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Under NAFTA, Diabetes Became Leading Cause of Death in Mexico

teleSUR | April 8, 2017

Diabetes has become the leading cause of death in Mexico, according to a new study released by the World Health Organization, WHO.

The United Nations agency claims diabetes rates in the Latin American country began surging just over two decades ago, around the time the North American Free Trade Agreement, NAFTA, came into force.

An estimated 80,000 people die each year in Mexico from diabetes, WHO also reports, adding that nearly 14 percent of adults there suffer from the disease.

“Diabetes is one of the biggest problems in the health system in Mexico,” Dr. Carlos Aguilar Salinas told NPR during a recent interview.

“It’s the first cause of death. It’s the first cause of disability. It’s the main cost for the health system.”

Why has diabetes become such an issue in Mexico after NAFTA? The answer is simple: cheap imported junk food.

Since its 1994 inception, NAFTA has allowed U.S. and Canadian restaurants and processed food manufacturers to sell products at rates much lower than their Mexican counterparts. This creates a situation where fastfood chains like McDonald’s and processed food brands like Nabisco are able to dominate the country’s market, given that their products are more financially accessible.

And in a country with rising poverty, inequality and food insecurity, cheap imported junk food is often the only nutritional option.

In 2015, WHO reported that Mexico is the leading consumer of junk food in Latin America — the average person there consumes 450 pounds of ultra-processed foods and sugary beverages each year.

The organization also reported that until recently, Mexico was the largest per capita consumer of soda in the world, with the average person drinking 36 gallons each year. The U.S., Argentina and Chile are now the leading consumers of soda.

“Diabetes used to be a disease of the rich,” WHO’s Mexico chief Dr. Gerry Eijkemans also told NPR during a recent interview.

“In Western Europe and the U.S., it was really the people who had the money who were obese, and now it’s actually the opposite.”

Nearly 60 percent of Latin Americans are overweight, according to a UN report.

April 10, 2017 Posted by | Economics, Timeless or most popular | , , , | 2 Comments

President Trump: Nationalist Capitalism, An Alternative to Globalization

By James Petras :: 01.27.2017

Introduction: During his inaugural speech, President Trump clearly and forcefully outlined the strategic political-economic policies he will pursue over the next four years. Anti-Trump journalist, editorialists, academics and experts, who appear in the Financial Times, New York Times, Washington Post and the Wall Street Journal have repeatedly distorted and lied about the President’s program as well as his critique of existing and past policies.

We will begin by seriously discussing President Trump’s critique of the contemporary political economy and proceed to elaborate on his alternatives and its weaknesses.

President Trump’s Critique of the Ruling Class

The centerpiece of Trump’s critique of the current ruling elite is the negative impact of its form of globalization on US production, trade and fiscal imbalances and on the labor market. Trump cites the fact that US industrial capitalism has drastically shifted the locus of its investments, innovations and profits overseas as an example of globalization’s negative effects. For two decades many politicians and pundits have bemoaned the loss of well-paid jobs and stable local industries as part of their campaign rhetoric or in public meetings, but none have taken any effective action against these most harmful aspects of globalization. Trump denounced them as “all talk and no action” while promising to end the empty speeches and implement major changes.

President Trump targeted importers who bring in cheap products from overseas manufacturers for the American market undermining US producers and workers. His economic strategy of prioritizing US industries is an implicit critique of the shift from productive capital to financial and speculative capital under the previous four administrations. His inaugural address attacking the elites who abandon the ‘rust belt’ for Wall Street is matched by his promise to the working class: “Hear these words! You will never be ignored again.” Trump’s own words portray the ruling class ‘as pigs at the trough’ (Financial Times, 1/23/2017, p. 11)

Trump’s Political-Economic Critique

President Trump emphasizes market negotiations with overseas partners and adversaries. He has repeatedly criticized the mass media and politicians’ mindless promotion of free markets and aggressive militarism as undermining the nation’s capacity to negotiate profitable deals.

President Trump’s immigration policy is closely related to his strategic ‘America First’ labor policy. Massive inflows of immigrant labor have been used to undermine US workers’ wages, labor rights and stable employment. This was first documented in the meat packing industry, followed by textile, poultry and construction industries. Trump’s proposal is to limit immigration to allow US workers to shift the balance of power between capital and labor and strengthen the power of organized labor to negotiate wages, conditions and benefits. Trump’s critique of mass immigration is based on the fact that skilled American workers have been available for employment in the same sectors if wages were raised and work conditions were improved to permit dignified, stable living standards for their families.

President Trump’s Political Critique

Trump points to trade agreements, which have led to huge deficits, and concludes that US negotiators have been failures. He argues that previous US presidents have signed multi-lateral agreements, to secure military alliances and bases, at the expense of negotiating job-creating economic pacts. His presidency promises to change the equation: He wants to tear up or renegotiate unfavorable economic treaties while reducing US overseas military commitments and demands NATO allies shoulder more of their own defense budgets. Immediately upon taking office Trump canceled the Trans-Pacific Partnership (TPP) and convoked a meeting with Canada and Mexico to renegotiate NAFTA.

Trump’s agenda has featured plans for hundred-billion dollar infrastructure projects, including building controversial oil and gas pipelines from Canada to the US Gulf. It is clear that these pipelines violate existing treaties with indigenous people and threaten ecological mayhem. However, by prioritizing the use of American-made construction material and insisting on hiring only US workers, his controversial policies will form the basis for developing well-paid American jobs.

The emphasis on investment and jobs in the US is a complete break with the previous Administration, where President Obama focused on waging multiple wars in the Middle East, increasing public debt and the trade deficit.

Trump’s inaugural address issued a stern promise: “The American carnage stops right now and stops right here!” This resonated with a huge sector of the working class and was spoken before an assemblage of the very architects of four decades of job-destroying globalization. ‘Carnage’ carried a double meaning: Widespread carnage resulted from Obama and other administrations’ destruction of domestic jobs resulting in decay and bankruptcy of rural, small town and urban communities. This domestic carnage was the other side of the coin of their policies of conducting endless overseas wars spreading carnage to three continents. The last fifteen years of political leadership spread domestic carnage by allowing the epidemic of drug addiction (mostly related to uncontrolled synthetic opiate prescriptions) to kill hundreds of thousands of mostly young American’s and destroy the lives of millions. Trump promised to finally address this ‘carnage’ of wasted lives. Unfortunately, he did not hold ‘Big Pharma’ and the medical community responsible for its role in spreading drug addiction into the deepest corners of the economically devastated rural America. Trump criticized previous elected officials for authorizing huge military subsidies to ‘allies’ while making it clear that his critique did not include US military procurement policies and would not contradict his promise to ‘reinforce old alliances’ (NATO).

Truth and Lies: Garbage Journalists and Arm Chair Militarists

Among the most outrageous example of the mass media’s hysteria about Trump’s New Economy is the systematic and vitriolic series of fabrications designed to obscure the grim national reality that Trump has promised to address. We will discuss and compare the accounts published by ‘garbage journalists (GJ’s)’ and present a more accurate version of the situation.

The respectable garbage journalists of the Financial Times claim that Trump wants to ‘destroy world trade’. In fact, Trumps has repeatedly stated his intention to increase international trade. What Trump proposes is to increase US world trade from the inside, rather than from overseas. He seeks to re-negotiate the terms of multilateral and bilateral trade agreements to secure greater reciprocity with trading partners. Under Obama, the US was more aggressive in imposing trade tariffs that any other country in the OECD.

Garbage journalists label Trump as a ‘protectionist’, confusing his policies to re-industrialize the economy with autarky. Trump will promote exports and imports, retain an open economy, while increasing the role of the US as a producer and exporter. The US will become more selective in its imports. Trump will favor the growth of manufacturing exporters and increase imports of primary commodities and advanced technology while reducing the import of automobiles, steel and household consumer products.

Trump’s opposition to ‘globalization’ has been conflated by the garbage journalists of the Washington Post as a dire threat to the ‘the post-Second World War economic order’. In fact, vast changes have already rendered the old order obsolete and attempts to retain it have led to crises, wars and more decay. Trump has recognized the obsolete nature of the old economic order and stated that change is necessary.

The Obsolete Old Order and the Dubious New Economy

At the end of the Second World War, most of Western Europe and Japan resorted to highly restrictive ‘protectionist’ industrial and monetary policies to rebuild their economies. Only after a period of prolonged recovery did Germany and Japan carefully and selectively liberalize their economic policies.

In recent decades, Russia was drastically transformed from a powerful collectivist economy to a capitalist vassal-gangster oligarchy and more recently to a reconstituted mixed economy and strong central state. China has been transformed from a collectivist economy, isolated from world trade, into the world’s second most powerful economy, displacing the US as Asia and Latin America’s largest trading partner.

Once controlling 50% of world trade, the US share is now less than 20%. This decline is partly due to the dismantling of its industrial economy when its manufacturers moved their factories abroad.

Despite the transformation of the world order, recent US presidents have failed to recognize the need to re-organize the American political economy. Instead of recognizing, adapting and accepting shifts in power and market relations, they sought to intensify previous patterns of dominance through war, military intervention and bloody destructive ‘regime changes’ – thus devastating, rather than creating markets for US goods. Instead of recognizing China’s immense economic power and seeking to re-negotiate trade and co-operative agreements, they have stupidly excluded China from regional and international trade pacts, to the extent of crudely bullying their junior Asian trade partners, and launching a policy of military encirclement and provocation in the South China Seas. While Trump recognized these changes and the need to renegotiate economic ties, his cabinet appointees seek to extend Obama’s militarist policies of confrontation.

Under the previous administrations, Washington ignored Russia’s resurrection, recovery and growth as a regional and world power. When reality finally took root, previous US administrations increased their meddling among the Soviet Union’s former allies and set up military bases and war exercises on Russia’s borders. Instead of deepening trade and investment with Russia, Washington spent billions on sanctions and military spending – especially fomenting the violent putchist regime in Ukraine. Obama’s policies promoting the violent seizure of power in Ukraine, Syria and Libya were motivated by his desire to overthrow governments friendly to Russia – devastating those countries and ultimately strengthening Russia’s will to consolidate and defend its borders and to form new strategic alliances.

Early in his campaign, Trump recognized the new world realities and proposed to change the substance, symbols, rhetoric and relations with adversaries and allies – adding up to a New Economy.

First and foremost, Trump looked at the disastrous wars in the Middle East and recognized the limits of US military power: The US could not engage in multiple, open-ended wars of conquest and occupation in the Middle East, North Africa and Asia without paying major domestic costs.

Secondly, Trump recognized that Russia was not a strategic military threat to the United States. Furthermore, the Russian government under Vladimir Putin was willing to cooperate with the US to defeat a mutual enemy – ISIS and its terrorist networks. Russia was also keen to re-open its markets to the US investors, who were also anxious to return after years of the Obama-Clinton-Kerry imposed sanctions. Trump, the realist, proposes to end sanctions and restore favorable market relations.

Thirdly, it is clear to Trump that the US wars in the Middle East imposed enormous costs with minimal benefits for the US economy. He wants to increase market relations with the regional economic and military powers, like Turkey, Israel and the Gulf monarchies. Trump is not interested in Palestine, Yemen, Syria or the Kurds – which do not offer much investment and trade opportunities. He ignores the enormous regional economic and military power of Iran. Nevertheless Trump has proposed to re-negotiate the recent six-nation agreement with Iran in order to improve the US side of the bargain. His hostile campaign rhetoric against Tehran may have been designed to placate Israel and its powerful domestic ‘Israel-Firsters’ fifth column. This certainly came into conflict with his ‘America First’ pronouncements. It remains to be seen whether Donald Trump will retain a ’show’ of submission to the Zionist project of an expansionist Israel while proceeding to include Iran as a part of his regional market agenda.

The Garbage Journalists claim that Trump has adopted a new bellicose stance toward China and threatens to launch a ‘protectionist agenda’, which will ultimately push the trans-Pacific countries closer to Beijing. On the contrary, Trump appears intent on renegotiating and increasing trade via bilateral agreements.

Trump will most probably maintain, but not expand, Obama’s military encirclement of China’s maritime boundaries which threaten its vital shipping routes. Nevertheless, unlike Obama, Trump will re-negotiate economic and trade relations with Beijing – viewing China as a major economic power and not a developing nation intent on protecting its ‘infant industries’. Trump’s realism reflects the new economic order: China is a mature, highly competitive, world economic power, which has been out-competing the US, in part by retaining its own state subsidies and incentives from its earlier economic phase. This has led to significant imbalances. Trump, the realist, recognizes that China offers great opportunities for trade and investment if the US can secure reciprocal agreements, which lead to a more favorable balance of trade.

Trump does not want to launch a ‘trade war’ with China, but he needs to restore the US as a major ‘exporter’ nation in order to implement his domestic economic agenda. The negotiations with the Chinese will be very difficult because the US importer-elite are against the Trump agenda and side with the Beijing’s formidable export-oriented ruling class.

Moreover, because Wall Street’s banking elite is pleading with Beijing to enter China’s financial markets, the financial sector is an unwilling and unstable ally to Trump’s pro-industrial policies.

Conclusion

Trump is not a ‘protectionist’, nor is he opposed to ‘free-trade’. These charges by the garbage journalists are baseless. Trump does not oppose US economic imperialist policies abroad. However, Trump is a market realist who recognizes that military conquest is costly and, in the contemporary world context, a losing economic proposition for the US. He recognizes that the US must turn from a predominant finance and import economy to a manufacturing and export economy.

Trump views Russia as a potential economic partner and military ally in ending the wars in Syria, Iraq, Afghanistan and Ukraine, and especially in defeating the terrorist threat of ISIS. He sees China as a powerful economic competitor, which has been taking advantage of outmoded trade privileges and wants to re-negotiate trade pacts in line with the current balance of economic power.

Trump is a capitalist-nationalist, a market-imperialist and political realist, who is willing to trample on women’s rights, climate change legislation, indigenous treaties and immigrant rights. His cabinet appointments and his Republican colleagues in Congress are motivated by a militarist ideology closer to the Obama-Clinton doctrine than to Trumps new ‘America First’ agenda. He has surrounded his Cabinet with military imperialists, territorial expansionists and delusional fanatics.

Who will win out in the short or long term remains to be seen. What is clear is that the liberals, Democratic Party hacks and advocates of Little Mussolini black shirted street thugs will be on the side of the imperialists and will find plenty of allies among and around the Trump regime.

January 28, 2017 Posted by | Economics, Militarism, Timeless or most popular | , , , , , | 3 Comments

The Day Vladimir Putin Passed NAFTA

By Rob Urie | CounterPunch | November 4, 2016

The U.S. is entering a dangerous political phase where a distant and cloistered political class threatens the use of state power to legitimize itself in the face of declining popular support and serial military calamities of its own making. In 2001 the George W. Bush administration used the opaque and as yet not fully explained events of 9/11 to claim legitimacy as faux protector of the American people as it launched catastrophic wars that destroyed Iraq and Afghanistan and unleashed ongoing chaos across the Middle East.

With uber-hawk and unindicted co-conspirator Hillary Clinton favored to win election under a cloud of suspicion for pay-to-play practices as Secretary of State and in widely declining economic circumstances an imperative to change the subject will assert itself the day after election day. Having demonstrated a propensity for wanton slaughter in Bosnia, Iraq, Afghanistan, Yemen, Libya and the streets of major American cities (1994 ‘Crime’ bill), Mrs. Clinton is already busy stoking a new Cold War with Russia to cover her own activities.

The neo-con choice of Russia as menace-of-opportunity joins a long history of defining American politics through negation. In the original (‘classic?’) Cold War national identity served as an envelop-of-convenience for conciliatory economic policies within the U.S. and repressive and opportunistic policies abroad. Since the 1970s selective (class based) economic liberalization has cut labor and the poor adrift as a self-serving ruling class has gorged itself at the public trough through bailouts, privatizations and special privileges.

The Cold War was always largely a business enterprise— the communist boogeyman was used by the U.S. to overthrow democratically elected governments and install business-friendly regimes that would answer to U.S. (corporate) interests. Its resurrection is to reassert a national ‘envelop’ as cover for economic interests now ‘freed’ to treat a growing portion of the domestic population as imperial subjects. Growing resistance suggests a need for more convincing misdirection if the status quo is to be maintained.

Ongoing neo-con claims that Russia invaded Ukraine are to cover the U.S. role in facilitating a coup against the popularly elected government there and depend on American ignorance of the longstanding Russian naval base at Sevastopol for plausibility. Furthermore, against explicit promises not to do so, since the early 1990s the U.S. (through NATO) has built military bases in Eastern Europe surrounding Russia. This as the U.S. embarks on a multi-decade program to ‘upgrade’ its nuclear weapons arsenal.

Surrounding Russia with NATO (U.S.) military bases is generally analogous to the Russians building military bases on the Mexican and Canadian borders with the U.S., only without the historical precedent of sequential, devastating land invasions that the Russians have faced. What cloistered neo-cons in the U.S., led by Hillary Clinton, call military ‘strength’ is a perpetual upping of the ante where each step is ‘rational’ in some political-economistic sense while the broader enterprise risks collective suicide.

As strategy, doing so leaves either capitulation or full scale confrontation as likely responses. A ‘third-way’ was tried when American economists were sent to post-Soviet Russia in the 1990s to ‘help’ with privatization of the Russian economy. The result was a bifurcated economy where 99% of Russians were deeply immiserated while select ‘oligarchs,’ were made stupendously rich. Luckily for the economists, enough Russians died from privation during their ‘experiment’ to leave few witnesses to the fiasco.

For cynical Americans raised on Cold War propaganda, the idea of Western academics scamming gullible Russians with long-discredited capitalist ideology might be good for a laugh were these same people not the ‘brain trust’ behind the bi-partisan governing consensus in the U.S. in 2016. The economics used to loot Russia were absolutely conventional, the very same used by Bill Clinton to ‘liberate’ Wall Street from social accountability, to liberate the American working class from gainful employment and to ‘free’ the American poor from burdensome food and rent money.

The Russian reaction to being immiserated was to turn away from the American-style economic liberalization that remains the Democrats’ core economic program in the U.S. The seeming inability of the American political class to learn from its mistakes proceeds from the assumption that current outcomes are mistakes in any sense recognizable to it. Highly cloistered class divisions leave it impervious to the negative consequences of its economic policies much as it is to those of its foreign policies.

Following passage of NAFTA economic competition was used to explain the engineered immiseration of the American working class. But without commensurability of circumstances the idea of a global labor market makes little sense. The implausibility of displaced auto workers in Detroit packing up their families and possessions to live for $10 per day in southeastern China illustrates the conundrum. ‘Capital,’ connected capitalists with extensive social resources, can build factories abroad. But without a standing army to repatriate profits, that scheme has never worked very well.

Conversely, with the racial repression that followed the nominal end of slavery in the U.S., at what point did American Blacks receive the market wage that no longer suppressed wages more broadly? Notice the formulation: Blacks whose wages were held down through systematic racial repression (Black codes, convict leasing, Jim Crow and now mass incarceration) acted in a ‘market’ sense to lower the wages of wage-dependent Whites. This is the ‘market’ explanation of race relations in a market economy when the (liberal) premise of market-driven outcomes is applied.

It is this latter point— that rigged economic institutions produce rigged outcomes, that liberal Democrats try to explain away with identity politics. NAFTA, like the TPP that follows, is designed to shift economic power from labor to capital. It is also designed to exploit residual imperial relations to divide labor along engineered lines of division. In the U.S. the state created and enforced racial repression to serve economic interests. This is the residual of imperial relations that to which NAFTA was added.

By siding with existing economic power Western liberals chose the paradox that by destroying the institutions that make markets ‘free’ like labor unions and collective bargaining (see Adam Smith on manufacturer combines suppressing wages) economic outcomes can still be claimed to be ‘market’ based. In a general sense in the case of Russia, the Russian people wanted none of it once it became clear that American intentions were collaborative looting of the Russian economy.

Americans have a longer history of market mythology to wade through. If slaves produce goods that have economic value then demand for wage labor is reduced relative to the goods produced and the difference accrues to capitalists. If NAFTA ‘frees’ capitalists to produce goods in Mexico or China under neo-colonial conditions (see Foxxcon suicide nets) a similar process takes place. This sleight-of-hand works by tautologically defining all labor, including slave labor, as freely undertaken.

It is hardly accidental that Barack Obama, and soon most probably Hillary Clinton, frame corporate-power enhancing agreements like the TPP in terms of geopolitical competition. Much as Democrats use Republicans (and vice-versa) as foils, the U.S. powers-that-be need a Russian ‘strongman’ and Chinese economic ‘connivance’ to sell trade deals and foreign entanglements to an already hard-pressed American working class. Here the relation of economic interests to geopolitics re-enters.

Like her husband before her, Hillary Clinton has committed to the economically paradoxical position of increasing social spending and balancing the Federal budget. Bill Clinton addressed this paradox by reneging on his promise to increase social spending. In terms of factual possibility, balancing the budget has always been a canard used by Republicans (and national Democrats) to cut social spending. There is no fact-based reason why a balanced budget is either necessary or virtuous.

The political-economic position that this leaves Mrs. Clinton in is that her major benefactors on Wall Street and in executive suites want policies that weaken the position of labor and immiserate the bottom 90% or so of the population. And the pressure relief value of increased social spending will be ‘off-the-table’ much like it has been under Barack Obama and Bill Clinton so as to balance the budget. Even if neo-Keynesian pleaders get through to her the response will be ‘public-private partnerships,’ privatization and tax cuts that benefit the wealthy.

The political problem for the establishment is that the polity is in various stages of open revolt. In the long-held American tradition of dividing to conquer, Mrs. Clinton has drawn battle lines in a class war by dismissing the most economically put-upon half of the polity as ‘deplorables,’ as racist hicks who lack the vocabularies and table manners to properly earn their keep. That these same people had jobs until the Clintons sent them to Mexico and earned their keep until Wall Street cut their pay to nothing helps clarify precisely who it is that is deplorable.

Russia re-enters as the mythical boogeyman, a/k/a convenient foil, for the remote and calcified ruling class to pin its own misdeeds on. Julian Assange has now clarified that, Clinton ‘team’ assertions to the contrary, Russia is not the source of the Wikileaks revelations that will serve as fodder for ongoing investigations if Mrs. Clinton wins election. A crisis of legitimacy is all but guaranteed. If ‘things’ begin to unwind as circumstances suggest they might, expect the war drums to beat louder.

Rob Urie is an artist and political economist. His book Zen Economics is published by CounterPunch Books.

November 5, 2016 Posted by | Economics, Militarism, Timeless or most popular | , , | Leave a comment

Negroponte’s Crimes

By Branko Marcetic | Jacobin | August 16, 2016

Among the right-wingers that have jumped the Republican ship and thrown their support behind Hillary Clinton in the last few months, you’ll find neoconservatives and warmongers who have vocally supported just about every heinous US foreign policy venture under the sun, from the Iraq War to Libya to torture. But though their cheerleading may have been valuable in the push for these actions, few can claim direct responsibility in the making of these disasters.

Not so for John Negroponte, the former career diplomat who served under four Republican presidents and one Democrat and whose support for Clinton was announced last week.

The endorsements of Clinton by right-wing hall-of-famers like Negroponte have not come about entirely out of nowhere. It’s true that many elements of Clinton’s foreign policy appeal to the interventionist and neocon wing of the Republican Party.

Nonetheless, as Politico reported last week, the Clinton campaign has been actively courting leading lights of the GOP, culminating in last week’s launch of “Together for America,” a site touting the growing list of high-profile Republicans and independents backing Clinton.

This is a curious development, given that in the very first Democratic debate of 2015, Clinton proclaimed that the enemies she was most proud of making throughout her career were “the Republicans,” a line that drew both raucous cheers from the crowd and a broad smile from the candidate herself.

Given her stated animosity toward Republicans, seeking out the support of someone like Negroponte presumably must be very valuable for Clinton. But who exactly is Negroponte, and why has Clinton prized the endorsement of someone like him?

Reagan’s Man in Tegucigalpa

The son of a Greek shipping magnate, Negroponte cut his diplomatic teeth in Vietnam, where he served under future Clinton mentor and war criminal Henry Kissinger (another luminary whom Clinton’s campaign is now reportedly wooing for an endorsement) during the Paris peace talks.

While Kissinger helped Nixon to win in 1968 by secretly scuttling peace negotiations with North Vietnam, once in power, both wanted eventually to get the United States out of the war, mostly out of concern for how a continuing quagmire would hurt Nixon politically. Negroponte challenged him about a concession in the peace agreement that allowed the North Vietnamese to station troops in the South after US withdrawal.

“Do you want us to stay there forever?” Kissinger asked the young Negroponte. The United States’ years of bloodletting in Vietnam, Cambodia, and Laos apparently wasn’t enough for Negroponte.

Negroponte worked for several years in a number of less prominent diplomatic positions, owing, at least in one observer’s view, to being “exiled” by Kissinger because of his break with the secretary of state over Vietnam.

Ronald Reagan’s election in 1980 gave Negroponte his big break.

Under Reagan, Latin American politics took a hard right turn, which his administration enabled by sending aid, arms, and, in the case of Grenada, troops to assist right-wing governments and forces — nearly all of which aided in scores of human rights atrocities.

In 1981, Reagan made Negroponte the US ambassador to Honduras. Negroponte had held earlier posts in Greece and Ecuador; Honduras was the big leagues.

In 1980, neighboring El Salvador had plunged into civil war between leftist guerillas and a quasi-fascist, US-backed military government and its right-wing paramilitary forces that included death squads. A year earlier, its other neighbor, Nicaragua, had seen its US-backed dictator deposed and replaced by the socialist Sandinista government.

The Sandinistas were opposed by a coalition of brutally violent counterrevolutionaries that included former members of the National Guard, ex-soldiers, Conservative Party members, and disgruntled peasants and farmers. They were known as the Contras, later of Iran-Contra fame.

In both countries, the Reagan administration threw in with the right-wing torturers and murderers.

The action was principally in Nicaragua and El Salvador, but Negroponte had not been relegated to some insignificant backwater. Honduras was central to the Reagan administration’s efforts to halt the spread of leftist rule in Central America, serving as the home base for its covert war against the Left in the region. Honduras had one of the largest US embassies in Latin America, hosted thousands of American troops, and eventually housed the biggest CIA station in the entire world.

Although Honduras had a civilian government — its first in more than a century — the military remained powerful, and General Gustavo Alvarez, the chief of the armed forces, held considerable sway. Under Alvarez, Honduras became the training ground and headquarters for the Contras and other right-wing forces, who were then sent to wreak havoc in Nicaragua and El Salvador.

It was also where budding members of Honduran death squads received their schooling, including the notorious Battalion 3-16, responsible for the disappearance of at least 184 people, mostly leftists, and the torture of many more.

All of this was done with the support of the United States and its man on the ground, Negroponte.

US military aid to Honduras increased from $4 million to $200 million between 1980 and 1985, and the Reagan administration paid top Honduran military brass for their assistance. Repressive forces, including Battalion 3-16, were trained by the CIA and FBI, and the United States provided the money to hire Argentinian counterinsurgency officers — involved in their own US-backed, horrific, decade-long “Dirty War” against leftists — to provide further instruction.

The “coercive techniques” they learned were partly taken from CIA interrogation manuals that advocated using threats of violence and disruption of “patterns of time, space and sensory perception” against prisoners.

With this training in their back pocket, these US-backed Honduran forces proceeded to cut a swath of brutality across the country and its neighbors. Within Honduras, hundreds of people suspected of being subversives were kidnapped, tortured, disappeared, or all three. All of it was known, and quietly approved, by Negroponte.

The torture endured by prisoners covered just about the entire spectrum of depravity, including suffocation, beatings, sleep deprivation, electrocution of the genitals, rape, and the threat of rape toward family members. In one case, military forces used rope to tear off a man’s testicles before killing him.

People were picked up off the street and thrown into unmarked vans. Some victims were completely innocent, such as a union organizer who was befriended and betrayed by a battalion member who knowingly turned him over to security forces under false charges.

Military forces barged into homes, ransacked them, and arrested the occupants if they found Marxist literature. And the Contras, who Ronald Reagan called the “moral equals of our Founding Fathers,” were possibly even worse.

Negroponte played a key role in covering up all of this. As the ambassador, Negroponte’s job was to ensure that the abuses committed by Honduran forces remained unknown to US lawmakers and the general public so they could continue unabated.

Had Congress caught wind of the atrocities, the government would have had to shut off the flow of tens of millions of dollars of military aid to the country, which, under the Foreign Assistance Act, is prohibited to governments engaging in human rights violations. This was the last thing Negroponte and the Reagan administration wanted. They were bent on defeating the leftists, and if that required turning a blind eye to widespread torture, rape, and murder, so be it.

The Reagan administration’s grand strategy was enabled by a steady stream of obfuscation from the Honduran embassy and Negroponte himself.

In one 1983 cable to Thomas Enders, an assistant secretary of state for inter-American affairs, Negroponte chided the State Department for talking openly about the Contra presence in Honduras. “Since when, in open channel messages, do we refer to United States support for Honduran based exiles as Department does in para four reftel?” he wrote.

At the time, the Reagan administration’s support for the Contras was still secret; Negroponte likely did not want references to them to appear in state documents that were subject to open records requests.

In another, this one from 1984, he advised the secretary of state on how Washington agencies could help suppress wider knowledge of the actions of the Contras in Honduras, who had “obviously overdone things” and needed “to lower [their] profile to the absolute minimum.”

Publicly, Negroponte consistently whitewashed this “overdoing.” He wrote to the Economist in 1982 that “it is simply untrue to state that death squads have made their appearance in Honduras.”

A year later, he wrote an article for the Los Angeles Times acknowledging that while there had been “arbitrary arrests” and “some disappearances,” there was “no indication that the infrequent human rights violations that do occur are part of deliberate government policy.”

As late as 2001, he continued to insist on this point, telling the Senate at his confirmation hearing to be Bush’s ambassador to the United Nations: “I have never seen any convincing substantiation that [Battalion 3-16] were involved in death squad-type activities.”

Consequently, the annual human rights reports produced for Congress by the Honduran embassy under Negroponte’s watch were sanitized to the point of parody, as these excerpts from the 1983 edition illustrate: “There are no political prisoners in Honduras”; habeas corpus “appears to be standard practice”; “access to prisoners is generally not a problem for relatives, attorneys, consular officers or international humanitarian organizations”; “sanctity of the home is guaranteed by the Constitution and generally observed.”

Noting the obvious absurdity and transparent lies of the report, one embassy officer joked at the time, “What is this, the human rights report for Norway?”

Suppressing the Evidence

Of course, Negroponte knew very well that conditions in the country were the very opposite of how he portrayed them. It was virtually impossible for him not to.

The Honduran press put out hundreds of stories about military abuses, victims’ families protested in the streets, and both they and Honduran officials pleaded with US officials for intervention — including with Negroponte himself. As soon as Negroponte took over, Jack Binns, his predecessor, personally briefed him on the atrocities he’d learned of — and unlike Negroponte, had made noise about with higher-ups.

The ambassador stayed up to date on the latest barbarities. In 1982, when the embassy press spokesman informed Negroponte that the Honduras military had kidnapped and was busy torturing a prominent journalist and his wife, Negroponte intervened on their behalf — not out of a concern for human rights, but because of the potential damage the US program would suffer if word of the incident got out. The prisoners were released and allowed to leave to the United States on the condition they never spoke about their experience.

The episode was left out of that year’s originally damning embassy report, which high-ranking officials at the embassy cleansed of all references to Honduran abuses.

As a 1997 report by the CIA inspector general made clear, the embassy under Negroponte regularly suppressed inconvenient information about the Honduran military. In 1984–85, several reports “were identified as ‘politically sensitive’ by the Embassy, which requested either their non-publication or restricted dissemination.”

In 1983, read the report, “unspecified individuals at the Embassy did not want information concerning human rights abuses during [a Honduran military operation] to be disseminated because it was viewed as an internal Honduran matter.”

The report outlined how Negroponte personally “was sensitive to political ramifications that might have resulted” from reports on the Olancho Operation, which resulted in the death — possibly an execution — of an American priest. It also documented his concern that “over-emphasis would create an unwarranted human rights problem for Honduras.” It was all part of Negroponte’s aim “to manage the perception of Honduras,” as one officer quoted in the report put it.

In fact, embassy cables that were declassified many years later as part of a Freedom of Information Act request by the Washington Post show that Negroponte did much more than just suppress damaging information. Despite the Sandinistas’ repeatedly stated willingness to enter negotiations with the Contras to reach a settlement, the Honduran ambassador consistently argued against them, calling negotiations a “Trojan horse” that would help consolidate the Sandinista revolution.

The Contadora Process, the peace negotiations initiated by several Latin American states in 1983, would lead to “effectively shutting down our special project,” he warned. Rather than take the Sandinistas up on their offer to end the torture and bloodshed that US-backed forces were responsible for, Negroponte pushed hard to keep them going.

Straying far from the typical duties of an ambassador, Negroponte appeared at times to direct US support of the Contras. In one cable he suggested publicizing US contact with anti-Sandinista forces and stepping up action in Nicaragua’s southern front in order to counter the idea that “all of this is emanating from Honduras.”

In another, he furnished the State Department with detailed information about Sandinista military movements on the Honduran and Nicaraguan border. Speaking with Honduran president Roberto Suazo Córdova in April 1982, Negroponte “urged that strongest possible pre-emptive measure be taken” to prevent revolutionary violence from “taking on unmanageable proportions later on” — a tacit encouragement of the abuses already being committed by the Honduran military.

Negroponte’s enabling of rights violations in the country was exposed thanks to the declassification of secret documents many years after the fact, as well as a fourteen-month-long investigation by the Baltimore Sun in 1995. But what should have been a scandal only boosted Negroponte’s status in Washington.

A Diplomat’s Diplomat

Among his later career highlights, Negroponte was appointed ambassador to Mexico in 1989 by George H. W. Bush, in which position he helped facilitate the passage of the North American Free Trade Agreement (NAFTA). (Unsurprisingly, he’s also a fan of the Trans-Pacific Partnership, or TPP.)

He went on to serve in a number of different posts in the second Bush administration, including as the first ever director of national intelligence and as the first post-Saddam ambassador to Iraq. Despite faint stirrings of criticism about his past, he was easily confirmed to each position.

In establishment circles, he’s simply a “diplomat’s diplomat,” a venerated elder statesman whose hand in terrible human rights abuses is as relevant as his shoe size. As his wife put it in 2004 to the critics still taking him to task for the carnage he licensed in Central America: “Haven’t you moved on?”

Perhaps people have moved on, which is why Clinton now feels it safe to seek out and publicize Negroponte’s praise for her “leadership qualities.”

It’s hard not to see in the publicizing of the endorsement a less-than-subtle hint of what a Clinton administration foreign policy would look like, however — one that ruthlessly prioritizes US strategic and political interests at the expense of peace, human rights, and the lives of poor people in foreign countries.

Say what you will about Clinton’s shifting political beliefs over the course of this election and her entire career, but she’s been fairly consistent on foreign policy, pushing the kind of unapologetically interventionist approach that made her the darling of hawks long before Trump came along.

And like Negroponte, she has both her own dubious history in Honduras and has backed both NAFTA and the TPP (at least until she — maybe — changed her mind about the latter). On these issues, they’re kindred political spirits.

Clinton’s embrace of Negroponte’s support could be viewed as simply part of the tried-and-true process of padding one’s resume with endorsements from respected establishment figures. Some would say Negroponte’s support doesn’t really matter — that it’s just pageantry, not remotely a sign of her future foreign policy intentions.

Even if we grant this, however, seeking and embracing the support of a man who actively facilitated years of stomach-churning atrocities is particularly unseemly — as Democrats and Clinton herself have argued in the recent past. The party has smugly — and justifiably — pilloried Trump for his praise of authoritarian rulers like Putin and Saddam Hussein.

“Donald Trump’s praise for brutal strongmen seemingly knows no bounds,” read a Clinton campaign statement last month, which also criticized Trump for approvingly citing Saddam’s dismissal of legal formalities like reading people their rights. “Trump’s cavalier compliments for brutal dictators, and the twisted lessons he seems to have learned from their history, again demonstrate how dangerous he would be as Commander-in-Chief and how unworthy he is of the office he seeks.”

Compliment brutal dictators and Clinton will slam you. But actually help them carry out their abuses, as John Negroponte did, and her campaign will seek and proudly tout your support.

August 26, 2016 Posted by | Militarism, Timeless or most popular, War Crimes | , , , , , , , | Leave a comment

Is Hillary Double-Talking on Trade Deals?

By JP Sottile | Consortium News | August 1, 2016

Did perennial Clinton rainmaker and current Virginia Governor Terry McAuliffe let the cat out of the bag? The “cat” is the widely-held suspicion that Democratic presidential candidate Hillary Clinton isn’t really opposed to the Trans Pacific Partnership (TPP). The “bag” is the campaign narrative that frames her election year reversal on the controversial trade accord as the outcome of an honest re-examination of a deal that she once hailed as “the gold standard in trade agreements.”

Just to add to the confusion, Hillary Clinton failed to declare her opposition to the TPP in her historic acceptance speech. Instead, she asked assembled Democrats to join her if they “believe that we should say ‘no’ to unfair trade deals” and “stand up to China.”

It was an understandable omission given the grievances of Bernie loyalists poised to pounce on her every misstep. By avoiding the minefield completely she disappointed union leaders and deferred the issue until she debates Donald Trump.

Until then, she — and notable surrogates like economist Joseph Stiglitz — will try to convince a trade-weary public that she’s truly committed to renegotiating the increasingly unpopular deal. She’ll also be beating-back the ghost of trade deals past.

United Auto Workers President Dennis Williams claims Hillary assured him during the primary that she’s also committed to reopening the North American Free Trade Agreement (NAFTA). Like the TPP, she was for it before she was against it. And like Hillary’s campaign promise to tweak NAFTA, McAuliffe suggested in an interview with Politico that – if she wins the White House – Clinton would make a few tweaks in the Trans Pacific Partnership trade deal and then support it.

These caveats fit into a long pattern of trade policy triangulation that raises the question: Is this policy reversal truly a switch or just another bait and switch? There is good reason for the buyer to beware.

“Once the election’s over, and we sit down on trade, people understand a couple things we want to fix on it but going forward we got to build a global economy,” McAuliffe said.

Trading Places

NAFTA is America’s most notorious trade deal. Although It was negotiated by the first Bush Administration, it was Bill Clinton who closed the deal. At the end of his first year in office he guided NAFTA through the House and Senate by offsetting Democratic resistance with significant Republican majorities. Its ratification fit perfectly with the “centrist” mission of the Clinton-led “New Democrat” movement incubated by the Democratic Leadership Council (DLC) during the preceding decade.

From its inception in 1985, the DLC triangulated against the Democratic Party’s “liberal” moniker that the GOP so effectively turned into an epithet after Ronald Reagan’s election in 1980. The historic loss of “liberal” former Massachusetts Governor Michael Dukakis in 1988 set the table for the DLC’s corporately-minded “New” Democrats. The election of DLC star Bill Clinton in 1992 was the turning point.

With the DLC’s best salesman and former chairman in the Oval Office, the Democratic Party was open for business. His wheeling-dealing economic team opened a whole new avenue for Wall Street to influence U.S. government policies. The Democrats were no longer a political roadblock.

Even if these New Democrats weren’t completely trading places with the GOP, Team Clinton was certainly willing to triangulate against Democrats’ traditional constituencies … particularly on trade.

The biggest signal of Clinton’s brand new deal was Al Gore’s smug dismissal of Ross Perot’s NAFTA warning on Larry King’s CNN show about the trade deal causing a “giant sucking sound” of American jobs going to Mexico. In dismissing Perot’s worries, Gore fired the starting gun for the go-go globalization of the 1990s.

The Morning NAFTA

For the first decade of NAFTA, Perot’s “sucking sound” seemed to go in reverse. As Sonali Kolhatkar detailed on TruthDig, big U.S. agribusinesses flooded Mexico with cheap, subsidized corn and seven other market-crushing products. That tidal wave put small Mexican farmers out of work. Ironically, they flooded back across the border to work in — surprise! — Big Ag’s burgeoning factory farming operations in states like Iowa, North Carolina, Alabama and Arkansas. Go figure.

According to a 2014 assessment by the Center for Economic and Policy Research, Mexico is still waiting for the promise of NAFTA’s economic leveling effect to be fulfilled. It’s actually lost ground on economic growth and GDP per person. And the poverty rate remains essentially unchanged.

But NAFTA did offer another low wage alternative to manufacturing in the United States. That helps keep retail prices low enough to match the eroding purchasing power of American consumers, which suffers because their wages are, like Mexican workers, flat or declining. The one thing that hasn’t suffered? Corporate profits and the executive compensation it is predicated upon. Again, go figure.

Where Credit Is Due

Although NAFTA is the usual target of anti-trade fervor, it simply doesn’t compare with the transformative impact of Bill Clinton’s biggest “trade deal” — securing Most Favored Nation (MFN) trade status for China. Repeated approval of Chinese access to U.S. markets set off a wave of job losses in America’s industrial heartland. It stoked corporate profits and consumer debt. And it ushered in the often-lamented era of the big box store.

Rising retail titans like Arkansas-based Walmart rushed into China’s incredibly favorable labor market. The cheap products they made turned the 1990s into a decade of plenty. Big box stores were stocked with cheap plastic stuff and consumers gobbled up the bargains with one or more of the credit cards they’d been given during an unprecedented era of ubiquitous consumer credit.

A study by Demos published in 2003 found that during Bill Clinton’s tenure the “average American family experienced a 53 percent increase in credit card debt, from $2,697 to $4,126.” Low-income families experienced a “184 percent rise in their debt.” And, despite the rise in income inequality during his presidency, even “high-income families had 28 percent more credit card debt in 2001 than they did in 1989.”

Demos also found a sharp rise in credit card direct mail solicitations from 1.52 billion in 1993 to a staggering 5 billion in 2001. Monthly minimums where lowered from 5 percent to 2 percent, thus making it easier to carry debt. And the consumer credit industry “tripled the amount of credit it offered customers from $777 billion to almost $3 trillion” by the time Clinton left office. It was a bill of sale first written by Bill Clinton on the campaign trail in 1992.

Promises, Promises

When Bill Clinton ran for president, the Cold War was over; the Savings and Loan scandal had exploded; the economy was mired in a sharp recession; and incumbent President George H.W. Bush couldn’t do a damn thing right. He seemed bored by people’s “pain.” He looked woefully out of touch in a grocery check-out line. And he’d broken the infamous “no new taxes” pledge that helped him defeat “Taxachusetts” Governor Michael Dukakis in 1988.

With Reaganomics on the ropes, Team Clinton scored repeatedly with their “It’s the Economy, Stupid” campaign. But Clinton also exploited another weakness — the Bush Administration’s quick embrace of the Chinese Government after the Tiananmen Square massacre in 1989. That embrace was sealed with a discomfiting handshake by Bush’s national security advisor Brent Scowcroft.

Shortly thereafter, President Bush renewed China’s “Most Favored Nation” trade status, which, among other things, lowered tariffs on Chinese imports into the U.S. He was widely criticized, often from within his own party, for cutting a deal with a regime some called “The Butchers of Beijing.”

In the 1992 campaign, Bill Clinton exploited Poppy’s “kowtowing” to great effect. Clinton accused Bush of “indifference toward democracy” in China. And Clinton famously said Bush was willing to “coddle dictators.” On March 9, 1992, Clinton proclaimed, “I do not believe we should extend ‘Most Favored Nation’ status to China unless they make significant progress in human rights, arms proliferation and fair trade.”

Of course, that all changed after he took office. On March 28, 1993, the cagey President announced he’d cut a deal with a Congress to extend a waiver that effectively approved MFN while deferring human rights-related conditions to the following year. Clinton even outlined other concerns, including China’s “$18 billion trade surplus” with the U.S.

But all those concerns, along with his campaign pledge, where jettisoned on March 27, 1994 when Clinton made the economy-changing decision to “de-link” China’s MFN status from human rights. That decision buried Tiananmen Square in the crowded graveyard of America’s often-trumpeted “advocacy” for human rights around the globe.

It also unleashed American corporations to dive headlong into China’s vast, cheap pool of low-wage labor. By the time Clinton made his state visit to China in the summer of 1998, MFN was becoming a footnote to the amazing story of China’s skyrocketing industrial output. Facing charges of hypocrisy on human rights, Clinton countered, “I’m going because I think it’s the right thing to do for our country.”

That may be a debatable point. What’s not in doubt is that it, like MFN, was the right thing to do for the bottom line of American business. And it was specifically beneficial for an emerging retail behemoth that had a long, close relationship with the Clintons.

The Power Greeter

Alice Walton likes Hillary Clinton. That’s a fairly safe assumption given the $353,400 check she cut for the Hillary Victory Fund during a mad dash of pre-election year fundraising at the end of 2015. And she also kicked in another $25,000 into the “Ready for Hillary” SuperPAC. Those big donations are, like the estimated $130 billion net worth of Walton family, a legacy handed-down from Walmart founder Sam Walton.

That legacy dates back to Bill’s time as Governor — when the Walton family began a long history of financial support of the Clintons, according to Bloomberg. It made sense given Walmart’s supersized role in Arkansas.

It also made good political sense that, as Michael Barbaro of the New York Times reported back in 2007, Hillary was brought onto Walmart’s Board of Directors back in 1986 at the behest of Walton’s wife Helen. That effort to add a woman to the boardroom turned into a six-year stint that cemented the long relationship between Arkansas’ most famous corporation and its most famous political family.

As Brian Ross of ABC News reported in the lead-up to her 2008 run, Hillary notably left that glass ceiling-shattering appointment out of her biography. She basically “de-linked” herself from a stridently anti-union company that was also a notoriously thrifty spender on employee wages and benefits. The ABC report also referenced a 1992 report showing her trumpeting Walmart’s “Buy America” campaign in spite of Walmart’s reliance on children working in sweatshops in places like Bangladesh. That’s a practice Walmart continued into the 1990s.

It came to a head in 1996 when All-American “sweetheart” Kathie Lee Gifford got embroiled in a child labor scandal in Honduras. Coincidentally, that scandal broke the same year Walmart entered China “through a joint-venture agreement.” And that was just two years after Bill Clinton “de-linked” human rights from MFN.

It was also the same year that he successfully renewed MFN with an overwhelming vote of support by the House of Representatives. The timing couldn’t have been better for Walmart. They’d auspiciously formed their international division in 1993 and were poised to profit off Bill’s broken promise to “not coddle dictators.”

But, as with all things Clinton, there really isn’t a “smoking gun” linking Bill’s MFN reversal with Walmart’s amazing good fortune in China. There is just the lingering miasma of happy coincidences. Bill Clinton’s crowning coincidence before exiting the Oval Office was Congressional approval of his proposal to give China permanent Most Favored Nation trading status in 2000.

The New Normal

On Oct. 10, 2000, he signed the U.S.–China Relations Act of 2000 into law. Most Favored Nation status officially became Normal Trade Relations. Also in that year, the $18 billion trade deficit he decried in 1993 ballooned to $83 billion. Meanwhile, Walmart rode low-cost Chinese manufacturing to the top of the retail heap. Walmart’s massive workforce is now the third largest in the world behind the U.S. Defense Department and, ironically, China’s People’s Liberation Army.

Amazingly, the U.S. trade deficit with China more than tripled to $263 billion in the eight years after Clinton secured “Normal” trade relations in 2000. Meanwhile, Walmart’s infamous low-wage practices at home were subsidized annually to the tune of “an estimated $6.2 billion in public assistance including food stamps, Medicaid and subsidized housing,” according to 2015 report in Forbes.

Also amazingly, the Clintons’ wealth skyrocketed to $111 million in the years after Bill left office. Hillary spent those years in and out of “public service” and the former President turned the Clinton Foundation into a $439 million powerhouse by 2014.

While the Foundation’s philanthropy is demonstrable, criticisms of it as a de facto slush fund remain. But the link between political promises and trade policy persisted. This time it was Hillary running for president. The trade deal was with war-torn Colombia. And the campaign trail leads back to the Clinton Foundation.

Rinse, Repeat

There is a strange symmetry between China’s MFN status, the TPP imbroglio and a notable “flip-flop” on the Colombia Free Trade Agreement by first-time presidential candidate Hillary Clinton in 2008. Then like now, she was competing against a movement candidate in newcomer Barack Obama. And then like now, she struggled to protect her “left” flank on economic issues.

At issue in 2008 was a sweeping deal negotiated by the second Bush Administration with the U.S.-supported, civil war-wracked narco-state of Colombia. Obama “vowed” to oppose the deal. To keep pace with her high-octane opponent, Hillary repeatedly reassured labor leaders of her opposition to the deal.

The rub was two-fold. Not only did she have a decidedly pro-free trade voting record as a senator. But both her free-trading husband and her chief campaign strategist were on record supporting the deal. She ditched her Colombia-linked strategist and matched Obama’s anti-deal stance. But, just like China’s MFN before it, the trade agreement with Colombia eventually became a “big win” for a Democratic President who was for it before he was against it.

This time it was a flip-flopping President Obama. With the help of his flip-flopping former foe and then-current Secretary of State Hillary Clinton, he scored a trade deal trifecta on Oct. 12, 2011. That’s when Congress approved the United States-Colombia Trade Promotion Agreement (CTPA) and separate deals with both South Korea and Panama. Obama called the trio of trade deals “a major win for American workers and businesses.” Alas, it turned out that there was a lot more change on trade than reason to hope Obama or Hillary would keep their promises.

Mining The Depths

Meet billionaire mining magnate Frank Giustra. According to the New York Times, the financial power-player’s global interests have included philanthropy and a $45 million stake in a deal to sell strategic uranium mines in Central Asia and the United States to the Russian atomic energy agency Rosatom. Strangely enough, those two interests — charity and strategic resources — fit together nicely. That’s because the uranium deal required U.S. agencies — including the State Department — to sign-off before it was approved.

The eight-year process for the uranium deal required approval by the U.S. Committee on Foreign Investment of which the State Department is a member. That approval finally came in 2010 when Hillary Clinton was Secretary of State and while the Clinton Foundation was continuing to collect millions of dollars from related investors.

Throughout, Giustra’s wheeling and dealing continued with his close friend and private jet-setting partner Bill Clinton, who gave a $500,000 speech to a Russian investment bank that gave the stock a buy rating.

Since 2005, Giustra has lavished the Clinton Foundation with repeated donations, adding up to in excess of $100 million. Yet, putting Bill Clinton’s oddly remunerative, but not uncommon $500,000 speech in Moscow aside, there still is no smoking gun linking then-Secretary of State Hillary Clinton to the actual approval of the deal. Once again we just have that miasma of happy coincidences.

More troubling, though, is the coincidence that her husband’s friend Frank Giustra did benefit from the Colombia Free Trade Agreement deal’s “extreme” protections for foreign investors and special rights for corporations engaged in “resource extraction,” according to an eye-opening exposé by David Sirota, Matthew Cunningham-Cook and Andrew Perez of the International Business Times.

At issue is a company formerly known as Pacific Rubiales, an oil company founded by (you guessed it) Frank Giustra. The State Department repeatedly fielded accusations of workers’ rights and human rights abuses, particularly related to a strike targeting Pacific Rubiales in 2011. Strangely, the State Department not only ignored these accusations, but actually praised the Colombian government’s stellar progress on human rights. Was this Hillary Clinton’s “de-linking” MFN moment?

Maybe it’s worse. It looks like there’s a little smoke coming out of this gun. As Sirota, Cunningham-Cook and Perez reported:

“At the same time that Clinton’s State Department was lauding Colombia’s human rights record, her family was forging a financial relationship with Pacific Rubiales, the sprawling Canadian petroleum company at the center of Colombia’s labor strife. The Clintons were also developing commercial ties with the oil giant’s founder, Canadian financier Frank Giustra, who now occupies a seat on the board of the Clinton Foundation, the family’s global philanthropic empire.”

Those “commercial ties” include the “Clinton Giustra Enterprise Partnership” which its snazzy website calls a “pioneering an innovative approach to poverty alleviation” that “generates both social impact and financial returns by addressing existing market gaps in developing countries’ supply or distribution chains.”

Really, doesn’t that “pioneering approach” sound a lot like the long-term project of the Democratic Leadership Committee?

The “pioneering” privatization of “poverty alleviation” was a big part of then-President Bill Clinton’s famous “welfare reform bill” of 1996. Profitable privatized prisons grew to match the skyrocketing demand created by infamous “crime bill” of 1994. The “financial returns” flowed as the prison “market gap” was closed. And like neoliberal trade policy, deregulation of Wall Street and the media, it’s all symptomatic of the Clinton-led move of the party toward the corporate-friendly “center.”

As Frank Giustra said in a 2006 profile of Bill Clinton for The New Yorker, “All of my chips, almost, are on Bill Clinton. He’s a brand, a worldwide brand, and he can do things and ask for things that no one else can.” Based on a Giustra’s latest venture in Colombia — a big financial play in the Gran Colombia Gold Corporation — he’s still reaping the “free trade” rewards of his bank-shot bet on Hillary Clinton.

In fact, he’s not just going for the gold … but some silver, too.

Big Box Democrats

Back in 1992, the phenomenal Clinton political machine successfully sold the “new,” improved Democratic Party to Reaganomics-starved political consumers. He felt their pain. He also changed his party and opened the door to the big-box consumerism. Now that same sharp messaging machine is repackaging Hillary’s free-trading past, pulling Bill’s mixed political record from the shelves, and hard-selling her latter-day transformation on trade and economic policies.

The question is: Will suspicious voters buy her “Come to Bernie” moment as a wholesale conversion on the road to the White House? Disgruntled and disaffected voters have to buy into the idea that she’s truly changed on trade and is not, as Terry McAuliffe implied, simply repeating a well-worn pattern of bait and switch.

Simply put, she’s got a long, demonstrable history of supporting trade agreements. And by one account she specifically “pushed” the Trans-Pacific Partnership 45 times. But that was then and this now. And now she’s got a disillusioned cadre of #BernieOrBusters to her left and a new army of anti-trade Trumpsters to her right. That’s left her stuck in the “centrist” middle with the corporate donors, financiers and loyalists who’ve been shopping in the supermarket of political influence ever since the Clintons transformed the Democrats into the party of Big Box-style democracy.

August 2, 2016 Posted by | Deception, Economics, Progressive Hypocrite, Timeless or most popular | , , , , , , , | Leave a comment

Free Trade Agreements Have Exacerbated a Humanitarian Crisis in Central America

By Manuel Perez-Rocha | IPS | June 29, 2016

U.S. trade negotiators continue to claim that free trade agreements help to support security, but in reality, they exacerbate the root causes of instability in the Mesoamerican region, IPS’s Manuel Perez-Rocha said in a speech at the AFL-CIO conference on U.S. trade policy.

“Real security encompasses economic, human, financial, and political security,” he said.

Today the Northern triangle of Latin America is one of the most dangerous places in the world. In Mexico alone, there are more than 27,000 people reported missing on top of the 100,000 killed in the so-called war on drugs, Perez-Rocha said.

He explained that the origins of this crisis are rooted in structural adjustment policies that the IMF and the World Bank imposed on Central America to pave the way for free trade agreements like the North American Free Trade Agreement (NAFTA), the Central America Free Trade Agreement (CAFTA) and now the Trans-Pacific Partnership (TPP).

“Instead of bringing prosperity, [NAFTA] took away domestic protections from Mexico’s food production, leading to greater food insecurity and the widespread loss of our agricultural livelihoods,” he said.

Perez-Rocha said the abandonment of national production of food to favor imports, brought on by NAFTA, has meant the fall of production, employment, and income and the increase of inequality, poverty, and migration. He said this abandonment of the countryside by the government propelled the vacuum that has become occupied by organized crime.

“NAFTA is responsible,” he said. “for the increase of violence and public insecurity in the countryside and in all of Mexico.”

Ten years later, CAFTA was imposed in Central America, ushering in what Perez-Rocha called “the deterioration of economic conditions for working people and major new threats to the environment.”

Perez-Rocha offered one of the most egregious examples in the case of the Pacific Rim mining company which is demanding millions of dollars from El Salvador for protecting its environment.

“This is a deep humanitarian crisis that should be recognized as such,” he said. He quoted U.S. Vice President Biden as saying ‘confronting these challenges requires nothing less than systematic change, which we in the United States have a direct interest in helping to bring about.’

However, the proposal in the Alliance for Prosperity Plan does not address the roots of the crisis, Perez-Rocha said.

“The goal of the alliance, as we see it,” Perez-Rocha said, “is to attract foreign direct investment for the exploitation of natural resources.”

The alliance and agreements like the TPP, on top of the destruction already brought on by NAFTA and CAFTA, will only mean an acceleration of the race to the bottom for the region’s working families, further dislocation and displacement, and regional insecurity, he said.


Read Manuel Perez-Rocha’s full essay on page 43 [PDF).

July 5, 2016 Posted by | Economics, Environmentalism | , , , , | Leave a comment

Bill Clinton’s War on the Poor (AKA The Hillary Plan)

By Joshua Frank | CounterPunch | February 19, 2016

So, how did America’s poor fare under Bill Clinton’s White House reign? Better than George W. Bush — at least that seems to be the common belief among Democratic voters today, especially those lining up behind Madam Hillary. However, the economy under Clinton in the 1990s may not have been as robust and healthy as many would like to believe.

As economist Robert Pollin of the University of Massachusetts at Amherst explains in Contours of Descent: US Economic Fractures and the Landscape of Global Austerity, Clintonomics was not all it was cracked up to be. “The distribution of wealth in the US became more skewed than it had at any time in the previous forty years,” he argues. “No question, an increasing number of US jobs began to be outsourced at an unprecedented rate as well.”

“Unlike Clinton, Bush is unabashed in his efforts to mobilize the power of government to serve the wealthy,” he continues. “But we should be careful not to make too much of such differences in the public stances of these two figures, as against the outcomes that prevail during their terms of office … the ratio of wages for the average worker to the pay of the average CEO rising astronomically from 113-to-1 in 1991 under Bush-1 to 449-to-1 when Clinton left office in 2001.”

Pollin points out that while Clinton’s tax policy reversed some of the regressive taxation that occurred under Ronald Reagan, it certainly did not reverse the brunt of it. And, as Pollin contends, “The fact is that, insofar as the end of the Cold War yielded any peace dividend under Clinton, it took the form of an overall decrease in the size of the federal government rather than an increase in federal support for the programs supposedly cherished by Clinton, such as better education, improved training, or poverty alleviation.”

Was Clintontime even a boom-era after all? Pollin doesn’t think so. “Under the full eight years of Clinton’s presidency, even with the bubble ratcheting up both business investment and consumption by the rich average real wages remained at a level 10 percent below that of the Nixon-Ford peak period, even though productivity in the economy was 50 percent higher under Clinton than under Nixon and Ford. The poverty rate through Clinton’s term was only slightly better than the dismal performance attained during the Reagan-Bush years.”

Bargaining power for low-wage workers during the 1990s decreased tremendously as well. Wall Street scion Alan Greenspan in fact did not want the unemployment rate to drop below 6 percent because he feared that inflation would skyrocket. Greenspan also did not want workers to increase their bargaining power, which could possibly benefit their organizing strength in the work place. The majority of workers during Clintontime were not happy with their occupations. As Pollin writes, “Wage gains for average workers during the Clinton boom remained historically weak, especially in relationship to the ascent of productivity. These facts provide the basis for the poll findings reported in Business Week at the end of 1999 that substantial majorities of US citizens expressed acute dissatisfaction with various features of their economic situation.”

Pollin also shows that the Earned Income Tax Credit (EITC), the most significant economic initiative under Clinton, more than doubled from $9.3 billion to $26.8 billion during Clinton’s two terms. But food stamps “dropped by $8.5 billion reflecting a large increase in the percentage of households who are not receiving food assistance even though their income level is low enough for them to qualify. Under the Clinton Administration, the decline in the number of people receiving food stamps — 9.8 million — was 17% greater than the decline in the number of people officially defined as impoverished and was accompanied by a dramatic increase in the pressure on private soup kitchens and food pantries.

“And while the EITC does correct some of the failings of the old welfare system, it has created new, and equally serious, problems. Moving poor and unskilled women from welfare onto the labor market exerts a downward pressure on wages, and the national minimum wage itself is too low to allow even a full-time worker to keep just herself and only one child above the official poverty line.”

Poverty did decline under Clinton by almost 4 percentage points. Yet, as Pollin explains, in the prosperity of the 1990s, this small drop back to 1974 levels is reprehensible: “Per capita GDP in 2000 was 70% higher than it was in 1974, productivity was 61% higher, and the stock market was up 603%.”

Clinton’s presidency did see a stop in wage decline from 1993 to 1996, however. And in the next three years wages rose sharply. But “the real wage gains were also, in turn, largely a result of the stock market bubble. The Clinton economy of the late 1990s, whose successes were so heavily dependent on the stock market, offers little guidance as to what such an alternative path to sustained improvements in real wages might be.

“Moreover, conditions under Clinton worsened among those officially counted as poor. This is documented through data on the so called ‘poverty gap,’ which measures the amount of money needed to bring all poor people exactly up to the official poverty line. The poverty gap rose from $1,538 to $1,620 from 1993-99 (measured in 2001 dollars).”

Pollin continues, “Because workers had experienced the ‘heightened sense of job insecurity’ under most of Clinton’s tenure, when wages did finally start to rise significantly in 1997, this was from an extremely low base. Moreover, the injection of increased spending under Clinton that produced low unemployment came from the stock market bubble, which, as has now become transparently clear, was unsustainable. In the 1960s, the catalyst driving the economy to full employment was government spending on the Vietnam war — that is, a source of economic stimulus that was also unsustainable and even more undesirable than the 1990s market bubble.

“The central challenge for an employment-targeted policy in the US today would therefore be to identify alternative sources of job expansion that do not require waging war or destabilizing the financial system. The Bush-2 plan for huge military spending increases obviously does not qualify any more than the Vietnam War as a desirable source of job expansion.”

In other words, even though jobs were plentiful in the 1990s, poverty was widespread and, in fact, increasing. All this before the effects of NAFTA and welfare reform reared their ugly heads. But this was all by design. Clinton, et al., knew exactly what it was they were doing. No question Hillary’s neoliberal agenda will follow suit.

February 21, 2016 Posted by | Economics, Militarism, Timeless or most popular | , | Leave a comment

Failing to Deliver: Manufacturing Wages Aren’t What They Used to Be

By Deirdre Fulton | Common Dreams | November 21, 2014

Though nine out of ten Americans perceive blue-collar jobs as “good jobs” and policymakers tout the benefits of expanding the country’s manufacturing base, the truth is that factory wages now rank in the bottom half of those for all jobs in the U.S., according to a new study from the National Employment Law Project (NELP).

The report, Manufacturing Low Pay: Declining Wages in the Jobs That Built America’s Middle Class (pdf), reveals that while the manufacturing sector has experienced a rebound in recent years, in fact “the quality of too many of the returning jobs is low and fails to live up to workers’ and the overall public’s expectations.”

“Manufacturing jobs are… highly sought after by our federal and state policymakers,” write co-authors Catherine Ruckelshaus and Sarah Leberstein, “lauded as ‘advanced industries’ that generate investments, create a high number of direct and indirect jobs, enhance worker skills, and generate additional economic activity in related industries.”

But “while the manufacturing sector has been resurging in the last few years, growing by 4.3 percent between 2010 and 2012, the jobs that are returning are not the ones that were lost: wages are lower, the jobs are increasingly temporary, and the promised benefits have yet to be realized,” they write.

Specifically, the study finds that:

  • More than 600,000 manufacturing workers make just $9.60 per hour or less and more than 1.5 million manufacturing workers—one out of every four—make $11.91 or less;
  • Real wages for manufacturing workers declined by 4.4 percent from 2003 to 2013—almost three times faster than for workers as a whole.
  • In the largest segment of the manufacturing base—automotive—wages have declined even faster. Real wages for auto parts workers, who now account for three of every four autoworker jobs, fell by nearly 14 percent from 2003 to 2013—three times faster than for manufacturing as a whole, and nine times faster than the decline for all occupations.
  • In particular, new jobs in the auto industry pay less than the jobs that were lost. New hires in auto earn less than $10 an hour.
  • Heavy reliance on temporary workers hides even bigger declines in manufacturing wages. About 14 percent of auto parts workers are employed by staffing agencies today. Wages for these workers are lower than for direct-hire parts workers and are not included in the official industry-specific wage data cited above.

“What will these jobs look like in 10 years if these trends continue?” the report asks. “If the wage trends continue, manufacturing jobs will not deliver on the promise of creating livable jobs with positive economic revivals in communities and families.”

Writing at the Campaign for America’s Future blog, Dave Johnson blames globalization and so-called free-trade pacts for exacerbating—if not directly causing—the issues raised in NELP’s report.

“American factory jobs used to provide reasonable pay and benefits—largely because of unions and democracy. So how do you make manufacturing jobs more ‘efficient?’ You can move the factory to a country that doesn’t allow unions. Our country used to recognize this game and ‘protected’ the good wages and benefits that democracy provided people with tariffs that raised to price of goods made in places that allowed exploitation of working people. Solution: ‘free trade’ that pits our democracy against thugocracies with few or no protections for people or the environment.

Free trade’ worked—to force unemployment up and wages down. We lost more than 6 million manufacturing jobs and 60,000-plus factories between 2000 (the year before China entered the World Trade Organization) and 2010.

With approval of the corporate-friendly Trans-Pacific Partnership on the horizon, NELP’s findings are a wake-up call, writes Scott Martelle for the LA Times.

“We as a nation need to press the federal government to rethink trade policies, especially as it pushes for ever more deals to make it easier to ship goods and jobs around the world,” he says. “The looming Trans-Pacific Partnership (look at it as NAFTA for the Pacific Rim) might be good for global manufacturers and American consumers, but those consumers are also American workers. Driving down retail prices while also driving down family incomes is the wrong spiral for community stability and a steady or improving standard of living.

Martelle continues: “A century ago, Henry Ford figured out that if he wanted a mass market capable of buying his cars—cheaper to make with his moving assembly line—then he needed to pay higher wages. He understood the connection between wages paid and products bought. These days, the focus seems to be more on wages squeezed. And that’s no way to preserve, or strengthen, a middle class capable of driving a vibrant consumer economy.”

November 21, 2014 Posted by | Economics | , | Leave a comment

New frontiers for oil palm

Communities lose out to oil palm plantations

GRAIN |  September 22, 2014

Palm oil is not something you would associate with a Mexican kitchen. But go to any supermarket in the country, and you will find countless products containing it. The country’s food system has changed immensely since the North American Free Trade Agreement (NAFTA) came into effect in 1994 and multinational companies moved in to take control of the country’s food supply. The alarming rate of obesity, now higher than that of the US, is one manifestation of Mexico’s changing food landscape, and tied to this is the escalating consumption of palm oil.

Palm oil consumption has increased by over four times since NAFTA was signed, and it now accounts for one quarter of the vegetable oil consumed by the average Mexican, up from 10% in 1996. Other countries in Latin America undergoing similar changes to their food systems have also increased their consumption of palm oil. Venezuelans have doubled their intake, and Brazilians are consuming 5 times what they did in 1996.

This growing consumption is matched by growing production, not in Mexico, but in those countries where oil palm can be most cheaply produced. A third of Latin America’s palm oil exports now go to Mexico.

Colombia, with about 450,000 ha under production, is the biggest palm oil producer in the Americas. Since the late 1990s, Colombia’s palm oil production has taken off for several overlapping reasons, including government incentives and a national biodiesel mandate. Oil palm has also been promoted as a substitute crop for coca as part of the US-backed “Plan Colombia” – a programme aimed at ending the country’s long-standing armed conflict and curbing cocaine production. Paradoxically, palm oil is also proving a useful way for drug cartels, paramilitaries and landlords to launder money and maintain control of the countryside.

The most notorious land grabs for palm oil in Colombia have occurred in the north west Chocó province, where businessmen and paramilitaries have colluded to force Afro-Colombian communities to cede their territories for palm oil plantations and contract farming. After dozens of Afro-Colombian leaders were killed resisting such land grabs, Colombia’s Prosecutor General’s Office brought forward charges against 19 palm oil businessmen for crimes of conspiracy, forced displacement, and the invasion of ecologically important land. Three of these businessmen have so far been convicted.

Disease outbreaks have limited palm oil’s expansion in Chocó Province and most of the expansion has instead happened on the pasture lands of the central and eastern parts of the country, where the oil palm industry claims there is little deforestation and displacement of peasants. But studies show that these pasture lands are in fact typically common areas vital to peasants for the production of their food crops and the grazing of their livestock. The “pasture lands” are often the only lands that peasants have access to, and palm oil companies routinely use force and coercion, including paramilitaries, to take control of these lands from them or to force them into oppressive contract production arrangements. Across Colombia, the expansion of palm oil and the presence of paramilitaries are tightly correlated.

Ecuador, Latin America’s second largest palm oil producer, has also seen a recent expansion in oil palm production. While much of its palm oil is produced on farms of less than 50 ha, new expansion is driven by private companies who have been moving into the territories of Afro-Ecuadorians and other indigenous peoples in the Northern part of the country, leading to severe deforestation and displacement and meeting with stiff local resistance.

Land conflicts over palm oil are also erupting in Central America. In Honduras, peasants in the Aguan Valley have been killed, jailed and terrorized for trying to defend their lands and small palm oil farms from powerful national businessmen who have been grabbing their lands to expand their palm oil plantations with the backing of foreign capital. Ironically, these peasant families first moved into the forests of the Aguan in the 1970s as part of a government land reform programme, and were encouraged to grow palm oil and establish their own cooperatives. The neoliberal policies of the 1990s and a coup d’état in 2009, opened the door for powerful local businessmen like Miguel Facussé, to destroy the peasant cooperatives, violently grab lands for plantations, and reorient the supply chain towards exports for biofuels and multinational food companies. Likewise in Guatemala, where production of palm oil has quadrupled over the past decade, the palm oil sector is now entirely controlled by just eight wealthy families who have been aggressively seizing lands from indigenous communities, such as the Q’eqchi,

Some industry insiders predict that an expansion of oil palm production in Brazil will soon dwarf all other production in the region. Brazil is a net importer, and production has so far been confined to a small area of Pará, in the North. But, unlike in other regional palm oil producing countries where production is dominated by national companies and wealthy landowning families, transnational corporations have recently made significant investments in Brazilian palm oil production, such as the mining company Vale, energy companies Petrobras and Galp, and ADM, one of the world’s largest grain traders and a major shareholder in the world’s largest palm oil processor Wilmar.

Going further

Tanya M. Kerssen, “Grabbing Power: The New Struggles for Land, Food and Democracy in Northern Honduras,” FoodFirst, 1 February 2013

Human Rights Everywhere, “The flow of palm oil Colombia- Belgium/Europe: A study from a human rights perspective,” 2006

More frontiers

October 5, 2014 Posted by | Economics, Environmentalism, Ethnic Cleansing, Racism, Zionism | , , , , , , , , , | Leave a comment

NAFTA at 20: State of the North American Worker

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.

By Jeff Faux | Foreign Policy in Focus | December 13, 2013

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.

December 14, 2013 Posted by | Civil Liberties, Economics, Environmentalism, Solidarity and Activism, Timeless or most popular | , , , , , , , | Comments Off on NAFTA at 20: State of the North American Worker

Trans-Pacific Partnership: Free Trade vs. Democracy

By Cliff DuRand  | Americas Program | April 12, 2013

As closed-door negotiations concluded in Singapore on the Trans-Pacific Partnership, opposition begins to build in many countries. At the urging of the United States, Canada and Mexico have joined the nine countries in the talks and now Japan has announced it too wants to be part of this new free trade pact of Pacific rim countries, described by its critics as “NAFTA on steroids”.

Going into its 17th round of negotiations, the Obama administration aims to wrap up an agreement by October, hoping to push ratification through the Senate on a fast- track basis. Called Trade Promotion Authority, fast track would mean an up or down vote without amendments or even hearings on the agreement presented to it. It is a profoundly anti-democratic procedure because it shuts down debate.

But from start to end, TPP has been thoroughly anti-democratic. On the first day of the Singapore talks a broad range of civil society organizations issued an open letter to Congress calling for greater transparency in the proceedings. The agreement is being hammered out in secret discussions among trade ministers. Even Senators have been denied a look at its draft provisions.

However, some 600 transnational corporations are in the inner circle. They are writing the rules for trade in their own interests without any democratic input from the people whose lives will be profoundly affected. If adopted, TPP will deny citizens their democratic rights to shape public policies on a host of domestic issues, conceding those decisions to the large corporations.

Some sections have been leaked. They reveal “an agreement that actually formalizes the priority of corporate power over government,” according to Lori Wallach of Public Citizen’s Global Trade Watch. Only 5 of the 29 chapters have to do with trade. Wallach says the rest of the draft “include[s] new rights for the big pharmaceutical companies to expand, to raise medical prices, expand monopoly patents, limits on Internet freedom, penalties for inadvertent noncommercial copying, sending something to a friend. There are the same rules that promote off-shoring of jobs that were in NAFTA that are more robust that literally give privileges and protections if you leave. There is a ban on ‘buy American’ and ‘buy local’ or ‘green’ or sweat-free procurement. There are limits on domestic financial stability regulations. There are limits on imported food safety standards and product standards. There are limits on how we can regulate energy towards a more green future – all of these things are what they call ‘Behind the Borders’ agenda. And the operating clause of TPP is: ‘Each country shall ensure the conformity of its domestic laws, regulations and administrative procedures with these agreements.’”

Global Class War

Free trade is about more than trade. It is about favoring corporations over the democratic rights of citizens and the sovereignty of nations. As the former Director-General of the WTO, Renato Ruggiero, said in 1995, “We are no longer writing the rules of interaction among separate national economies. We are writing the constitution of a single global economy.”# What is being created is a global governance order in which corporations are the citizens, not flesh and blood humans like you and me. With free trade, corporations are making an end run around democracy.

TPP is the latest offensive in a global class war. For nearly 40 years now, since the mid 1970s, corporations have been rolling back the popular gains of the New Deal era and the 1960s. Democracy has been the target of a class war to restore the class power of capital. And there has been weak resistance, at best, by the popular classes. But the stakes have become increasingly clear to more and more. Indeed, on the issue of free trade, there is now a broad public sentiment against this aspect of the corporate offensive.

The US has become the world advocate of “free trade,” promoting it through trade agreements like NAFTA and other bi-lateral agreements as well as through global governance institutions it has sponsored such as IMF, World Bank and WTO. The US has promoted free trade for much the same reason Great Britain promoted it in the 19th century, viz. the economically strongest country in the world benefits from free trade. It is the weaker countries that seek tariff protection for their infant industries, protection from competition with cheaper and higher quality imports. That protection is what enabled the US to industrialize in the last half of the 19th century. But then when the US became economically strong enough to compete regionally and eventually globally, it became an advocate of free trade and demanded that others abandon protectionism.

The justification for free trade rests on the theory of comparative advantage. This is the view that if countries trade free of government impediments, the market will tend to direct each to export that which they can produce most efficiently and import what can be produced more efficiently and thus more cheaply elsewhere. The invisible hand of the market will guide each to specialize in producing what they have a comparative advantage in. Thus a rational production and trading system will emerge that maximizes efficiency.

Free trade agreements like NAFTA were sold to the US public by appealing to consumer’s interest in having access to cheaper goods imported from Mexico. What was deliberately soft-pedaled was their interest as workers in having jobs. Organized labor opposed NAFTA, fearing it would pit US workers in competition with low wage Mexican workers. Independent presidential candidate Ross Perot warned of “a giant sucking sound” as jobs would be off-shored to Mexico.

But the Clinton administration said US exports to Mexico would create new jobs. And so, ignoring opposition from its traditional base in the unions, new Democrat Clinton pushed ratification of NAFTA through the Senate as his first priority. Perot proved to be correct as US companies shifted production to low wage Mexico – until even lower wage Chinese workers were brought into play when China joined WTO. But Clinton was also right as cheaper consumer goods from abroad filled the shelves of Wal-Mart with bargains welcomed by US workers who found their wages reduced. Free trade proved to be a mixed blessing.

Capital Becomes Global

One important point about free trade that is often overlooked is that it is not only about the free, frictionless movement of goods and services across borders, unrestricted by tariffs, quotas and regulations. It assures the free movement of capital, as corporations are freed to invest abroad. The mobility of investment capital is of utmost importance, with profound economic consequences and consequences for democracy.

Unable to find sufficiently profitable venues for investment in the overdeveloped US economy, large corporations have increasingly moved abroad. They sought not just new outlets to sell their commodities, but low wage workforces that would decrease their production costs and thus boost their profits. Frequently that would involve locating different stages of the productive process in different countries so as to take optimal advantage of local conditions. The assembly lines of US industry were disaggregated and disbursed across the globe.

Global assembly lines emerged. These global production chains have become a signature feature of contemporary capitalism. Components may be manufactured in Singapore, transported to China for subassembly and then shipped to Mexico for final assembly before sale in the United States. Although global assembly lines are geographically dispersed, they overcome the limitations of the fixed assembly lines of the Fordist era in that they no longer have to rely on a fixed labor force that can organize itself to effectively claim a share of the surplus they create.

Instead, the global assembly line gives capital the flexibility to seek out the lowest wage workforce and friendliest business environment available anywhere in the world. This has been made possible by the development of a global computerized network of instant communications via satellite. That and the computerization of banking have made money transfers and the movement of capital both easy and instantaneous. The communications network also allows the decentralization of technological development and design. Technicians can work at points distant from the processes of production to which they address themselves. And the entire process can be coordinated by management located anywhere on the globe. The limitations of space and time have been overcome by digital communications and cheap energy for transporting goods to their ultimate consumers.

For such globalized production to be possible, capital must be able to flow freely across national borders and products have to be able to move with minimum friction across those borders, unhampered by tariffs or quotas or non-uniform standards. In other words, there must be free trade for transnational capital to optimize accumulation.#

But transnational corporations also need legal protection of their investments. They need protection from expropriation of their assets, laws and governments that can ensure their property is secure. A crucial part of free trade agreements is protection of what are called investor rights. This involves more than just protection from expropriation, as happens with revolutions. It also involves protection from governmental actions that might reduce the value of their property or potential profits by environmental and health regulations, labor laws or other such measures even though they might be for the public good. What in US law is called “regulatory takings” are seen as tantamount to expropriation.

When such governmental actions do occur, free trade treaties give the foreign corporation the recourse to sue. The suit is not adjudicated in a national court, but by a transnational body of experts operating in secret. States are expected to enforce its decisions on their own nation’s taxpayers and consumers. This favors investor rights (i.e. the interests of transnational corporations) over the democratic rights of a nation.

Super NAFTA

As corporations have globalized, morphing into transnational corporations, they have promoted free trade agreements to get national governments to assist them. But when “investor rights” trump the democratic rights of citizens, the transnational corporations become the real citizens of the emerging global order. TPP is a further step in this direction, making an end run around a number of important issues –banking regulation, extension of patent protection, food inspection, environmental protection, food sovereignty, internet freedom, health care, job creation policies, and more, denying voters the opportunity to decide such matters when they impinge on corporate profit making.

Here are a few of the issues around which opposition to TPP is beginning to emerge.

* Doctors Without Borders (Medecins Sans Frontieres, MSF) is concerned that TPP would “enhance patent and data protections for pharmaceutical companies, dismantle public health safeguards enshrined in international law and obstruct price-lowering generic competition for medicines.” The intellectual property provisions would give pharmaceutical companies prolonged monopoly protection for medicines and delay access to cheaper generic versions. This would have disastrous consequences in poorer countries.

* Internet freedom is also in danger. The Council of Canadians and OpenMedia have warned that the TPP would “criminalize some everyday uses of the Internet,” including music downloads, making no distinction between commercial and non-commercial copyright infringement. The TPP imposes a “three strikes” system for copyright infringement, where three violations would result in the termination of a household’s Internet access.

* Japanese farmers are concerned that TPP will force removal of protections from Japan’s agriculture needed to maintain food sovereignty for the country. They are protesting Japan’s decision to enter into TPP negotiations at all.

* Guaranteed compensation for loss of “expected future profits” from health, labor or environmental regulations.

* Corporate performance requirements are banned.

* Capital mobility is to be guaranteed, preventing capital controls in event of a financial crisis. TPP will require countries to let capital flow in and out without restriction, not allow the banning or regulation of risky investments like derivatives and credit-default swaps and will prevent the formation of much-needed public banks

Democratic sovereignty

Most fundamentally what is at stake with TPP and existing free trade treaties is the sovereignty of nations and the ability of their peoples to make democratic decisions. This is a concern on both the Left and the Right, suggesting the possibility of a broad coalition opposing TPP, bridging our otherwise polarized politics.

A major NBC News-Wall Street Journal poll from September of 2010 revealed that “the impact of trade and outsourcing is one of the only issues on which Americans of different classes, occupations and political persuasions agree,” with 86% saying that outsourcing jobs by U.S. companies to poor countries was “a top cause of our economic woes,” with 69% thinking that “free trade agreements between the United States and other countries cost the U.S. jobs.” Only 17% of Americans in 2010 felt that “free trade agreements” benefit the U.S., compared to 28% in 2007.

Arthur Stamoulis, executive director of Citizen Trade Campaign  said: “If they were to negotiate an agreement that put human rights ahead of corporate profit, creating more just and sustainable social policy, the TPP could be a tool for incredible good. But if you look at who has a seat at the table, with the public shut out and more than 600 corporate lobbyists included, there is nothing to indicate that’s the deal we’re going to get.”

The developing opposition to the corporate coup that the TPP represents has the potential to win. It’s about time for the people to win one victory in the corporate class war. Our first chance in this campaign will be over granting fast track Trade Promotion Authority. And that battle will be followed by the fight over Senate approval of TPP itself. This is one that we can win. The stakes are high. The alternatives are democracy or plutocracy.

******

Cliff DuRand is a Research Associate at the Center for Global Justice and a contributor to the CIP Americas Program http://www.cipamericas.org. He is co-author and co-editor of Recreating Democracy in a Globalized State (Clarity Press, 2012). Contact him at global.justice.cliff@gmail.com

For More Information:

Public Citizen’s Global Trade Watch  http://www.citizen.org/trade

on TPP http://www.citizen.org/TPP

Citizens Trade Campaign www.citizenstrade.org

A coalition of labor, environmental, religious, family farm, and consumer organizations united in the pursuit of socially and environmentally just trade policies.

It’s Our Economy www.itsoureconomy.us

It’s Our Economy seeks to educate, organize and mobilize Americans to shift the power from concentrated capital to the people.  http://itsoureconomy.us/occupy-the-tpp-stop-the-global-corporate-coup/

April 13, 2013 Posted by | Civil Liberties, Economics, Full Spectrum Dominance | , , , , , , | Comments Off on Trans-Pacific Partnership: Free Trade vs. Democracy