Free Trade Deals are Not Working for Middle Class Americans

[KeithE]

Both Bernie Sanders and Donald Trump know this and that is why they are getting the lion’s share of people to their political rallies. Jobs is the big issue.

Here are three recent articles on how these trade deals (NAFTA, CAFTA, and yet to be enacted TPP and TTIP) are making the wealthy fabulous wealthy while lowering wages and jobs prospects for ordinary Americans.

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Slightly disagree with Frank’s article in that he believes the manufacturing jobs will return; I agree with Reich/Bernstein that new higher paying jobs in R&D, education, energy distribution, internet services, etc. are better and more likely for the USA right now (Sanders agrees).

On the flip side, is the Heritage Foundation’s praise of FTAs. Of course it is controlled by ideologues and/or billionaires for billionaires (whether they know it or not). 88% of the people writing the TPP has been from business interests. Their chief concerns are extending intellectual property for decades, and providing cheap labor. There have little if any concern for environment or labor practices; in fact the TPP and TTIP have provisions that enable corporations to sue governments that do try to save the environment and/or enforce labor rights. These free trade agreements (FTAs) have helped create low wage jobs abroad and flooded our markets with cheaper goods. But our middle/lower class people have little money to buy those cheap goods while the wealthy buy higher class stuff or just stash their money away. One chief unintended result of NAFTA/CAFTA is that it has killed the small farmers in Central America forcing them to run to the US often splitting up families. Trumpism would deny even these desperation moves of these farmers.

The State Dept has offered it's praise of FTAs given . Both Democratic and Republican establishments have come out in favor of FTAs since their donors (the Corptocracy and Wall Street) are for it and the subject matter is too complex for most Americans to understand. However, Americans do feel the results (lack of good paying jobs) and that is what both Sanders and Trump are playing to (rightfully so, imo).

Trump is not worthy to be President due to other factors - his shear arrogance, penchant for badmouthing people/groups, intention to increase foreign interventions, ridiculous claims what what he will do (e.g. infrastructure improvements and deporting immigrants/building a wall) while lowering taxes, etc..... Sanders OTOH has a plan - he sees jobs in more government-funded research (especially renewable energy), higher paying education jobs, infrastructure repair and expansion, mass transportation, Medicare-for-all, all funded by increased taxes on the rich, removal of SS tax cap, a small financial transaction tax, and carbon taxes. except he may have to compromise on infrastructure or assume a Keynesian kick to revenues and/or productivity improvements. READ this last link please.

This is a huge issue affecting millions of people in this country, but it is little understood.

Any comments?

[Sandy]

Trump is a one percenter, and I agree with Bernie Sanders that he is a pathological liar. It's always been about him, so I have no expectation that he will do anything as president except badger and push Congress to make the rich richer at the expense of those who seem to be supporting him, and the rest of us in the middle class. His racism and bigotry has attracted a following of thug racists and bigots, and his philosophy of government is fascist. If he's elected, he will push to create an oligarchy of the wealthy.

I agree with what you say regarding the trade deals in which we've engaged. The problem though, hasn't been that we've engaged in them, but that the obstructionist Congress has prevented the current administration from taking the kind of enforcement and "deal making" action that Trump keeps screaming about. The current administration has attempted to take action to equalize trade agreements with tax policy, interest rates and other tools that would strengthen our position, but the Republicans in Congress, in their obsession to keep the president from having any meaningful accomplishments, are stonewalling those proposals and plans, because they are more willing to let the country suffer and collapse than provide job growth and economic recovery. Well, Obama's policies have done a lot of that anyway, in spite of the stonewalling, but it could have been better.

[KeithE]

[Dave Roberts]

Until we work on our education system, especially to improve STEM subjects, our jobs will continue to depart, and we will continue to import skilled people who have the education and skills to do them. Public education has been streamlined and tested to death and made responsible to legislatures across the country, all in the name of better education, but it is not happening. I see so many second and third-rate buildings, have seen vocational schools with outdated equipment and programs, and see science labs in schools that have not really been updated since the early 1960's (when we feared that Ivan might know more than Johnny). Recently, there was a Washington Post survey to locate the twenty top high schools in VA. What was interesting, almost half were in the Washington suburbs, the rest were in the corridor of Richmond, the Tidewater, or in university settings, all of which are privileged places with massive resources. The majority of the state's schools were not even competitive. Then, we keep muddying the waters of science teaching by trying to keep the religious right on board with pseudo-science, we try to avoid unpleasant historical facts, and we graduate young people who cannot cope with demanding fields of study. I am in an area where most of our doctors are foreign-born, and only three of the current local practitioners have their roots in the area. American kids are not being prepared for the future.

[KeithE]

[Sandy]

[ET]

I'm curious, Sandy, if a tree is cut down in a forest and no one is around but Obama holding a chainsaw, would you blame it on Republicans?

Trade deals are complicated things. Probably never been one to make everybody happy. I don't buy into the analysis Keith provided, which is really nothing but political rhetoric with little to no substantive analysis, but at least the "ideologue" from the Heritage Foundation provided some graphs and charts compared to the other anti-trading folks. (If Keith can label those on the other side as "ideologues", I shall insist on being able to paint just as broadly and be able to label the folks he likes as "anti-trade". I don't believe I've ever quoted anyone who has a different view of economic or political matters that Keith didn't label an "ideologue".)

I have been employed for just over 30 years by a "business interest". If the "business interests" of my employer is included in such a trade deal whereby aforementioned "business interest" makes more money, how is this a bad thing for me? It is my general understanding of economics that says for me to remain employed the "business interest" the "business interest" that provides my paycheck must be able to make money so that the check doesn't bounce. However, I maybe I've missed something.

Many of you guys need to stop living in the 1950s. You don't live in a world any longer where most of the civilized world is digging out of the rubble of a world war and there was pretty much only 1 first-world economy still standing and able to provide the goods and services of growing economies around the world. Folks have options. They don't have to pay the costs that come with that $15/hr min wage rate you wish to impose, nor the "tag-along" costs of any large number of regulatory costs. The American worker nor the American government can dictate to the rest of the world the price of goods -- they can just go shop elsewhere.

I realize such simple notions may escape folks like Robert Reich, but I imagine the proliferation of many of the technological conveniences of modern life - even among the poor in this country - has to with the ability of folks to make those products more cheaply in other parts of the world - or to at least employ the economic concept of .

Who decides how many manufacturing jobs America should have? Does America have a "right"to 20 million such jobs? What of productivity? If it only takes 12 million manufacturing jobs today to produce the same amount of goods that it formerly took 15 or 20 million, then why should we be concerned with the "loss" of manufacturing jobs?

If other countries offer lower labor costs to the rest of the world and you seek to mandate American companies pay a minimum of $15/hr or higher, to whom will American companies sell their wares if other countries can produce the same product - or maybe license it from an American company - and produce it for 20, 30 or 50% less than American labor can produce?

Will you restrict what Americans can buy from overseas to protect American jobs? What does "protect American jobs" mean other than imposing costs on companies so that EVERY citizen has to pay more for goods? Will we have to return to the '70s when American cars gained a reputation for low quality because Bernie and Hillary and Donald are going to protect them from competition?

Most progressives are lusting after the profits that American companies have kept overseas due to the American corporate tax rate. Every other OECD country has a territorial taxation system whereby profits made in another country are taxed in that country and then brought untaxed back to the home country. Since so often the progressives quote what other OECD countries are doing, why shouldn't America pursue a lower rate of corporate taxation by implementing a territorial taxation system? All those profits stashed overseas would then be free to be brought back here and put to use.

And if you do not revise the tax code, how will the middle class benefit when American companies cannot compete due to higher taxes? When manufacturers in other countries can offer the same product for sale at a lower cost due to a lower tax burden, why would the investors of the world want to invest in an American company that would hire American workers when they can get a better rate of return from a company that has set up shop in a country that can offer a more favorable business environment?

Bernie may be too old to realize it, but tens of millions of folks with lots of money are not limited in where they can send their money for investment. They can decide it's better to make their money in another part of the world where the business climate is more favorable than one burdened by all sorts of Big Government mandates and regulatory idiocy.

With all the increased labor and regulatory costs my progressive friends seek to impose on the American business community, why would anyone wish to invest in the American business climate you wish to create? And should the investors of the world find the costs you impose too high, how will these "good paying jobs" ever come about?

[Sandy]