes the U.S. economy today, so a reduction in the trade deficit in the next couple of years spurred by a reversal of trading partners’ currency management would boost growth and jobs.

[. . .] if the trade deficit was reduced in coming years by ending widespread currency management by our trading partners, the United States would see a pick-up in output and employment growth.

[. . .] Yes, the relationship between trade deficits and jobs can be nuanced, but it’s really not that hard. In today’s U.S. economy, trade deficit reductions engineered by ending currency management would boost U.S. output and employment, and trade deficit reductions will (all else equal) always and everywhere boost manufacturing employment.

This Is The Result Of Intentional Policy Choices

From the recent post, “Enormous, Humongous March Trade Deficit Creating Jobs Elsewhere“:

This didn’t just suddenly happen. Globalization is not some kind of inevitable natural process of history that has caught up with us. This was and is the result of intentional policy choices, designed to force deindustrialization, break unions, drive down wages and benefits and increase inequality as that pay differential is pocketed by a few. This is the result of the “free market, free trade” ideology that rose up in the late 70s. Free trade policy was and is designed to give a few plutocrats and their giant corporations — “the 1 percent” — increased power over governments.

We have a trade deficit (negative “net exports”) because we import more than we export. A lot of this is imports of things that used to be made here by people who used to be paid here. Congress lets this go on because it makes a few plutocrats vastly wealthy – at the expense of the rest of us.

The trade deficit is eating our economy, closing factories, killing jobs, forcing wages down. But the White House isn’t allowed to say that because they want fast track trade authority to pass next week.

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This post originally appeared at Campaign for America’s Future (CAF) at their Blog for OurFuture. I am a Fellow with CAF. Sign up here for the CAF daily summary and/or for the Progress Breakfast.

Fast Track Hits House Next Week; Clinton Must Speak Up

The House is expected to vote on fast track trade promotion authority as soon as next week. If it passes, the corporate-negotiated Trans-Pacific Partnership (TPP) is a done deal — even though it is still secret. Why is presidential candidate Hillary Clinton still silent on this?

The Money Wants TPP — The People Do Not

TPP is the most important economic issue facing the Congress between now and the election — because it could happen, and because if it does the results will be terrible for working people. The game will be further rigged in favor of the 1 percent and against the rest of us. It will increase corporate power over governments — and us.

The Money wants TPP, because it will be very, very good for them. The people do not want fast track/TPP because it means increased corporate power, fewer jobs, more pressure, and lower pay.

A corporate/plutocrat-bought Congress is being told by The Money — Wall Street, the giant corporations and the plutocrats — to pass it, and for some incomprehensible reason President Obama will sign it. Street-level activists are fighting tooth and nail to get the word out and rally opposition. This is now. This is urgent. This is the focus.

This is an either/or. There is one side, and there is the other side. This is us vs. them. This is The Money vs. We the People. There is no in-between on this one, no waiting it out, no holding back, and no fence-sitting. It is one or the other. Not choosing a side on this is really just choosing the wrong side.

Clinton Still Silent On Fast Track

Here’s the thing: Fast track essentially pre-approves TPP. Fast track comes up for a vote as soon as next week. If fast track passes, TPP is a done deal. Where is Clinton on this?

Hillary Clinton is the leading Democratic candidate for president. A lot of activists are looking for reasons to enthusiastically support Clinton’s candidacy. She has taken great, progressive positions on immigration and other issues. But it is still early; opinions are not yet hardened. Things can change.

So far Clinton is trying to stay on the fence about fast track and TPP:

“There are questions being raised by the current agreement. I don’t know what the final provisions are yet,” she said. “I want to judge the final agreement. I have been for trade agreements, I have been against trade agreements.”

But fast track preapproves that “final agreement.” The vote on fast track in the House could be as soon as next week. After next week, TPP could be a done deal. Clinton owes it to the public to show up and lead on this. She especially owes it to the activists. They are fighting in the streets over this. They would appreciate some help. They will remember who was there with them — and who wasn’t.

Political Calculation vs. The Right Thing

Clinton’s advisors are calculating that this whole controversy will fade away after fast track’s passage makes TPP a done deal. They are trying to get her past this without taking a stand that risks putting off either side. They are betting that with time people will forget and get over it.

But to the activists on the street, this is the big one — just like the Iraq War vote was. People will remember, because people who know about it are fighting in the streets today, doing everything they can to stop this. And those people will say that taking no position is the same as being for it, because it is allowing it to happen, without laying down in front of the moving fast-track train.

Some people care about the issues, not the horse race. They care about substance, not image. Not everyone cares, to be sure, or is even paying attention yet. But in the long run the positions are what will matter, not the day’s calculated image. This is because the results of this will not fade away; they will matter to people’s lives.

For example, Nike wants TPP because it lowers the tariff on shoes imported from Vietnam and Malaysia. But when this forces New Balance to shut down their U.S. manufacturing, that will be in the news, people will feel it, and they will look back and say “Where was Clinton?”

The Iraq War vote looked like the pragmatic political position to take, but that political calculation came with a cost in the long run because the consequences of that vote mattered to people’s lives. Doing the right thing comes with a reward in the end.

Sitting back and hoping important issues just go away won’t cut it this time. You can’t make it just go away. Better yet, the way to make it just go away is to grab it by the horns and move it in the right direction.

Looking For A Champion Who Pushes For Transformative Change

People are impatient for a real champion. This is not a time to be safe, sit back, read polls, and wait out controversy. The economy simply is not working for most of us, and people know it. People see that the game is rigged and want proposals for transformative change.

There is no question that TPP is on the wrong side of this, and will result in even more hardship for the very people Clinton says she is campaigning to help. Fast Track preapproves TPP and the vote is coming up very, very soon.

Staying on the fence on this one is a mistake. By staying on the fence she risks being remembered as “No-Position Clinton” on the issue that matters most.

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This post originally appeared at Campaign for America’s Future (CAF) at their Blog for OurFuture. I am a Fellow with CAF. Sign up here for the CAF daily summary and/or for the Progress Breakfast.

Stop Calling TPP A Trade Agreement – It Isn’t

This is a message to activists trying to fight the Trans-Pacific Partnership (TPP). Stop calling the TPP a “trade” agreement. TPP is a corporate/investor rights agreement, not a “trade” agreement. “Trade” is a good thing; TPP is not. Every time you use the word “trade” in association with the TPP, you are helping the other side.

“Trade” is a propaganda word. It short-circuits thinking. People hear “trade” and the brain stops working. People think, “Of course, trade is good.” And that ends the discussion.

Calling TPP a “trade” agreement lets the pro-TPP people argue that TPP is about trade instead of what it is really about. It diverts attention from the real problem. It enables advocates to say things like, “95 percent of the world lives outside the U.S.” as if that has anything to do with TPP. It lets them say, “We know that exports support American jobs” to sell a corporate rights agreement. It enables them to say nonsense like this about a corporate rights agreement designed to send American jobs to Vietnam so a few “investors” can pocket the wage difference: “Exports of U.S. goods and services supported an estimated 9.8 million American jobs, including 25 percent of all manufacturing jobs … and those export-supported jobs pay 13 to 18 percent higher than the national average wage.”

Trade is good. Opening up the border so you can get bananas and they can get fertilizer is trade because they have a climate that lets them grow bananas and you already have a fertilizer plant. Enabling companies to move $30/hour jobs to countries with $.60/hour wages so a few billionaires can pocket the difference is not trade.

Calling TPP a “trade” agreement lets TPP supporters say people opposed to TPP are “anti-trade.”

TPP Is A Corporate/Investor Rights Agreement

TPP is a corporate/investor rights agreement, and that is the problem.

TPP extends patents, copyrights and other monopolies so investors can collect “rents.”

TPP elevates corporations and corporate profits to and above the level of governments. TPP lets corporations sue governments for laws and regulations that cause them to be less profitable. Enabling tobacco companies to sue governments because anti-smoking campaigns limit profits has nothing to do with trade. Enabling corporations to sue states that try to regulate fracking has nothing to do with trade.

While giving corporations a special channel to sue governments, labor, environmental, consumer and other “stakeholder” organizations do not get a channel for enforcement. This helps enable corporations to break unions, force wages down and pollute without cost. This increases the power of corporations over governments – and us.

Who Says?

Paul Krugman, “This Is Not A Trade Agreement“:

One thing that should be totally obvious, however, is that it’s off-point and insulting to offer an off-the-shelf lecture on how trade is good because of comparative advantage, and protectionists are dumb. For this is not a trade agreement. It’s about intellectual property and dispute settlement; the big beneficiaries are likely to be pharmaceutical companies and firms that want to sue governments.

Josh Bivens at the Economic Policy Institute (EPI), in “No, the TPP Won’t Be Good for the Middle Class“:

…TPP (like nearly all trade agreements the U.S. signs) is not a “free trade agreement”—instead it’s a treaty that will specify just who will be protected from international competition and who will not. And the strongest and most comprehensive protections offered are by far those for U.S. corporate interests. Finally, there are international economic agreements that the United States could be negotiating to help the American middle class. They would look nothing like the TPP.

Jim Hightower, “The Trans-Pacific Partnership is not about free trade. It’s a corporate coup d’etat–against us!“:

TPP is a “trade deal” that mostly does not deal with trade. In fact, of the 29 chapters in this document, only five cover traditional trade matters!

The other two dozen chapters amount to a devilish “partnership” for corporate protectionism. They create sweeping new “rights” and escape hatches to protect multinational corporations from accountability to our governments… and to us.

On OurFuture.org,” Economist Jeffrey Sachs Says NO to the TPP and the TAFTA Trade Treaties“:

Without touching on the unpopular Fast-Track mechanism necessary to pass these two treaties, Sachs laid out five reasons why, on the substance, they should not be passed or ratified:

1. They are not trade treaties, but agreements aimed at protecting investors.

Josh Barro, “But What Does the Trade Deal Mean if You’re Not a Cheesemaker?

Much of the controversy is because the T.P.P. isn’t really (just) a trade agreement. (There’s a reason I called it an “economic agreement” at the top.) A lot of it is about labor, environmental standards, intellectual property and access to markets for services like banking and accounting. And in contrast with the tariff cuts, there’s a lot more reason to worry that some of the agreement’s non-trade provisions would hurt the world economy even as they benefited specific industries.

Techdirt, “If You Really Think TPP Is About ‘Trade’ Then Your Analysis Is Already Wrong“:

Instead, trade agreements have become a sort of secret playground for big corporations to abuse the process and force favorable regulations to be put in place around the globe.

… If you make the facile assumption that the TPP is actually about free trade, then you might be confused about all the hubbub about it. If you actually take the time to understand that much of what’s in there has nothing to do with free trade and, in fact, may be the opposite of free trade, you realize why there’s so much concern.

Timothy B. Lee at VOX, “The Trans-Pacific Partnership is great for elites. Is it good for anyone else?“:

In the past, debates about trade deals have mostly been about trade. … In contrast, debates over the TPP mostly haven’t focused on its trade provisions.

[. . .] As the opportunities for trade liberalization have dwindled, the nature of trade agreements has shifted. They’re no longer just about removing barriers to trade. They’ve become a mechanism for setting global economic rules more generally.

… We expect the laws that govern our economic lives will be made in a transparent, representative, and accountable fashion. The TPP negotiation process is none of these — it’s secretive, it’s dominated by powerful insiders, and it provides little opportunity for public input.

Former IMF chief economist [Simon Johnson] on the problems with TPP:

The Trans Pacific Partnership is a notorious, secretly negotiated trade deal; from leaks we know that it continues “Investor State Resolution” clauses that allow foreign companies to sue to overturn national labor and environmental laws. Johnson’s analysis stresses that trade agreements can be good for countries, but they aren’t necessarily good — and when they’re negotiated in secret, they rarely go well.

Stop calling TPP a trade agreement. It is a corporate/investor rights agreement.

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This post originally appeared at Campaign for America’s Future (CAF) at their Blog for OurFuture. I am a Fellow with CAF. Sign up here for the CAF daily summary and/or for the Progress Breakfast.