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“Trade, Labor, And Politics”: Whatever They May Say, Politicians Who Espouse Rigid Free-Market Ideology Are Not On Your Side

There are a lot of things about the 2016 election that nobody saw coming, and one of them is that international trade policy is likely to be a major issue in the presidential campaign. What’s more, the positions of the parties will be the reverse of what you might have expected: Republicans, who claim to stand for free markets, are likely to nominate a crude protectionist, leaving Democrats, with their skepticism about untrammeled markets, as the de facto defenders of relatively open trade.

But this isn’t as peculiar a development as it seems. Rhetorical claims aside, Republicans have long tended in practice to be more protectionist than Democrats. And there’s a reason for that difference. It’s true that globalization puts downward pressure on the wages of many workers — but progressives can offer a variety of responses to that pressure, whereas on the right, protectionism is all they’ve got.

When I say that Republicans have been more protectionist than Democrats, I’m not talking about the distant past, about the high-tariff policies of the Gilded Age; I’m talking about modern Republican presidents, like Ronald Reagan and George W. Bush. Reagan, after all, imposed an import quota on automobiles that ended up costing consumers billions of dollars. And Mr. Bush imposed tariffs on steel that were in clear violation of international agreements, only to back down after the European Union threatened to impose retaliatory sanctions.

Actually, the latter episode should be an object lesson for anyone talking tough about trade. The Bush administration suffered from a bad case of superpower delusion, a belief that America could dictate events throughout the world. The falseness of that belief was most spectacularly demonstrated by the debacle in Iraq. But the reckoning came even sooner on trade, an area where other players, Europe in particular, have just as much power as we do.

Nor is the threat of retaliation the only factor that should deter any hard protectionist turn. There’s also the collateral damage such a turn would inflict on poor countries. It’s probably bad politics to talk right now about what a trade war would do to, say, Bangladesh. But any responsible future president would have to think hard about such matters.

Then again, we might be talking about President Trump.

But back to the broader issue of how to help workers pressured by the global economy.

Serious economic analysis has never supported the Panglossian view of trade as win-win for everyone that is popular in elite circles: growing trade can indeed hurt many people, and for the past few decades globalization has probably been, on net, a depressing force for the majority of U.S. workers.

But protectionism isn’t the only way to fight that downward pressure. In fact, many of the bad things we associate with globalization in America were political choices, not necessary consequences — and they didn’t happen in other advanced countries, even though those countries faced the same global forces we did.

Consider, for example, the case of Denmark, which Bernie Sanders famously held up as a role model. As a member of the European Union, Denmark is subject to the same global trade agreements as we are — and while it doesn’t have a free-trade agreement with Mexico, there are plenty of low-wage workers in eastern and southern Europe. Yet Denmark has much lower inequality than we do. Why?

Part of the answer is that workers in Denmark, two-thirds of whom are unionized, still have a lot of bargaining power. If U.S. corporations were able to use the threat of imports to smash unions, it was only because our political environment supported union-busting. Even Canada, right next door, has seen nothing like the union collapse that took place here.

And the rest of the answer is that Denmark (and, to a lesser extent, Canada) has a much stronger social safety net than we do. In America, we’re constantly told that global competition means that we can’t even afford even the safety net we have; strange to say, other rich countries don’t seem to have that problem.

What all this means, as I said, is that the Democratic nominee won’t have to engage in saber-rattling over trade. She (yes, it’s still overwhelmingly likely to be Hillary Clinton) will, rightly, express skepticism about future trade deals, but she will be able to address the problems of working families without engaging in irresponsible trash talk about the world trade system. The Republican nominee won’t.

And there’s a lesson here that goes beyond this election. If you’re generally a supporter of open world markets — which you should be, mainly because market access is so important to poor countries — you need to know that whatever they may say, politicians who espouse rigid free-market ideology are not on your side.

 

By: Paul Krugman, Op-Ed Columnist,  The New York Times, March 28, 2016

March 28, 2016 Posted by | Bernie Sanders, Hillary Clinton, International Trade Agreements, Protectionism | , , , , , , , , | 1 Comment

“So Much Unpaid, Unrewarded Labor”: Why Women Should Get The Rest Of The Year Off

As of October 11, the average American woman who works full time, year-round started working for free.

That’s because she makes just 78 percent of what a man makes. If a man’s pay lasts the whole year long, hers doesn’t even make it to Halloween.

Women of color have been putting in even more time. Black women have been working for free since August 21. Hispanic women have been doing so since July 16.

Even if we take into account things like the fact that women tend to go into different industries and occupations, stay in the labor force for less time (often thanks to raising children), and are less likely to be in a union, women should still walk away from work beginning Black Friday and not come back until New Years Day.

The fact that women’s work comes so heavily discounted has inspired unions in Denmark for the last five years to call on Danish women to take the rest of the year off after they reach that point—and they have just a 17 cent pay gap, one of the world’s smallest. “It’s a way to remove the gender pay gap in a split second,” Lise Johansen, who heads the campaign for the Danish Confederation of Trade Unions, told Bloomberg News. “Go to a tropical island for the rest of the year!”

Women aren’t just working for free when they leave their houses, of course. They’re working for free every day of the year when they go home and raise children, cook meals, and clean house. They devote far more time to this than men: they spend a half hour more on child care, housework, cooking, and household management each day compared to men. That’s double the time men spend on child care.

That time may not be rewarded, but it still has a value. Take the effort women put in caring for elderly parents, which they are far more likely to do compared to men. If all the informal elderly caregiving by family and friends were instead replaced by someone paid to do it, the total would be $522 billion a year. That’s a half trillion dollar gift (mostly) women give to society.

So maybe they should get even more time off than just what the gender wage gap allows, since they’re putting in so much unpaid, unrewarded labor. Given that they do seven hours more housework each week, or fifteen extra days a year, and eight hours more child care a week, or seventeen days a year, let’s call it even if they get another month tacked on to their early vacations. Being generous, that means women could have thrown in the towel when we reached the end of October.

What would happen if American women stopped working inside and outside the home for two months out of the year? It’s all obviously relegated to the world of thought experiments. Even in Denmark, where three-quarters of the workforce belongs to a union, women won’t actually heed the mostly joking call to stay away from work, and here in the United States union power is far lower.

But desperate times call for desperate measures, and when it comes to the wage gap, these are increasingly desperate times. The gap was closing quickly and steadily between the 1960s and 1990s and continued to shrink in the 2000s, but over the last decade, it’s only budged by 1.7 percentage points. At this rate, the Institute for Women’s Policy Research estimates it won’t close until 2058. While President Obama has issued executive orders related to equal pay and Democrats in Congress have proposed bills like the Paycheck Fairness Act, none of these measures will close the gap on their own. In the meantime, the pay gap contributes to more women living in poverty, relying on government benefits, and facing economic instability in their retirement years.

Maybe what’s needed is for this issue to jump from a talking point to a day of action. Perhaps if the country witnessed what it would be like for half the population to refuse to type a word, ring up a purchase, pick up a wrench, or to wipe a booger or a counter, women’s value would be brought into sharp focus. Then we might see some aggressive action to correct for the discrimination that still suppresses women’s wages. Until then, women should at least slack off as much as they can for the remainder of the year.

 

By: Bryce Covert, The Nation, November 13, 2014

November 16, 2014 Posted by | Economic Inequality, Gender Gap, Wages | , , , , , , | 1 Comment

   

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