While the national minimum wage did rise roughly in step with productivity growth from its inception in 1938 until 1968, in the more than five decades since then, it has not even kept pace with inflation. However, if the minimum wage did rise in step with productivity growth since 1968 it would be over $24 an hour today, as shown in the Figure below.
$15 WAS the compromise!
$15 is a compromise already. If the minimum wages had kept pace with the gains in the economy it would be $24 or so per hour now, which is around $96K per year for a couple. What this means is that if labor’s share of the economy had stayed the same the minimum lifestyle equivalent would be what a $96K lifestyle today is. The house you’d be able to buy, etc. That would be our minimum.
If they kill the $15 compromise there is no reason to keep fighting for $15. It should be $24 and we should all rightfully be fighting for that. It just gets us back to where we were before the great financialization, the great separation of labor wages from the economy, the great inequalizer.
I agree with the tariffs, but not the way it is being done. It should have been planned, phased in, coordinated with US industry and, most important, part of a comprehensive US economic/trade/industrial policy. The latter just isn’t going to happen under Trump nor under a Wall Street dominated economy even with Democrats running things.
Here is an example of the problem. China increased its capacity dramatically during their infrastructure boom (which is how they got through the recession). Then internal demand dropped as the infrastructure projects wrapped up, but the steelmaking capacity continued because they don’t want to lay a lot of people off. So they are selling the steel wherever they can at prices lower than cost. The rest of the world suffers. Esecially the US “rust belt” workers. But also our country’s ability to make steel as needed. Imagine a conflict with China and they cut off steel to us, after this “dumping” has closed what’s left of our production capacity.
When China’s growth was very high, and China was building tall buildings and high-speed rail all over the place they needed a lot of steel. Then their economy slowed. Now China is making more steel than they need.
Meanwhile countries around the world are fighting their own slow growth with austerity policies that literally take money out of their economies – like cutting back on infrastructure maintenance and modernization. And their slowing economies mean less steel use.
… So there is less demand for steel in China and around the world. Current global overcapacity is estimated at 700 million tons – more than seven times what U.S. steelmakers can produce. This is expected to get worse.
But Wait, There’s More – Cheap Labor
OK, now the bigger picture. Economists will tell you about the benefits of trade. I should have said Wall Street economists.
“Trade” is supposed to be about “comparative advantage.” This means a region that grows bananas has an advantage doing that compared to Iowa. But Iowa is great at crowing corn. Iowa trades corn for bananas, etc.
However currently discussion of “trade” really just means using “trade” deals for moving American production out of the country to low-wage places. The “comparative advantage” involved is cheap labor. (The factories aren’t even already there, they are moved there.) Wall Street likes to argue the benefits of lower prices resulting from using what amounts to slave labor outside the US but the real benefit they get from this and the rest of the trade regime is pressure on US wages, which means people have to take what they can get (or drive for Uber) and labor cannot demand a larger slice of the pie.
When they say trade agreements “increase trade” remember that moving a factory across a border and bringing the same goods back here “increases trade” because now they cross a border. “Trade”?
Even More – “Expanding Markets”
There is another part of what we call “trade.” They say trade “opens up markets for US goods and services.” As if those markets are not already being served? What it does is open up “markets” for exploitation by the largest, ost powerful competitors, wiping out whatever has developed locally. There AND here. Look at how “trade’ has wiped out OUR textile, electronics, etc producers. And OUR giant monopolies like to use their power to wipe out local industries elsewhere.
So “trade’ is currently being used by giant multinationals to consolidate their power.
It Doesn’t Have To Be This Way. Imagine Democracy.
It doesn’t have to be this way.
Imagine if the US had full-employment policies, so everyone who wants a job has one. This is in fact easily done.
Imagine a democracy with rule of law and sensible coherent structures for determining policy. (Those policies would include breaking up monopolies and reducing the power of big companies.)
Imagine a government that offers a job to anyone who wants one, with reasonable above-poverty pay and benefits. There is so much that needs doing, like child care, elder care, retrofitting buildings to be energy efficient, fixing up parks, teaching — you know, the list of things that a democracy would put resources into to make people’s lives better.
So imagine a system where everyone has the ability to get by, and the opportunity to do work that does good. Imagine how jobs would change if employers had to compete to get people to do the jobs they need done. That competition would involve offering jobs that actually do make the world a better place, because people would be able to choose to do that.
This Creates A New Economic Problem – A NEED To Outsource Production
Never mind the societal reckoning full employment policies would bring, with its higher wages, increases in labor’s power, etc. (That’s another discussion…) There would be a new economic problem: Our economy would have trouble finding enough labor to get things done. In other words, the economy would be prevented from running at full capacity by a demand for labor. What to do?
THEN it makes economic sense to move production elsewhere. But then it could be done non-exploitively, bringing higher pay and prosperity to the places we outsource to as well as here. Then trade becomes the benefit it is supposed to be, benefitting everyone. This is how democracies would do it.
And immigration. (But that’s also another discussion.)
In an economy designed to be of, by and for We the People outsourcing production could be good for everyone.
Imagine an economy designed to be of, by and for We the People. Wow.
He’s opposed to the new overtime rule that gave the right to time and a half pay to millions of salaried employees earning less than $47,476 a year. Wal-Mart has already raised its managers’ pay, as did about half of all big retailers, even before the rule was supposed to take effect on December 1. But Puzder wants to kill it so he can keep working low-paid employees without paying them a dime extra for their overtime hours.
“You better keep your eye on your kids. We know what car you drive.” That’s the kind of threats a local union official is getting after President-presumed-Elect Donald Trump tweeted something bad about him.
A guy shows up at a Pizza shop based on conspiracy theories — some pushed out by Trump insiders, others by the same Trump-related websites and radio shows that pushed the Sandy Hook hoax — claiming Hillary Clinton runs a child sex trafficking ring from its basement. He brings an assault rifle,
… terrifying customers and workers with his assault-style rifle as he searched Comet Ping Pong, police said. He found no hidden children, no secret chambers, no evidence of a child sex ring run by the failed Democratic candidate for president of the United States…
Is this the “new normal” for our country?
Trump Attacks Local Union Leader
The latest example of this top-down attacking involves Chuck Jones, the president of United Steelworkers (USW) local 1999. Local 1999 represents workers at Indiana’s Carrier furnace and air conditioner manufacturer.
This is the next President of the United States publicly attacking a guy who is president of a local union in Indiana, singling him out for national attention. And this national humiliation and endangerment by the next President of the United States is because the guy told the truth after Trump did not.
Half an hour after Trump tweeted about Jones on Wednesday, the union leader’s phone began to ring and kept ringing, he said. One voice asked: What kind of car do you drive? Another said: We’re coming for you.
He wasn’t sure how these people found his number.
“Nothing that says they’re gonna kill me, but, you know, you better keep your eye on your kids,” Jones said later on MSNBC. “We know what car you drive. Things along those lines.”
But there’s more to it. Attacking a union’s leadership, saying “no wonder companies are fleeing the country,” the union should have “kept those jobs in Indiana” and saying the union should “spend more time working-less time talking. Reduce dues.” is classic management anti-union propaganda. Saying the union is costing jobs is a union busting tactic intended to drive a edge between the union and rank-and-file workers.
This anti-union action shows the mindset of Trump toward working people. It sends a signal. If unions try to help their membership, and challenge Trump’s tactics and facts, Trump will attack them and threaten their leadership.
Not everyone is intimidated by these attacks on individuals by the next President.
In response to Trump’s attack on Jones, AFL-CIO President Richard Trumka issued this statement,
Chuck Jones is a man of passion, conviction and integrity who would do anything for his union brothers and sisters. President Gerard is exactly right – Chuck is a hero. An attack on him is an attack on all working people.
Chuck is right to call out the president-elect for inflating the number of jobs that will be saved at Carrier. He understands better than anyone that these are more than numbers—they are people with families to support and bills to pay.
Instead of attacking those who have been working hard to save jobs, the president-elect needs to engage with local union leaders at Carrier and at his hotel in Las Vegas. Trump International Hotel in Las Vegas is breaking the law by not bargaining with its newly unionized employees. Mr. Trump will soon occupy the White House. His words and actions need to befit that office.
Scott Paul, President of the Alliance for American Manufacturing tweeted this about Jones,
Chuck’s a man of deep integrity. He’d do anything to keep jobs here. Trump got half a loaf for workers. Chuck’s right to call Trump out. https://t.co/kxeVukiHZw
Also on Twitter, the hashtag #ImWithChuck has messages of support of Jones.
This Is The Next President?
Trump, believe it or not, is President-elect on the United States. That is a position of great power, commanding great influence over what people think and do. When Trump or those around him “punch down” and publicly attack individuals or advance bizarre conspiracy theories, it puts people in danger. Trump and those around him don’t seem to care. And by publicly not caring and continuing to do it, it starts to look like intent.
Trump and the people around him are, in essence, sending these nuts after people. Provoking. Inciting. But with the tweets attacking Chuck Jones using classic union-busting propaganda Trump is also strategically attacking the interests of all working people.
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.