Obama’s Trans-Pacific Partnership Promises Echo Clinton’s On NAFTA

NAFTA – the North American Free Trade Agreement – was sold with promises of jobs and prosperity on all sides of the border. What really happened was that an increased trade deficit sucked demand and jobs out of the U.S. economy; workers lost bargaining power, resulting in pay and benefit cuts; and income inequality rose as corporations pocketed the wage differential.

Now the Trans-Pacific Partnership (TPP) is being sold with literally the same promises. Here is why TPP is not going to work out better than NAFTA did.

Note the pitch used to sell NAFTA by President Clinton and former presidents Ford, Carter and George H. W. Bush as they were featured together in this September 14, 1993 news report.

From the transcript:

Continue reading

Postal Workers And The Public Want A Postal Banking Public Option

Contract talks between the American Postal Workers Union (APWU) and the U.S. Postal Service for a new contract start Thursday. Along with asking for fair wages and benefits, the APWU wants improvements in customer services, including postal banking.

“There are two competing visions of the future of the Postal Service,” said APWU President Mark Dimondstein. “Postal management’s policy has been to severely degrade service, dismantle the postal network, and engage in piecemeal privatization. … Management has shortened hours at neighborhood post offices, closed mail processing centers, lowered delivery standards, and slowed mail delivery.”

Instead of trying to “save money” by cutting service with layoffs and closings that cause more customers to turn away, which costs revenue, the Postal Service should add services such as postal banking. This would also help millions of people who currently are left wide open to predatory services like payday lending.

Postal Banking: A Public Option For Banking

Until 1967, the Postal Service (then called the Post Office) operated postal banking through the United States Postal Savings System. Reviving postal banking would be like offering a “public option” for financial services. It would let people have accounts they could use to cash checks, get small loans, pay bills and even get prepaid debit cards. These services would enable lower-income Americans to avoid the exploitative “payday lenders” and check-cashing “services” that eat up working people’s earnings.

The Postal Service would use existing bank infrastructure as the backbone for these services, particularly the debit card service. In “A public option for banking,” Mike Konczal explains how the Treasury Department is already doing this with their Direct Express debit card program for disability and pension payments.

The program allows unbanked recipients of Social Security, federal disability and a few pension-related federal programs to receive their benefits on a debit card. The program emerged from congressional efforts in the 1990s to move from paper checks to direct deposits for these benefits. Congress tasked Treasury to make sure there were low-cost accounts available to the unbanked so they could access deposits.

… By 2007, the department initiated a competitive bidding process for the cards, and Comerica won the account by offering the low-fee schedule the cards now have.

The Treasury Department is already offering this service. There is no reason the Postal Service could not do the same thing with postal banking.

Millions Would Benefit

A lot of people would benefit if the Postal Service offered postal banking. The term for people with no bank accounts is “unbanked.’ According to the 2013 FDIC National Survey of Unbanked and Underbanked Households, “7.7 percent (1 in 13) of households in the United States were unbanked in 2013. This proportion represented nearly 9.6 million households.” On top of that, “20.0 percent of U.S. households (24.8 million) were underbanked in 2013, meaning that they had a bank account but also used alternative financial services (AFS) outside of the banking system.”

In “The Post Office Should Just Become a Bank, David Dayen explains how this idea could free these millions from the grips of “check-cashing stores, pawn shops, payday lenders, and other unscrupulous financial services providers who gouged their customers to the tune of $89 billion in interest and fees in 2012,” and help the Postal Service at the same time. With small fees for services, including small, low-interest loans, the Postal Service would be helping Americans and increasing its funding.

Post offices could deliver the same services at a 90 percent discount, saving the average underserved household over $2,000 a year and still providing the USPS with $8.9 billion in new annual profits, significantly improving its troubled balance sheet. The report calls simple financial services “the single best new opportunity for the posts to earn additional revenue.”

These millions are not being served now by the financial industry, as Dayen explains,

Banks don’t want these customers; if they did, they would actually make a play for their business. Large banks have closed branches in the very low-income communities with the largest percentages of unbanked Americans. In fact, banks find it more profitable to fund payday lenders that charge junk fees and outrageous interest—currently the subject of a Justice Department investigation—than actually take market share away from them.

Instead of partnering with predatory lenders, banks could partner with the USPS on a public option, not beholden to shareholder demands, which would treat customers more fairly.

If ever there was an idea whose time has come (again) it is the idea of a public option for postal banking. It would help millions of people, would boost the revenue of the Postal Service and would demonstrate that our government actually can be on the side of regular people. (Note that a government service in a democracy should be providing a government service, not trying to “operate like a business” and “make money” off of citizens.)


Also see “A “Grand Alliance” To Save Our Public Postal Service.”

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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.

Audio: Taking On Fast Track, TPP And Free-Trade Talking Points

[fve]http://youtu.be/sfxMRWVJcrs[/fve]

On Sunday I was the speaker on a regular Sunday call for the National Campaign Call to Stop Fast Track for the TPP. (TPP stands for Trans-Pacific Partnership, a NAFTA-style trade deal that is being negotiated in secret right now.)

My topic was “Deconstructing the Corporate Case for Fast Track – One Argument at a Time,” based on my recent post, Let’s Take Apart The Corporate Case For Fast Track Trade Authority. But I began by going over a few basics, like how our country has an enormous, humongous trade deficit, and what that does to jobs and the economy. Then I talked about what fast track means, and how it will be used to rig the approval process, essentially pre-approving the TPP. Finally, I talked about the problems with the corporate arguments in favor of fast track and TPP. Then there is a question and answer period.

I wrote the other day that we can imagine a trade agreement that is negotiated of, by and for We the People:

We don’t need more corporate-dominated, rigged trade agreements. Instead we need to fix the agreements we already have. To do this we need to reform the corporate-dominated process that has gotten us where we are today. We need to bring in all of the stakeholders in these agreements and put them at the negotiating table.

Imagine a trade agreement negotiation by representatives of consumer, labor, environmental, health, LGBT, democracy and other citizen “stakeholder” groups instead of solely by and for the giant multinational corporations. Imagine the changes in the way we can all live.

Imagine a trade agreement that prohibits employers from threatening to move a job out of the country to keep someone from getting a raise. Imagine a trade agreement in which the participants agree not to import any goods from countries that allow pollution of the environment. Imagine a trade agreement that outlaws the sale of goods made in conditions that are unsafe for workers. Imagine a trade agreement that sets minimum standards for product reliability and customer support. Imagine a trade agreement that sets a limit on the gap between CEOs and their employees.

Honestly, democratically and transparently negotiated trade agreements could bring about a new direction for the world’s economy and citizens.

If you want to be notified of these calls, please contact Liz Warren (not the senator, also not running for president) at liz.moveon@earthlink.net.

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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.

Rallies And #FightFastTrack Twitter Storm This Week

Fast track trade promotion legislation is likely to be introduced soon and will be used to push through the Trans-Pacific Partnership (TPP) trade agreement – but the public knows very little about what this would mean to them.

To help get the word out, there will be a series of rallies across the United States this week and next week to oppose fast track legislation.

A list of February #FightFastTrack rallies around the country can be found here.

On Thursday, between 1 p.m. and 2 p.m. Eastern time, you can join the #FightFastTrack Twitter storm, using the hashtag #FightFastTrack.

Here are some sample tweets you can use:

Don’t let Congress rubber stamp the #TPP and send jobs overseas. Join a rally near you to #FightFastTrack http://bit.ly/1ykSu0k

Tell Congress: Don’t rubber stamp #TPP with Brunei and Vietnam, serial violators of human rights. #FightFastTrack

Rallies to #FightFastTrack are being held all over the US this week and next. Find one near you to stop the TPP.http://bit.ly/1ykSu0k

What’s At Stake

“Fast Track” is a weird process in which Congress voluntarily gives up its power to define, consider and amend trade deals. With Fast Track Congress is not allowed to amend (a.k.a. “fix”) trade agreements, is only allowed very limited debate on the House and Senate floor, and must pass the agreement within 90 days of the public seeing the text of the agreement for the first time. The Senate is not allowed to filibuster the deal.

Why would Congress give up their duty and power like this? Fast Track gets passed because the multinational corporate sponsors of these trade agreement put on well-funded PR campaigns that put massive pressure on legislators. The PR campaigns tell the public that legislators will “hurt jobs” or are “anti-business” if they vote against Fast Track and these trade deals. In fact, the record is that these trade deals are great for the owners of giant multinational corporations, but have hurt jobs and “Main Street” businesses.

The basic argument the corporations make for Fast Track is that the trade deals could never be completed if the negotiators thought Congress could “meddle” with the results. In other words, these deals can’t stand the test of being acceptable to a democracy so they have to rig the process in advance. The trade deals are negotiated in a rigged process that excludes representatives of different parts of society who might object to rules that favor the giant multinational corporations that will benefit from these deals. Representatives of labor, environmental, health, LGBT, democracy, consumer and other interest groups are not “at the table” as part of the negotiating process – so of course the end result does not reflect the interests of these “stakeholders.”

Or, to put it another way, look at what has happened to the world’s economy and environment since the corporate “free trade” and deregulation ideology came to dominate elite thinking in the late 1970s-early 1980s. The interests of the giant multinational corporations and the 1 percent behind them have done very, very well. The rest of us? Not so much.

You can follow the week’s events on Twitter at @PCGTW.

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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.

Virtually Speaking Tonite 9ET/6PT Dave Johnson and Joan McCarter

Virtually Speaking is an online radio show that you can listen to at any time, live or later. It features online progressive “personalities” — people you see doing a lot of writing online.

Tonite I am on with Joan McCarter of Daily Kos. Moderator is Jay Ackroyd.

Live 9pm Eastern / 6pm Pacific

Click here to listen live or later http://www.blogtalkradio.com/virtuallyspeaking/2015/02/16/dave-johnson-joanmccarter-virtually-speaking-sundays

Topics:

Which lies really matter, Brian Williams’ or Dick Cheney’s?

GOP governors and Medicaid expansion encapsulated in King v Burwell and the tension in the party between doing as the Koch’s command and what their constituents need.

Joan McCarter — Senior Political Writer and regular front page contributor to Daily Kos. Joan writes about national legislative developments. Follow @joanmccarter

Dave Johnson — Fellow with Campaign for America’s Future and Senior Fellow with Renew California. Read Dave at Seeing the Forest, Campaign for America’s Future and Alternet. Follow @DCJohnson

Virtually Speaking Sundays offers an alternative to the Sunday morning talk shows, drawing from a panel composed of prominent members of the liberal blogosphere

A “Grand Alliance” To Save Our Public Postal Service

The Conservative/Wall Street/1 Percent/Republican anti-government strategy is to set government up to fail (usually by starving it of funding). Then they point to the resulting “crisis” they created and say it proves that government doesn’t work so we should “privatize” it – in other words, rig the system against We the People by handing our common wealth over to a few wealthy people to harvest for personal profit.

Now they’re coming for the U.S. Postal Service.

Manufacturing A Crisis

Republicans created the problems with the Postal Service. In 2006 Republicans in Congress required it to come up with $5.5 billion per year to pre-fund 75 years of retiree costs. This means the Postal Service has to set aside money now for employees who are not even born yet. No other government agency – and certainly no company – has to do this.

They also require the Postal Service to make a profit – or at least break even. But democratic government is supposed to provide services to We the People. It is not supposed to be about making a profit off of us. Yet Republicans say government should be “run like a business.” Then they hamstring it, preventing it from competing with businesses because they say it has too many advantages and any competition would be unfair.

From the post, “You Should Be Outraged By What Is Being Done To Our Postal Service”:

Here are a few things you need to know about the Postal Service “crisis”:

  • The Postal Service is the second largest employer in the United States after Walmart. But unlike Walmart, which gets away with paying so little that employees qualify for government assistance, the Postal Services is unionized, pays reasonable wages and benefits and receives no government subsidies.
  • Republicans have been pushing schemes to privatize the Postal Service since at least 1996. In 2006 Republicans in the Congress pushed through a requirement that the Postal Service pre-fund 75 years of retiree costs. The Postal Service has to pay now for employees who are not even born yet. No other government agency – and certainly no company – has to do this.
  • Unlike other government agencies (like the military) since 1970 the Postal Service is required to break even.
  • While required to break even the Postal Service has to deliver mail to areas that are unprofitable for private companies to operate in. A letter sent from a small town in Alaska is picked up and transported across the country to a farm in Maine for 46 cents. … [M]any people for one reason or another still send letters. In a democracy these people are supposed to count, too.
  • But along with requiring the Postal Service to break even, Congress has restricted the Service’s ability to raise rates, enter new lines of business or take other steps to help it raise revenue. … [W]hile detractors complain that the Postal Service is antiquated, inefficient and burdened by bureaucracy, the rules blocking the Postal Service from entering new lines of business do so because the Postal Service would have advantages over private companies. …

The Postal Service is a public service for We, the People, not a business. The Service is hamstrung by people who pretend it is supposed to compete and then won’t let it. They won’t help with taxpayer dollars and say it has to compete in the marketplace … they give it rules that no private company could survive. Then when it gets into trouble, say that government doesn’t work, start laying people off, selling off the public assets, and saying it has to be “privatized” …

Privatization Destroys People And Communities

Privatizing the various parts of the postal service will move the workforce from good union jobs to low-wage, no-or-low-benefit private-sector jobs. Aside from the effect this would have on employees and their families – not to mention the inexpensive delivery of mail to even the most remote locations – privatization also destroys the surrounding communities. The USPS is the country’s second largest employer, so in this case the surrounding communities are … all of the communities in the United States.

In “The Privatization Scam: Five Government Outsourcing Horror Stories,” I wrote about a study that showed that wage and benefit cuts resulting from privatization hurt communities, including declining retail sales, greater reliance on public assistance and a larger share of at-risk children in low-income families.

Fighting Back

Now the people who work for the Postal Service are fighting back. The American Postal Workers Union (APWU) is announcing “A Grand Alliance to Save Our Public Postal Service.” As the alliance’s new website explains,

“In the face of aggressive attacks, a wide range of national organizations have come together to create A Grand Alliance to Save Our Public Postal Service. These organizations are united in the demand that the public good must not be sacrificed for the sake of private investment and profit. A strong public Postal Service is our democratic right. The Alliance is fighting to protect and enhance vibrant public postal services now – and for many generations to come.”

This Grand Alliance consists of a large number of organizations (At least “63 religious coalitions, retiree organizations, educational and postal unions, lawmakers and progressive advocacy groups”, according to The Washington Post, and more being added as I write) as well as individuals (you) who sign the pledge to “support the fight to protect and enhance vibrant public postal services now—and for many generations to come.”

Two Years In The Making

At his swearing-in ceremony in November 2013, APWU President Mark Dimondstein pledged to build a “Grand Alliance” to save the postal system, saying,

“We must build a grand alliance between the people of this country and postal workers. We must mobilize our allies and their organizations, including seniors, retirees, civil rights organizations, veterans groups, the labor movement, community and faith-based organizations, the Occupy movement, and business groups in defense of America’s right to vibrant public postal services.”

Two years later, at a press conference Thursday, Dimondstein explained that this alliance is forming “because the postal service belongs to the people and it is in danger.” He said there are “two competing visions of the future” – privatizing vs. staying public – and that there will be a conversion from “living wage to low-wage jobs” if the Postal Service is privatized.

Dimondstein said that the Postal Service “is our democratic right” and that it can operate cost-effectively “if you get rid of the manufactured crisis created in Congress.”

Also at the press conference, Melanie Campbell, President and CEO of the National Coalition of Black Civil Participation and convener of Black Women’s Round Table Public Policy Network said, “this is a fight for the people, we the people.” She called the Postal Service “a national treasure” and said, “We’re here today to stand in solidarity … Our national postal offices have faithfully served communities.”

The mission of this Grand Alliance:

The United States Postal Service is a wonderful national treasure, enshrined in the Constitution and supported by the American people. Without any taxpayer funding, the USPS serves 150 million households and businesses each day, providing affordable, universal mail service to all – including rich and poor, rural and urban, without regard to age, nationality, race or gender.

The U.S. Postal Service belongs to “We, the People.” But the USPS and postal jobs are threatened by narrow monied interests aimed at undermining postal services and dismantling this great public institution.

Even some postal executives have been complicit in the drive toward the destruction of the Postal Service and ultimate privatization: They have slowed mail service, closed community based Post Offices and mail processing facilities, slashed hours of operations, tried ceaselessly to end six-day service as well as door to door delivery, and eliminated hundreds of thousands of living wage jobs.

Good postal jobs are vital to strong, healthy communities, and have provided equal opportunities and the foundation for financial stability for workers from all walks of life, including racial and ethnic minorities, women and veterans. Postal services are essential to commerce and bind together families, friends and loved ones. In the day of e-commerce, a public postal service is as relevant as ever.

Yet those corporate forces who want to privatize public services allege that curtailing postal services and eliminating jobs are necessary due to diminishing mail volume and “burdensome” union wages and benefits. Nothing could be further from the truth.

In reality, a Congressionally manufactured USPS “crisis” imposed an unfair crushing financial mandate on the Postal Service that no other government agency or private company is forced to bear. (The Postal Accountability and Enhancement Act of 2006 compels the USPS to pay approximately $5.5 billion per year to fund future retiree healthcare costs 75 years in advance.) Without this unreasonable burden, the USPS would have enjoyed an operating surplus of $600 million in 2013 and over $1.4 Billion in 2014.

The people of this country deserve great public postal services. We advocate expanded services, such as non-profit postal banking and other financial services. We call on the Postmaster General and Postal Board of Governors to strengthen and champion the institution.

The public good must not be sacrificed for the sake of private investment and profit. A strong public Postal Service is our democratic right. Join us in the fight to protect and enhance vibrant public postal services now – and for many generations to come.


Meghan Byrd contributed to this post.

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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.

Invite: Special Call On Fast Track/TPP Sunday 7:30ET / 4:30PT

“Deconstructing the Corporate Case for Fast Track”

with

Special Guest Speaker: Dave Johnson, Campaign for America’s Future (me)

Sunday, February 8, 2015 – 7:30 p.m. EST/4:30 PST

Always be sure to phone in FIRST: 605-562-3140 PIN: 951146(lines open 15 minutes before call start)

THEN…

Click here to link to the video-only portion and access the interactive, real-time chat features*

Call details: Dave will dismantle claims made by lobbyists, and explain, point by point, exactly WHY fast track authority for the president (and the trade deals he plans to use it to force through) would be an economic disaster for American businesses and workers.

We’ll also hear from Celeste Drake, Trade and Globalization Policy Specialist with the AFL-CIO, about the current climate in Washington and plans for Presidents’ Day recess week actions targeting Congress, beginning next weekend and continuing through February 22.

*ABOUT THE CALL: We don’t use AnyMeeting for audio; you can’t connect with your computer to the phone line we use, so disregard onscreen audio codes. After you follow the link above and enter the requested information, just click on the phone receiver icon you see on the screen, advance to the next screen, and click “close.” You’ll be in the meeting room.

How To End Unemployment

Alongside Friday’s good employment data, there is a brouhaha on the Internets over claims that the government’s employment numbers are a “big lie.” Jim Clifton, Chairman and CEO of the Gallup polling company penned “The Big Lie: 5.6% Unemployment,” claiming that “the media” is “cheer-leading” and the White House is “scor[ing] political points” over phony numbers that the government makes up to make things look better than they are.

In fact, the “top line” unemployment number – now 5.7 percent, representing 9 million people, does not factor in people who have given up looking, 6.8 million part-time workers who want to work full-time, 2.2 million “marginally attached” people, people who are grossly underpaid, etc. But everyone knows that, and the government reports that. The “official” number has a specific definition, the “U-6 “alternative measure of labor under-utilization” reports the more accurate 13.5 percent number. So somewhere between 15 and 20 million Americans count as un- or underemployed. But even that doesn’t count those who have given up. It’s still bad out there, but the government’s figures are not being manipulated.

Intentionally High Unemployment

I want to suggest that this high un- and underemployment is intentional. Here is why. Two things that the government could easily do right now would pretty much get rid of unemployment. But our government is blocked from doing those things by extremely wealthy people, who benefit from the low wages, and a desperate and “cowering” reserve army of unemployed status quo.

First, balancing the trade deficit would by itself bring back more than 5 million jobs. This is based only on the 3.1 million lost to the China trade deficit, 1 million lost to NAFTA and 900,000 lost to the Japan trade deficit. We also have trade deficits with Germany, South Korea, and others.

A way to visualize this is to imagine the effect on our economy of $500 billion of new orders coming in to businesses that make and do things inside the U.S. Then another $500 billion next year and every year after that. Our annual trade deficit is $500 billion. Fixing that means $500 billion of new business here, now,  and continuing every year from now on. What you are visualizing is the damage this trade regime has done to us since Wall Street and the right’s “free trade” ideology took over.

Second, we have deferred maintaining our infrastructure since the Reagan era started the cycle of tax cuts and spending cutbacks. To bring the country’s infrastructure up to standards (never mind modernizing) we would need to spend $360 billion each year for 10 years, according to the American Society of Civil Engineers’ Infrastructure Report Card. If you conservatively estimate that each $1 billion spent on infrastructure creates 30,000 jobs, $350 billion translates to 350×30,000 = 10.5 million jobs.

So that’s conservatively 15.5 million jobs if we just go back to doing what the country did before the Reagan era. (This gives you a hint at the damage Reagan’s “trickle down” economics, and “free trade” market ideology have done. Look around. The extreme inequality that resulted tells you why it was done.)

Balance trade and fix up our aging infrastructure means at least 15.5 million jobs. (Think about what that would mean for wages, too.)

But That’s Just Catch-Up

But those things are just playing catch-up. It comes close to giving jobs to the unemployed, part-time for economic reasons and “marginally attached” workers. It doesn’t even start to dig into the people who have given up and left the labor market.

We got here by cutting taxes for the rich, gutting government, deferring maintenance, a and letting a few billionaires harvest our public wealth through privatization, etc. We’ll get out of it by fixing the trade deficit, repairing our infrastructure, undoing policy mistakes that have continued since the Reagan era, and ending “trickle down” tax cuts.

How do we take this a step further? The following things would employ tons of people and bring a long-term economic return far above any “cost.”

First, retrofit buildings and homes to be energy-efficient. Start with the basics: plug leaks and drafts, paint roofs white. These simple things could employ tons of people who we call “low skilled.” Take it a step further, and install energy-efficient windows, insulation, modern heating and cooling systems, solar on the roofs, etc. — all made in America, of course — and we will employ millions more. The energy payoff would be enormous, and we would go into the future with a much more efficient economy.

Next, engage in 21st century infrastructure projects like high-speed rail across the country and into Canada and Mexico — just like China is already doing. (See: “New Silk Road.“) We’ll create jobs, and end up with a massively more efficient, competitive economy. Then, modernize our power grid and install wind turbines across the plains states. Again, we end up with a massively more efficient, competitive economy. Requiring American-made supplies boosts the return to our economy.

What about building out national, high-speed, fiber internet? Imagine the innovation that would result.

There is so much we could do to first bring about full employment, and then move our economy into the 21st century. But we are held back by this weird Reagan/Wall Street/conservative ideology that tells us not to believe that We the People deserve a government that spends to make our lives better. That spending boosts us up now, makes our lives better, and more than pays for itself later. But we are kept from dreaming and doing because that return on our investment would go to us, instead of into the pockets of a few billionaires.

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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.

Enormous, Humongous Trade Deficits Widen, Further Exposing Failed Policy

In December the trade deficit in goods and services made its largest percentage jump in more than five years and the 2014 yearly total is its highest since 2012 – which begs the question: Why is the Obama administration doubling down on the failed trade policies of its predecessors?

The U.S. has run massive trade deficits for decades since the Wall Street-driven “free trade” ideology came to dominate. “Free trade” de-industrialization has cost our country millions of jobs, tens of thousands of factories and entire industries. It has pushed down wages and greatly increased inequality. Now the Obama administration is doubling down, pushing a vast “NAFTA-style” trade agreement and asking Congress to pass a rigged “fast track” process to pre-approve it.

December’s Numbers

The U.S. Census Bureau reported Thursday that the December trade deficit jumped $6.8 billion (17.1 percent) to $46.6 billion, the largest since November 2012 and the biggest percentage increase since July 2009.

Exports fell $1.5 billion to $194.9 billion (with a chunk of our exports being oil and gas and other raw materials, not manufactured, finished goods). Imports rose $5.3 billion to $241.4 billion.

2014’s Totals

For all of 2014, the trade deficit increased $28.7 billion (6 percent) to $505 billion. There was a $6.5 billion (2.9 percent) increase in the services trade surplus and a $35.2 billion (5.0 percent) increase in the goods trade deficit. Note that exports increased, but imports increased more. Exports were $2,345.4 billion, up $65.2 billion or 2.9 percent. Imports were $2,850.5 billion, up $93.9 billion or 3.4 percent.

The resulting trade deficit subtracted 1.02 percentage point from last year’s GDP growth and is causing the government to revise growth forecasts downward.

The Economic Policy Institute’s Robert Scott pointed out that “The U.S. trade deficit in manufactured products increased to $524.2 billion in 2014, an increase of $76.8 billion (17.2 percent) from 2013. … Growing trade deficits in manufactured products have been a primary driver in the displacement of U.S. manufacturing jobs since 2000.”

The 2014 trade deficit with China increased by $23.9 billion to $342.6 billion. Exports to China were up $2.3 billion to $124.0 billion while imports from China increased $26.2 billion to $466.7 billion. Again, exports increased but imports increased more, resulting in job loss and a drain on our economy.

Korea and NAFTA

Since the Korea Free Trade Agreement, our trade deficit with Korea has surged more than 80 percent, which equates to the loss of more than 70,000 U.S. jobs. The U.S. goods trade deficit with Korea increased 20 percent in 2014 to more than $25 billion. 2014 exports to Korea were lower than 2011 — which was before entering into the KORUS Korea FTA.

Brad Markell, Executive Director of the AFL-CIO Industrial Union Council, issued a statement that included the following:

These numbers are a consequence of a murderer’s row of bad trade deals. Together, NAFTA, PNTR, CAFTA, and KORUS have gutted the U.S. manufacturing sector. They’re a hall of fame of horribles.

So why is the Obama administration doubling down on the failed policies of its predecessors? Especially when the President and his team have worked hard to encourage American manufacturing by saving the domestic auto industry, establishing a national technology strategy, and enforcing trade-rule violations. Their dogged pursuit of more old-style trade agreements will undermine all of the progress we have made.

Instead, the Obama administration should crack down on foreign government’s currency manipulation to help our manufacturing sector. Prominent economists across the spectrum like Art Laffer, Larry Summers, Jared Bernstein, Dean Baker and Rob Scott all agree this is a significant problem that should be addressed in trade agreements. But President Obama recently acknowledged provisions on currency manipulation are being left off the table.

Currency Manipulation

A major cause of the trade deficits was currency manipulation by other countries. By manipulating the value of their own currency countries can cause American-made goods and services to cost more internationally. China and Japan are two of the worst offenders.

Currency manipulation is not addressed in the Trans-Pacific Partnership agreement now under negotiation.

A February 2014 report from the Economic Policy Institute (EPI), “Stop Currency Manipulation and Create Millions of Jobs,” shows how currency manipulation by China and others are costing the United States between 2.3 million to 5.8 million jobs.

Japan’s currency manipulation contributes to the approx. 897,000 us jobs lost to our 2013 trade deficit with that country — 466,000 of those in manufacturing.

Robert Scott of the Economic Policy Institute explains:

The U.S. dollar gained 13.3 percent against other major currencies between December 2013 and January 2014 (according to the Board of Governors of the Federal Reserve System) as a result ofcurrency manipulation by Japan and the slowdown in Europe.  Dollar appreciation reduces the competitiveness of U.S. exports and increases the U.S. goods trade deficit.

Trans-Pacific Partnership (TPP) And Fast Track

The Obama administration is pushing the Trans-Pacific Partnership (TPP) by saying that we need this trade deal to keep China from dominating the region. But our problem with China is because of trade deals. We set up conditions when we agreed to bring China into the World Trade Organization (WTO) and we were promised jobs from exports. Instead we got massive imports.

President Obama talks about “boosting exports” but does not mention imports or the enormous, humongous trade deficit. The administration is putting up with these trade deficits and refusing to do anything about currency manipulation by China, Japan and others, while pushing TPP.

The TPP has nothing that fixes this problem. It does not require balance; it does not address currency manipulation. All it does is set up rules that create conditions for the giant multinational corporations to dominate and prevent competition.

EPI’s Robert Scott, in Increased U.S. Trade Deficit in 2014 Warns Against Signing Trade Deal without Currency Manipulation Protections warns of consequences of TPP, because several of the TPP countries are currency manipulators:

U.S. trade and investment deals such as the North American Free Trade Agreement and the U.S.-Korea Free Trade Agreement, and China’s membership in the World Trade Organization, have resulted in growing U.S. trade deficits and job losses and downward pressure on U.S. wages.   Several members of the proposed TPP are well known currency manipulators, including Malaysia, Singapore, and Japan. In fact, Japan is the world’s second largest currency manipulator, behind China. The United States should not sign a trade and investment deal with these countries that does not include strong prohibitions on currency manipulation.

Action note: The Alliance for American Manufacturing asks you to: “join us in telling Congress to ensure currency manipulation is addressed in the TPP.

We don’t need any more “free trade” agreements. The U.S. has run large and increasing trade deficits since the late 1970s, when the “free trade” ideology took over. The results are obvious. These trade agreements have devastated entire “rust belt” regions of the country. They have kept wages stagnant for decades. They have caused “structurally” high unemployment. They have shifted the middle class down into demeaning, low-wage jobs. They have brought incredible, massive wealth to a very few gazillionaires as they move more factories and jobs out of the country and pocket the wage and environmental-protection differential and these gazillionaires are now controlling our entire political system.

Enough Is Enough

We don’t need more corporate-dominated, rigged trade agreements. Instead we need to fix the agreements we already have. To do this we need to reform the corporate-dominated process that has gotten us where we are today. We need to bring in all of the stakeholders in these agreements and put them at the negotiating table.

Imagine a trade agreement negotiation by representatives of consumer, labor, environmental, health, LGBT, democracy and other citizen “stakeholder” groups instead of solely by and for the giant multinational corporations. Imagine the changes in the way we can all live.

Imagine a trade agreement that prohibits employers from threatening to move a job out of the country to keep someone from getting a raise. Imagine a trade agreement in which the participants agree not to import any goods from countries that allow pollution of the environment. Imagine a trade agreement that outlaws the sale of goods made in conditions that are unsafe for workers. Imagine a trade agreement that sets minimum standards for product reliability and customer support. Imagine a trade agreement that sets a limit on the gap between CEOs and their employees.

Honestly, democratically and transparently negotiated trade agreements could bring about a new direction for the world’s economy and citizens.

Actions

Campaign for America’s Future says: “No More Job Killing Trade Agreements.”

The Communications Workers of America (CWA) wants you to: “Tell Congress: We Can’t Afford to Outsource More Jobs.”

Robert Reich says, “I’m collaborating with my friends at Democracy for America and MoveOn to spread the word about why the TPP is such a bad idea. Check out this email that I made with MoveOn — and then sign DFA’s petition to Congress.”

Public Citizen wants you to email your representative to keep us from taking the Fast Track down the same losing path.

Magic: The “Inside the Beltway” Distortion Trick

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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.

Let’s Take Apart The Corporate Case For Fast Track Trade Authority

U.S. Trade Representative (USTR) Michael Froman appeared before Congress Tuesday to make the corporate argument for “fast track” trade promotion authority. The USTR and President Obama are pushing fast-track pre-approval for the Trans-Pacific Partnership (TPP) and other big “trade” agreements they are working on. The Chamber of Commerce, Business Roundtable and other corporate groups and lobbyists are also pushing hard for Congress to pass fast track.

The promoters of fast track say we need it to push “trade” agreements through Congress to expand trade and increase exports. “What we’re going to do through this trade agreement is open up markets,” Froman told Congress Tuesday, “and then level the playing field so we can protect workers, protect American jobs and then ensure a fair and level playing field by raising labor and environmental standards, raising intellectual property rights, standards and enforcement, making sure that we’re putting disciplines on state-owned enterprises that pose a real threat to workers.”

These corporate arguments (you can see them in this Chamber of Commerce slide show “Ten Reasons Why America Needs Trade Promotion Authority”) just make me more skeptical of what they are selling. Here’s why.

1) President Obama, trade representative Froman, the Chamber of Commerce and others repeat the talking point, “95 percent of the world’s markets are outside the U.S..” This makes me skeptical of what they are selling because it is a “look over there at that shiny object” argument.

Saying that 95 percent of the world’s markets are outside the U.S. implies that we need TPP and other agreements because we are currently not selling goods to 95 percent of the world. This is patently false. We sell goods and services around the world already. In fact, it contradicts other corporate arguments for these agreements like, “More than 38 million American jobs already depend on trade.”

This argument deceives people about the very nature of these agreements. Most of the objections being voiced over these coming agreements are about non-trade issues. Only five of TPP’s 29 chapters deal with what people understand as “trade.” So an argument that TPP and similar agreements will “expand trade” masks what the bulk of these agreements are really about, which is getting governments off the backs of the giant corporations and protecting their profits from competition and democratic regulation.

Just one example of this is the “investor-state dispute settlements” provision, which I have called “corporate courts.” This part of “NAFTA-style” trade agreements, including TPP, allows corporations to sue governments that pass laws and regulations that interfere with profits. Similar clauses in trade agreements around the world have, for example, enabled tobacco companies to sue governments for trying to protect the health of their citizens. Under TPP these suits will be adjudicated by corporate attorneys, not democratically constituted courts.

Other examples are expanded copyright and patent protection for the giant multinationals, which will increase the cost of pharmaceutical products and potentially restrict the freedom of the Internet.

Obviously the corporate advocates of these agreements want this, so they are using distraction, diversion and shiny promises of increased trade and more jobs to sell the agreements.

2) Froman, testifying before the Senate Tuesday, said that we need these new agreements because our country has low tariffs and other barriers to entry while many countries we trade with have high tariffs and barriers to entry.

Wait, back up, he is saying that other countries have high tariffs and barriers to entry but we let goods from those countries into our country with low tariffs and few barriers? What? Doesn’t this undermine our country? Don’t low import tariffs cost badly needed revenue and enable offshoring of jobs and factories? Isn’t this a recipe for imbalance, job loss and huge trade deficits? (And don’t we have imbalance, job loss and huge trade deficits as a result of that recipe?)

In other words, he is saying that the U.S. has been an absolute and complete patsy on trade. And obviously we have been paying the price. Our government hasn’t enforced trade balance and hasn’t protected American interests, which has cost us wages, jobs, factories and entire industries. We have an enormous, humongous trade deficit and that has lowered our standard of living, and driven inequality. Trade agreements haven’t fixed this — recent trade agreements like NAFTA and South Korea have worsened this problem, with more job loss and even larger trade deficits.

The USTR and the president argue that TPP will reset this problem and will enforce good labor and environmental standards. (Enforcing international labor standards would require our government to boost enforcement and a number of U.S. states to change their laws, by the way.)

The U.S. government has no credibility when it comes to protecting Americans from trade imbalances and the resulting loss of wages, jobs, factories and entire key industries. Yet with this terrible record Froman and the president are asking Congress to pre-approve new trade agreements by passing fast track. They are asking this while the coming agreements – negotiated using the same corporate-dominated process that caused the mess – are still secret. They are asking this even though fast track will prevent Congress from adequately examining and debating agreements and fixing problems. Fast Track also keeps the public from having time to read and comprehend the agreements and rally opposition if opposition is warranted.

Saying that we have been patsies isn’t an argument for setting up a fast-track process to pass more trade agreements; it is an argument for backing up and replacing everyone and everything involved in setting and enforcing our government’s trade policies. Pushing through even more agreements using the same corporate-dominated process that caused the mess is not a way to fix the mess; it is a way to make things even worse.

3) Corporate advocates for fast track argue that we need to increase exports. This is exactly right, but they never, ever, ever, ever, ever mention imports and trade deficits. Why is that? We need balanced trade. If imports increase more than exports this represents a net loss of jobs, technology, manufacturing ecosystem and our living standard. If trade imbalances continue over time it throws the entire world’s economy out of balance. (It does things like enable 80 people to have as much wealth as half of the world’s population, and 1 percent of the world to have more wealth than all of the rest combined.)

Is there a section of these new agreements – the five of 23 chapters that are actually about trade, anyway – that requires that trade be balanced so we can stop losing jobs, wages, factories and industries? TPP is still secret, so we don’t really know. And fast track doesn’t give us time to find out once we do see the agreement, and doesn’t allow us to fix it if it doesn’t require balance.

4) Corporate advocates say “more than 38 million American jobs already depend on trade. This is one in every five jobs across the country.” I’m not sure how this is an argument for new trade agreements when they say we’re already doing so great. In any event, they are not bringing up the jobs we have lost to imports – which is more than the jobs we have gained from exports. They’re again saying “trade is good” to divert us from seeing that only five of the 29 chapters of TPP are even about trade at all. The rest is about getting democratic government off the backs of the giant multinational corporations and protecting them from competition.

5) Another corporate argument is that 97 percent of American companies that export are small businesses. This is another misleading and irrelevant number. They don’t say what percent of our exports come from these small businesses. And trade agreements that reinforce the monopolies held by giant multinational corporations by expanding their copyright and patent dominance certainly do not help smaller businesses. They are instead designed to limit competition.

What is needed is for the the contents of the TPP agreements to be made public now and for stakeholders like labor, environmental, consumer, democracy, health and all other groups to be part of the process right now. Then, when an agreement is concluded, Congress and the public need adequate time to fully analyze and discuss these agreements and their implications. Finally, Congress should be able to fix problems with the agreements to bring them in line with the interests of all Americans.

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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.

Protesters Disrupt Senate Fast Track Hearing

US Trade Representative (USTR) Michael Froman testified before the Senate Tuesday. He was there to push Congress to pass Fast Track Trade Promotion Authority (TPA), so new trade agreements can get pushed through. Protesters disrupted the hearing. The people are trying to make their voices heard over the corporate push for Fast Track.

Heating Up

Things are heating up as big new corporate “trade” agreements get closer to coming before Congress. These trade agreements have a terrible track record for American workers, because they have driven inequality, devastated entire regions of the country, and hollowed out the middle class. New corporate-centered trade agreements being negotiated will go far beyond previous NAFTA-style deals, by setting up monopoly protections for giant multinationals, elevating corporate rights above the rights of governments, and setting up corporate-run tribunals, that will have the power to override laws and regulations if they interfere with corporate profits.

Monday, the Trans-Pacific Partnership (TPP) negotiations resumed in New York City. Even though the big blizzard was starting, the negotiators were greeted by protests, as hundreds of people representing trade, labor, environmental, health, communities of color, anti-GMO and food justice, anti-fracking, animal rights, and other groups that will be hit hard by TPP and other upcoming agreements.

Hearing Disrupted

Tuesday, USTR Froman testified before the Senate, and was met with protests. Roll Call reports, in “Protesters Arrested at Fast-Track Trade Hearing”:

Capitol Police arrested three sign-carrying, slogan-shouting demonstrators who disrupted a Tuesday morning Senate Finance Committee hearing on the president’s trade policy agenda.

The protesters wore shirts reading “No Fast Track” and greeted U.S. Trade Representative Michael Froman with signs stating, “Froman lies” — a response to his statement to the committee that trade promotion authority “is Congress’s best tool to ensure that there is ample time for public scrutiny and debate on U.S. trade agreements.”

The Daily Dot reports, in “Internet freedom activists storm congressional TPP hearing”:

Margaret Flowers, a member of Physicians for a National Healthcare plan and a longstanding TPP critic, burst in carrying a sign reading “Trading away our future,” and shouting “we know the Trans-Pacific Partnership is negotiated in secret!”

As she was being escorted away by security, a pair of male protesters entered from another door. “You’re going to super-size NAFTA!” one yelled, as the other simply repeated “No TPP!” The two unfurled a banner behind Froman, who stared straight ahead with an annoyed look on his face.

Then a third wave hit: Three protestors sitting behind Froman held up other signs, like one reading “Fast track constitutional train wreck.”

Fast Track Limits Congress’ – Democracy’s – Ability To Make Changes

Froman was asking Congress to pass “Fast Track” Trade Promotion Authority (TPA), a process that sets aside Congress’ Constitutional duty to define and review (and fix) trade deals. Under Fast Track, Congress agrees not to amend agreements, to limit the amount of time spend discussing the deals, and to vote on approving the treaty within 90 days of Congress and the public first seeing what is in the agreement.

Rep. Alan Grayson (D-FL), appeared on the Thom Hartmann show to discuss Fast Track process:

The Fast Track legislation prohibits subcommittee debates, subcommittee hearings, subcommittee markups, full committee debates, full committee hearings, full committee markups, and it limits us in the House of Representatives to 88 seconds of debate for each one of us. Eighty-eight seconds to extend to 40 other countries (if we count both trade deals the President is working on), the disaster that’s been visited upon the U.S. economy simply by having a dozen existing countries with these deals in effect. They want to put our $30/hour workers directly in full head-to-head competition with the $0.30/hour workers in Vietnam and Brunei and in other places like that, who have no environmental protection, no labor rights, and in many cases are [relying on] slave labor. That’s what these deals are trying to do. It’s the Fast Track to Hell.

In addition to only 88 seconds per Representative to discuss the treaty, 90 days from first seeing a trade agreement does not give the public time to read and analyze the repercussions of these massive trade deals. It does not give the public time to organize opposition if opposition is warranted.

It is no wonder that citizens are trying to overcome the corporate juggernaut pushing Fast Track. It is a rigged process, designed to push these agreements past Congress and democracy, before the public can do anything about it.

Call your member of Congress, and both of your Senators, and tell them you oppose Fast Track. The coming trade agreements will require sufficient time for the public to read and fully comprehend them. They might have flaws that Congress should be able to fix.

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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.

Protests As Trans-Pacific Partnership Talks Resume In New York Today

Negotiators working on the Trans-Pacific Partnership (TPP) convened today in New York City. Even the location was kept secret until the last possible minute, but hundreds of trade, labor, environmental, health, communities of color, anti-GMO and food justice, anti-fracking, animal and other activists still showed up in the big blizzard to protest the secret trade agreement and “fast track” trade promotion authority (TPA).

TPP is a huge “trade” agreement, which will set the rules for 40 percent of the world’s economy. It is being negotiated in secret. Corporate representatives are part of the process, stakeholders like environmental, consumer, labor, democracy, health and other groups are excluded from the negotiations. Needless to say the agreement (some of it has leaked) reflects corporate interests at the expense of the rest of us and our governments. Meanwhile President Obama is asking Congress to pass fast-track TPA, which rigs the rules so that Congress essentially pre-approves TPP before Congress and the public even see what is in the agreement, never mind have the time to study it and rally opposition if opposition is warranted.

TPP Grants Monopolies

The Electronic Frontier Foundation (EFF) helped organize the protests because of their objection to extended monopolies being negotiated in TPP’s copyright rules. In their post, Secret TPP Negotiations—And Public Protests—To Be Held in New York City, they explained,

… The countries negotiating TPP with the US are willing to give in and agree to bad copyright rules as long as they get the other gains they were promised—things like market access and lowered tariffs so they can sell their products to US consumers. But those other countries will not budge without a guarantee that the overwhelming public opposition to the agreement won’t prevent its adoption in the United States. Fast Track offers that guarantee; that’s one reason the White House is now desperate to pass it.

Several public interest groups are organizing a protest outside the luxury Sheraton Hotel this Monday, January 26 at noon. Many of those demonstrating will be there to oppose other provisions in the TPP, but we encourage people to be there to represent all the users around the world who will be impacted by this massive agreement’s draconian policies.

A “Death Pact” Not A Trade Agreement

AIDS activists joined the various groups at the protests. They are objecting to the monopolies TPP would grant to certain large pharmaceutical corporations, which they fear would bring the price of AIDS drugs beyond the reach of many in need of them. Health Global Access Project (Health GAP) released a statement that included the following,

Previously leaked proposals revealed that the US seeks easier-to-get, stronger, and longer patent monopolies on medicines and new monopolies on drug regulatory data that would prevent marketing of more affordable generic equivalents. It also seeks restrictions on price control measures and enhanced investor rights that would allow drug companies to sue governments when their expectations of exorbitant profits are undermined by otherwise lawful government policies and decisions. These are among the most severe intellectual property rules ever demanded in international trade.

“The TPP would create a vicious cycle. The provisions currently proposed will allow for fracking and other practices that fuel environmental degradation and make people sick. Strengthened intellectual property rules will then prevent people from accessing life- saving medicines,”, said Michael Tikili of Health GAP, one of the endorsers of the demonstration. “Thirteen million people living with HIV depend on generic AIDS medicines and another 20-plus million are waiting line for treatment. By protecting Pharma’s bloated profits, the Obama administration is undermining its own global AIDS initiative – this isn’t a trade agreement—it’s a death pact.”

Other groups represented at the New York TPP protest included the Teamsters, Fight for the Future, Green party, Popular Resistance and others.

Pictures of cold-looking protesters here, here, here, here and here.

Please visit:

Expose the TPP

Stop Fast Track

No fast Track

Stop TPP

Flush the TPP

Communications Workers of America (CWA)

Global Trade Watch

Progressive Democrats of America TPP Page

People Demanding Action

Trade Justice

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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.