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This post first appeared at Talkpoverty.org.

My name is John D’Amanda, and I have been a loyal employee at a McDonald’s in Oakland, California for five years. Prior to working in fast food, I was a small business owner like millions of Americans. I made good money washing windows for houses, stores, malls and contractors in the San Francisco/Alameda/Contra Costa counties area. But when the economy tanked, my business went with it as people tightened their belts and stopped hiring window washers. I lost many customers, struggled to pay my bills and was eventually evicted from my apartment. I even lost the car that enabled me to travel to my jobs and couldn’t afford to buy another car. I came close to being out on the street.

I continued to work throughout my struggles. Like many others in the new economy, I went from owning my own business to a low-wage, part-time job in the fast food industry. And, even though I found work at McDonald’s, my wages were not enough to rent an apartment of my own, pay medical bills, or buy a car. Fast forward five years and I still experience unpredictable hours and I am rarely scheduled for even 25 hours a week.

In light of my financial situation, I have cut back on living costs as much as possible. I rent a shared room in a house where I also share a bathroom and kitchen with 7 other people. Although taking the train to work would be much faster, I save money by commuting on the bus. In the evenings, it can take as much as 2 hours to get home. I’ve proactively applied for food stamps, but due to my work schedule and commute time, it has been impossible for me to attend the required in-person meetings.

In America, we’re told that if we work hard, we can make it. If we cut back and save and scrimp, we will succeed. I have done these things and I’m still struggling. And so, I’m looking for answers. I ask the people making the policies in Washington, DC and California – how did our economy become so broken? What else would have you me do to survive?

Things have improved for me somewhat — my city passed a $12.25 per hour minimum wage and the raise, which just went into effect, helps me keep up with my bills. Maybe I will be able to save up enough to buy a car so that I can start up my window washing business again. But, with this raise, I have to choose between saving for my business and covering basic living costs such as dental care. I am one disaster away from losing everything.

For example, last month, I went to the emergency room with severe tooth pain. The doctor pulled 7 teeth in one sitting. Now I need dentures that I can’t afford to pay for. My friends and family back home in Florida are going to pass the hat to help me out. But that’s not the way it should be. This isn’t how we fix our broken economy and provide opportunity to people.

We need to fight for $15 an hour. I can speak for myself when I say that, if I made $15 per hour, things would totally change. I could buy a car, afford regular dental care and maybe even be married and have a house. I could save to reestablish my business and get back on my feet. When Americans work hard, we deserve to be paid enough to support ourselves and our families. That’s why I continue to fight.

The views expressed in this post are the author’s alone, and presented here to offer a variety of perspectives to our readers.

Although this post appeared at Talkpoverty, I borrowed it with permission from Billmoyers.com, and that link is below.

Trying to Survive in a Broken Economy | BillMoyers.com.

Like Republican Party politicians, politicians of the Democratic Party sell their legislative favors to the big money boys for campaign contributions, cushy jobs after they leave office, and millions of dollars in speaking fees. Unlike the Republican Party, the Democratic Party is rapidly fading away.

In fact, it’s reasonable to call the Democratic Party a cash raising machine rather than a political party. As a political party, the corrupt Democratic Party maybe a spent force in national and state elections. So what’s the problem with the Democrats? Let’s begin at the top.

Wall Street President Barack Obama is trying to deliver the biggest income redistribution scam to Wall Street and large corporate donors in time for the Democratic Party to maximize campaign donations just in time for the 2016 election, according to Matt Taibbi of Rolling Stone. Even though Obama might deliver the goods, the beneficiaries of his largeness might not pony up the cash for a dying political party.

The scam is called the Trans Pacific Partnership (TPP), which is falsely being marketed as a trade agreement.

The TPP will redistribute massive sums of cash to big corporate donors stolen from the 99 percent. Hundreds of thousands, and likely multiple millions, of jobs will be exported from the USA to lower wage nations due to the TPP. The difference between the old higher US wages will and the new lower foreign wages will go straight into the pockets of the uber rich via higher corporate earnings, share prices and dividends.

This will be a massive boon for the 1 percent, if it comes to pass, but the TPP is likely the death blow to the remains of the Democratic Party. The reason is simple.

In order for the Democratic Party to be relevant in national and state politics, the Party must be able to muster votes. However, the Democratic base is the thing income redistribution agreements, like the TPP, hurts the most. This isn’t lost on the base, so the base is quietly and quickly fading away. Look at the numbers.

In 2008, the base rallied to President Obama and the Democratic Party under the “Hope and Change” hype of candidate Obama. When Obama took office, the Democratic Party controlled 60 US senate seats for a short while and fifty-nine for many months afterward. The Democrats held 237 US House of Representative seats, compared to 178 Republican held seats.

When he became president, Obama did his best to enrich his Wall Street benefactors at the expense of the 99 percent. He began by letting Health Insurance executives write a health care law that compelled the taxpayers to guarantee their profits into infinity. No public option, however miniscule, was on the table. Obama was also desperate to give Wall Street the South Korea income redistribution agreement, which he falsely labeled a trade agreement. Obama was also willing to reduce social security payments to the elderly in order to continue the Bush tax cuts for the rich. And these were just a few things that smelled bad to the base. Obama was a bitter disappointment for many Democrats for this and other reasons during his first two years in office.

The result was simple; the Republicans took the US house in 2010, and reduced the Democrats majority in the US senate. The corporate press lied to us and said this was normal. In fact, it was anything but normal.

Franklin Delano Roosevelt (FDR) was elected president in a landslide in 1932, as the Great Depression rolled along. The Democrats also enlarged their numbers in the US senate, from 48 in 1930 to 60 in 1932. And the Party took control of the US house that year, with a massive 313 members, compared to only 117 Republican representatives.

FDR took his job seriously, established the New Deal; he worked to end the Great Depression, but he also worked to curb the economic and political power of the wealthy. FDR came from a rich family, but then, he wasn’t called a “traitor to his class,” for nothing.

So what happened in the elections of 1934? With a president and congress working for all the people, rather than a tiny wealthy minority, as has been the case with Obama, the Democratic Party increased its numbers in the senate to 69, and 322 members in the US house.

What happened under President Obama? Well, many members of the political establishment, such as Wall Street Senator Ron Wyden, worked harder and harder to deliver more and more financial goods for the corporate establishment at the expense of the 99 percent.

In 2012, the Republicans gained more seats in the US house, 242 to 192. The Democrats, along with two independents who caucus with the Democrats, still held the US senate, but their majority was reduced to 53.

As the rich got richer under Obama and the Democrats, as their power and influence dwindled due to their obvious ties to Wall Street, and as the TPP became more well known through leaked documents, a larger section of the Democratic base stayed home during the 2014 elections.

In 2014, the Republicans swept to commanding majorities in the senate (with 54 seats) and the US house (247 seats compared to 188 Democratic representatives). The base stayed home, and most likely, permanently.

The Democratic leadership is rapidly becoming the leader of nothing, since the Democratic Party base is rapidly evaporating with every income redistribution scam the Party leadership can concoct.

Instead, the base is rallying to Bernie Sanders, while abandoning the latest Wall Street Democratic presidential candidate, Hilliary Clinton. She refuses to mention anything about the TPP lately, although she has publicly supported it in the past. Around election time it’s best to stay mum about her TPP position since getting their jobs sent overseas isn’t very popular with the Democratic base, what’s left of it anyway.

The Democratic leadership has only one thing to sell Wall Street; government power. The Democrats need to win elections in order to offer this product to Wall Street, and it needs votes in order to achieve these aims. But nowadays, votes are something in short supply for the Party the more they sell government favors to their Wall Street parasite friends.

The Trans Pacific Partnership has galvanized the base against the Party more than ever before. The base is rallying to independent presidential candidate Bernie Sanders, who looks a lot like what Democrats once stood for.

The TPP most likely means permanent minority status for the Party, and likely extinction in the future.

The United States is in the midst of an economic expansion, which happens to be the most sluggish in US history. Demand growth is at all time lows, or so it seems, yet the stock market bubble continues to expand outward, because massives amount of income and wealth are being legislatively redistributed from the 99 to the 1 percent at a rate never before seen in US history.

1 percent of the US population now receives 99 percent of all income growth, and 95 percent of all income growth since 2009. The rich received 8 percent of all US income in 1980, 21 percent in 2008, and now 37 percent. What have they purchased with their thefts?

More corruption of government and the moral and economic crisis we have today.

Los Angeles became the largest US city to raise its minimum wage to $15 an hour on Tuesday, as a wage increase bill passed the city council by a vote of 14-1.

It is now up to city attorney Mike Feuer to draft an ordinance to implement the new minimum wage requirements. The ordinance will then return to the council for a final vote before becoming law. Under the proposed legislation, the city’s minimum wage would increase to $10.50 in July 2016, and would increase incrementally every year until it reaches $15 in July 2020. For small businesses with 25 or fewer employees, the wage hike would come on a modified schedule with the incremental increases starting in July 2017 and the minimum wage reaching $15 by July 2021.
Seattle workers hail ‘historic moment’ as city sets course for $15 minimum wage
Read more

The current minimum wage in California is $9 an hour and is set to increase to $10 in January 2016.

In the past year, two other US cities have approved similar wage increase measures. In June 2014, Seattle moved to increase its minimum wage to $15 by 2017. Last November, San Francisco voted to increase its minimum wage to $15 by 2018.

Not meaning to sound negative, but the official inflation rate is only a tiny fraction of what the real inflation rate is. Since 1980, the US government has revised the way it determines inflation twenty times, and each time tended to make the official inflation rate smaller. The real inflation rate is about 7.5 percent per year.

Five years from now, that $15 an hour in Los Angeles will only be worth roughly $12 in today’s reality.

Senator Elizabeth Warren delivered a floor speech on May 19, 2015 about an amendment she introduced with Senator Heidi Heitkamp (D-N.D.) and 13 other senators to the Trade Promotion Authority (“Fast Track”) legislation that would prohibit Fast Track from being used to pass trade deals that include Investor State Dispute Settlement. More information about the amendment is available at: Huffington Post

Politico.com and USA Today reported last week that President Obama will veto any congressional legislation that seeks to stop the Chinese government from manipulating currency.

Why do President Obama and executives of US based multinational corporations, like Nike, want the Chinese government to manipulate its currency? And what does this have to do with the Trans Pacific Partnership and Fast Track Authority?

The answer to one of these questions is simple: the TPP will force China to manipulate its currency even more than is currently the case.

Take a look at the graph below. On the left side is the Yuan, which is the Chinese currency. On the bottom line is the dollar. Now look at the two intersecting lines, which is the supply and demand for dollars. In this example, 600 yuan can purchase $100 in the currency markets, which is roughly what the two currencies currently exchange for.

So when Nike, Microsoft or Apple Inc. manufacture a product in China that costs the consumers, say, 600 yuan in China, given the exchange rate, the same product will cost $100 in the United States, after, of course, it is exported from China to the USA. Assume these US corporations have a 25% profit margin. That means these companies get 150 Y profits in China per product, and $25 profit when they export their products to the United States.

The same is true for companies that manufacture products in the USA, and then export them to China. American manufacturing companies earn $25 per $100 of product sold in the USA, and 150 Y when their products are exported from the USA to China.

The government of China has been accused of manipulating the value of its currency. So what happens when it does this? It purchases dollars. This shifts the D1 line to the left, because there are less dollars on the market, which is shown in the graph below as line D2. This makes the Yuan less expensive in terms of dollars.

Why would President Obama encourage the Chinese government to manipulate its currency by threatening to veto US legislation aimed at stopping it? Why would Wall Street Senator Ron Wyden only pay lip service to the evil of Chinese currency manipulation, while apparently supporting it? Why are the higher up folks at Nike, Microsoft, Apple and every US corporation that is producing goods in China for export to the United States against any legislation that seeks to address Chinese currency manipulation? There is a very good reason they’re all for this.

Look at the example in the next graph below. When the Chinese government manipulates it’s currency by purchasing dollars, 800 Y will now purchase $75. Do the math; 600 Y will purchase now $56. What does that mean?

It means that when Nike manufactures a pair of shoes in China which costs 600 Y there, in the US it should cost $56 rather than $100, thanks to China’s currency manipulation, but that rarely happens. The US corporate propaganda machine will lie to you and tell you it makes Chinese imports less expensive. However, the truth is that China’s  manipulation increases the profits of Nike.

Nike still gets 25%, or 150 Y, in profits when its shoes are sold in China. When it exports the same shoes to the USA from China, Nike still gets 25% profit on $56, which is $14 dollars. However, Nike still sells it’s shoes for $100 in the United States, which means another $44 in earnings per pair, in addition to the $14.

That means Nike’s profit margin on a $100 pair of shoes goes from 25% at the old exchange rate to 58% at the new exchange rate. This sends its earnings and stock prices higher. The same thing occurs with Microsoft, Dell, Hewlett-Packard, Apple, and every US corporation manufacturing in China, that are exporting their products to the United States.

So who pays the price for this?

You do; if you work for a living in the United States, or if you’re a  small or medium size business owner. Here’s how. Suppose you are a US manufacturer producing shoes in Oregon that sell in the USA for $100. You ship them to China at 600 Y for $100, and earn 150 Y, or $25, in profits. Now suppose the Chinese government, with the encouragement of your corrupt government and many US business leaders, manipulates its currency by purchasing tens of billions upon tens of billions of dollars. The supply of dollars on the international currency markets shrinks, making dollars more expensive, and as noted above, the D1 line shifts to D2, which represents the new supply of money. BTW, the space between D1 and D2 represents the amount of dollars the Chinese purchased.

Those $100 US made shoes now costs 1000 Y in China. Okay, my graph isn’t too high tech, but the actual figure is 1066 Y, if you do the math, but let’s stick with the 1000 Y, for simplicity sake. There’s still a 25% profit margin per pair of shoes, but at the 1000 Y price, there’s not a whole lot of buyers in China. The US manufacturer could lower the price of the shoes to 750 Y, but he or she isn’t making a penny at that price, and they’re still overpriced for the Chinese market. Say goodbye to the Chinese market for all US products at the new exchange rate.

US exports to China are going to shrink quite rapidly under this scenario. This means fewer American jobs, and less wages for everyone. It means less tax dollars going to schools and other government services, it means no retirement pay for a larger percentage of the 99 percent. Rich folks don’t need the money they’re going to steal from us, except to keep the latest stock market bubble surging, at least until it pops. However, greater profits mean the bubble can keep expanding for a while longer.

So how can US corporate leaders and their corrupt politicians encourage the Chinese government to manipulate its currency even more than it already has?

The scams that have been created to do this are called the Trans Pacific Partnership and Fast Track Authority. So what do these two things have to do with Chinese currency manipulation? More importantly, why would the Chinese

government want to engage in currency manipulation?

The answer in one word; Vietnam.

Vietnam is one of the nation’s involved in negotiating the Trans Pacific Partnership. As you can see from the graph below, China’s annual minimum wage is nearly twice that of Vietnam. The wages in China at those Nike and Microsoft and Apple and Hewlett-Packard factories and their suppliers and contractors and subcontractors have been going up rapidly over the past fifteen years. Those labor costs have been able to go up because the Chinese government has increased the profit margins of its US manufacturers by manipulating its currency. But there’s another reason why China needs to manipulate its currency vis-a-vis the dollar.

As you can see from the map below, there are nearly 313,000 Nike workers toiling in Vietnam, and nearly 250,00 in China. Vietnam clearly has lower labor costs than those in China. The Chinese government, however, can offset its labor cost disadvantage by manipulating its currency. So it can keep those jobs in China, and still allow the wages of Chinese workers to expand. But that might not be the case should the Trans Pacific Partnership (TPP) become a reality.

Tariff is another word for tax. When a US company like Nike manufactures its products in Vietnam, and then exports them to the US, a tariff is charged against the products of between 10 and 15 percent. So another $10 to $15 dollars is added to the cost of a $100 pair of Nike’s Vietnamese made shoes exported to the USA. That means less profits, lower dividends, and lower share prices than would otherwise be the case without tariffs. The US tariffs on US corporate goods manufactured in Vietnamese factories helps to offset some of the Vietnamese labor cost advantages vis-a-vis the cost of Chinese labor.

Under the TPP, should it become law, those tariffs will likely be gone, giving Vietnam a much larger labor cost advantage over Chinese workers.

In which case, the Chinese government will have two options; let millions of Nike and Dell and Apple and Microsoft jobs head south to Vietnam, along with the jobs of contractors and subcontractors, or manipulate its currency even more, which means all of those US corporations manufacturing stuff in China for export to the US will see unprecedented and explosive growth of their profits; and all of this will occur at the expense of small and medium sized US companies that make stuff in the United States and export them to China.

That means several unpleasant things will occur to the US economy: US unemployment will grow with the TPP, as exports to China diminish, inequality in wealth and income will continue to increase during the reign of Obama and Wyden, the stock market bubble will continue to expand, the coming stock market crash will be even worse than imaginable, US businesses will need to export more US jobs to China, and all of these bad things will trickle down to more crowded classrooms, less government services, reduced wages, fewer jobs, more poverty, and much more negative stuff for the 99 percent. However, the super rich will become even more super rich. And Chinese currency manipulation will not be the only thing in the TPP contributing to all of these things. See https://johnhively.wordpress.com/2015/04/21/how-the-trans-pacific-partnership-will-destroy-american-jobs-by-destroying-us-exports/

The political game in the US over the TPP and Fast Track Authority currently being played out is a complete farce.

Start with Fast Track Authority, which President Obama, Nike, Microsoft, Ron Wyden, Orrin Hatch, Mitch McConnell and just about every major US corporate CEO and investor desperately want Obama to have. Fast track will limit congressional debate on trade deals, it will scuttle any possible congressional amendments, and eliminate the use of the filibuster in the senate to stop the TPP. Fast track needs to pass through both houses of congress.

As a condition for bringing Fast Track Authority to a debate on the floor of the US senate, on May 13, a number of Democrats who traditionally vote to redistribute income from the 99 to the 1 percent (Ron Wyden, Harry Reid, Patty Murray, Heidi Heitkamp, Bill Nelson, Tim Kaine, Claire McCaskell, and Ben Cardin) agreed to first bring a vote for a bill by which the US will crackdown somehow on China for manipulating currency.

These folks know such a bill may not pass the senate, much less the house of representatives. If it did pass, then it will sit on Obama’s desk until Fast Track Authority passes both chambers of congress. Then he will veto the currency manipulation bill. There’s a ton of income to be redistributed from the 99 to the 1 percent resting on his shoulders.

Then the above senators will pretend to the folks back home that they did all that they could, when in fact, they did nothing when they could have done something to protect the folks back home from the TPP.

Every US senator and every US house representative knows this is the game, and many are willing to play this deadly game so as to justify their support for giving President Obama Fast Track Authority, even though the TPP will likely rip out the guts of the middle class, as well as the US economy.

If the above named Democrats were at all serious about Chinese currency manipulation, then they would agree to wait until Wall Street President Barack Obama signed the bill into law before opening debate on fast track authority.  That won’t happen.

Fast Track Authority is the only way the president can ram the TPP through congress. It’s an income and political power redistribution agreement falsely marketed as a trade agreement. Most of those in the know say the TPP is dead if the president doesn’t receive fast track authority. So fast track is the key.

Save the United States. Fight against this madness called Fast Track Authority. The TPP will only create greater trade deficits in the future than is currently the case. As US Congressman Alan Grayson famously and recently said, “You will find that the largest fourteen trade deficits in the history of the world have been the US trade deficits in each of the last fourteen years….What sane person can look at these trade deficits and conclude we need more free trade?”

The political fight over the Trans Pacific Partnership, Fast Track Authority, and Chinese currency manipulation isn’t about sanity; it’s about greed and government corruption. It’s about raising the already soaring share prices, dividends and earnings of US corporations that have exported millions of US jobs to China and other third world nations, and doing so at the expense of everybody else. It’s about redistributing your standard of living to a small minority of overly rich people who have corrupted and rigged your government in favor of themselves. It’s about redistributing your income and wealth to the 1 percent so as to keep the current stock market bubble expanding. It’s about redistributing the American dream to the 1 percent. It’s about taking the opportunities that once existed for the majority of American citizens and wiping them out by giving 100 percent of all income growth to the 1 percent, and leaving more and more people in poverty.

Currently, the 1 percent steal 37 percent of all income produced in the United States compared to 8 percent in 1980, back when opportunities for financial advancement existed for most Americans. Now the big boys, and the politicians they’ve bought off in one way or the other, want to eliminate your opportunities, as well as those of your children.

Call your senators. Call your congressmen and congresswomen. Stop Fast Track in the senate. Stop the corruption. Stop the insanity.

Over the past fourteen years, since China was granted most favored nation trade status, Nike’s stock price has risen over a thousand percent, from $10 a share to over a $100. Chinese currency manipulation has helped fuel this bubble. So if you purchased a million shares of Nike in the year 2000, today the value of those shares would be over $10 million. With the TPP and Chinese currency manipulation, the value of Nike’s stock will continue to increase, but only at the expense of everybody else. Much of the US stock market bubble is fueled by the same force, and that goes for the stock prices of Apple, Microsoft, Dell, Adidas, Hewlett-Packard and more. And if the TPP goes through, more US manufacturers will need to shift production to China.

Sen. Elizabeth Warren delivered a tub-thumping speech to delegates at the California Democratic Party convention in Anaheim on Saturday, touching on the policy themes that have made her the increasingly popular champion of her party’s liberal wing and bestowing conspicuous praise on state Atty. Gen. and U.S. Senate candidate Kamala Harris.

Anyone hoping for Warren to call out President Obama by name over a controversial trade pact was disappointed. But she did make caustic remarks about the deal, saying it would benefit multinational corporations and “leave American workers in the dirt.”

For more on the story, check out the link below.

Los Angeles Times

 

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