Hillary Clinton just announced that she’s running for president. However, this commentary is not really about her. It’s about a nation of more than 300 million people in which politics has become the sole property and domain of the rich. The rich decided some time ago that Hillary Clinton would be the virtually unchallenged presidential candidate of the Democratic Party. The 48 percent of Americans that express an affinity with the Democratic Party have not yet chosen Clinton. There has been no primary election in any state. But, that does not matter because the selection process that counts occurs in the boardrooms and mansions and private clubs and getaways of the rich. Hillary Clinton and her husband, Bill, have spent virtually their entire adult lives on the millionaires’ campaign circuit, the rich man’s primary. In the process of pleasing the rich, they have become rich, themselves.
Hillary hopes to spend two and a half billion dollars of – mostly – rich people’s money in the 2016 campaign. Wealthy people will be just as generous with the Republican candidate. The outcome on Election Day is absolutely certain: the rich man’s candidate will definitely win, and the people will lose – because they have no candidate in the major parties.
The people are not even in the game; the contest is over before the Democratic Party’s formal selection process even begins. And, when primary season does arrive, it will only be a formality. The menu has already been printed, and Hillary will be the main course for Democrats next year.
Democratic voters can say “Yes” to Hillary, but they can’t say “No,” because the party machinery and the rich men who pay for that machinery will crucify and expel any Democrat who seriously challenges her from the Left.
The Democratic Party’s apologists like to call it a big tent with room for Blacks and browns and gays and labor and peace-loving people. But it’s actually a huge trap designed to contain and politically neutralize the folks who might otherwise turn against the rich. The Party has always been a scam, but at least in the old days it put on a populist show to fool the rank and file into believing that they could actually influence the party’s direction. However, Wall Street is determined that there will be no serious Democratic deviation from the corporate agenda set by Bill Clinton and Barack Obama. Hillary Clinton would represent the third Clinton presidency – which, for Wall Street, is just as good as the two George Bush presidencies. Maybe better, because labor and Blacks and that fuzzy cohort called liberals will all think they won the election, when nothing could be farther from the truth. Rank and file Democrats will see the fait accompli of Hillary’s nomination as a sign of unity among Democrats, when in fact it is the triumph of filthy rich campaign contributors. The rich have shown great solidarity in uniting behind a Democratic presidential candidate. Later on, they will unite around a Republican candidate, too. After that, it won’t matter who wins.
Glen Ford can be contacted at Glen.Ford@BlackAgendaReport.com.
Family members of Ecuador’s fugitive Isaias brothers appear to have received preferential treatment in the U.S. thanks to political donations to the Democratic Party, The New York Times revealed Tuesday.
Estefania Isaias — the daughter of Roberto Isaias, one of two brothers wanted in Ecuador for bank fraud — had been barred from entering the United States after committing immigration fraud. That ban was lifted thanks to the intervention of high-ranking officials in the U.S. State Department. The lifting of the ban was made possible thanks to the assistance of Robert Menendez, a Democratic Senator.
The New York Times investigation reveals that the office of Menendez lobbied extensively in support of Estefania Isaias, even reaching out to Cheryl Mills, Hilary Clinton’s chief of staff while Clinton was she was U.S. secretary of state. He succeeded in getting Ms. Isaias into the United States and wrote to her to tell her the news a mere day after the Isaias family gave a donation to the Democratic Party.
Estefania’s sister Maria also faced a ban on entering the United States and Menendez’s office once again worked to intervene in her favor — also after receiving a donation from the Isaias family.
A spokesperson for Menendez told the Times that his office’s advocacy in the case of Ms. Isaias was routine. However, Linda Jewell, former U.S. ambassador to Ecuador, told the Times, “Such close and detailed involvement by a congressional office in an individual visa case would be quite unusual, especially for an applicant who is not a constituent of the member of Congress.”
The U.S. newspaper reported that the family donated hundreds of thousands of dollars to political campaigns, which were often followed by favorable decisions by the U.S. government.
The Isaias brothers, Roberto and William, were found guilty in absentia for a fraud worth US$400 million. They were sentenced to eight years in prison. The Isaias brothers have been living in the United States, fugitives from Ecuadorean justice. The government of Ecuador has requested their extradition but the U.S. government has denied the request.
Ecuador claims that the political donations made by the family is buying them protection in the U.S. However, The New York Times also reported that the U.S. Department of Homeland Security is currently working to have the Isaias brothers deported.
The U.S. Justice Department is investigating Senator Menendez for his support of the Isaias brothers. The senator is suspected of attempting to influence immigration officials in exchange for donations from the fugitive brothers.
It seems that Seattle has officially passed the $15 baton to San Francisco, and they’re running with it. On May 5th San Francisco had its first public organizing meeting to prepare for a ballot measure to raise the minimum wage to $15. The Labor movement and broader community organizations were well represented, and with them all the potential to achieve a great victory.
The San Francisco $15 proposal is stronger than the Seattle mayor’s version: the time line to get to $15 is shorter, and there are fewer exceptions.
San Francisco companies with more than 100 employees would have until 2016 to raise wages to $15 an hour, but they must lift wages to $13 an hour by next January. Businesses with fewer than 100 employees have until 2017 to raise wages to $15 an hour, but must raise them to $13 an hour by 2015 and $14 by 2016.
Polling has already indicated overwhelming support (59 percent) for the initiative.
The process that San Francisco is using also has other advantages over Seattle’s. The unions and community groups are working as a united front in San Francisco, whereas in Seattle there was constant tension between the socialist city council member Kshama Sawant and her $15 Now group of supporters versus the unions: Sawant wanted a strong version of $15 and several of the unions just wanted a deal, seemingly more interested in working with the mayor towards “consensus” between the unions and the corporations.
In San Francisco “consensus” was thankfully blown to pieces. The ballot initiative process goes over the head of the City Hall corporate politicians, destroying the consensus that San Francisco mayor was desperately seeking between the Chamber of Commerce — representing the giant corporations — and the unions. This has infuriated the 1%.
The San Francisco Chronicle reports:
“The San Francisco Chamber of Commerce said it was ‘outraged by the preemptive minimum wage ballot measure’ designed by SEIU and its allies.”
This is exactly the kind of outrage that should warm the heart of all working people.
The ballot initiative is also superior because it opens up the doors to wider participation of various community groups, who can mobilize their members to collect signatures, organize rallies, etc., instead of simply having four or five union reps cut a backroom, watered-down deal with the mayor and corporations.
Which begs the question: why don’t unions and community groups work together on inspiring ballot initiatives more often? Half the states in the country and many municipalities have the legal authority to evoke this brand of direct democracy, yet it’s rarely done.
The answer is, sadly, that this weapon is rarely used in an inspirational way because of the “partnership” between unions and the Democratic Party. The Democrats are adversaries of anything potentially harmful to the big corporations, which any economic measure that inspires working people will inevitably be.
This is why — as Obama’s presidency proved yet again — the Democratic Party is where hope goes to die.
Which makes the events in San Francisco all the more important: the $15 dollar initiative is an example of the unions making a big break, in practice, from the Democrats, which hopefully others around the nation will follow.
And follow they must, since it would be suicide for the national labor movement to sit idly as the fight for $15 snowballs. Union and community groups should be working together across the country for similar ballot initiatives wherever possible.
For those states without ballot initiatives, $15 can still be used as a rallying cry and a mobilizing force for change. Wherever the Democratic Party blocks this process, unions should come together and form a labor party. Working people are tired of excuses.
The fight for $15 also gives a boost to organizing new workers into unions as well. For example, Wal-Mart workers would love to make $15 an hour and the labor movement has been trying in vain to organize them for years. The slogan “$15 and a union” would resonate far better with Wal-Mart workers than anything the unions have yet put forth.
There are also many other unions that have already-organized workers who don’t make $15, and now they can have the confidence to demand $15 at the bargaining table, knowing full well that the broader community will come to their aid.
The $15 demand is especially important because it’s the first time in decades that the labor movement is going on the offensive. This is crucial. Three decades of playing defense — and playing it poorly — has had a demoralizing effect on the entire working class. A big offensive victory opens the doors wide to new possibilities and new horizons. It boosts confidence. One year ago $15 seemed like a fantasy; in five years we’ll hopefully be looking back at $15 with nostalgia, having achieved many other offensive victories.
The possibilities for unions and community groups to organize around $15 are endless. And if other unions don’t follow the example of the San Francisco unions and community groups, they’ll be acting as willing participants to the ongoing corporate onslaught. Not fighting back is no longer an option.
Shamus Cooke is a social service worker, trade unionist, and writer for Workers Action. He can be reached at email@example.com
This past weekend, more than 30,000 union workers at Boeing Corp. in Seattle, were forced to accept deep concessions in their union contract, gutting their pensions, future healthcare benefits, wages, and other benefits. Their contract with Boeing had not even expired but they were forced into concessions nonetheless. Nor was the company, Boeing, in any financial distress. It had registered record profits in consecutive years, and had in November 2013 bought back $10 billion in stock from its shareholders and paid another $2 billion in dividends to the same. Nevertheless Boeing demanded concessions, having received communication from Union (IAM) International leadership beforehand of their willingness to grant the same. The combination of Union International leadership pressure, countless Democratic Party politicians, and the Company’s new offensive, proved too much for local workers to resist. The new concessions will effectively end workers’ defined benefit pensions, cutting retirement benefits to the bone, and allow the company to end its healthcare insurance benefits by 2018 in accordance with the Obama new health care plan. Wages for new hired workers are projected to decline to levels of minimum wage or less over the next 11 years of the new contract term.
This kind of attack on pensions and healthcare–or what this writer calls the ‘social wage’ was predicted in this writer’s article, ‘Concession Bargaining at the Crossroads’ two years ago in 2011. That article is reproduced here in its original draft form once again.
CONCESSION BARGAINING AT THE CROSSROADS
“The history of collective bargaining since the Second World War has consisted of several stages or phases. The first phase was roughly from 1947 to 1979. During it collective bargaining was expanded both in terms of its ‘scope’ and its ‘magnitude’. Scope refers to new areas of bargaining, such as cost of living adjustments, supplemental unemployment benefits, pensions and health care benefits, union and worker rights, etc. Magnitude refers to increasing the dollar value of wages and benefits. Up to 1979 both expanded.
In contrast, from the mid-1970s to 2007, concession bargaining became the growing practice. But it was concession bargaining focused on giving back ‘magnitude’ gains of the previous decades, not necessarily the scope of bargaining. Workers in the private sector gave ground on wages and benefits in a decades-long attempt to protect their jobs.
First Stages of Concession Bargaining
Among the first to feel the effects were workers in the construction sector, starting in the 1970s. Employers formed early in the decade the ‘Construction Industry Users Roundtable’. Its strategy was to undermine the then powerful building trades unions by a new tactic: the ‘double breasted operation’. This simply put was a way to undermine the construction unions by setting up parallel, non-union companies. The unions ignored the threat more or less, since the double breasted operations were set up in the suburbs and outlying regions. The urban bastion of unionization in construction wasn’t immediately impacted. Employers progressively then moved jobs and work to the non-union operations. The loss of jobs in the unionized operations eventually forced workers and unions to start granting concessions in an attempt to prevent their work shifting to the non-union companies. Concessions soon expanded. Saving jobs in exchange for givebacks on wages and benefits eventually became the norm.
In the late 1970s the strategy of forcing workers to give up wage and benefit gains to keep their jobs leap-frogged into the manufacturing sector. The pilot and defining event was the Chrysler bailout of 1979. It worked so well the model was planned for application to manufacturing in general. By then the Construction Industry Users Roundtable’ had expanded into what is now known as perhaps the most formidable and effective Big Business organization today—the Business Roundtable. Big manufacturing and service companies joined with the Construction employers. The construction industry union-busting model was transported to other sectors of the economy.
The tactic of double breasted operations took on a new form. Alternative union-free operations were set up. But not across town, as in construction. It was now across borders. The manufacturing analog of the double breasted operation was the runaway shop, as manufacturers moved operations offshore.
In these they were aided by the most pro-business President since Coolidge—Ronald Reagan and a compliant Congress. Manufacturers were provided generous economic incentives to set up offshore. Tax incentives were generously granted. Deregulation was introduced. Then in 1988 and 1993 ‘free trade’ agreements were established with Canada and Mexico to facilitate the movement of US capital to those countries to set up operations. Free ‘trade’ is not just about export-import of goods and services; it is even more about negotiating favorable conditions for US foreign direct investment in those countries. Tax [breaks] for investing offshore plus free trade plus deregulation devastated jobs in the US beginning in the early 1980s, and continuing ever since. Under pressure of losing jobs, workers in manufacturing began the long, dead-end road toward concession bargaining in an attempt to save their jobs. But it didn’t. More than 10 million jobs have been off-shored ever since.
The pressure to grant wage concessions intensified in the 1990s. In addition to the threat of job loss, now escalating double-digit annual increases in health care costs provided a second hammer. That ushered in what was called ‘maintenance of benefits bargaining’. Now desperate to maintain their health care coverage, workers gave up more wages in exchange for keeping health benefits. But that too did not last long.
Health care cost shifting accelerated by 2000 and into the next decade. To assist in paying for rising health care premiums and costs, the federal government permitted companies to drag surplus funds from workers’ defined benefit pension plans to cover rising health costs. Up to 20% of health cost increases were subsidized in this manner. But that represented giving up wages—i.e. concessions—in order to maintain benefits as well. Only this time it was workers’ ‘deferred wages’ that went into their pension funds instead of their immediate paychecks. But a wage is a wage, whether immediate or deferred. And concessions on nominal (immediate) and deferred wages became the increasing rule by the late 1990s.
This evolving concession bargaining since the late 1970s into the last decade represents the second phase of the history of collective bargaining in the US. The first, as noted above, was the phase during which collective bargaining expanded both in terms of ‘scope’ and ‘magnitude’—that is, in terms of new areas of bargaining added to negotiations as well as in terms of advances in wages and benefits. The second phase of bargaining in the US, from the late 1970s to around 2000, represents the first stage of concession bargaining.
Stage Two: From ‘Magnitude’ to ‘Scope’ Concession Bargaining
This first stage of concession bargaining (1975-2000) began to change for the worse in the past decade, shifting to a new stage during which workers and their unions have been forced to grant concessions not only in terms of magnitude or levels of wages and benefits, but now in terms of scope and entire areas of bargaining as well. Defined benefit pensions were abandoned for 401k personal pension plans at an accelerating rate. Not only were pensions increasingly privatized, but the de-collectivization of health insurance plans also accelerated under George W. Bush with the introduction of what were called ‘health savings accounts’—the analog on the health benefits side to 401ks on the pensions side.
Employer provided health insurance benefits were now dropped in growing numbers altogether. Or they were dumped onto the union, as in the Auto Industry, in the form of VEBAs (voluntary employment benefit agreements). Employers removed in effect any negotiating over companies paying for health care for workers from union collective bargaining agreements. In a similar fashion, once widespread Cost of Living clauses in collective bargaining agreements were stripped from union contracts. Ditto for supplemental unemployment benefits (SUBs). More and more companies simply discontinued unilaterally retirees health care coverage from bargaining, aided now by court decisions that ruled such were not bona fide subjects of bargaining any longer. Union rights were increasingly circumscribed in agreements, as management rights clauses were expanded. In other words, concession bargaining was no longer simply about ‘magnitudes’—i.e. how much wages or benefits would be reduced in order to keep jobs or the companies from moving offshore or from being outsourced and reduced to mere skeleton crews. Not entire key areas of union contracts were being ‘conceded’ and thus wiped out, removed from the very subject of bargaining altogether.
Stage Three: Concession Bargaining Extends to the Public Sector
In the past two years this second phase of concession bargaining—i.e. cutting levels of wages and benefits and giving up entire areas of bargaining—is now being applied to public sector workers as well, in a vicious attack now unfolding throughout the country. Politicians of both political parties, public sector employers, and wealthy billionaires and millionaires who pay for the elections of these same politicians, are in the process of imposing concession bargaining on public workers.
Furthermore, concession bargaining is occurring in an especially compressed form. Both magnitude and scope are occurring simultaneously and in a matter of just a few years instead of the few decades in which it was deepened in the private sector of the economy. The entire process is effectively ‘telescoped’ and thus taking place is a particularly intense form. All across the country today, in state after state, politicians are declaring bargaining over pensions and health care no longer will be the practice. They are unilaterally discontinuing defined benefit pensions and replacing them with 401k plans. They are moving to eliminate union and agency shop agreements with the open shop, placing ‘caps’ on wage negotiations, and in general attempting to return to the days of ‘civil service’ rules and regulations in lieu of bona fide collective bargaining.
Stage Four: Concession Bargaining’s New Target: ‘Social Wage’ Reduction
Concession bargaining is morphing still further, however. It is now moving from the level of taking back money wages and benefits at the ‘shop-floor level’—both in the private and public sectors—to the level of ‘social wage’ concession bargaining.
The ‘social wage’ is money wages that workers give up in exchange for pay they will receive at a later date. Social wages are thus deferred wages. Social wages are most notably Social Security and Medicare taxes that workers pay in the form of payroll taxes, in order to receive the wage paid upon retirement in the form of social security pension and medicare health care benefits. The focus since the 2010 midterm elections in the US is now on austerity—a codeword for cutting so-called ‘entitlements’ like social security and medicare. But social security and medicare represent wages paid by workers in the past for claims in the future. Not content with concessions from current wage and benefits, Corporate America—the rulers behind the throne of Congress and the Presidency and Courts—now want reductions in the ‘social wage’ as well. Why? So they can maintain their historic tax cuts enacted over the past three decades and not have to pay the costs of the bailouts and economic crisis [as well as the wars for Israel – Aletho News] that they themselves caused.
The dimensions of the Great American Tax Shift of the past three decades, still on-going and expanding under Obama and the Democrats (and about to expand further still) are the subject of another analysis. But briefly, a tip of the iceberg view is: In the 1960s corporations paid 30% of total federal tax revenues; today they contribute 6.6%. In the 1960s the top income brackets paid 45% of total federal tax revenues; today the effective top bracket tax paid by the wealthiest individuals is only 16%.
The latest phase of concession bargaining now emerging in the past year—concessions giving back the ‘social wage’—is historic. It represents concession bargaining over workers’ income that is shifting to the political level on a grand scale. It is ‘grande scale concession bargaining’. Not content with concessions in money and benefits at the shop level in the private sector, not even content with extending that in intensified form today to the public worker sector, corporate interests now demand concession bargaining over social wages at the political level.
What’s especially onerous about the new concession bargaining is that politicians are making the decisions. Workers don’t even have the option of voting on the concessions, or striking in opposition, as they might when undertaken in cases of earlier concession bargaining at the shop level. They now have virtually no say in the process short of taking to the streets to have their voices heard—which appears increasingly as the only alternative. Moreover, the dollar value of the concessions being, and about to be, offered are now also immensely greater. As the recent debt ceiling debate illustrates clearly, the coming attack on Medicare represents social wage concessions approaching half a trillion dollars. Concessions involving social security retirement that will soon follow in 2012 will amount to a like amount, at minimum, with even more Medicare cuts. In just a few short years, several times the value of total givebacks in concessions in wages and benefits at the shop level since 1979 may occur. It is a massive transfer and shift of income from working and middle class America to the wealthiest households and their corporations.
Behind the facade of Washington politics are the same corporate interests, however. Only now instead of directing their managers at the bargaining table, they now direct their political managers by means of their immense, and growing, campaign contributions and billion dollar lobbying efforts.
Occasionally an example slips through the veil of confusion about who’s behind it all. The veil drops revealing the ‘Wizards of Oz’ pulling the levers and the curtains. Witness the notorious relationship between Wisconsin governor, Walker, and the billionaire Koch brothers. But there are ‘Koch brothers’ lurking everywhere behind the veil, in Ohio, in New Jersey, Connecticut, Massachusetts, Georgia, and even California. They are driving the fundamental strategy, directing the elected politicians in exchange for campaign contributions and day to day lobbying largesse.
The Empty Legacy of Concession Bargaining
What concession bargaining has proven over the past three decades—whether at the political level or the shop floor level—is that concessions only result in demands for more concessions.
Concessions in the private sector over the past three decades haven’t saved jobs. What they have achieved is a stagnation and decline in the income for 100 million families that is choking off consumer spending and economic growth and therefore economic recovery. The second phase, concession bargaining in the public sector, will now add to this consumption decline. And the now emerging third phase, expanding concession bargaining to the level of social wages, about to begin with the direct attack on social security and medicare will not ‘save’ those programs any more than concession bargaining in the past ‘saved jobs’.
Concession bargaining will only result in a deepening crisis in those programs and lead, inevitably in turn, to more demands by corporate interests for still further cuts (i.e. concessions) in those programs. Calls by politicians for ‘shared sacrifices’ are really concession bargaining by another name: to reduce the social wage represented by social security and medicare.
Nothing positive whatsoever has come from concession bargaining the past three decades in the private sector. Good jobs have continued to disappear by the tens of millions. Wages and earnings for the 100 million non-supervisory workers in the US have stagnated and fallen. Giving up wages to ‘maintain health and retirement benefits’ have fared no better. Pensions have nearly disappeared and employer provided health care coverage has declined by the millions of companies, and will not last out the current decade. Nor will anything beneficial come from the intensification of concession bargaining now penetrating the public sector. Union leaders will give up wages and benefits, but that will not stop the millions that are slated for layoffs in the public sector over the next few years—at minimum 500,000 in the year ahead alone! The extension of concession bargaining to the public sector, now accelerating at a pace far worse than that which previously occurred in the private sector, will produce the same results—only now telescoped into a much shorter time period. Not least, nothing positive will come from granting concessions over social wages—i.e. agreeing to reduce social security and medicare benefits. Those programs will not be ‘saved’ by concessions. They will be destroyed by them.
The only way to stop concession bargaining in any of its forms, including the most virulent now attacking the ‘social wage’, is to refuse any and all concessions. ‘No cuts and No Concessions’ is the only effective bargaining demand.
And just as, at the shop floor, when union leaders cave in to employer demands for concessions, they should be thrown out and replaced with leaders who will refuse to do so and stand firm—so too should any politician who agrees to concessions from social security and medicare be thrown out. Indeed, any politician who fails to actively resist such concessions should be thrown out. Not in the next election. But by immediate recall.
Finally, any political party that allows its elected to members to agree to concessions in social security and medicare, or whose elected members stand by silently while the fight to defend the social wage takes place, should be replaced by another political party whose members consider the social wage ‘non-negotiable’.
Unfortunately, it appears the political party—the Democrats—who introduced and once championed social security and medicare are now becoming participants in its destruction. Not only President Obama, but Senate leader Harry Reid and House leader Nancy Pelosi, have all publicly indicated this past summer they are prepared to concede and to cut medicare before year end 2011 in some form. Next it will be social security retirement. And medicare again.
But once starting down that road of initial concessions, it will only lead to further concessions—as the history of concession bargaining at the shop floor over the last three decades sadly shows.
If that happens, and the leadership of the Democratic Party abandon social security and medicare to concession bargaining, as it appears they will, the only answer to stopping concession bargaining is to create a new party of labor, every member of which must solemnly pledge to expand the social wage, to defend and expand social security and medicare, to stand firm on the question of concession bargaining. There can be no ‘Bi-Partisan’ compromise. It is time to raise the flag, with the motto boldly proclaiming across it: ‘No Concessions! No Retreat!.
Jack Rasmus, August 7, 2011
Twenty years since its passage, NAFTA has displaced workers on both sides of the U.S.-Mexico border, depressed wages, weakened unions, and set the terms of the neoliberal global economy.
Foreign Policy In Focus is partnering with Mexico’s La Jornada del campo magazine, where an earlier version of this commentary appeared, to publish a series of pieces examining the impacts of the North American Free Trade Agreement (NAFTA) 20 years since its implementation. This is the first in the series.
The North American Free Trade Agreement, or NAFTA, was the door through which American workers were shoved into the neoliberal global labor market.
By establishing the principle that U.S. corporations could relocate production elsewhere and sell their products back into the United States, NAFTA undercut the bargaining power of American workers, which had driven the expansion of the middle class since the end of World War II. The result has been 20 years of stagnant wages and the upward redistribution of income, wealth, and political power.
A Template for Neoliberal Globalization
NAFTA impacted U.S. workers in four principal ways.
First, it caused the loss of some 700,000 jobs as companies moved their production to Mexico, where labor was cheaper. Most of these losses came in California, Texas, Michigan, and other states where manufacturing is concentrated (and where many immigrants from Mexico go). To be sure, there were some job gains along the border in the service and retail sectors resulting from increased trucking activity. But these gains are small in relation to the losses, and have generally come in lower paying occupations. The vast majority of workers who lost jobs from NAFTA, therefore, suffered a permanent loss of income.
Second, NAFTA strengthened the ability of U.S. employers to force workers to accept lower wages and benefits. As soon as NAFTA became law, corporate managers began telling their workers that their companies intended to move to Mexico unless the workers lowered the cost of their labor. In the midst of collective bargaining negotiations with unions, some companies even started loading machinery into trucks that they said were bound for Mexico. The same threats were used to fight union organizing efforts. The message was: “If you vote to form a union, we will move south of the border.” With NAFTA, corporations also could more easily blackmail local governments into giving them tax breaks and other subsidies, which of course ultimately meant higher taxes on employees and other taxpayers.
Third, NAFTA drove several million Mexican workers and their families out of the agriculture and small business sectors, which could not compete with the flood of products—often subsidized—from U.S. producers. This dislocation was a major cause of the dramatic increase of undocumented workers in the United States, putting further downward pressure on North American wages, particularly in already lower-paying labor markets.
Fourth, and ultimately most importantly, NAFTA created a template for the rules of the emerging global economy, in which the benefits would flow to capital and the costs to labor. Among other things, NAFTA granted corporations extraordinary protections against national labor laws that might threaten profits, set up special courts—chosen from rosters of pro-business experts—to judge corporate suits against governments, and at the same time effectively denied legal status to workers and unions to defend themselves in these new cross-border jurisdictions.
The U.S. governing class—in alliance with the financial elites of its trading partners—applied the NAFTA principles to the World Trade Organization, to the policies of the World Bank and IMF, and to the deal under which employers of China’s huge supply of low-wage workers were allowed access to U.S. markets in exchange for allowing American multinational corporations to invest there. The NAFTA doctrine of socialism for capital and free markets for labor also drove U.S. policy in the Mexican peso crisis of 1994-95, the Asian financial crash of 1997, and the global financial meltdown of 2008. In each case, the U.S. government organized the rescue of banks and corporate investors while letting the workers fend for themselves.
A Watershed in U.S. Politics
In U.S. politics, the passage of NAFTA under President Bill Clinton signaled that the elites of the Democratic Party—the “progressive” major party—had accepted the reactionary economic ideology of Ronald Reagan.
A “North American Accord” was first proposed by the Republican Reagan in 1979, a year before he was elected president. A decade later, his Republican successor, George H.W. Bush, negotiated the final agreement with Mexico and Canada.
At the time, the Democrats who controlled Congress would not approve the agreement. And when Democrat Bill Clinton was elected in 1992, it was widely assumed that the political pendulum would swing back from the right, and that therefore NAFTA would never pass. But Clinton surrounded himself with economic advisers from Wall Street and in his first year pushed the approval of NAFTA through the Congress.
Despite the rhetoric, the central goal of NAFTA was not “expanding trade.” After all, the United States, Mexico, and Canada had been trading goods and services with each other for three centuries. NAFTA’s central purpose was to free American corporations from U.S. laws protecting workers and the environment. Moreover, it paved the way for the rest of the neoliberal agenda in the United States: the privatization of public services, the deregulation of finance, and the destruction of the independent trade union movement.
The inevitable result was to undercut the living standards of workers all across North America: Wages and benefits have fallen behind worker productivity in all three countries. Moreover, despite declining wages in the United States, the gap between the typical American and typical Mexican worker in manufacturing remains the same. Even after adjusting for differences in living costs, Mexican workers continue to make about 30 percent of the wages that workers make in the United States. Thus, NAFTA is both symbol and substance of the global “race to the bottom.”
Creating a New Template
Here in North America there are two alternative political strategies for change.
One is repeal: NAFTA gives each nation the right to opt out of the agreement. The problem is that by now the three countries’ economies and populations have become so integrated that dis-integration could cause widespread dislocation, unemployment, and a substantial drop in living standards.
The other option is to build a cross-border political movement to rewrite NAFTA in a way that gives ordinary citizens rights and labor protections at least equal to the current privileges of corporate investors. For example, all three NAFTA nations should adopt similar high standards for the protection of free trade unions, collective bargaining, and health and safety—and their citizens should have the right to sue other countries for violations.
This would obviously not be easy. But a foundation has already been laid by the growing collaboration among immigrant, trade unionist, human rights, and other activist organizations in all three counties.
If such a movement could succeed in drawing up a new continent-wide social contract, North American economic integration—instead of being a blueprint for worker exploitation—might just become a model for bringing social justice to the global economy.
Jeff Faux is the founder, and now Distinguished Fellow, of the Economic Policy Institute in Washington DC. His latest book is The Servant Economy.
Time to end the failed experiment with rigged corporate trade and put in place fair trade for the people and planet before profits
Momentum is growing in the campaign to stop the Trans-Pacific Partnership (TPP). Yesterday, the TPP was dealt two blows. Each could be lethal but the TPP, and its Atlantic counterpart, called TAFTA, are not dead yet. It is time for the movement of movements that formed to oppose the TPP to stand in solidarity, defeat these agreements and end the era of rigged corporate trade.
Yesterday’s first blow came from Wikileaks, showing once again that when government works in secret with big corporations, exposure by whistle blowers is critical to changing the corrupt direction of government and the economy. Wikileaks published the full text of the intellectual property chapter; the leaked document included the positions of all the parties. It will take time for all the corporate rigging in this lengthy document to be understood, but already it is evident that Internet freedom will be curtailed, access to health care will become more expensive and access to information will be undermined.
This is not the first leak of TPP text. Previous leaks are consistent with the Wikileaks leak – enhanced corporate power that puts profits before the needs of the people and the protection of the planet. The Wikileaks release shows that the United States is by far the most aggressive advocate for trans-national corporate interests, often isolated in pushing for harmful policies.
The second blow came from members of the U.S. House of Representatives. In recent days, several letters were sent to President Obama opposing Fast Track Trade Promotion Authority. Fast Track undermines Congress’ responsibility under the Commerce Clause to regulate trade between nations by allowing the president to sign the agreement before Congress even sees it. The letters made public on November 13th demonstrate broad bi-partisan opposition to Fast Track with 179 Members signing at least one of the three letters.
A letter spearheaded by Rep. Rosa DeLauro (D-CT) and Rep. George Miller (D-CA) garnered the support of three-quarters of House Democrats with 151 Members telling President Obama they oppose Fast Track, writing:
We will oppose ‘Fast Track’ Trade Promotion Authority or any other mechanism delegating Congress’ constitutional authority over trade policy that continues to exclude us from having a meaningful role in the formative stages of trade agreements and throughout negotiating and approval processes.
Important leaders of the Democratic Party signed the letter including 18 out of 21 Ranking Members who would chair committees if the Democrats were in the majority. This means that to pursue Fast Track authority, President Obama will need to challenge three-quarters of his own party.
But, that is not all. In another letter, organized by Mike Thompson (D-CA) and Earl Blumenauer (D-OR) and signed by 12 of the 16 Democratic Party members of the Ways and Means Committee, which is primarily responsible for Fast Track legislation, members expressed opposition to Fast Track unless it was radically different from previous grants of authority. The letter says it “cannot just be an extension of earlier trade promotion authorities. Any new proposed TPA must . . . ensure Congress plays a more meaningful role in the negotiating process.”
And, the opposition is bi-partisan. Rep. Walter Jones (R-NC) and Rep. Michelle Bachmann (R-MN) drafted a letter signed by 23 Republicans. The Republican letter emphasized that Congress has the “exclusive authority to set the terms of trade.” Further, “The Founders established this clear check and balance to prevent the president from unilaterally negotiating with foreign nations and imposing trade policies that Congress would deem to be against the national interest.” They write that they refuse to “cede our constitutional authority to the executive” through Fast Track.
These are just the latest problems in the quest for Fast Track, indeed a bill has yet to be introduced. The previous US Trade Representative, Ron Kirk, said in 2012: “We’ve got to have it.” He wanted the authority by the end of 2012. In April, Sen. Max Baucus (D-MT) promised Obama Fast Track by June of 2013. The broad bi-partisan opposition announced this week shows that winning Fast Track has very little support in Congress. In fact, the letters may be the death knell for such legislation.
The Wikileaks documents show there is a lot of division among the negotiating nations with important disagreements on key aspects of the text. Without Fast Track to guarantee passage of the TPP, these nations will be even less likely to agree to demands by the U.S. Further, Asian countries are negotiating their own competing agreement, which does not include the United States but, unlike the TPP, does include China.
Latin American countries are also speaking out against the TPP. Earlier this year, Rodrigo Contreras, Chile’s lead TPP negotiator quit to warn people of the dangers of the TPP – highlighting how big financial institutions will dominate their governments and how the TPP “will become a threat for our countries: It will restrict our development options in health and education, in biological and cultural diversity, and in the design of public policies and the transformation of our economies. It will also generate pressures from increasingly active social movements, who are not willing to grant a pass to governments that accept an outcome of the TPP negotiations that limits possibilities to increase the prosperity and well-being of our countries.” And, recently the Parliament of Peru passed a resolution “requesting that the government open a ‘public, political, and technical debate’ on the binding rules being negotiated in the TPP.”
In the United States, cities and counties are beginning to pass TPP Free Zones, saying they will not obey the TPP if it becomes law. These local governments are concerned with provisions that would not allow them to give preference to buying local, buying U.S. made goods or other provisions that undermine their sovereignty.
In addition to opposition in the U.S. government and foreign governments, a mass citizen uprising is developing against the TPP. There have been large protests in many of the countries involved in the negotiations as well as in the United States. The night before the Wikileaks documents were released, 13 cities did visibility protests opposing the TPP in light shows. In September we joined with activists in Washington, DC in a series of protests, including covering the office building of the US Trade Representative in banners to expose their secret trade agreement. Protests are scheduled for Salt Lake City, UT on November 19th where lead negotiators from 12 countries will hold meetings. A global day of protest is planned for December 3 against not only the TPP but also the WTO and all toxic trade agreements.
The TPP is running into resistance in Congress, local governments and among Pacific nations in Asia and Latin America; and by people who oppose the agreement all over the world. This is part of a growing movement of movements – all of the movements impacted by corporate trade; e.g. labor, environmental, Internet freedom, health care, food sovereignty, immigrants’ rights, banking regulation – are joining together to defeat it.
The people are winning. Fourteen trade agreements have been stopped in the last 14 years and as Tom Donohue of the US Chamber of Commerce wrote this week “the WTO has not concluded a single new multilateral trade agreement since it was created in 1995.” Mass protest against rigged corporate trade agreements can end the experiment in trade that puts profits ahead of the people and planet.
We are on the verge of defeating Fast Track. It is important that we keep the pressure on Congress. Neither the TPP nor TAFTA will become law if people learn what is in them and Congress fulfills its constitutional responsibility to review their impact. Denying the President Fast Track is the essential step to defeat both of these agreements.
Once we defeat Fast Track and prevent TPP and TAFTA from becoming law, we need to remain in solidarity and work to transform trade so it becomes “fair” trade that puts the necessities of the people and the protection of the planet first. The people will have firmly established that they will not tolerate rigged corporate trade deals. If corporations want to see trade between nations, they need a new approach – transparent, participatory and fair – with new goals of serving the people and planet.
To get involved in the campaign to stop the Trans-Pacific Partnership visit Flush the TPP.
Kevin Zeese, JD and Margaret Flowers, MD co-host Clearing the FOG on We Act Radio 1480 AM Washington, DC, co-direct Its Our Economy and are organizers of the Occupation of Washington, DC.Their twitters are @KBZeese and MFlowers8.
According to the president of the United States, “we’re all created equal and every single American deserves to be treated equally in the eyes of the law.”
Of course, Barack Obama, like other US politicians, does not actually believe we, the people of Earth, are all created equal. That’s clear enough from his exclusion of non-Americans when he describes who “deserves” equal treatment before the law. As a conservative nationalist, Obama believes some nationalities are more entitled to legal protections than others. Born in America, he might deign to give you a trial; born in Pakistan, he won’t even bother identifying the remains left in the wake of a Predator drone.
But Obama wasn’t talking about state-sanctioned murder. Instead, in a blog for the Huffington Post, he was condemning the continued, legal discrimination on the part of employers against LGBT employees.
“It’s offensive,” an Obama staffer presumably wrote. “It’s wrong. And it needs to stop because, in the United States of America, who you are and who you love should never be a fire-able offense.”
This is a great bit of rhetoric that’s ready to be slapped on a photo of a happy gay couple and shared 83,000 times on Facebook. It’s also incredibly disingenuous.
Barack Obama, right now, without needing to convince any bad mean stupid Republicans in Congress, could sign an executive order banning federal contractors from engaging in discrimination based on perceived sexual orientation. He could have done that yesterday. He doesn’t need legislation: he could have ended that discrimination instead of blogging, instantly providing greater job security to the tens of thousands of people working right now for the private contractors who effectively provide government services any more.
But he didn’t because Obama and the Democratic Party run a neat little scam, whereby they set themselves up as 0.05 percent more progressive than the GOP — for which they expect accolades and tribute — and then rely on the public’s ignorance of process to explain away why they’re not actually doing anything to make things even 0.05 percent better. In this case, John Boehner and his gang of angry white homophobes in the House get blamed for setting back Progress; discrimination against LGBT people continues; and the Democratic Congressional Campaign Committee then sends out a mailer with that happy gay couple meme on it asking if you will please donate to help defeat the forces of darkness.
And then they laugh and they laugh and they laugh.
I was unaware that Sarah Palin was still a meme, but the Democratic Party is apparently still using her to raise money and build their email lists. Apparently, because who cares enough to look it up, the former Alaska governor said the US government is “stockpiling bullets” to use against the public. And so a petition has been launched by the Democratic Governors Association to demand an apology because that is important:
Accusing our government of actively stockpiling weapons to use against its own people is not only offensive and wrong — it’s downright dangerous. For Sarah Palin to insinuate that the United States is similar to the tyrannical governments in Syria and Iran who do carry out those types of atrocities is completely reprehensible.
Good on the governors for looping Iran into the mix, rather than a Bahrain or Saudi Arabia. President Hillary may have to bomb them someday, so it’s important to lay the groundwork now. Sarah Palin and Iran: Bad. Got it.
Of course, the unfortunate thing is that the US government is “actively stockpiling weapons to use against its own people” (no one cares about it using them against other people). You don’t end up with 2.3 million Americans in prison cells by asking them nicely. You force them in at the point of a gun. The FBI alone gets over $8 billion a year to do this. Federal prisons get over $8 billion to keep them there.
Is that the same as the sort of political repression that goes on in Syria or Iran? No, it’s different. The people getting shot in the streets by security forces are usually Black or Latino. And no one has anywhere near the size prison population that America does.
It was an impassioned performance by a cynical politician who offers little but corporate tax incentives and continued austerity. Barack Obama peppered his State of the Union address with up-tempo buzzwords about illusory “progress,” but the president’s substantive message was that he is determined to complete the austerity bargain he struck with the Republicans in 2011. Thus, it is a sign of “progress” that “we are more than halfway towards the goal of $4 trillion in deficit reduction that economists say we need to stabilize our finances” – meaning, he will collaborate with the GOP in cutting almost $2 trillion more.
The big cuts will come from those programs that enjoy overwhelming support among Americans. He claims to be with them in spirit while opposing them in practice. “Those of us who care deeply about programs like Medicare must embrace the need for modest reforms – otherwise, our retirement programs will crowd out the investments we need for our children, and jeopardize the promise of a secure retirement for future generations.” His reasoning is identical to the Republicans, who say these programs must be bled, or die.
Obama created the model to gut entitlements through his Simpson/Bowles Deficit Reduction Commission, appointed well before the GOP took control of the House. Now he pretends that the cuts have been forced upon him, but that he will acquiesce in the spirit of compromise. “On Medicare, I’m prepared to enact reforms that will achieve the same amount of health care savings by the beginning of the next decade as the reforms proposed by the bipartisan Simpson-Bowles commission.”
He constructs a phony trade-off for children, the poor and the elderly. “Why would we choose to make deeper cuts to education and Medicare just to protect special interest tax breaks? How is that fair?” he asks, rhetorically. The cuts must come, but in return Obama will revise the tax code “that lowers incentives to move jobs overseas, and lowers tax rates for businesses and manufacturers that create jobs right here in America.”
This is the double-whammy. Austerity in people’s programs is traded for tax breaks for corporations that will, in totally discredited theory, bring back the jobs they had outsourced overseas.But don’t complain, says Obama. “None of us will get 100 percent of what we want.” And most of us will get the shaft.
Obama’s jobs program is almost entirely a corporate tax incentive scheme, to bribe corporations to send home the jobs they sent offshore, where they have also hidden tens of trillions from taxation – a subject not deemed worthy of mention in a national discussion of shared sacrifice and patriotic obligations.
The military-industrial complex will make “America a magnet for new jobs and manufacturing,”says the president. Fifteen manufacturing “hubs” will be built around businesses that “partner with the Departments of Defense and Energy to turn regions left behind by globalization into global centers of high-tech jobs.” You can bet there are huge corporate subsidies involved, through negative taxation.
Obama will repair America’s infrastructure through a “Fix-It-First” program that nobody has ever heard of before, and has no price tag – which means it doesn’t exist in anything more than rhetorical form. And his “Partnership to Rebuild America” proposal to upgrade private infrastructure – oil and gas pipelines, ports and the power grid – almost certainly involves corporate subsidies, or else why wouldn’t the private sector be repairing its own properties, already?
Those business incentives just keep on coming. All one need to qualify is say the word “jobs” – but don’t you dare say “public works.” The Corporate-Subsidizer-In-Chief says: “Let’s offer incentives to companies that hire Americans who’ve got what it takes to fill that job opening, but have been out of work so long that no one will give them a chance. Let’s put people back to work rebuilding vacant homes in run-down neighborhoods.” Obama says he will “partner with 20 of the hardest-hit towns in America to get these communities back on their feet.” How will that get done? By offering “new tax credits to businesses that hire and invest.” Obama can do a passable Al Green, but when it comes to public policy in 2013, he sings only one song: tax schemes for business.And he stole that tune from the GOP.
Obama’s Black boosters will no doubt point to the president’s concern for the “hardest hit” to conclude that he is now open to targeted aid to the those communities that have been most devastated. Not so. He is simply open to aiding corporations under any and all circumstances. His administration failed to spend almost all of $7.6 billion set aside by Congress for a Hardest Hit Fund, to aid communities hurt worst by the housing collapse. Hard-hit people don’t get special attention from this administration; well-off corporations do.
During his 2008 campaign, Obama vowed to raise the minimum wage to $9.50 an hour by 2011. He must have thought no one was listening, because he didn’t mention the subject for the next four years. Now, in 2013, he promises to fight for a $9.00 minimum – 50 cents an hour less. And he didn’t even apologize to the nation, Tuesday night, for reneging during his first term.
“Race to the Top,” Obama’s signature program to privatize education through withholding of funds to states that fail to establish an alternative charter system and transform teachers into temporary workers, is set for a great corporate leap forward. States that craft their curriculum to suit corporate priorities will get additional funding; those that do not, will be punished. “We’ll reward schools that develop new partnerships with colleges and employers, and create classes that focus on science, technology, engineering, and math – the skills today’s employers are looking for to fill jobs right now and in the future.” Obama is an education gangster, hired muscle for the corporate class.
It is fitting that Obama, who has made it possible for all of us to experience the First Black U.S. Presidency, will enhance the experience of choosing between corporate Democrats and corporate Republicans: “I’m announcing a non-partisan commission to improve the voting experience in America. And I’m asking two long-time experts in the field, who’ve recently served as the top attorneys for my campaign and for Governor Romney’s campaign, to lead it.”
We discovered during the presidential debates that there was very little that separated the two contenders. The Republican and Democratic experts should have no problem finding a mutual electoral comfort zone.
Glen Ford can be contacted at Glen.Ford@BlackAgendaReport.com.
- Obama’s Historic Assault on Social Security (alethonews.wordpress.com)