Its Time to Start Over on Trade

In a challenge to President-elect Donald Trump, EPI Distinguished Fellow Jeff Faux writes in U.S. trade policy—time to start over that Washington’s fixation with trade agreements has diverted attention from the more important question of how to put American workers back on the historic track of rising wages and opportunities.

Faux warns that, having declared the multinational Trans-Pacific Partnership dead, Trump now says he intends to continue the pursuit of bilateral trade deals, on the grounds that he is a better negotiator. But even if he is, writes Faux, new deals will not solve the problems of off-shored jobs and depressed wages that Trump raised during the presidential campaigns. http://www.epi.org/publication/u-s-trade-policy-time-to-start-over/

Therefore, Faux calls on Trump to announce an indefinite freeze on any new trade negotiations, until his administration and the Congress commit to and implement a credible comprehensive agenda for making American workers competitive and balancing our trade with the rest of the world.

“For two decades Democratic and Republican leaders have had it backwards,” writes Faux. As the Economic Policy Institute has been reporting for decades, trade deals have systematically traded away the income and job security of American workers in exchange for promoting the interests of American international investors. The effect has been to “open up American workers and their communities to brutal global competition for which they have not been prepared. The result is that the costs to American workers of each cycle of expanded trade relentlessly exceed the benefits.” Continue reading

Why Did Trump Win? And What is Next for Labor?

Why Did Trump Win? And What’s Next for Labor in the US?http://stansburyforum.com/why-did-trump-win-and-whats-next-for-labor-in-the-us/
Peter Olney and Rand Wilson
The Stansbury Forum

 

European elites were shocked at the surprising victory of “Brexit” last June. American elites — and especially the pollsters and major media outlets — were similarly shocked by the results of the U.S. elections on November 8.(1)

While Brexit was a straight up “Yes” or “No” vote, Hillary Clinton won the popular vote, but lost because of the Electoral College [1] system of electing our national presidents. The Electoral College is an arcane constitutional provision intended to protect smaller states from the population power of larger states and the rule of the “mob” over the perceived wisdom of elite electors.

This is the fifth time in U.S. history that a presidential candidate has won the popular vote, but lost the election because of the anti-democratic Electoral College. The last time was in 2000 when George W. Bush became President after a Supreme Court ruled that he had won the vote in the state of Florida. That state’s electoral college vote gave Bush the election, even though a plurality of the American people voted for the Democratic nominee, Al Gore.

Trump heralded his election as “Brexit on steroids” and appeared at a rally in Mississippi with Nigel Frage from the British Independence Party. Both Brexit and Trump’s triumph tapped into a distraught white working class buffeted by globalization and new demographic realities. In many cases Trump’s appeal was pure and simple racism, attracting alt-right and overt racist elements. Yet while all racists, misogynists and xenophobes most likely voted for Trump, not all of his 60 million votes were racists, misogynists and xenophobes.

The Electoral College system made winning the states of Pennsylvania, Ohio and Wisconsin key to either candidate winning the White House. Why did Secretary Clinton lose in these three states that her predecessor Barrack Obama carried in 2008 and 2012? Workers in all three states have suffered huge job losses in basic industry and in the case of Pennsylvania, the closure of coalmines. The sons and daughters of “New Deal” Democrats many of whom supported Obama in 2008 and 2012 were looking to make a statement against the ruling elites and voted for change. Continue reading

Get Out and Vote!

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By John O. Mason

You simply MUST get out and vote this November 8; the stakes have never been higher for this country for a long time. Donald Trump is simply unfit to be President of the United States. His calling to build a wall against Mexico, characterizing all Mexicans as criminals, rapists, and drug dealers; his call for a ban on Muslims entering this country; his contempt for women in any capacity but subordinate to him; his associating with the most infamous racists like David Duke, and aligning with the racist “alt-right” movement; his encouraging assaults on protesters in his rallies; his willful ignorance about foreign affairs and the launch system for nuclear missiles; his refusal to say he would abide by the election results, win or lose-all these indicate the kind of President he would be, a dictator.

A myth in our politics says that “If we give the running of our government over to businessmen, they’ll run it as a business, efficiently and cost-effective.” Well, let’s see how businesslike Trump has been-Trump steaks, Trump vodka, Trump Shuttle airlines, trump magazine, Trump World magazine-all failed business ventures. Trump University-charged with fraud. His casinos and hotels-bankrupt. He has been able to negotiate his way out of trouble, since the bankruptcy laws are so weighed in favor of corporate types like him; but does he think that Putin, Kim Jong Un, or the Ayatollahs of Iran would cut him any breaks, give him any favors?

And Hillary-there is no other choice but to vote for her. Hillary Clinton DOES have political and governmental experience, albeit too much playing safe on the side of corporations. I fear that if we the people don’t constantly monitor the Clinton administration 2.0, it would be just like Bill’s regime, too much in favor of the corporations and shying away from those “nasty unions,” signing such trade deals as NAFTA in Bill’s time, and TPP, which lies dormant in Congress like a disease. Continue reading

How A Vote Saved California Schools

California 17,000 Teachers Laid  Off in 2009.

Four years ago California voters overwhelmingly passed Proposition 30, the emergency ballot measure that Governor Jerry Brown and state education leaders had argued was needed to rescue public schools and community colleges from the fiscal free-fall of the 2008 Great Recession.
The good news, according to the California school teachers and officials, parents, college professors, health-care advocates and economic researchers interviewed by Capital & Main for this series, is that the initiative not only performed as advertised, but it may be the most spectacularly successful ballot initiative in the state’s notoriously uneven history of direct democracy.
Proposition 30 averted thousands of new teacher layoffs during the Great Recession.

By raising income taxes on the wealthy and the sales tax on everyone, Prop. 30 dramatically stabilized school funding in the wake of the recession, averting thousands of new teacher layoffs while beginning the work of restoring the jobs and programs lost during the first years of the crisis. It was also instrumental in allowing the state legislature to balance its budget for the first time in years without slashing social programs.
About This Series

Together with a recovering economy, the temporary tax measure has to date reinvested more than $31.2 billion in preschool, K-12, and community colleges. By boosting per-pupil funding by more than 14 percent, Prop. 30 bumped the state’s Great Recession-battered national ranking from dead last in 2010-11 to 40th among all states at $10,493 per student in 2016-17. It’s still a far cry from California’s long-ago position as a top funder of public education, and a 2016 report estimates that merely moving California to the average funding level of the top 10 states would require roughly a doubling of current state funding under Prop. 30. Continue reading

Millions in U.S. Climb Out of Poverty

by Patricia Cohn,
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The availability of full-time jobs at a livable wage may be essential to move out of poverty but is not necessarily enough. Many poor people, saddled with a deficient education, inadequate health care and few marketable skills, find small setbacks can quickly set off a downward spiral. The lack of resources can prevent them from even reaching the starting gate: no computer to search job sites, no way to compensate for the bad impression a missing tooth can leave.
Many of those who made it had outsize determination, but also benefited from a government or nonprofit program that provided training, financial counseling, job hunting skills, safe havens and other services.
Cheyvonné Grayson, 29, grew up in South-Central Los Angeles, where he, at the age of 14, saw a friend gunned down. Since graduating from high school, Mr. Grayson has worked mostly as a day laborer. In 2014, he was paying $300 a month to sleep on someone’s couch and showing up at 6 a.m., morning after morning, at nonunion construction sites in the hopes of getting work.
Often the supervisors and workers spoke only Spanish, and it was hard to understand the orders and measurements. He remembered one foreman looking him up and down, skeptical that he could do the job.

“I had to prove this man wrong,” Mr. Grayson said.
At every site, he said he tried to pick up skills, carefully observing other workers, asking questions and later reinforcing the lessons by watching YouTube videos. Even so, the work was inconsistent and paid poorly, he said.
What made the difference, he said, was getting into the carpenters’ union — a feat he could not have achieved without the help of the Los Angeles Black Worker Center. “That was the door opener,” Mr. Grayson said.

He had to borrow a few hundred dollars for fees and tools, but his first apprenticeship as a carpenter started at $16.16 an hour. He quickly moved up to $20.20 an hour and is paid for his further training. He is now hanging doors for new dormitories at the University of Southern California.
For the first time in his life, he opened a bank account.

As a carpenter he started at $16.16 an hour. He quickly moved up to $20.20 an hour and is paid for his further training. He is now hanging doors for new dormitories at the University of Southern California.
For the first time in his life, he opened a bank account.
Read the entire piece. http://www.nytimes.com/2016/09/26/business/economy/millions-in-us-climb-out-of-poverty-at-long-last.html?_r=0

Trump Promises Jobs in Anthracite Coal Industry That Collapsed in 1950s

by Martin Kich

 Donald Trump spoke in Scranton, Pennsylvania, and promised to restore the jobs of coal miners.

I grew up in Scranton, and he might just as well have promised to restore the jobs of telegraph operators or those in typewriter factories.

The population of Scranton peaked at more than 140,000 in 1930. By 1960, the population had decreased to just over 110,000, and today it is between 75,000 and 80,000. The population decline mirrored the decline of the coal industry, though the production of coal ultimately fell more dramatically than the population.

Scranton remains the largest city in what is known as Pennsylvania’s “Coal Region.” Four substantial deposits of anthracite coal extend throughout a spur of the Appalachians in east central and northeastern Pennsylvania.

From the late nineteenth century through World War II, anthracite coal became the primary heating fuel for homes in the New York and Philadelphia metropolitan areas. Production peaked in 1917 at more than 100 million tons annually.

By 1950, annual production had dropped to 46 million tons. By 1970, it had dropped to 9.2 million tons, and by 1987, to 5.2 million tons.

Today, 7.9 million tons are produced annually. But that increase is very misleading if one believes that it can be equated with employment.

Through World War II, anthracite mining was a labor-intensive and dangerous enterprise and almost all of the anthracite produced was deep-mined. These conditions combined to produce much labor unrest, most famously in the violence perpetrated by the Molly Maguires, and by the 1930s, the “Coal Region” was a union stronghold.

But today, only about 235,000 tons of anthracite are produced by deep mining, about 2,316,000 by open-pit mining, and, most notably, about 5,444,000 tons by processing coal refuse.

Coal refuse accumulated near coal “breakers,” where the anthracite was separated from slate, slag, and other materials and then separated by size for use in various types of furnaces. The piles of coal refuse were known as culm dumps, and when I was a boy, Scranton tried to lure tourists by inviting them to come and witness the “”burning mountains.” In the summer, the coal in the culm dumps would ignite in orange bands that sometimes resembled lava. The sulphurous smell was just God-awful.

These culm dumps were often hundreds of feet high, and when Interstate 81 was constructed between Scranton and Binghampton, New York, several dozen of these “burning mountains” still stood along the southbound lanes of the new interstate. Most of the material in those and other culm dumps would be trucked to Scranton’s east and west sides, where the culm was flushed into mine tunnels that were starting to collapse under streets and homes.

In any case, the decline of the anthracite coal industry can be attributed to four factors: (1) the shift to oil and natural gas as home heating fuels following World War II; (2) the increased attention to the environmental damage produced both by mining and by burning coal (illustrated not just by the culm dumps but also by the Centralia mine fire, which is still burning decades after the town was largely abandoned); (3) the increased concern about on-the-job fatalities and disabling injuries and conditions, most notably “black lung”; and (4) the fact that the anthracite mines, especially in the northern part of the “Coal Region,” had reached the water table, making the coal much more expensive to extract.

In 1959, 16 miners died in the Knox Mine Disaster. The mine was located near Port Griffith, between Scranton and Wilkes Barre. The Susquehanna River broke through the ceiling of a mine shaft and eventually flooded most of the anthracite mine tunnels in Luzerne County. Historians find it a convenient marker for the demise of anthracite mining as a major industry, but they generally acknowledge that the industry suffered a long and sometimes agonizing death, rather than succumbing to a sudden catastrophe.

I have not been able to find out how many people are still employed in anthracite mining, but in 2010, only 8,724 people were employed directly in coal mining in Pennsylvania, which is still the nation’s sixth most populous state. Indeed, about four times that number of people in the state–32,853–are employed in manufacturing mining equipment. That number likely reflects not only  the increased automation of coal mining but also the rapid growth of the natural-gas fracking industry in Pennsylvania.

This article is reposted from the Academe Blog with the permission of the author.

[Ed. note:  As a Catholic high schooler in Harrisburg, PA in the 1950s, I admired the grittiness of the Coal Region football teams I played against.  But their families were already streaming out of the collapsing region to look for employment elsewhere.  Nothing “Berns” me more about Trump than his cynical and ignorant disregard for the suffering of actual working families – Paul Garver]

Who Gets the Gains from Trade?

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by Stan Sorscher

Let’s start the debate about trade policy on the right foot. Everyone I know is “for” trade. A better question is, “Who gets the gains from trade?”

Gains from anything, trade included, can be divided in 3 ways.

  1. Someone might give you your share of gains, for whatever reason.
  2. You might take your share, if you have power.
  3. You might get nothing, or possibly lose what you have.

Option 1 presumes some level of trust. Microsoft’s CEO, Satya Nadella, projected that sentiment onto women, when he told them to be patient and not ask for raises. Their bosses would recognize their value and reward them in due time. Nadella and other CEO’s are accustomed to power. He was probably expressing benevolence, muddled with sexism.

Ultimately, power relationships determine how gains are shared. If you have power, you get gains. If someone else has power, they get gains. If power is balanced, then gains are more likely to be shared.

Nadella’s paternalism is reflected in an edgy cliché told about trade policy, “Sure, trade creates winners and losers. The winners could compensate the losers.” Right. Winners might voluntarily compensate losers, but the point of being a winner is to win, not to compensate someone else!

Where do workers get power? I remember a time when unions made demands. They could strike to increase their share of gains from productivity and work. Union contracts would then set standards for employment generally.

Sorscher 1

Figure 1. Large works stoppages over time.

In the late 70’s that power started to evaporate.

Continue reading