Why do Nike executives want the US congress to pass the Trans Pacific Partnership?
The answer is simple, they want to offshore more jobs, which the corporation will be able to do once the TPP becomes law. But first let me explain a few things.
The folks at Nike declared that the notorious jobs exporter would create 10,000 new manufacturing jobs in the US if the Trans Pacific Partnership (TPP) is passed by congress. President Obama repeated this lie when he gave a speech at Nike headquarters on May 8. I should point out that 10,000 jobs represents less than 1 percent of Nike’s total manufacturing labor force. So it’s a drop in the bucket.
So how is it that the president is willing to share information from his top secret trade negotiations with Nike executives, but not with the rest of us?
This willingness to create jobs in the United States defies both logic and Nike’s history.
Nike is one of the top jobs exporters in all of US history, if not number one of all time. And the defining issue for Nike in the TPP, that we know of via leaked documents, is the desire of Nike executives to reduce or eliminate the tariff on Nike products the company exports to the United States from Vietnam, which swells the US trade deficit, and ask anybody, the latter is a bad thing.
If the TPP becomes law, we can count on tens of thousands of Nike jobs to be relocated from China to Vietnam because the wages in Vietnam are much lower than in China. This will increase Nike’s profits and stock price. Take a look at the history of Nike’s stock price below.
Nike’s stock price was barely over $4 a share in November 1994, just before the implementation of NAFTA in December 1994. It more than doubled between 1994 and 2000, because the company was able to export more jobs. Then China was given most favored nation status. The price of Nike stock has jumped more than a thousand percent since then because the company was able to export even more jobs. If you owned 1000 shares of Nike in 1994, your stock was worth $4000. Now it would be worth $100,000, and that doesn’t even count the yearly dividend payment.
Nike’s stock growth was a result of exporting jobs. When a job is exported from the US, the difference between the old higher US wage and the new lower Vietnam wage increases profits, which drives stock prices and dividends higher, but leaves everybody else in poverty.
So it’s more than likely that Nike will not shift production to the United States with or without the Trans Pacific Partnership. This suggests that people should rightly be suspicious of the dubious claim by Nike executives that they will create 10,000 US manufacturing jobs in the US if only the TPP passes through congress. Nike could do it right now. And the lowering of US tariffs on imports from Vietnam via the TPP gives Nike absolutely no incentive to create production jobs in the US. Rather, it gives Nike incentives to export the few production jobs in the US and the hundreds of thousands in China to Vietnam.
On the other hand, these executives want the TPP in the worst sort of way, which suggests they have had the privilege of seeing the text of the TPP, a right which is being denied to the rest of us.
So what is the president and his chief Wall Street henchman in the senate (Ron Wyden) hiding?
We know from leaked documents that the TPP will:
* TPP will give incentives for US corporations to export millions of US jobs. The Federal Reserve estimates that 28 million US jobs were exported between 1990 and 2010. Wyden wants to increase this number. Jobs are the biggest US export product. Wyden likes this.
* TPP will increase US income and wealth inequality. The 1 percent have already taken 95 percent of all income growth in the United States since 2009. Currently, the 1 percent are stealing 36+ percent of all income produced in the USA, compared to only 8 percent in 1980. International trade scams and other federal legislation have brought inequality about. For example, when the above jobs were exported, the difference between the old higher US wages and the new lower wages will go straight into the pockets of the 1 percent via higher corporate profits, rising dividends and surging share prices. Wyden is a principle architect of this inequality.
* Those lost jobs will no longer be paying the taxes for our infrastructure, K-12 education, higher education (tuition and fees will go up), social safety nets, schools, fire, police, public transportation, social security taxes, but those lost jobs will push the stock markets higher.
* TPP will effectively eliminate your voting rights on local and state issues since it will unconstitutionally grant investors of the 0.01 percent special privileges to challenge labeling and health and safety local laws and regulations of the 99 percent, which most people call voter suppression, but in this case it should be called voter elimination.
* TPP will eliminate millions of jobs in Latin America, which will drive millions of more people illegally into the United States and depress wages here. See How the Trans Pacific Partnership Will Destroy American Jobs and Exports
* TPP will jack up pharmaceutical prices by extending the patents of the pharmaceutical corporations. Hmm, that doesn’t sound like free trade. It sounds like they’re rigging the game against the 99 percent.
These things we know only from leaked documents, and they’re only a tiny bit of what’s been negotiated. It doesn’t seem like the stuff we don’t know about in the TPP is going to be very good for the majority of citizens, otherwise, the president would let us know what is in the TPP, which is precisely what the president doesn’t want us to know. If the TPP is so good for the majority of American citizens, as the president claims, then why don’t the rich folks want us to know what’s in it?
Read Full Post »