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Posts Tagged ‘trade deficit’

For the past several years, US job growth has been weaker on a monthly average than when Jimmy Carter was US president. There’s a reason for this and a lot has to do with US corporations exporting jobs. Click here for that story. This brings us to former President Obama.

As a United States senator, Barack Obama demanded President George W. Bush do something to counter Chinese currency manipulation. As president, Obama mentioned Chinese currency manipulation one time. Then some politically powerful billionaires likely placed their arms over Obama’s shoulder and probably said something like, “Don’t mention that again, or we’ll take you behind the wood shed.”

Notice President Trump railed against Chinese currency manipulation as a candidate and hasn’t said a word about it as president. It’s likely some of his fellow billionaires threatened to take him behind the woodshed too if he ever mentioned the issue again.

This is because millions of US jobs have been exported to China; and US corporations have created millions of jobs over there rather than here thanks to President Bill Clinton and President George W. Bush, both of whom gave China “most favored nation trade status,” and which allowed US corporations to export US jobs and create jobs in China rather than here.

When China manipulates its currency vis-a-vis the US dollar, it increases the profit margins of US corporations manufacturing in China and exporting to the US, while simultaneously decreasing the profit margins of companies manufacturing in the US and exporting their goods to China. This is why all those Nike, Dell, Apple, Treetop, Campbell’s Soups, and thousands of other things are made nowadays in China and exported to the US rather than in the United States. See the-trans-pacific-partnership-the-op-ed-the-liberal-and-conservative-corporate-media-doesnt-want-you-to-see–JohnHively.wordpress.com

This is one of the reasons why income and wealth inequality has grown so great during the last thirty-five years. In the US, the top 1 percent own more wealth nowadays than the 90 percent lowest Americans, and that gap is growing.

The Federal Reserve Bank and the US Treasury could easily counter Chinese currency manipulation, but those organizations work for the billionaires and not for the rest of us. In the meantime, the US economy weakens over the long haul. That’s because workers wages now represent a smaller portion of US gross domestic product since 1947. That’s because when jobs are exported the difference between the old higher US wages and benefits and the new lower foreign wages with no benefits goes straight into the fat wallets of the billionaires via higher corporate profits, rising dividends, and surging share prices. Trade agreements, nice scams huh?

This is precisely why the rich are now stealing about 37 percent of all income produced in the United States, compared to 8 percent when Carter was president in 1980. This is why job growth was greater under Carter on a per monthly basis than nowadays even though the US economy was only about 40 percent the size of today’s US economy, and the population was only 60 percent the size of today’s US population.

This is something to reflect on when some Wall Street US Senator like Ron Wyden says we need more trade agreements to create more jobs. When Wyden, or Wall Street Senator Mitch McConnell says crap like this, you know it’s a lie.

 

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A new poll by the Pew Research Center show that 80 percent of US citizens believe that trade agreements have cost the United States jobs. According to the poll:

“The public sees threats to jobs coming from several directions: Eight-in-ten adults say increased outsourcing of jobs to other countries hurts American workers, and roughly the same share (77%) say having more foreign-made products sold in the U.S. has been harmful. Significant shares also cite increased use of contract or temporary workers (57%) and declines in union membership (49%) as trends that are hurting, rather than helping, workers. At the same time, global markets for U.S.-made products are seen as helpful for workers by 68% of adults. And seven-in-ten say the rise of the internet and email has been a net positive.”

The poll suggests the US public is not fooled by these trade scams that redistribute income from working folks to the rich. And they’re spot on.

According an Economic Policy Institute Study shows that over 2 million US jobs were exported to the eleven nations participating in the Trans Pacific Partnership (TPP) in 2015. That doesn’t count China, since it is not a part of the as of yet not approved TPP.

The U.S. trade deficit with China was $365.7 billion in 2015, or about double what it was with the TPP nations. This is a new record, up slightly from last year’s record of $343 billion. Counting the trade deficit with China suggests US companies exported at least 4 million more jobs in 2015, for a total of over 6 million jobs in 2015.

At least one study suggested US corporations have exported 26 million jobs since 2000. The EPI study for jobs loss in 2015 coupled with the US trade deficit with China suggests this is very likely, and perhaps even understates the job loss numbers.

That’s why Americans have wised up to these income redistribution scams falsely marketed as trade agreements. They may not know the exact number of jobs lost, but given that the current economic expansion is the weakest since the Great Depression, most people can see and feel that something has gone terribly wrong with the US economy.

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The governors of the Federal Reserve Bank voted to keep interest rates at historic lows in their September 17, 2015 meeting. The bank has not raised interest rates in nearly a decade. Lucky us, or maybe unlucky us.

Chairwoman Janet Yellen cited a number of reasons why the bank decided to keep rates low. She mentioned, for example, the weakness of manufacturing in China.

However, she didn’t mention that nearly 50 percent of US manufacturing is done in China, which, quite naturally, indicates a slowing down of US outsourced manufacturing, which certainly impacts the US. Like a good politician, she also did not mention that the evil US trade deficit is fueled by US manufacturers exporting jobs overseas, like Microsoft, Apple, Nike and Adidas. These and hundreds of other companies manufacture their products in China and elsewhere, and export their stuff to the US.

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This is precisely and the only reason why the US has a trade deficit. The US trade deficit, in other words, is with US job exporters, not with China, Pakistan, Mexico or elsewhere.

Anyway, keeping interest rates low was a good thing for the US economy. Typically, the Fed waits to raise interest rates until just after the US economy begins to slide into recession.

That process begins when US corporations see a slowdown in their earnings growth, in the aggregate. These businesses begin to lay people off, which jacks up their profits. Perhaps the folks running the Fed take this as some sort of sacred signal that everything is all right. However, laying enough people off throughout the economy ignites recessions in the process of jacking up those profits, because the demand for goods and services slackens, jobs and profits decline, and a recession begins even while corporate earnings expand.

This is why I mentioned the slowdown of Chinese manufacturing, which in all likelihood, represents something of a slowdown of US manufacturing abroad. Profit growth has been shaky the last two years, though still growing in fits and spurts with sudden quarterly declines followed by rapid growth.

In other words, the US and world economies are still quite weak, especially since the rich have stolen 95 percent of all income growth in the US since 2009, an historic high by a wide margin. This has meant sluggish US and world economic growth since the more money the 1 percent steal in the US and elsewhere, the weaker the demand for goods and services by the 99 percent.

Yellen has the brains to understand all of this. This is likely why the Fed has kept interest rates at historic lows for years. To maintain their standards of living, the 99 percent had to keep borrowing because they haven’t gotten a raise in 35 years on average and in real terms. Raise interest rates and the demand for goods and services begins to die.

Raising interest rates will likely be the straw that sends the world economy into the monstrous fangs of the biggest economic crisis since the Great Depression. This crisis may already be in its early less visible stages.

Not a single world leader has learned the lesson from the last Recession. The current US economic expansion is fueled by the same artificially created housing and stock market bubbles as the last recession. Wall Street executives are calling the economic shots in the White House, on Capital Hill and the US Supreme Court. That’s why nobody who could do anything did squat about the corrupt forces that brought about last recession, and now the bill is coming due.

The last recession was the worst since the Great Depression. The next one, as I have pointed out in my book, The Rigged Game: Corporate America and a People Betrayed, will be far more hideous.

The Fed has literally no tools to fight off this coming Great Depression, but it will print trillions of dollars to save billionaires and others from their foolish investment decisions. See breakdown-of-the-26-trillion-the-federal-reserve-handed-out-to-save-rich-incompetent-investors-but-who-purchase-political-power–JohnHively.wordpress.com

The federal government will be forced to expand the deficit, and instead of having 48 million people permanently on food stamps, the US will have 60 to 100 million, unless the madness of redistributing income from the 99 to the 1 percent via job exporting trade treaties, unsustainable and illogical immigration policies (both legal and illegal, HB1 visas), and privatization scams.

Much of this can be reversed simply by amending income redistribution schemes known as international trade agreements, limiting immigration by restricting the flow of people moving into the USA at least until wages begin to rise, enforcing current immigration laws, and putting a halt and reversing many privatization follies.

All three of these policies have stolen jobs from American citizens, while enriching the politically and financially affluent in the process, all at the expense of people who produce goods and services.

Of course, that is precisely what the corrupt US government (all three branches), and both corrupt major political parties, have been driven to do by the money unleashed in the political markets since and because of the Reagan tax cuts for the rich.

The ultimate end game of Reaganomics is coming to its ugly conclusion.

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This morning, Wall Street Congressman John Boehner introduced Fast Track Authority into the US House of Representatives, which passed 218-208. 190 Republicans and 28 Democrats voted for this scam; 50 Republicans and 158 Democrats voted against it. Eight members did not vote.

Now the measure will return to the US senate as a stand alone piece of legislation, where Wall Street Senator Ron Wyden is chomping at the bit to vote for it on behalf of Wall Street billionaires, and against the interests and wishes of the vast majority of Oregonians, which he was elected to represent.

Fast Track Authority will allow for the passage of the Trans-Pacific Partnership, the largest income and political power redistribution scam in world history. Previously, Fast Track had to pass with the Trade Adjustment Assistance Act (TAA), which was geared to help the hundreds of thousands of workers, and perhaps millions, whose jobs will be exported with TPP.

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We know from leaked documents the 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.

* 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.

* 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.

* 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-by-destroying-us-exports–Johnhively.wordpress.com .

* will raise pharmaceutical prices by extending patents forcing the 99 percent to pay more for big pharma’s products.

* will override Wall Street regulations, as if the mostly ineffective US regulations inhibit Wall Street profits and illegal activities.

* will increase the US trade deficit. The largest fourteen trade deficits in world history have been the last fourteen US trade deficits. It’s either absolute insanity or absolutely corrupt to desire increasing the trade deficit. Yet, Wyden and other Wall Street Democrats have saliva running down their jowls thinking about voting for Fast Track and the TPP.  Think corruption, not insanity.

Stunningly, Democrats such as Wall Street Senator Ron Wyden support doing all of the above to the American people. And these things are only a few things we know about. Why are these negotiations so secret? US Senator Elizabeth Warren says it best below.

As for Fast Track Authority, if passed by congress, it will mean there be limited debate in congress when the TPP comes up for a vote. Fast track will also prohibit any amendments to the TPP and eliminate any means to filibuster it in the senate. In other words, fast track rigs the political and economic game against the 99 percent and for the 1 percent.

Save your democracy. Stop the corporate takeover of your nation. Call your senators and tell them to vote against Fast Track Authority. Click on the following link to find the phone number and email addresses of your senators; Contact your senators .

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The time to stop Fast Track is now or never.

This terrible trade-negotiation policy recently passed in the Senate. Now that members of Congress are back from vacation, they’re expected to bring Fast Track to a vote any day now. Some of our lawmakers already have committed to stand with their wealthy campaign donors and support Fast Track. But many of our elected officials still can be moved—especially if we remind them that we vote.

Call and ask your representative to oppose Fast Track right now.

This week, people across the country are making calls to their lawmakers to let them know that working folks absolutely cannot afford another bad trade deal.

We need to let them know we’ve got the facts and we don’t support Fast Track. In the past, deals that were passed using the Fast Track process deepened our trade deficit, weakened our manufacturing sector, lowered wages and gave the 1% more control over our economy. More of these bad policies will shrink our paychecks and stifle middle-class growth.

Not only does Fast Track encourage the passage of bad trade deals, but it will tie the hands of Congress, preventing lawmakers from improving bad deals or telling negotiators the deal won’t get a vote unless they go back to the drawing board. We deserve better than a policy that limits Congress to a simple up-or-down vote on trade deals that will affect working families everywhere.

I believe we can win this, but we have to act now.

Contact your representative now and tell her or him to stand up for workers and democracy by opposing Fast Track.

To call your Member of Congress:
US Capitol Switchboard (202) 224-3121

To locate your Member on-line:
U.S. House of Representatives: http://www.house.gov
U.S. Senate: http://www.senate.gov

In Solidarity,

Rich

Richard Trumka
President, AFL-CIO

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US Congressman Alan Grayson explains in the video above how the regime of free trade is destroying the middle class by redistributing its income to the 1 percent. The fourteen largest trade deficits in the history of the world are the last fourteen US trade deficits. That neatly corresponds to the current imbalance in income and wealth inequality. That’s because they’re connected, tightly entwined, like the fibers of ropes, or the financial links between politicians and their financial backers.

Grayson asks, “What sane person could look at the trade deficit numbers and conclude that America needs more free trade?”

Yet many politicians support the Fast Track Authority and the TPP, mostly due to political corruption. So is their support of increased income inequality and rising trade deficits caused by insanity or corruption or stupidity? Try the second reason.

I disagree with some of Grayson’s conclusions. One of the things he doesn’t understand is that the US trade deficit is largely caused by US corporations, which ship jobs overseas, and then export these products to the United States. The difference between the old higher wages and the new lower foreign wages goes straight into the pockets of the super rich via higher corporate profits, rising dividends and share prices.

This is why the US trade deficit fits neatly in with growing income inequality. Trade deals are a nifty and shady way of hiding this income redistribution and how the 1 percent achieve it.

That means trade deals have never had anything to do with trade, except as a coincidence to legally paving the way for US corporations to ship jobs overseas, or to create jobs over there rather than back here.

So when a trade deal comes along, like the Trans Pacific Partnership, and this deal will likely increase the already massive US trade deficit, it’s a sure sign that it negotiated to redistribute income from the 99 to the 1 percent, and income inequality will increase correspondingly, and this is what the TPP is all about, and nothing more.

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President Obama wants congress to give him Fast Track Authority so as to sneak the Trans Pacific Partnership (TPP) through congress without much public perusal. If given, Fast Track will limit debate in congress, forbid a senate filibuster, and prohibit amendments to the looming Trans Pacific Partnership, the largest income and political power redistribution scam in all of history, falsely being labeled a free trade agreement. Income will be redistributed from the 99 to the 1 percent via the TPP. Among other onerous things, the 99 percent will also see their voting rights eliminated on the state and local levels when it comes to issues of health, safety, and food labeling. These are the exact reason why Wall Street President Barack Obama, Wall Street Senators Orrin Hatch, Mitch McConnell and Ron Wyden, as well as Congressmen such as Earl Blumenauer and John Boehner loves Fast Track and the TPP. They want to screw the American people over on behalf of the 1 percent.

In other words, these Wall Street politicians are trying to rig the economic and political games even more than they already have against the 99 percent.

1. Fast track legislation is designed to pave the road for new trade deals like the TPP by forcing Congress to relinquish their constitutional authority to review and amend a trade deal. That’s dangerous because it removes any possibility of improving sections of a deal that hurt working people.
2. No trade deal has ever been defeated under fast track procedures no matter how bad it is for wages, jobs, small business and the environment.
3. Fast Track forces Congress to make a take-it-or-leave-it decision on a 29 chapter, 1,000 page agreement that was negotiated in secret. It’s more important to do trade deals right than fast.
4. Nearly two-thirds of American voters oppose granting the President fast track authority. That’s because they believe it gives too much power to one person.
5. Congressional leaders were afraid to bring Fast Track up for a vote last year because they were afraid of the political consequences. Politicians should know better than to try now. Voters have long memories.
6. Working families can have leverage over the outcomes of trade deals—but only until fast track is passed. That’s why stopping fast track is among our highest priorities. We can’t afford any more failed policies from the past.
7. The U.S. economy is shedding manufacturing jobs like there is no tomorrow, having lost about 6 million manufacturing jobs and more than 60,000 factories just since 2001.
8. About 3.2 million of those lost jobs are due to trade with China, 60,000 have been lost to Korea since the Korea FTA, and another nearly 700,000 have been displaced due to Mexico due to NAFTA .
9. The United States has a $476 billion annual trade deficit—and a whopping 60% of our trade deficit is with China. The trade deficit represents lost jobs for America’s workers. That’s $476 billion dollars of lost jobs, which represents approximately 31 million lost jobs.
10. The difference between the wages of those lower wage jobs overseas and the higher pay in the United States goes into the pockets of the 1 percent via higher corporate profits, rising dividends and surging share prices. Why do you think the Dow Jones Industrials is at a record level?
11. In other words, the president and Wall Street senators want to use Fast Track Authority to steal more of your money, and your children’s money.

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