In his upcoming State of the Union speech, President Barack Obama is expected to prioritize what is emerging as his legacy issue: combatting America's growing wealth inequality. Expect him to promote policies to create new middle-class jobs, especially in manufacturing, and counter the erosion of wages now undermining workers economy-wide.
But in the speech, Obama is also expected to highlight several major trade initiatives, including his priority Trans-Pacific Partnership (TPP) deal, a massive pact with 11 Asian and Latin American nations that Obama hopes to sign quickly. The business lobby is at full tilt pushing Obama to use the SOTU to call on Congress to pass Fast Track trade authority for the TPP.
The thing is that economists of all stripes agree that U.S. trade policy has been one of the major contributors to growing U.S. income inequality.
There really is no disagreement about that -- the only debate is about the degree of the effect. A study published by the Peterson Institute for International Economics -- an early supporter of the North American Free Trade Agreement (NAFTA) on which TPP is modeled -- estimated that as much as 39 percent of the observed growth in U.S. wage inequality is attributable to trade trends. Other studies have posited greater and lesser contributions.
The TPP would replicate and expand to additional countries the trade agreement model established in the NAFTA. Twenty years of evidence of NAFTA's contribution to U.S. income inequality has become a major problem for Obama's push to get Congress to provide Fast Track authority for the massive TPP deal, described as NAFTA on steroids.
Not a single House Democrat would sponsor the legislation submitted two weeks ago to establish Fast Track. Last week, 17 Senate Democrats made their feelings known in letters to Majority Leader Harry Reid (D-Nev.). And last November, 151 House Democrats signed a letter saying they oppose Fast Track, arguing that lawmakers have been cut out of negotiations.
Congressional opposition to more-of-the-same trade deals has intensified as Obama's past SOTU trade promises have fallen flat. In contrast to Obama's 2011 SOTU promise that his only major past trade deal, the U.S.-Korea Free Trade Agreement, would boost exports, in the agreement's first year, U.S. exports to Korea fell 10 percent, imports from Korea rose and the U.S. trade deficit with Korea exploded by 37 percent. This equates to a net loss of approximately 40,000 U.S. jobs.
The drop in exports to Korea added to last year's sluggish overall two percent U.S. export growth rate. Given current trends, the U.S. will not achieve the president's export-doubling plan until 2032 -- 18 years behind the 2014 deadline Obama set in his 2010 State of the Union speech.
This follows on the recent 20th anniversary of NAFTA, which fueled an explosion of the U.S. trade deficit with Mexico and Canada to $181 billion by 2012, resulting in a net American loss of one million jobs. (The net job loss figure is derived from the U.S. government methodology employed to calculate the employment effects of trade flows.)
U.S. government data show that the average annual growth of our trade deficit has been 45 percent higher with Mexico and Canada than with countries that are not party to a NAFTA-style pact. U.S. manufacturing exports have grown at less than half the rate to Mexico and Canada since NAFTA than in the years before it. Before NAFTA, the U.S. had a small trade surplus with Mexico and a modest deficit with Canada.
While many focus on the number of U.S. jobs lost from NAFTA and similar pacts, the most significant effect has been a fundamental alteration in the composition of jobs available to the 63 percent of American workers without a college degree. And this has had a direct impact on income inequality.
Trade pact investment rules remove many of the risks otherwise associated with sending jobs offshore to where labor costs are drastically cheaper. The United States has lost millions of manufacturing jobs during the 20 years of NAFTA and decade-plus since Congress approved China's entry to the World Trade Organization. As a result, the wages most U.S. workers can earn have been severely degraded even as overall unemployment has been largely stable (excluding the Great Recession) as new low-paying service sector jobs have been created.
According to the U.S. Bureau of Labor Statistics, two of every three displaced manufacturing workers who were rehired in 2012 experienced a wage reduction, most of them more than 20 percent. The list compiled by the Department of Labor's Trade Adjustment Assistance program of more than 845,000 specific American jobs lost to NAFTA and similar pacts reads like the funeral program for the middle class.
The implications for growing income inequality are broad. It is not only those American workers who lost a job to NAFTA or China trade who face downward wage pressure; as increasing numbers of workers displaced from manufacturing jobs joined the glut of workers competing for non-offshorable, low-skill jobs in sectors such as food service and retail, real wages have fallen in these growing sectors as well.
The U.S. government data is striking: The shift in employment from high-paying manufacturing jobs to low-paying service jobs has contributed to overall wage stagnation. The average U.S. wage has grown less than one percent annually in real terms since NAFTA was enacted even as worker productivity has risen more than three times. Since the January 1, 1994, implementation of NAFTA, the share of national income collected by the richest 10 percent has risen by 24 percent, while the top 1 percent's share has shot up by 58 percent.
Offshoring of American jobs is rapidly moving up the skills ladder, expanding the income inequality effect. Alan S. Blinder, a former Federal Reserve vice chair, Princeton economist and NAFTA supporter, says that one out of every four American jobs could be offshored in the foreseeable future. A study he co-authored found that the most offshorable industry is finance and insurance, not manufacturing. According to Binder's study, American workers with a four-year college degree and an annual salary above $75,000 are among those most vulnerable to having their jobs offshored.
The grandfather of modern free trade economics, Paul Samuelson, published a startling 2004 academic paper in the Journal of Economic Perspectives that shows mathematically how the offshoring of higher-paid jobs to low-wage countries can cause U.S. workers to lose more from reduced wages than they gain from cheaper imported goods. Trade theory states that while those specific workers who lose their jobs due to imports may suffer, the vast majority of us gain from trade "liberalization" because we can buy cheaper imported goods. Except, as job offshoring has moved up the wage level, this is no longer necessarily true.
When the Center for Economic and Policy Research applied the actual data to the trade theory, they discovered that when one compares the lower prices of cheaper goods to the income lost from low-wage competition under our current policy, the trade-related losses in wages hitting the vast majority of American workers outweigh the gains in cheaper priced goods from trade. U.S. workers without college degrees (the vast majority) lost an amount equal to 12.2 percent of their wages, so for a worker earning $25,000 a year, the loss would be more than $3,000 per year.
The 20-year record of NAFTA shows that deals like the Trans-Pacific Partnership would contribute to income inequality as more middle-class jobs are lost. Either Obama can prioritize a battle against income inequality or he can push more NAFTA-style trade agreements and the trade authority to railroad them through Congress, but he cannot do both.
Link to original article from Huffington Post
More information is available at http://www.citizen.org/fast-track.
Today SJ 78, a bill to ratify the stalled Equal Rights Amendment, was placed on the docket of the Elections subcommittee in the Virginia House. Could this signal GOP support for Constitutional pay equity? Even in the 21st century corporations continue to pay women less because they are women. Last week we learned that General Motors offered their first female CEO a salary 50% less than her male predecessors (the usual female pay discount is only 8%).
Rep. Victoria Steele’s (D-9) bill to ratify the Equal Rights Amendment (HCR2016) was assigned to the House Judiciary Committee late last week. (You’ll remember that mid-week, I reported it was languishing on the desk of House Speaker Andy Tobin.)
There is an ideological perfect storm brewing in the Arizona Legislature. A memorandum supporting extension of the ratification deadline for the Equal Rights Amendment (ERA) has been assigned to a committee where five out of seven members have pledged to protect and fight for the rights of fetuses over the rights of women.
What I know about sports, I learned watching movies, but what I know about fair play and equality, I learned watching my parents. Although movies Based on a true story, have evolved closer to reality since William Bendix played Babe Ruth, the brain damage of inequality requires more than A Hail Mary Pass at equal economic opportunity and Justice for All to tackle an Equal Rights Amendment fumbled by a deadline for ratification.
In November 2014, Americans will be heading to the polls to vote in the midterm elections.
Women will be voting.
If Alice Paul had not been alive to fight for that right, women still might not have the opportunity to make their voices heard in the United States of America.
January 11, 1885 was the day this great American woman was born and it is on this day that everyone should take a moment to recognize and celebrate her brave and progressive life.
People are out collecting signatures to get the Oregon’s Equal Rights Amendment (ERA) for women on the November 2014 ballot. This could mean a change to the state constitution to include language that specifically protects women. Oregon’s ERA for women has been out there several times before now, most recently before the legislative session in 2013, but it didn't pass.
Congratulations Rhode Island! Rhode Island is the first state to have 100% of their Federal delegation supporting our legislation. A special thanks to Senator Sheldon Whitehouse, Senator Jack Reed, Rep. David Cicilline and Rep. James Langevin. We appreciate your support.
Just a few weeks before his death, on October 11, 1963, President Kennedy received the final report of the President's Commission on the Status of Women. A direct line runs between the work of this commission and the establishment of the National Organization for Women.
If an Equal Rights Amendment were to pass, women would have the written support of the Constitution. Instead of women having to prove that they were being discriminated against, violators of the amendment would face a harsher reality, having to prove their innocence.
The benefits of ratifying the amendment are fairly simple. By passing the Equal Rights Amendment, the government would not only open doors of opportunity for women in the country, but also open them all around the world.
UPDATE: Linda Sanchez and Louise Roybal-Allard are now cosponsors of HJ Res 43. As Progressives we should all be outraged that of the 15 members of the Progressive Caucus from California, there are 5 (3) who have not co-sponsored Representative Rob Andrews legislation, HJ Res 43, removing the deadline for the ratification of the Equal Rights Amendment. Unacceptable. They are well aware of the legislation and we must alert them to this fact.
Targeting women’s right to vote may be the undoing of extreme governance and an opportunity to take care of constitutionally unfinished business for women – an Equal Rights Amendment (ERA). The newly declared war on the right of women in NC to vote looks to be the match to the fuse in the renewed push for passing an ERA.
A Major Victory for ERA (Equal Rights Amendment) advocates happened today as Senator Elizabeth Warren becomes the 32nd co-sponsor on Senator Ben Cardin’s bi-partisan bill, SJRES15 to remove the deadline to ratify the ERA.
In the spirit of Moral Mondays the Onslow County Democratic Party announced that this Monday’s demonstration on October 28th will focus on pushing back against the wave of legislation negatively impacting women’s rights to include the targeting of their voting rights. Demonstrators are civilly rallying from 5:00 pm to 6:00 pm outside the Jacksonville City Hall at 815 New Bridge Street to support the passage of an Equal Rights Amendment (ERA) checking state laws that are eroding women’s rights.
“Seems like old times,” was former ODP chair, David Leland’s comment when we exchanged greetings at the Statehouse, October 2nd. Indeed it did. About 1000 enthusiastic women and men showed up for a rally entitled, “We Won’t Go Back: Stand Strong with Ohio’s Women!”
Women earn less than men. Compared to white men, Latinas earn 59 cents for every dollar earned by a white man, black women earn 68 cents on the dollar, white women earn 81 cents on the dollar, and Asian women earn 88 cents on the dollar
The new push to ratify the Equal Rights Amendment (ERA) continues to grow as word spreads about the effort to get the Obama Administration to take a stand on the issue of equal rights for women. The ERA 2013 Action Campaign and its partner, ERA NOW, seek to gather 25,000 signatures on an official White House petition to trigger an official response from the Obama Administration, now needs only 4600 signatures by February 9th.
Enter your zip+4 and find your elected officials. This link provides name, address and phone number
Click on your state in the list to find out if your Senators and Representative are cosponsors of the Equal Rights Amendment. Then call and either Thank Them or ask them to support the legislation.
Sample scripts are below.
Thank You ScriptI am a voter in your district and the Equal Rights Amendment is very important to me and all my friends. Thank you for supporting equal rights.
Request SupportI am a voter in your district and the Equal Rights Amendment is very important to me and all my friends. Equality is a human rights issue. The Equal Rights Amendment has been stalled and we believe removing the ratification deadline will most the process forward. Please cosponsor SJ Res 15 (for Senators) HJ Res 43 (for your Representative)
We need to add the Equal Rights Amendment to the National conversation. Use our tool to send a letter to the editor of your local paper.
If your Senator(s) and/or Representative is not currently a supporter, they may not be aware that the legislation exists. Nothing sends a stronger message to a Congressional member than a personal visit to a district office by a voter with a written request for support. Phone calls and emails are incredibly important but nothing gets attention like a personal visit. Our Educate Congress page has information and a sample letter. Print the letter, sign it, deliver it.
There is no faster way to send a message to your Congress members than using our Email Advocacy Tool.
VA State Legislature
Marena Groll Moral Monday - Fayetteville