Feeds:
Posts
Comments

Posts Tagged ‘Richard Trumpka’


Donald Trump just secured the votes of millions of American citizens by renegotiating NAFTA. However, it has yet to pass congress and may never, just because it is a big-time body blow to the desires of Wall Street and the billionaires in their efforts to redistribute more income from working Americans to the rich by exporting jobs, thereby creating greater income and wealth inequality using U.S. taxpayer dollars in the process.

The millions of U.S. jobs currently occupied by Mexico’s $3 dollar per hour labor will almost certainly see some jobs returning to the United States, or more than likely, they may be exported from Mexico to Pakistan, China or Vietnam.

Regardless, Richard Trumpka, president of the AFL-CIO wrote of the renegotiated treaty, “The United States Mexico Canada trade agreement is a huge win for working people. After a quarter-century of suffering under the failed North American Free Trade Agreement (NAFTA) and 18 months of hard-fought negotiations, the American Federation of Labor and Congress of Industrial Organizations (AFL-CIO) is now proud to endorse a better deal for working people: the United States Mexico Canada Agreement (USCMA)…The USMCA isn’t perfect — no deal ever is. But it’s a far cry from the original NAFTA, and that is a huge win for working people in North America. While it won’t bring back every job lost under NAFTA, it will help stop the bleeding and add important new protections for workers across the continent.”

A few things need to be said about the agreement. It will slow the pace of income and wealth inequality that has occurred over the last forty years, but only a little bit. Nowadays, three men own more wealth than the bottom half of the U.S. population and the 1 percent now steal somewhere between 22 to 38 percent of all the income produced each year in the United States, up from 8 percent in 1980; much of this can be attributed to international trade agreements negotiated to export U.S. jobs by the tens of millions.

The difference between the old higher wages and the new third world wages goes directly into the bank accounts of the rich via higher corporate profits, dividends and share prices.

The USCMA passed through the Democratic Party-controlled U.S. House of Representatives last week. However, it now has to pass through the RepubliCon controlled U.S. Senate early in 2020. The RepubliCons and their Wall Street and other corporate masters are dead set against it.

U.S. RepubliCon Senator Pat Toomey, who represents Wall Street and some billionaires, wrote in the Wall Street Journal that he will vote against the trade agreement. Here are a few of his objections;

1. Car manufacturers will need to… “pay wages far above prevailing Mexican rates.” In other words, Mexican auto workers do not deserve to earn more than $3 an hour.

2. “First are the laws to facilitate unionization of Mexican factory workers.” Apparently, Toomey thinks that organized billionaires (shareholders in corporations) is something that has God’s blessing, but organized labor is evil. This is class warfare at its worse.

3. “Another flaw is the drastic reduction of the Investor-State Dispute Settlement mechanism. U.S. investors don’t always get a fair adjudication of their business disputes in foreign courts, even in Canada and Mexico.”

These were secret tribunals that were highly unconstitutional. The U.S. Constitution allows the rules of treaties to override U.S. laws. However, a treaty requires 67 percent of the U.S. Senate to approve of treaties. That was not the case for the North American Free Trade Agreement (NAFTA), which was, and notice this, called an “agreement.”

NAFTA only required a majority vote since it was an “agreement.” Consequently, the always secretly held tribunals of the Investor-State clause of NAFTA has always been unconstitutional. Representatives of local government, citizen groups, labor groups, and others, were never allowed into the tribunals. Only lawyers for the governments of Canada, the U.S., and Mexico, as well as corporate lawyers, were allowed in. Local and state laws were overturned by this unconstitutional tribunal, but Senator Toomey thinks it unfair the power of the tribunals is no more.

Expect Wall Street and the entire RepubliCon party to reject this agreement in the United States Senate, but expect Donald Trump to benefit politically nonetheless.

Read Full Post »

To a remarkable extent, the level of inequality—which fell during the New Deal but has risen dramatically since the late 1970s—corresponds to the rise and fall of labor unionization in the United States; and US labor union participation rates corresponds with the number of free trade agreements the US government enters into, as well as the development of historic levels of income and wealth inequality.

According to the Economic Policy Institute, “As union membership has fallen over the last few decades, the share of income going to the top 10 percent has steadily increased. Union membership fell to 11.1 percent in 2014, where it remained in 2015 (not shown in the figure). The share of income going to the top 10 percent, meanwhile, hit 47.2 percent in 2014—only slightly lower than 47.8 percent in 2012, the highest it has been since 1917 (the earliest year data are available). When union membership was at its peak (33.4 percent in 1945) the share of income going to the top 10 percent was only 32.6 percent.”

As you can see in the graph below, the share of US workers represented by labor unions began to drop in 1960 as electronic jobs, such as manufacturing televisions and radios, began to be exported more and more to places like Taiwan. That process began in the 1950s.

Union membership began to decline even more in 1964 when Mexico and the USA signed a treaty creating the free trade Maquiladora Zone inside Mexico. This zone runs along the US border, and is twelve miles wide and runs from the Gulf of Mexico to the Pacific Ocean. Corporations are allowed to import parts into the zone, assemble things there, and export the finished products into the United States duty free. Tens of thousands of US labor union jobs were exported into Mexico because of this treaty.

Other maquiladora zones have been created throughout Central America since then. What happened to the US textile industry? Much of it is in Central America. Roughly 225,000 former US textile jobs now reside in El Salvador alone.

download

US labor union membership dropped from 28.5 to 25.4 percent from 1964 to 1980. Then, of course, Reaganomics and more trade treaties hit US workers. NAFTA struck, and the rest is history. The stock markets shot up as labor union members saw their jobs being exported. You can see the amazing coincidence in the graphs above and below. As the jobs were exported, the stock markets exploded upward. Roughly 35 million US jobs have been exported since 1990.

S&P500_(1950-12)

Nowadays, the top 1 percent are stealing 37 percent of all income produced in the United States, compared to 8 percent in 1980. That’s because when a job is exported the difference between the old higher US pay and the new lower third world country pay goes straight into the pockets of the rich via higher corporate profits, surging dividends, and soaring share prices.

This is the link between income/wealth inequality and trade agreements business leaders, politicians, academics, and the corporate press don’t want you to know about.

Corporate stocks and bonds, by the way, are wealth. Wealth is something of value that you own, while income is money coming in. So the rich get more income by shipping jobs overseas, and in the process, they inflate the value of their wealth, such as stocks and bonds. The rich get richer with every trade agreement.

Now President Obama, and several Wall Street Democrats, such as Hillary Clinton and Ron Wyden, have joined with the majority of Republicans in congress to redistribute more income from the 99 to the 1 percent via the Trans Pacific Partnership (TPP). The TPP is the largest income redistribution scam in US history, and the Wall Street Democrats and most Republicans are falsely marketing it as a free trade agreement. The Guardian News Paper calls the TPP “NAFTA on steroids.”

As more of those labor union jobs are exported, much of the tax base is exported with it. Actually that tax base is redistributed to the rich. As that tax base diminishes, the tax funds for fire, police, Social Security, public schools, slowly evaporates. And unionized public sector employees find themselves under attack.

It’s a big scam folks.

Protect your jobs! Protect your future! Fight against the TPP! Vote for Bernie Sanders!

Read Full Post »

Earlier this week, working people at Verizon went on strike. It’s never been good when working families are forced to take this step but Verizon workers felt they had no choice.

They’re fighting to create a better workplace for themselves and those that come after them. That’s why they work. It used to be called the American Dream. Now they’re stuck in the American Nightmare, so they aren’t going to give up until Verizon ends its push to send jobs overseas, stops intimidating Verizon Wireless workers who are trying to create a better future for themselves and their families and drops its demands to cut retirement benefits, gut job security and to make workers move away from their homes and families for months at a time just to keep their jobs.

Verizon’s stock is doing well, and that’s the primary criteria for determining how well every CEO is doing. Verizon’s CEO is doing very well at $18 million a year, which happens to be more than 200 times what the average Verizon worker earns. So stock price and CEO pay aren’t the problems forcing workers to go on strike. It’s plain greed, and nothing more.

AFL-CIO President Richard Trumka issued the following statement regarding the labor movements’ broad support for the striking workers:

“The AFL-CIO stands in solidarity with the Communications Workers of America and the International Brotherhood of Electrical Workers fighting for a fair contract. The 39,000 working people who went on strike this morning at Verizon deserve a fair contract that provides stability and acceptable working conditions.

Verizon made $39 billion in profits over the last three years, but is unwilling to provide job security, better benefits and safe working conditions to the people who made it possible for their top five executives to make over $233 million in the last five years.

No one wants a strike. But Verizon’s unwillingness to negotiate fair terms shows its disrespect for working people. Verizon wants to uproot workers, hurt communities and force retirees to pay extremely high health care costs. This strike is about doing what is right for everyday working people – not corporate interests. We call on Verizon to bargain in good faith and work with unions to create a fair and equal contract that stands up for working people rather than corporate greed.”

Read Full Post »

In 2012, in a town hall in India, then US Secretary of State Hillary Rodham Clinton said,

“Outsourcing jobs is part of our economic relationship with India. I think there are advantages with it that have certainly benefited many parts of our country (the USA), and there are disadvantages that goes toward the need to improve the work skills of our own people (those who lose their jobs), and create a better economic environment. It’s like anything. It’s got pluses and minuses.”

What Clinton didn’t say is who benefits and who loses when she supports exporting jobs. Let’s get something straight, nearly thirty million US jobs were exported from the US from 1990 to 2010. Millions more have been exported since. Notice in the graph below how the exporting of US jobs increased with NAFTA, which Clinton supported. Hillary has also supported the Trans Pacific Partnership (TPP), until she came under intense criticism as a presidential candidate. No doubt, she still supports it because Wall Street does, and she is Wall Street’s candidate.

manufacturing-jobs-exported-per-year

The United States is in the seventh and likely final year of an economic boom. The statistics are staggering about what exporting jobs have brought about here.

  1. Income inequality perhaps never experienced in US history.
  2. The 99 percent has gone from earning 92 percent of all income produced in the USA in 1980 to 63 percent today.
  3. 48 million people on food stamps, which is nearly one out of six Americans.
  4. A middle class that has shrunk from 61 to 49 percent of US adults from 1970 to 2016.
  5. Wages that have declined in real terms for 36 years.
  6. A rising homeless population.
  7. Wealth inequality never experienced in US history.
  8. The worst economic expansion in terms of wage growth and jobs growth since the Great Depression.
  9. Slower job growth than under President Jimmy Carter, back when the population was 65 percent of today, and the Gross Domestic Product was 45 percent the size of today.
  10. A tax base that is shrinking every year as the jobs are being exported, and this has brought about higher college costs, shrinking social safety nets (such as social security), decrepit public infrastructure, and many more negative things.
  11. A massive trade deficit the United States has with US corporations manufacturing abroad and then exporting those products to the USA.

Obviously, exporting jobs is not a winning formula for the vast majority of US citizens, but Mrs. Clinton thinks so. The rich, of course, benefit from exporting jobs.

When jobs are exported (and let’s face it, jobs are the number export product of the United States), the difference between the old higher US wages and the new lower wages in China, Vietnam and elsewhere, go straight into the pockets of the super rich via higher corporate earnings, rising share prices, and surging dividends.

So the good things about exporting jobs that Hillary spoke about in the video are that exporting jobs is the fuel that causes the stock markets and corporate profits to surge at record levels. Clinton doesn’t seem to give a rat’s ass about the massive collateral damage to the 99 percent, much of which is listed above.

That’s why every geographic area of the United States outside of the old confederacy is Bernie Sanders country, and why he will win the Democratic nomination.

That why Bernie Sanders whipped Hillary Clinton badly in Kansas and Nebraska on Saturday, March 5. He won by 68 percent of the vote in Kansas, and 55 percent in Nebraska. Hillary, as expected, took 70 percent of the vote in Louisiana.

Clinton has yet to prove she can win decisively outside of the southeast. She appears to be nothing more than an over-hyped regional candidate. True, Clinton edged out Bernie in Iowa, Nevada, and Massachusetts, but outside of the South, it is Sanders who has dominated the Democratic primaries.

Not counting the super delegates, most, of which, have declared for Clinton, Hillary leads in delegates 659 to 455. However, most of the Southern states have voted in the Democratic primary (save for Florida) and the rest of the nation appears to be Sanders country.

Sure most of the super delegates temporarily support Clinton, but if she loses the popular vote in the primaries, which is highly likely, the super delegates are not bound to Clinton. They will switch to Sanders, or experience the end of the Democratic Party by sticking with Hillary.

Read Full Post »

TPP_web

Wall Street President Barack Obama has come one step further along with the announcement that the Trans-Pacific Partnership (TPP) has been finalized in the Atlanta sessions that ended last weekend. His Democratic henchman, Wall Street Senator Ron Wyden, must have been smiling with the announcement, since he is the chief Democratic supporter of the TPP in the US senate.

The Democrats are desperate since they have been losing ground in congress and the polls since 2010. Their fundraising falls far short of Republican efforts, and their base is falling by the wayside for reasons described below. President Obama has been intent on securing the Trans-Pacific Partnership (TPP) for his Wall Street benefactors, as well as other sources of big campaign contributions and other sizable perks. If he can’t secure this for Big Donors, what good are the Democrats?

The TPP will show how adept the Democrats are at caving in to Republican Party since the TPP is falsely marketed as a trade agreement when it is designed to redistribute income and political power from the 99 to the 1 percent, just like all previous so-called trade agreements.

In order to get his deal, the president and his negotiators had to engage in serious back door deals with senators, congressional representatives and foreign trade negotiators. For example, in order to get the deal out of the gridlock of negotiations, the president and his team caved in to all of Japan’s demands on agriculture. See why-japan-did-americas-dirty-work-in-the-tpp-ustr-gave-away-the-agricultural-store–nakedcapitalism.com.

The president also made it easier for Japanese automobile parts manufacturers to export their stuff to the US, which will cost the US jobs. The price to get Japan in on the deal was destroy US jobs in auto parts.

The final battle against the middle class will now be waged in the halls of congress. It will be led by Wyden and Obama, along with a bevy of Big Cash politicians from the Republican Party. The news media will remain largely mum on the subject. It’s better to keep the little people illiterate about the issue, than arouse their indignation and protests via honest reporting.

The Democratic base has been falling by the wayside since Obama began his tenure as president. “Hope and change” was a nice slogan as the president gave the rich everything they wanted, including 95 percent of all income growth since Obama took office. The 1 percent steal 37 percent of the nation’s income, up from 8 percent in 1980. That’s what they’re buying with those campaign contributions and other perks.

Little by little the Democratic base has come to realize how indifferent the president is to their concerns, how much he actually favors the rich, what a lie “hope and change” was, since there was no “change,” and this is reflected in recent elections as more and more of the base has increasingly decided to stay home at voting time. That’s precisely why the Republicans have such large margins in both houses of the US congress.

If the TPP passes through congress, within a decade the 1 percent will steal 50 percent of the nation’s income, driving millions of people into poverty in the process.

Take China for example. China is not a part of the TPP, but Vietnam is. Wages in China are about twice is high as in Vietnam. In order to keep jobs in China, the Chinese government will be forced to manipulate its currency vis-a-vis the US dollar. Chinese exports will become cheaper in the US, while US exporters will be encouraged to export US jobs to China. But there is also a devious side to this situation. Prices of Chinese imports won’t decrease in the US. Instead, profit margins will increase.

Any company manufacturing in China will see an increase of its profits, and they won’t need to do a damn thing to make that happen. Corporations like Microsoft, Nike, Dell, and Apple will see massive rises earnings and their stock prices, as income is redistributed from US export workers losing their jobs to US manufacturers producing goods in China. Their rich shareholders will reap a massive bonanza at the expense of people who actually work for a living. See Four-graphs-that-will-make-you-boiling-mad-about-the-trans-pacific-partnership-or-why-president-obama-along-with-executives-from-nike-microsoft-apple-and-other-us-corporations-steadfastly-support–JohnHively.wordpress.com

This isn’t lost on everybody. Some people are already coming out against

AFL-CIO President Richard Trumka:

“We are disappointed that our negotiators rushed to conclude the TPP in Atlanta, given all the concerns that have been raised by American stakeholders and members of Congress. The Administration had a hard time reaching this deal for good reasons: it appears that many problematic concessions were made in order to finalize the deal. We ask the Administration to release the text immediately, and urge legislators to exercise great caution in evaluating the TPP. As we’ve said, rushing through a bad deal will not bring economic stability to working families, nor will it bring confidence that our priorities count as much as those of global corporations. We will evaluate the details carefully and work to defeat this corporate trade deal if it does not measure up.”

Communications Workers of America President Chris Shelton:

“Negotiators from the 12 Trans-Pacific Partnership trade deal countries, meeting in Atlanta, have announced an agreement. Despite all the hype, and given what we’ve learned over the past many months and years of negotiations, it’s clear that this TPP remains a bad deal for working families and communities. The corporate lobbyists who make up the majority of U.S. trade advisers have been pushing hard for an agreement, mainly because they’ve known all along that what’s in the TPP represents a sweet deal for multinational corporations and the 1 percent. For the rest of us—U.S. working families and communities, and workers in the other TPP countries—this agreement is bad news.”

Read Full Post »

Based on the above, my guess is that Hilliary will do the bidding of Wall Street, which include redistributing income from the 99 to the 1 percent; and that Bernie will do the bidding of the 99 percent, which suggests he will begin the process of reversing the redistribution of income and wealth from the 99 to the 1 percent that the government has undertaken during the last 35 years of absolute corruption at the hands and dollars of the 1 percent.

Hilliary has earned hundreds of thousands of dollars of speaking fees from Wall Street investment corporations at the rate of $200,000 per hour. Goldman Sachs is one of her biggest employers in this regard.

The AFL-CIO has refused to endorse Hilliary because she has announced on 45 occasions that she is for the Trans-Pacific Partnership, the largest income redistribution scam in US history, which is falsely being marketed as a free trade agreement, but which jacks up the prices of many goods citizens will pay for, such as pharmaceutical medicines.

Read Full Post »

On May 24, the state leader’s of Vermont’s AFL-CIO asked their national leadership to endorse Bernie Sanders for the Democratic nomination over Wall Street’s candidate, Hilliary Rodham Clinton. This endorsement follows South Carolina’s state AFL-CIO endorsement of Sanders.

There was simply no way that the leadership could endorse Wall Street candidate Hilliary Rodham Clinton, whose economic plan calls for eliminating labor unions by shipping jobs overseas, redistributing more income from the 99 to the 1 percent, and increasing the trade deficit, among other things.

The 1 percent now steal over 36 percent of all income produced in the United States, compared to 8 percent back in 1980. This redistribution is one of the reasons why the US economy is historically weak. The 99 percent simply don’t have the money to demand more goods and services, thereby increasing job and wage growth. Clinton plans to enact her plans by supporting the Trans-Pacific Partnership, the largest income and political power redistribution scam in US history, which is currently being marketed as a trade agreement.

National AFL-CIO President Richard Trumpka has come out against such endorsements, rightfully pointing out that it violates the rules of their association, which only allows the national leadership to make endorsements. However, Hilliary has earned $200,000 at least twice from Goldman Sachs for giving two half an hour speeches. That alone, coupled with the campaign contributions alone, see the list below, should tell you exactly where her sympathies lay, especially compared to Sanders sympathies. Hilliary is the candidate of Wall Street.

In other words, Trumpka and the national leaders of the AFL-CIO would be total idiots, or corrupt boneheads, to endorse Hilliary over Sanders.

Politico reports that “some local AFL-CIO leaders in Iowa want to introduce a resolution at their August convention backing the independent senator from Vermont. More than a thousand labor supporters, including several local AFL-CIO-affiliated leaders, have signed on to “Labor for Bernie,” a group calling on national union leaders to give Sanders a shot at an endorsement.”

The endorsement of Sanders is below and is taken from the Facebook page of the Vermont State Labor Council, AFL-CIO’s Executive Committee:

“Whereas: The Executive Committee of the Vermont State Labor Council, AFL-CIO is committed to building a broad, effective movement for democratic change, and

Whereas: Our goal is a government that carries out the will of the people, not prop up the profits of the 1% at the expense of the rest of us, and

Whereas: We firmly believe that Senator Bernie Sanders is the strongest candidate articulating our issues. His commitment to union principles and labor’s values is longstanding and heartfelt, and

Whereas: As a truly progressive candidate for President, Bernie has the chance to inspire millions of Americans with policy proposals that put the interests of the labor movement, front and center. His campaign will draw attention to what unions and collective bargaining have accomplished for workers and energize our movement, and

Whereas: Labor must step up to fundamentally change the direction of American politics, by refocusing on the issues of our time: growing inequality and pervasive racism, the power of concentrated wealth and its corruption of our democracy, an escalating pension and retirement security crisis, runaway military spending and a militarized foreign policy*, Medicare for All, and the need for new, bold solutions to our shared problems.

Therefore be it resolved that:

We call on the AFL-CIO, labor leaders, union members and working people everywhere to unite behind Bernie Sanders and elect the President America’s workers desperately need, and

Be it further resolved that:

The Vermont State Labor Council, AFL-CIO strongly urges the AFL-CIO to support Bernie Sanders 2016 and his campaign to become the nominee of the Democratic Party for president.

Adopted May 24th, 2015 and respectfully submitted for consideration to the AFL-CIO Executive Council.* Teamsters Local 597 proposed deleting “runaway military spending and a militarized foreign policy” but supports the general line of the resolution.”

Read more: http://www.politico.com/story/2015/07/afl-cio-endorsement-2016-democratic-primary-119701.html#ixzz3er9K6IN6

Read Full Post »

Four Graphs that Will Make You Boiling Mad About the Trans Pacific Partnership–Or Why President Trump, former President Obama, along with executives from Nike, Microsoft, Apple and other US corporations Steadfastly Support China’s Currency Manipulations

income inequality

Originally published May 19, 2015 by John Hively

When China manipulates its currency vis-a-vis the US dollar it increases the profits of US job exporters that produce stuff in China and exports that cheap stuff to the USA.

That’s most likely why former President Obama said he will veto any congressional legislation that seeks to stop the Chinese government from manipulating its 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.

Read Full Post »

Why does President Obama want congress to grant him Fast Track Authority and the Trans Pacific Partnership? Why do Wall Street Senators like Orrin Hatch, Mitch McConnell and Ron Wyden want the president to have these things?

Richard Trumpka, president of the AFL-CIO, tells you in the video above it’s above shipping jobs overseas and lowering wages. He’s correct, and incorrect.

More precisely, the president wants Fast Track Authority in order to limit senate debate on the issue of the Trans Pacific Partnership (TPP), the largest income redistribution scam of all time, falsely labeled as a free trade agreement.  The TPP will ship millions of jobs overseas and lower wages here at home, but it will do so to redistribute the difference between the old higher wages here and the new super lower wages overseas to the 1 percent via higher share prices, rising profits and soaring dividends.

That should tell you who the president and Ron Wyden really represents in the white house (Goldman Sachs, Warren Buffett, massive hedge funds, etc….) and who Orrin Hatch and Mitch McConnell represents (Goldman Sachs, Koch brothers, and massive hedge funds).

Read Full Post »

by
Elizabeth Warren

Reprinted with permission from Readersupportednews.org

Today, United States Senator Elizabeth Warren spoke at the AFL-CIO National Summit on Raising Wages. The text of Senator Warren’s remarks as prepared for delivery follows:

Good morning, and thank you MaryBe for the introduction, and for your work with the North Carolina AFL-CIO. Your efforts make a real difference for our families.

I want to start by thanking Rich Trumka and Damon Silvers for your leadership on economic issues, for your good counsel, and, for a long time now, your friendship. I also want to give special thanks to my good friends from the Massachusetts AFL-CIO who are here today, Steve Tolman and Lou Mandarini.

I love being with my labor friends, and I’m especially glad to join you today for the AFL’s first-ever National Summit on Wages. You follow in the best tradition of the American labor movement for more than a century-always fighting for working people, both union and non-union. Today you’ve spotlighted an economic issue that is central to understanding what’s happening to people all over this country.

I recently read an article in Politico called “Everything is Awesome.” The article detailed the good news about the economy: 5% GDP growth in the third quarter of 2014, unemployment under 6%, a new all-time high for the Dow, low inflation.(i)

Despite the headline, the author recognized that not everything is awesome, but his point has been repeated several times: On many different statistical measures, the economy has improved and is continuing to improve. I think the President and his team deserve credit for the steps they’ve taken to get us here. In particular, job growth is a big deal, and we celebrate it.

I’ve spent most of my career studying what’s happening to America’s middle class, and I know that these four widely-cited statistics give an important snapshot of the success of the overall economy. But the overall picture doesn’t tell us much about what’s happening at ground level to tens of millions of Americans. Despite these cheery numbers, America’s middle class is in deep trouble.

Think about it this way: The stock market is soaring, and that’s great if you have a pension or money in a mutual fund. But if you and your husband or wife are both working full time, with kids in school, and you are among the half or so of all Americans who don’t have any money in stocks,(ii) how does a booming stock market help you?

Corporate profits and GDP are up. But if you work at Walmart, and you are paid so little that you still need food stamps to put groceries on the table, what does more money in stockholders’ pockets and an uptick in GDP do for you?

Unemployment numbers are dropping. But if you’ve got a part-time job and still can’t find full-time work — or if you’ve just given up because you can’t find a good job to replace the one you had — you are counted as part of that drop in unemployment, but how much is your economic situation improving?

Inflation rates are still low. But if you are young and starting out life with tens of thousands of dollars in student loan debt locked into high interest rates by Congress, unable to find a good job or save to buy a house, how are you benefiting from low inflation?

A lot of broad national economic statistics say our economy is getting better, and it is true that the economy overall is recovering from the terrible crash of 2008. But there have been deep structural changes in this economy, changes that have gone on for more than thirty years, changes that have cut out hard-working, middle class families from sharing in this overall growth.

It wasn’t always this way.

Coming out of the Great Depression, America built a middle class unlike anything seen on earth. From the 1930s to the late 1970s, as GDP went up, wages went up pretty much across the board. In fact, 90% of all workers-everyone outside the top 10%-got about 70% of all the new income growth.(v) Sure, the richest 10% gobbled up more than their share-they got 30%. But overall, as the economic pie got bigger, pretty much everyone was getting a little more. In other words, as our country got richer, our families got richer. And as our families got richer, our country got richer. That was how this country built a great middle class.

But then things changed.

By 1980, wages had flattened out, while expenses kept going up. The squeeze was terrible. In the early 2000s, families were spending twice as much, adjusted for inflation, on mortgages as they had a generation earlier. They spent more on health insurance, and more to send their kids to college. Mom and dad both went to work, but that meant new expenses like childcare, higher taxes, and the costs of a second car. All over the country, people tightened their belts where they could, but it still hasn’t been enough to save them. Families have gone deep into debt to pay for college, to cover serious medical problems, or just to stay afloat a while longer. And today’s young adults may be the first generation in American history to end up, as a group, with less than their parents.

Remember how up until 1980, 90% of all people-middle class, working people, poor people-got about 70% of all the new income that was created in the economy and the top 10% took the rest? Since 1980, guess how much of the growth in income the 90% got? Nothing. None. Zero. In fact, it’s worse than that. The average family not in the top 10% makes less money than a generation ago.(viii) So who got the increase in income over the last 32 years? 100% of it went to the top ten percent. All of the new money earned in this economy over the past generation-all that growth in the GDP-went to the top.(ix) All of it.

That is a huge structural change. When I look at the data here – and this includes years of research I conducted myself – I see evidence everywhere about the pounding that working people are taking. Instead of building an economy for all Americans, for the past generation this country has grown an economy that works for some Americans. For tens of millions of working families who are the backbone of this country, this economy isn’t working. These families are working harder than ever, but they can’t get ahead. Opportunity is slipping away. Many feel like the game is rigged against them – and they are right. The game is rigged against them.

Since the 1980s, too many of the people running this country have followed one form or another of supply side – or trickle down – economic theory. Many in Washington still support it. When all the varnish is removed, trickle-down just means helping the biggest corporations and the richest people in this country, and claiming that those big corporations and rich people could be counted to create an economy that would work for everyone else.

Trickle-down was popular with big corporations and their lobbyists, but it never really made much sense. George Bush Sr. called it voodoo economics.(x) He was right, and let’s call it out for what it is: Trickle-down was nothing more than the politics of helping the rich-and-powerful get richer and more powerful, and it cut the legs out from under America’s middle class.

Trickle-down policies are pretty simple. First, fire the cops-not the cops on Main Street, but the cops on Wall Street. Pretty much the whole Republican Party – and, if we’re going to be honest, too many Democrats – talked about the evils of “big government” and called for deregulation. It sounded good, but it was really about tying the hands of regulators and turning loose big banks and giant international corporations to do whatever they wanted to do-turning them loose to rig the markets and reduce competition, to outsource more jobs, to load up on more risks and hide behind taxpayer guarantees, to sell more mortgages and credit cards that cheated people. In short, to do whatever juiced short term profits even if it came at the expense of working families.

Trickle down was also about cutting taxes for those at the top. Cut them when times are good, cut them when times are bad. And when that meant there was less money for road repairs, less money for medical research, and less money for schools and that our government would need to squeeze kids on student loans, then so be it. And look at the results: The top 10% got ALL the growth in income over the past 30 years-ALL of it-and the economy stopped working for everyone else.

The trickle-down experiment that began in the Reagan years failed America’s middle class. Sure, the rich are doing great. Giant corporations are doing great. Lobbyists are doing great. But we need an economy where everyone else who works hard gets a shot at doing great!

The world has changed beneath the feet of America’s working families. Powerful forces like globalization and technology are creating seismic shifts that are disrupting our economy, altering employment patterns, and putting new stresses on old structures. Those changes could create new opportunities-or they could sweep away the last vestiges of economic security for 90% of American workers. Those changes demand new and different economic policies from our federal government. But too many politicians have looked the other way. Instead of running government to expand opportunity for 90% of Americans and to shore up security in an increasingly uncertain world, instead of re-thinking economic policy to deal with tough new realities, for more than 30 years, Washington has far too often advanced policies that hammer America’s middle class even harder.

Look at the choices Washington has made, the choices that have left America’s middle class in a deep hole:

* the choice to leash up the financial cops,
* the choice in a recession to bail out the biggest banks with no strings attached while families suffered,
* * the choice to starve our schools and burden our kids with billions of dollars of student loan debt while cutting taxes for billionaires,
* the choice to spend your tax dollars to subsidize Big Oil instead of putting that money into rebuilding our roads and bridges and power grids,
* the choice to look the other way when employers quit paying overtime, reclassified workers as independent contractors and just plain old stole people’s wages,
* the choice to sign trade pacts and tax deals that let subsidized manufacturers around the globe sell here in America while good American jobs get shipped overseas.

For more than thirty years, too many politicians in Washington have made deliberate choices that favored those with money and power. And the consequence is that instead of an economy that works well for everyone, America now has an economy that works well for about 10% of the people.

It wasn’t always this way, and it doesn’t have to be this way. We can make new choices – different choices – choices that put working people first, choices that aim toward a better future for our children, choices that reflect our deepest values as Americans.

One way to make change is to talk honestly and directly about work, about how we value the work that people do every day. We need to talk about what we believe:

We believe that no one should work full time and still live in poverty – and that means raising the minimum wage.
We believe workers have a right to come together, to bargain together and to rebuild America’s middle class.
We believe in enforcing labor laws, so that workers get overtime pay and pensions that are fully funded.
We believe in equal pay for equal work.
We believe that after a lifetime of work, people are entitled to retire with dignity, and that means protecting Social Security, Medicare, and pensions.

We also need a hard conversation about how we create jobs here in America. We need to talk about how to build a future. So let’s say what we believe:

We believe in making investments – in roads and bridges and power grids, in education, in research – investments that create good jobs in the short run and help us build new opportunities over the long run.

And we believe in paying for them-not with magical accounting scams that pretend to cut taxes and raise revenue, but with real, honest-to-goodness changes that make sure that we pay-and corporations pay-a fair share to build a future for all of us.

We believe in trade policies and tax codes that will strengthen our economy, raise our living standards, and create American jobs – and we will never give up on those three words: Made in America.

And one more point. If we’re ever going to un-rig the system, then we need to make some important political changes. And here’s where we start:

We know that democracy doesn’t work when congressmen and regulators bow down to Wall Street’s political power – and that means it’s time to break up the Wall Street banks and remind politicians that they don’t work for the big banks, they work for US!

Changes like this aren’t easy. But we know they are possible. We know they are possible because we have seen David beat Goliath before. We have seen lobbyists lose. We’ve seen it all through our history. We saw it when we created the new Consumer Financial Protection Bureau, when we passed health care reform. We saw it when President Obama took important steps to try and reform our immigration system through executive order just weeks ago. Change is difficult, but it is possible.

This is personal for me. When I was 12, my big brothers were all off in the military. My mother was 50 years old, a stay at home mom. My daddy had a heart attack, and it turned our little family upside down. The bills piled up. We lost the family station wagon, and we nearly lost our home. I remember the day my mother, scared to death and crying the whole time, pulled her best dress out of the closet, put on her high heels and walked to the Sears to get a minimum wage job. Unlike today, a minimum wage job back then paid enough to support a family of three. That minimum wage job saved our home-and saved our family.

My daddy ended up as a maintenance man, and my mom kept working at Sears. I made it through a commuter college that cost $50 a semester and I ended up in the United States Senate. Sure, I worked hard, but I grew up in an America that invested in kids like me, an America that built opportunities for kids to compete in a changing world, an America where a janitor’s kid could become a United States Senator. I believe in that America.

I believe in an America that builds opportunities. An America that ensures that all hardworking men and women earn good wages. An America that once again grows a strong, vibrant middle class.

I believe in that America, and I will fight for that America! And if we fight-side-by-side-I know we will build that America again.

Thank You!

Reader Supported News is the Publication of Origin for this work. Permission to republish is freely granted with credit and a link back to Reader Supported News.

Read Full Post »

%d bloggers like this: