“Sanders Still Threatening A Floor Fight”: An Honest Discussion About Free Trade Is Not Likely In This Election
The DNC’s Platform Committee completed work last weekend on a draft document that will be discussed at a meeting in Orlando prior to being taken up at the Convention. According to reports, they reached a lot of important compromises, especially on the issue of Wall Street reforms.
But Nicole Gaudiano writes that Bernie Sanders is still threatening a floor fight over the platform if he doesn’t get further concessions. His primary target is the Trans Pacific Partnership trade agreement.
Most important to Sanders, he said, is that the platform opposes a vote in Congress on the Trans-Pacific Partnership, a proposed 12-nation trade pact he says would have “disastrous” consequences for U.S. workers and the environment. Clinton’s supporters on the drafting committee rejected such an amendment by one of Sanders supporters last weekend.
…Sanders said “we want to see the TPP killed” and the amendment should have won overwhelmingly, but he said Clinton’s representatives worried they would “embarrass” President Obama, who has pushed for the TPP.
“Well, I don’t want to embarrass the president either. He’s a friend,” Sanders said. “But in a Democratic society, people can have disagreements.”
While it’s true that President Obama isn’t wavering in his support of TPP and a plank opposing it in his own party’s platform would be unprecedented, to hear Sanders talk, you would assume that all Democrats except the President oppose the deal. That is not true. As I wrote over a year ago, the U.S. Conference of Mayors (which is dominated by Democratic mayors) endorsed TPP. Ron Brownstein more recently reported on why that support from our major metropolitan areas is unwavering. Moreover, a few months ago, Max Ehrenfreund summarized polls showing that the American public in general has mixed feelings about free trade.
To the extent that Sanders wants to make this all about “Clinton’s representatives” or protecting President Obama from embarrassment, he is simply ignoring the position of Democrats from all over the country. Contrary to what many would have us believe, there is not a consensus position on free trade within the Democratic Party. That probably explains why the platform committee settled on language “that said ‘there are a diversity of views in the party’ on the pact and reaffirmed that Democrats contend any trade deal ‘must protect workers and the environment.’”
In this election, the American public is not getting an honest discussion about free trade. We all know that Donald Trump is demagoguing the issue, Bernie Sanders is simply saying “no” while exploiting the fears that were stirred up by NAFTA and Hillary Clinton is dodging the issue. In other words, the opponents are yelling so loud that no one else is even trying to speak up.
As someone who recognizes that trade is necessary and that agreements are a way to protect not only our economy/environment but have played a vital role in lifting people out of extreme poverty around the globe, this is an unacceptable situation. Discussing trade agreements raises hard issues that are likely to lead to both payoffs and sacrifices. One has to wonder if the American public is capable of having a discussion like that right now. In an election year, I guess not.
By: Nancy LeTourneau, Political Animal Blog, The Washington Monthly, June 29, 2016
“Robber Baron Recessions”: Growing Monopoly Power Is A Big Problem For The U.S. Economy
When Verizon workers went on strike last week, they were mainly protesting efforts to outsource work to low-wage, non-union contractors. But they were also angry about the company’s unwillingness to invest in its own business. In particular, Verizon has shown a remarkable lack of interest in expanding its Fios high-speed Internet network, despite strong demand.
But why doesn’t Verizon want to invest? Probably because it doesn’t have to: many customers have no place else to go, so the company can treat its broadband business as a cash cow, with no need to spend money on providing better service (or, speaking from personal experience, on maintaining existing service).
And Verizon’s case isn’t unique. In recent years many economists, including people like Larry Summers and yours truly, have come to the conclusion that growing monopoly power is a big problem for the U.S. economy — and not just because it raises profits at the expense of wages. Verizon-type stories, in which lack of competition reduces the incentive to invest, may contribute to persistent economic weakness.
The argument begins with a seeming paradox about overall corporate behavior. You see, profits are at near-record highs, thanks to a substantial decline in the percentage of G.D.P. going to workers. You might think that these high profits imply high rates of return to investment. But corporations themselves clearly don’t see it that way: their investment in plant, equipment, and technology (as opposed to mergers and acquisitions) hasn’t taken off, even though they can raise money, whether by issuing bonds or by selling stocks, more cheaply than ever before.
How can this paradox be resolved? Well, suppose that those high corporate profits don’t represent returns on investment, but instead mainly reflect growing monopoly power. In that case many corporations would be in the position I just described: able to milk their businesses for cash, but with little reason to spend money on expanding capacity or improving service. The result would be what we see: an economy with high profits but low investment, even in the face of very low interest rates and high stock prices.
And such an economy wouldn’t just be one in which workers don’t share the benefits of rising productivity; it would also tend to have trouble achieving or sustaining full employment. Why? Because when investment is weak despite low interest rates, the Federal Reserve will too often find its efforts to fight recessions coming up short. So lack of competition can contribute to “secular stagnation” — that awkwardly-named but serious condition in which an economy tends to be depressed much or even most of the time, feeling prosperous only when spending is boosted by unsustainable asset or credit bubbles. If that sounds to you like the story of the U.S. economy since the 1990s, join the club.
There are, then, good reasons to believe that reduced competition and increased monopoly power are very bad for the economy. But do we have direct evidence that such a decline in competition has actually happened? Yes, say a number of recent studies, including one just released by the White House. For example, in many industries the combined market share of the top four firms, a traditional measure used in many antitrust studies, has gone up over time.
The obvious next question is why competition has declined. The answer can be summed up in two words: Ronald Reagan.
For Reagan didn’t just cut taxes and deregulate banks; his administration also turned sharply away from the longstanding U.S. tradition of reining in companies that become too dominant in their industries. A new doctrine, emphasizing the supposed efficiency gains from corporate consolidation, led to what those who have studied the issue often describe as the virtual end of antitrust enforcement.
True, there was a limited revival of anti-monopoly efforts during the Clinton years, but these went away again under George W. Bush. The result was an economy with far too much concentration of economic power. And the Obama administration — preoccupied with the aftermath of financial crisis and the struggle with bitterly hostile Republicans — has only recently been in a position to grapple with competition policy.
Still, better late than never. On Friday the White House issued an executive order directing federal agencies to use whatever authority they have to “promote competition.” What this means in practice isn’t clear, at least to me. But it may mark a turning point in governing philosophy, which could have large consequences if Democrats hold the presidency.
For we aren’t just living in a second Gilded Age, we’re also living in a second robber baron era. And only one party seems bothered by either of those observations.
By: Paul Krugman, Op-Ed Columnist, The New York Times, April 18, 2016
“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
“Republican Obstructionalism”: Why The Democratic Candidates Can’t Confront The Real Elephant In The Room
In last night’s Democratic debate, there was only one question, to Bernie Sanders, on what may be the most difficult challenge that will confront the next president if he or she is a Democrat: What are you going to do about Congress?
We’ll get to the answer Sanders gave in a moment, but first, some context. When Barack Obama was elected, congressional Republicans made what was in some ways a strategically shrewd decision, that they were going to oppose him on basically everything. Because he started with huge majorities in both houses of Congress, he had an extraordinary record of legislative achievement in his first two years, that opposition notwithstanding. But in 2010 Republicans won the House, and four years after that they took the Senate. For all intents and purposes, legislating was over.
In those two wave elections of 2010 and 2014, a generation of extremely conservative Republicans who viewed all compromise as betrayal were elected, moving the party to the right ideologically and making it far more obstructionist. Now let’s say a Democrat wins in 2016. What happens then?
It’s almost a certainty that Republicans will retain control of the House. Democrats have a chance to win back the Senate (Republicans have to defend many more seats, because everyone who won in 2010 is up for reelection), but even if they do, it certainly won’t be with a filibuster-proof majority. Not only that, if Democrats make gains, it will be in those few competitive states and House districts, which would mean that the remaining Republicans would as a group be even more conservative than they are now. Are they going to be in the mood to work with a Democratic president?
So here’s what Bernie Sanders said when he was asked about this problem:
“Now, in my view, the only way we can take on the right wing Republicans who are, by the way, I hope will not continue to control the Senate and the House when one of us is elected President. But the only way we can get things done is by having millions of people coming together. If we want free tuition at public colleges and universities, millions of young people are going to have to demand it, and give the Republicans an offer they can’t refuse.
“If we want to raise the minimum wage to $15 bucks an hour, workers are going to have to come together and look the Republicans in the eye, and say, “We know what’s going on. You vote against us, you are out of your job.”
In 2007, Mark Schmitt called the argument among Hillary Clinton, Barack Obama, and John Edwards the “theory of change primary.” As Clinton would describe it in speeches, Edwards thought you demand change, Obama thought you hope for change, and she thought you work for change. Sanders’ theory, as he lays it out here, is essentially that you force change, by making it too politically dangerous for Republicans to resist.
Which is realistic in one way and unrealistic in another. On one hand, Sanders is not bothering to indulge the dream that you can reach across the aisle and bring Democrats and Republicans together. In fact, no candidate from either party is saying that — and after the last seven years, who could do so with a straight face? But that’s a dramatic change from the last couple of decades.
Though they all ended up inspiring partisan passions, our last three presidents all ran as conciliators who could unite Washington and the country. Bill Clinton was going to create a liberal/conservative synthesis, a “Third Way” that could attract support from both parties. George W. Bush touted his record working with Democrats in Texas. “I want to change the tone of Washington to one of civility and respect,” he said in his 2000 convention speech. Barack Obama, who became a national figure in a 2004 convention speech where he said, “there’s not a liberal America and a conservative America; there’s the United States of America,” thought that he could sit down with everyone, earnestly listen to their concerns, and bring them around at least some of the time. All three presidents failed at this goal.
But if Sanders is being realistic about the present, his portrait of his future presidency has a big problem, particularly in the House. Let’s say he succeeds in creating a mass movement behind parts of his agenda. Is he really going to be able to raise the political risk of opposing something like free public college tuition high enough to overcome House Republicans’ personal inclinations and their constituents’ wishes?
Imagine you’re a Republican representative who hails from a conservative district in Alabama or Idaho or Tennessee; we’ll call him Jim. Jim is right now stopping comprehensive immigration reform, which the GOP as a whole knows it needs to pass in order to have any chance of appealing to the growing Hispanic population. But Jim won’t sign on, because though that might be good for the party, it’s bad for him. His conservative constituents don’t want it, he personally doesn’t want it, and the only political risk he fears is a primary challenge from the right.
Is Jim really going to be scared and/or persuaded when a bunch of young people in America’s cities — even if there are millions of them — create a movement behind President Sanders’ plan for free college tuition? Don’t bet on it.
It should be noted that their obstructionism, and the demands it creates among their own constituents, may keep the GOP from winning the White House as long as it continues. But that’s not really a problem for Jim. Indeed, if they lose again, Jim and others like him will tell themselves that it was only because their nominee wasn’t conservative enough.
I’m talking about Sanders here because he’s the one who got that question last night, but I haven’t heard Clinton address this problem in a real way, either. And maybe there’s no good solution. I’m not sure how I’d tell them to answer it if I were advising them, at least not if they want to maintain the lofty, hopeful tone presidential candidates tend to use, where they present themselves as potent agents of change and renewal who can overcome any obstacle. No candidate is going to tell voters, “Here are the things I’d like to do, although, let’s be honest, I probably won’t be able to.” Even if it’s the truth.
By: Paul Waldman, Senior Writer, The American Prospect; Contributor, The Plum Line Blog, October 14, 2014
“This Is What Erasure Looks Like”: We Are Witness To The Vandalism Of African-American Memory
“This,” says Roni Dean-Burren, “is what erasure looks like.”
She’s talking about something you might otherwise have thought innocuous: a page from World Geography, a high school textbook. A few days ago, you see, Dean-Burren, a former teacher and a doctoral candidate at the University of Houston, was texted a caption from that book by her son Coby, who is 15. It said that the Atlantic slave trade “brought millions of workers from Africa to the southern United States to work on agricultural plantations.” This was in a section called “Patterns of Immigration.”
She says the words jumped out at her. After all, a “worker,” is usually someone who gets paid to do a job. An immigrant is usually someone who chooses to come to a new country. Neither of which describes the millions of kidnapping victims who cleared America’s fields and endured its depravities in lives of unending bondage that afforded them no more rights under the law than a dog or a chair.
As the Trail of Tears was not a nature walk and the Normandy invasion not a day at the beach, black people were neither workers nor immigrants, but slaves. Dean-Burren, who is black, took to social media to explain that. You can guess what happened next. The story went viral, and the embarrassed publisher, McGraw-Hill Education, scrambled to apologize and fix the mess.
That’s all well and good. But let no one think this was incidental or accidental. No, there is purpose here. There is intent. In recent years, we’ve seen Arizona outlaw ethnic studies, Texas teach that slavery was a “side issue” to the Civil War, a Colorado school board require a “positive” spin on American history, and Glenn Beck claim the mantle of the Civil Rights Movement.
We are witness to the vandalism of African-American memory, to acts of radical revision and wholesale theft that strike at the core of black identity. Once your past is gone, who are you? What anchor holds you? So Dean-Burren’s word strikes a powerful chord: This is, indeed, erasure — like a blackboard wiped clean, all the inconvenient pain, sting and challenge of African-American history, gone.
It is, she says, “the saddest thought ever” that her grandchildren might not know Nat Turner’s rebellion or Frederick Douglass’ harsh condemnation of slavery. “The fact that they may not know what it was like for women to get the right to vote, the fact that they may not know that millions of Native Americans were slaughtered at the hands of ‘Pilgrims’ and explorers … I think it says a lot about our society.”
Nor is she persuaded by the argument that teaching the uglier aspects of American history would make students hate their country. She calls that “a crock of poo.” And it is. America’s ugliness defines its beauty as silence defines sound and sorrow defines joy.
“We tell our children that all the time: ‘The reason you’re standing here today … and you have what you have and you can go to the schools you want to go to, and you can say out loud, ‘I want to be an Alvin Ailey dancer …’ or ‘I want to go to Stanford,’ … is that you come from survivors. You come from people who said, ‘I’m going to stick it out. I’m going to make it. I’m going to keep pushing.’ If we don’t know the ugly, I don’t know how you can really love the pretty.”
To put it another way: Black History Matters. So let us be alarmed at attempts to rewrite that history for the moral convenience of others or to preserve what James Baldwin and Ta-Nehisi Coates have described as the fiction of white American “innocence” where crimes of race are concerned. They keep trying to make it less painful, says Dean-Burren, like putting a document through a Xerox machine and making it lighter, lighter and lighter still.
“And then, when you look up, there’s nothing on the page.”
By: Leonard Pitts, Jr., Columnist for The Miami Herald; The National Memo, October 12, 2015
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