The Big Trade-Off

The Trans-Pacific Partnership is back in the news and back as a 2016 campaign issue for both parties as the final touches on the deal have been worked out.

The United States and 11 other Pacific Rim nations on Monday agreed to the largest regional trade accord in history, a potentially precedent-setting model for global commerce and worker standards that would tie together 40 percent of the world’s economy, from Canada and Chile to Japan and Australia.

The Trans-Pacific Partnership still faces months of debate in Congress and will inject a new flash point into both parties’ presidential contests.

But the accord — a product of nearly eight years of negotiations, including five days of round-the-clock sessions here — is a potentially legacy-making achievement for President Obama, and the capstone for his foreign policy “pivot” toward closer relations with fast-growing eastern Asia, after years of American preoccupation with the Middle East and North Africa.

Mr. Obama spent recent days contacting world leaders to seal the deal. Administration officials have repeatedly pressed their contention that the partnership would build a bulwark against China’s economic influence, and allow the United States and its allies — not Beijing — to set the standards for Pacific commerce.

The Pacific accord would phase out thousands of import tariffs as well as other barriers to international trade. It also would establish uniform rules on corporations’ intellectual property, open the Internet even in communist Vietnam and crack down on wildlife trafficking and environmental abuses.

Several potentially deal-breaking disputes kept the ministers talking through the weekend and forced them repeatedly to reschedule the promised Sunday announcement of the deal into the evening and beyond. Final compromises covered commercial protections for drug makers’ advanced medicines, more open markets for dairy products and sugar, and a slow phaseout — over two to three decades — of the tariffs on Japan’s autos sold in North America.

The question for the assembled is this: does this deal pass Congress?

Lot of factors in play here: Obama’s legacy, Republicans who want this deal passed despite giving Obama a win, Democrats who want this deal scrapped, the 2016 candidates all over the map on this, corporate interests, environmental interests, unions, you name it, everyone has a stake in this deal.

But having gotten this far and the final international deal now done, does this deal pass from sheer inertia of history or does the politics of 2016 mean it can’t?

208 replies
  1. 1
    Baud says:

    Wow. I thought it might not actually get done.

  2. 2
    MattF says:

    My guess is that the corporate interests will prevail. The treaty has something for everyone, and the Pacific market is huge.

  3. 3
    Ryan says:

    I doubt very seriously that this is important for his legacy, which will always be either health care or Kenyan muslim socialist, depending on who you ask. As to the merits, this agreement raises as many barriers as it lowers. While tariffs fall, they’re already relatively low by historical standards. On the other hand, IP protection means that holders of IP will collect far more in rents than they do presently. Read Dean Baker for what this means for pharmaceuticals, and you’ll get a sense of the deficits in this agreement.

  4. 4
    NobodySpecial says:

    It makes the rentiers money, and the rentiers own Congress. Yes, it will pass. Easily. With a bonus waving flag and eagle shaped fireworks.

  5. 5
    Belafon says:

    @NobodySpecial: Who are the rentiers in this?

  6. 6
    MazeDancer says:

    The yelling points against the deal are easier than the ones for it.

    “Bad for America”
    “Obama is giving away our jobs”
    “Once again, Obama makes a lousy deal”
    “Another weak President give away to foreign powers”

    No GOP candidate wants to be seen supporting the President on anything. And not all Democratic voters like the deal either.

    What are the easy slogans for the deal? Don’t see the coalition who will pass the deal or what cover/rallying points they’ll use. Maybe there will be some that haven’t emerged yet.

  7. 7
    p.a. says:

    It is important for his legacy. For me, so was card-check: so that indicates where I’m coming from. Maybe an unusual concatenation of events can prevent Big Money from winning as usual.

  8. 8
    p.a. says:

    Can’t edit in mobile + android, so let me add here: I’m sure the labor and environmental protections will be every bit as effective as those written into NAFTA, so there is that.

    Sometimes sarcasm can work when in writing.

  9. 9
    C.V. Danes says:

    My understanding is that negotiations stumbled over the best way to word “feed the rich, f’k the poor.”

    If there was ever a good time for a do-nothing Congress, trying to pass this turkey is it.

  10. 10
    C.V. Danes says:

    @MattF: Given that Congress couldn’t even reauthorize the ExIm bank, I think approval is far from certain.

  11. 11
    Bruuuuce says:

    Robert Reich assesses the TPP (FB link):

    The deal is slightly better than the first draft but it would still widen inequality. Global banks and corporations headquartered in the U.S. as well as their executives and biggest shareholders would be the big winners; most other Americans would lose.

    1. Expand protections for the foreign property of big global corporations.
    2. Extend intellectual-property protections for big global pharmaceutical companies.
    3. Create special tribunals that can force countries to pay global corporations damages for lost profits due to health, safety, environmental regulations…
    4. By encouraging foreign direct investment in all these ways,the deal will make it even easier for big American companies to outsource work abroad…
    5. True, the worker standards in the TPP commit all parties to the International Labor Organization’s standards but almost all these nations are already committed to those standards…

    It’s a bad deal for the bottom 90 percent of Americans. Bernie Sanders is against it. Hopefully, Hillary Clinton will be as well. (And just because Donald Trump is also against it doesn’t make it right.)

    Sounds like a sucky deal for most of us, and with luck, the reactionary Republicans and a few progressive Democrats can block this crap from passing.

  12. 12
    Benw says:

    Anyone have a link to the nitty gritty of where the money and jobs are going in the deal?

  13. 13
    OzarkHillbilly says:

    @MazeDancer:

    Don’t see the coalition who will pass the deal or what cover/rallying points they’ll use

    Rally point #1: “Vote for this deal and I will donate $100,000 to your PAC.”

  14. 14
    Sherparick says:

    Joseph Stiglitz and a co-author point out that this deal is mostly about vacuuming up more money for the 1%, e.g. that it is all about extending monopolies, rent seeking, and guaranteeing “expected profits” if Government regulations change to restrict a corporation’s right to poison, injure, and inevitably kill some their workers, customers, and host country citizens.

    http://www.project-syndicate.o.....sh-2015-10

  15. 15
    Sherparick says:

    @Bruuuuce: The exclusion of “Big Tobacco” from the protection of the ISDS provisions may kill this deal. Mitch McConnell pretty much had made it a condition of his support and I don’t know if Big Pharma and the Chamber of Commerce can bring him around.

  16. 16
    Bruuuuce says:

    @Sherparick: I don’t much care which provision kills the deal, whether it’s Big Tobacco’s exclusion, the reduction of term for Big Pharma’s IP, or a populist rally threatening to change half the seats in Congress. Just so it fails.

  17. 17
    Betty says:

    From the Guardian:

    “The TPP would give Japan’s automakers, led by Toyota Motor Corp, a freer hand to buy parts from Asia for vehicles sold in the United States but sets long phase-out periods for US tariffs on Japanese cars and light trucks.

    The TPP deal being readied for expected announcement on Monday also sets minimum standards on issues ranging from workers’ rights to environmental protection. It also sets up dispute settlement guidelines between governments and foreign investors separate from national courts.”

    Don’t see how this helps the American people.

  18. 18
    bcinaz says:

    I believe the Senate is the place where treaties live or die and they require a 2/3 majority – that’s 67 votes. How the hell can anything Obama negotiates get to 67 votes in the Senate?

  19. 19
    Sherparick says:

    @OzarkHillbilly: That’s about it. The 1% elite in both parties think these deals are great and they are the ones most listened to by the majority of Senators and representatives. On the Republican side, no one is going to get primaried for voting for this deal. Immigration reform yes, tax increases yes, raising the debt ceiling, yes, not voting to defund PP, yes; but on this issue there is no Club of Growth, no anti-immigration Zealots, no Forced Birth constituency who will come out in a Republican Primary and vote out an incumbent. Now on the Democratic side yes, they do have to worry about the primary or (in purple areas) having an unmotivated base. But I expect the Democratic votes for TPP and TIPP will come in Blue states and districts that favor it (Seattle and San Jose like Intellectual Property Protectionism for instance and much of Iowa love the agricultural provisions) who don’t fear being primaried, especially with the fund raising advantage and weak union presence in their districts and states (see Virginia).

  20. 20
    Elizabelle says:

    @Baud: OT. Responded to VP item on previous thread. And rikyrah and others have put up some new good stuff.

    RE TPP: don’t know enough to evaluate, but I trust Robert Reich and Joseph Stiglitz. Unless we have President Sanders, though, I don’t see anyone doing a better job reigning in the usual suspects.

    Way interesting about Big Tobacco. Wouldn’t mind if this one got scuttled.

  21. 21
    Monkeyfister says:

    For once in my life, I am actually thrilled that Congress is such chaos and disarray.
    My only hope is that the dysfunction allows this piece of crap to die the death it deserves.

  22. 22
    eric says:

    One wonders however, if the idea of a TPP super highway is going to catch on …

  23. 23
    Elizabelle says:

    Anybody got some very good links about NAFTA’s longterm impact? It’s my sense it’s been a disaster, but I don’t know that.

  24. 24
    Elizabelle says:

    WaPost headline: It’s confirmed the cargo ship El Faro sank during Hurricane Joaquin. 33 souls on board. I know 4 of them were from Maine; 5 were Poles.

  25. 25
    Watchman says:

    Fitting that there’s a Trans Canada ad for the Keystone XL pipeline under this bullshit deal article.

    Clinton’s NAFTA deal destroyed American manufacturing. Obama’s TPP will destroy the rest. Who needs Republicans with Democrats like these?

    Fuck em.

  26. 26
    ruemara says:

    I don’t see this passing. Between anti-Obama sentiment, and anti-trade agreement sentiment, it’s a dealbreaker for the primaries. Maybe I’ll review the agreement on Vox. I just want simple clarity on what it means, not someone’s views on deal good/deal bad.

  27. 27
    GregB says:

    OT, with mixed good news/bad news in New Hampshire. Sitting Democratic Governor Maggie Hassan announces a challenge to Republican Senator Kelly Ayotte.

    A big recruitment get for the Democrats, however it also leaves them without an incumbent in the Governor’s seat in 2016.

  28. 28

    Oh, we’re getting fucked.

    The question is how badly and whether or not the wealthy and corporate interests decide to leave a $20 on the nightstand or not after they’re done.

  29. 29
    EZSmirkzz says:

    More apropos here I suppose, but you cannot understand any American foreign or domestic policy without looking at it through the lens of empire, which is laid out pretty bluntly, IMHO, by the book “The WikiLeaks Files”. I found it to be a somewhat difficult read because I happen to love my concept of America and on reflection find some, but not all anti-American observations to be an over generalization, and some of the monolithic assumptions of America to be off the mark.

    Of course TPP will pass Congress as they represent the United States, not the American people.

    On the other hand, the unwillingness of the American people to see, much less acknowledge the existence American empire returns me to my rant on the drawbacks of a structured college education, which leaves the aspect of the empire outside the paradigm of American history, even though it is very much integral to American history and policy. I suppose I should say, as well, that no education is wasted, yet all of them are incomplete.

  30. 30
    Poopyman says:

    I won’t know what to think on the TPP until I hear what Cornel West has to say.

  31. 31
  32. 32
    JGabriel says:

    NYTimes via Zandar @ Top:

    The Pacific accord would … open the Internet even in communist Vietnam …

    Right, but will it open the internet in the United States?

    I’m not joking. Availability of high speed internet access sucks in this country. Even when it’s available it tends to be lower than in other first and second world countries, and you usually have to deal with some of the worst customer support and most hated companies in the world to get it – yes, I’m looking at you Comcast, Time Warner, and Verizon.

    I guess what I’m saying is that we shouldn’t be so quick to criticize other countries internet capabilities – or characterize their internet access as weak or not open – when the capitalist model in this country has failed so spectacularly to provide competitive bandwidth speeds or even barely competent customer service.

  33. 33
    Rommie says:

    I still think the POTUS is approaching this from a “can’t lose” perspective. He KNOWS what his name attached to TPP means, and that the GOP will reflexively frown on it because of that. If it passes, great, he gets another legacy achievement. (Whether it’s good or bad we would find out down the road.) If it’s shot down – I just don’t see him losing a lot of sleep over it. If he *really* wanted this to pass, he would have stayed in the background IMO.

    IOW, “Look, folks/corporate moneybags/big donors pushing this, I tried! Stuff Happens!”

  34. 34
    JGabriel says:

    @MattF:

    The treaty has something for everyone …

    Except, you know, the vast majority of Americans who aren’t corporate executives or don’t own stocks.

  35. 35
    JGabriel says:

    @OzarkHillbilly:

    @MazeDancer:

    Don’t see the coalition who will pass the deal or what cover/rallying points they’ll use

    Rally point #1: “Vote for this deal and I will donate $100,000 to your PAC.”

    Exactly. Or to put it another way: Bingo.

    I’m not sure why so many here think the GOP will oppose TPP. Sure, they hate to agree with the President on *anything*, but the only thing they’ll need to hear to get on board is, “It makes the rich richer.” In fact, as far I know, most of the GOP is already on board.

  36. 36
    Keith G says:

    It will pass. And it will do for Obama’s legacy what NAFTA has done for Bill Clinton’s legacy.

  37. 37
    eric says:

    @Keith G: legacy to whom? most people i know dont link Clinton and NAFTA. Maybe a little “welfare reform” or dont ask dont tell. in the end, they link clinton to the economy and impeachment.

    Same will be true for Obama. His legacy is first black president and healthcare. TPP would not make the top 15.

  38. 38
    Lee says:

    @Elizabelle:

    Wiki’s summary of NAFTA is actually pretty good covering both the good & bad.

    Mexico & Canada did see modest economic gains. US did as well (not as much as Canada & Mexico) but we sacrificed jobs in some areas for an increase in other areas.

  39. 39
    NorthLeft12 says:

    This has become an issue in the ongoing Canadian election. The Conservatives are strong supporters of the deal [they negotiated for Canada] and are touting the advantages now. Although Canada’s experience with NAFTA was very negative especially here in Ontario. The auto industry has pretty much fled south to non-Union US plants and Mexico.
    The two opposition parties, Liberals and NDP, are cautious about the deal as they honestly do not know what is in it. The Liberals will undoubtedly support it, while the NDP will likely approve it too after much grumbling and noise.

    The Cons selling point is that the deal will happen with or without us, and the consequences will not be good if we are not a part of it.

    I smell a sell out to our financial overlords.

  40. 40
    burnspbesq says:

    After years of baseless speculation and uninformed fear-mongering from the Chickens Little of the left, it will be nice to finally see whether there is any there there.

    My initial reaction is to note that the signatories do not include China, India, or Bangladesh, so even a deal that included everything on Loomis’ wish list would be of limited utility.

  41. 41
    NobodySpecial says:

    @Belafon: Drug companies like Turing and media distribution companies. American IP law is fucked and we’re exporting that in this deal.

  42. 42
    Keith G says:

    @eric: NAFTA is not seen as an unmitigated success.

    There were many losers, economic losers, as result of the trade pact. Promises were made that there would be side legislation that would allow some mitigation of the negative impact on labor in the United States – promises that were not lived up to. Or, as Bill Clinton himself has written…

    We also had to make deals on a wide range of issues; the lobbying effort for NAFTA looked even more like sausage making than the budget fight had. Our whole team had won a great economic and political victory for America, but like the budget, it came at a high price, dividing our party in Congress and infuriating many of our strongest supporters in the labor movement.
    Source: My Life, by Bill Clinton, p.557 , Jun 21, 2004

  43. 43
    NorthLeft12 says:

    @Lee: I looked at Wiki and noticed the citations needed tags at the comments with respect to the manufacturing jobs. Mfg. employment is way down in Canada, hitting new lows almost every month.

    I would not blame those job losses solely on NAFTA, but globalization in general.

    Let the race to the bottom continue!

  44. 44
    Keith G says:

    @Elizabelle: If one believes, as I do, that the American working class has been, and is being, successfully hollowed out and there is an upwards drift of wealth to the economic class that is already wealthy enough, then one must consider both NAFTA and Clinton era banking legislation as being key components of enabling the new American kleptocracy.

    An overall impact of NAFTA may well have been a increase in the wealth of the entire American economic society, but changes caused by NAFTA helped to create conditions of very uneven economic growth that has become a growing problem in our country.

  45. 45
    pamelabrown53 says:

    @burnspbesq:

    Interesting. I was perusing the new Pew Poll. On the issue of expanding trade deals, dems were 44% more likely to support a candidate who supports expanding trade deals; 19 less likely; while 36% say it’s not a factor

    I’ll be glad to finally see some thorough analysis based on the actual deal and be able to determine if the positives outweigh the negatives.

  46. 46
    Lee says:

    @NorthLeft12:

    Like I said, it is a ‘pretty good’. It is not exhaustive or comprehensive. It does note the positives and negatives especially from the US point of view.

  47. 47

    @Keith G: I agree and I would include anyone whose livelihood depends on wages as working class. White collar work and education no longer insulate you from being treated like crap by your employer.

  48. 48
    Keith G says:

    This entry is being trashed due to a formatting error because I’m trying to do this on a mobile device that I’m not used to using.

  49. 49
    Gene108 says:

    @Keith G:

    It will pass. And it will do for Obama’s legacy what NAFTA has done for Bill Clinton’s legacy.

    Clinton inherited NAFTA from GHWB. It had been on the drawing table for years before Bill.

    Not sure how many jobs were lost du to NAFTA versus going to China.

    As posted up thread would like to know long term impacts.

  50. 50
    Dennis says:

    @Bruuuuce: It’s that third one that really sticks in my craw:

    3. Create special tribunals that can force countries to pay global corporations damages for lost profits due to health, safety, environmental regulations…

    Time to cash in, unless you repeal all environmental regulation! “Let me poison you, or you must pay me.”

  51. 51
    eric says:

    @Keith G: I agree. I see it as a failure by and large for American workers. I just dont think most people care about Clinton’s role

  52. 52
    Gene108 says:

    @Keith G:

    Uneven economic growth started under Reagan. Clinton’s second term was the only time in 40 years real wages rose for most Americans.

    I’d say Reagan green lighting M&A activity caused the decoupling of corporate profits from wages.

    Now that the djini is out of the bottle no idea how it goes back in.

  53. 53
    EZSmirkzz says:

    @schrodinger’s cat: Not even close.

  54. 54
    Archon says:

    The working class in America is as divided, dispirited, and demobilized as you will ever see in a country.

    Anyone who thinks TPP won’t pass is fooling themselves.

  55. 55

    @Bruuuuce: I don’t understand how the distribution of money within the US (this entire argument is about how much money goes to US executives vs US workers) should be regulated within a foreign trade deal. Domestic inequality needs to be resolved by domestic policies.

    The argument so far presented is that this brings increased money back to the US. That’s GOOD. That’s what a good trade deal ought to do. If our domestic policies are so fucked as to not distribute that properly, that’s got to be hammered out in other areas. You can’t expect to get Australia to sign on to US internal labor policies in a global trade deal. This is the Iran deal all over again, with the left taking the role of the tea party complaining about effects that are inappropriate to such a deal.

    Global trade is the driving force behind the decline in poverty globally. That was true within the US a century ago, it’s true globally now. The economy is not zero-sum. Raising wages in Vietnam doesn’t reduce wages in the US (domestic policies do that), but greater income in Vietnam does create increased demand for US goods and services.

    For example, people have complained for ages about Apple manufacturing devices in China, but nearly half of the cost to manufacture the device (not profits, COGS) is distributed back to the US to pay for components made here, the engineers that designed the parts, and so on. And these are good jobs. The money that has stayed in China has helped the Chinese middle class rise. And what do they spend their money on, now that they have it? iPhones, where the majority of the money flows back to the US (because the profits also flow back here). Are the engineering jobs created here not worth it? The new factories to make glass and semiconductors that are located in the US? The jobs that oversee the huge global supply chain that are all in California? The hundreds of thousands of new programming jobs?

    Why are we so focused on trying to preserve jobs that are increasingly low-skilled, and even more increasingly inevitably going to be automated out of existence? I know that’s a shitty deal for machinists, but you know what – their job was going to be eliminated no matter what. Trade isn’t what killed it – software is.

  56. 56
    Gin & Tonic says:

    @JGabriel: About 55% of Americans own company stock directly (as an individual or joint brokerage, 401(k) or self-directed IRA account.) Another significant percentage (I’m not going to spend a lot of time on research right now) are covered by a defined-benefit pension plan, which is almost certainly invested at least partially in common stock. There is certainly overlap between the two groups, but there are, I am sure, people who answer “no” to the first who are nevertheless indirectly invested and may not know it. I think it is safe to say that 2/3 of Americans have a direct or indirect stake in common stock.

  57. 57
    Keith G says:

    @schrodinger’s cat: Okay, trying this again…

    In order to explain some of the economic development to friends, I have invented the phrase wealth mining. I use wealth mining to explain the concept of individuals with access to capital or certain technologies who are able to swoop into a market or a specific enterprise and use that market or enterprise to mine or harvest any opportunities for extra income/wealth usually by destroying said market or enterprise.

    And of course, the miners were not exclusively external to the enterprise is being mined. American companies were also hollowed out by their own own board of directors as their production was relocated elsewhere.

    To be honest, the above-described processes are not always unfair or unhelpful. What is unhelpful is when accommodations are not made for the domestic results of such activities.

  58. 58
    schlemazel says:

    @Gin & Tonic:
    I do not believe that a significant number of people have a defined benefit plan, they have a defined contribution plan. In my case they stole the money from the defined benefit plan & gave me less than $1000/year for years of service. They keep this money until I am 65 and pay the Fed rate of interest on it (currently around 2.5%).

    As for 2/3 of Americans having a stake thats a truth that hides a bigger lie. The 1% own 90% of the stock & the rest of us have crumbs,

  59. 59

    @Keith G: Neoliberal economic policies have socialized risk and privatized profit. Currently, the economic system benefits the few at the expense of the many. I hold Reagan the most responsible for this change but Bill Clinton has also lent a hand in dismantling the New Deal policies where banking is concerned.

  60. 60
    Elizabelle says:

    If you’re a TPP opponent, could Donald Trump do you a favor? Kevin Drum this morning:

    [Politicians are expressing] parochial local concerns.

    So will it pass? A couple of months ago, I would have said yes, and I guess I still do. But I’m a little less sure thanks to the Donald Trump effect. He’s opposed to the deal—there’s no telling why, really—and he’s shown a genius in the past for picking out specific details about various issues and then flogging them to death. So I wonder: what’s he going to pick out about the TPP? It might be something ordinary, like currency manipulation provisions, or a general attack on President Obama’s lousy negotiating skills. Equally likely, though, he’ll somehow find something in the treaty that no one else is really paying attention to, and then twist it into a populist attack that really resonates with the public. If he does that successfully, it’s just possible that he could derail the deal.

  61. 61
    schlemazel says:

    @burnspbesq: After years of baseless speculation and uninformed fear-mongering from the Chickens Little of the left, it will be nice to finally see whether there is any there there.

    HAhaHAhaHahahahaha

    Oh wait, you were serious!? What color is the sky on your planet?

  62. 62
    Kay says:

    @Betty:

    The only reason the US didn’t get screwed worse on that is Mexico and Canada balked. The US negotiators were ready to give Japan everything they wanted.

    The local content rules would directly affect employment in auto parts industries and therefore are a politically important issue, negotiations said.
    Canada and Mexico, members of the North American Free Trade Agreement along the United States, strongly oppose setting the local content ratio for auto parts under the TPP at a level far below the 62.5 percent set under NAFTA. They are concerned that a very low ratio would lead to a drop in market shares of Canadian and Mexican auto parts makers in the U.S., one of the biggest automobile markets in the world.

    I can’t tell you how excited I was to read that working people in the US are now wholly dependant on the negotiators for Canada and Mexico advocating on behalf of their own working people. So great that our own crack negotiating team was ready to accept any demand Japan made, even if it resulted in a “sharp increase” in imports from Japan.

  63. 63
    Joe Shabadoo says:

    the United States and its allies — not Beijing — to set the standards for Pacific commerce.

    Has any deal where a country on the other side of the world controls commerce been good for anyone but corporations and the richest?

  64. 64
    Gin & Tonic says:

    @schlemazel: According to the Congressional Research Service, 31% of civilian full-time employees (includes state and local governments and private sector, excludes federal and military) participate in a DB pension plan.

  65. 65
    joel hanes says:

    @NobodySpecial:

    American IP law is fucked and we’re exporting that in this deal.

    This.

  66. 66
    Kay says:

    I also wish Democrats would drop bragging about funding training for displaced workers. It’s a wash. The best case for “training” is those workers go into some other sector. All they’re doing is mitigating some of the damage of their own trade deal. Telling people that’s some kind of generous gift is insulting.

    If the whole selling point to this deal is “it was the only way we could any money to train workers for the jobs that will be lost as a result of the trade deal” well, that is ludicrous, it makes no sense, and they should stop saying it.

  67. 67
    Kay says:

    @Joe Shabadoo:

    I’d also appreciate it if they’d quit pretending the US is the “gold standard” on labor protections or environmental protections or consumer protections or anything else. We’re not the gold standard. There are other countries who are parties to this deal who have higher standards than the US. We’ll be LOWERING standards in those countries.

  68. 68
    burnspbesq says:

    @schlemazel:

    Thanks for making my point about Chickens Little for me with your entirely content-free post.

  69. 69
    pamelabrown53 says:

    @Kay: @Kay:
    Well, I think we need retraining programs for a sophisticated economy with or without a trade deal. Sometimes I think Labor and labor policy is reactionary: stuck in the 50’s.

  70. 70

    @Keith G: Most wealth is not ‘mined’ but created. GDP per capita has expanded massively due to that capitalization. You saw it in the US migration from a largely substance economy prior to the US Civil War to what we have now. You are watching China do the same thing. The poor people are not getting poorer, they are getting substantially wealthier. The global poverty rate is falling incredibly quickly right now and that’s due to global trade and the availability of technologies and services more widely. Millions of people are pulling out of poverty armed with nothing more than a smartphone and access to lending. Does that enrich some individual elsewhere? Absolutely, but the greater value comes from lifting that person out of poverty, giving them their own capital and access to the same technologies.

    Now, is this rapid globalization hurting some Americans? Yes, but that’s mostly not a function of globalization. There are far fewer auto mechanic jobs in the US now. That used to be a pretty good trade job, and now its not. Nobody is taking their car to China to be serviced – but cars are massively more reliable than they used to be. And that’s emblematic of almost every industry in the US.

    There are basically two kinds of innovation – that which makes a given market more efficient (sustaining), and that which creates new markets (disruptive). The last 30 years, thanks mostly to Moores law, has made sustaining innovation incredibly effective. We couldn’t have global trade on this scale without modern computers and communication systems. Every industry is affected – we’ve cut retail jobs by ⅓ thanks to things like self-checkout, faster stocking systems, barcode scanners, etc. Auto repair jobs are down because cars are so much more reliable. Auto manufacturing jobs are down because we’ve got robots building cars (which is why the cars are so much more reliable) and so on. The problem is that we haven’t had policies that incentivized companies to take the profits they are capturing from efficiency and reinvesting that capital into creating new markets in a manner that we want. The easy new markets have been to expand to underserved markets – those 3rd world countries. So China’s cell phone infrastructure is nearly as good as the US. We can sell solar panels in Vietnam. That’s causing poverty in those nations to plummet, and allowing people there to pursue education and build new economies. Eventually that will slow once the easy pickings are gone (and they are already going quickly, which is why you are seeing a shift in manufacturing jobs back to the US.)

    But our domestic policies don’t encourage those sustaining profits to be reinvested into new markets in the U.S. Solar should be a shining example – lots of manufacturing and installation jobs, upgrades to the grid. Most of these jobs can’t be outsourced. But you have lots of states now dropping laws to prevent this from happening in order to protect incumbent power companies. You have Republicans in Congress fighting as well. This is not a trade problem – this is a domestic policy problem. So the companies that can capitalize these programs wind up abandoning the US market because we are unwilling to undergo the economic disruption and instead they take their capital to Europe or Asia. The founder of JetBlue left the company and started up a new airline in Brazil, in part because the US market is so fucked up with policies designed to protect incumbents that there were more opportunities elsewhere. Again, not a trade problem.

    Absolutely we need better policies here, but the focus on trade is misplaced and complaining about the trade distracts from where the focus needs to be.

  71. 71
    burnspbesq says:

    @Kay:

    There are other countries who are parties to this deal who have higher standards than the US.

    And those would be?

  72. 72
    Linnaeus says:

    This thing’s going to pass. The global trade regime is too well entrenched for it not to.

  73. 73
    JimGod says:

    @pamelabrown53: Fine. But don’t come crying when these “reactionaries” come to the conclusion that both parties are the same, the party of the working man screwed me out of my job, and they either don’t vote or vote third party or even Republican cuz guns. Because that will be the outcome.

  74. 74
    Kay says:

    @burnspbesq:

    Canada and Australia were the two countries that were concerned with lower US standards on consumer protection and labor. They were also concerned with conflicts with their domestic law on controlling drug prices, which could be (will be, IMO) considered a “non trade barrier”. The US pays the most for prescription drugs. They don’t want to join our club.

    The President should have allowed a debate on his trade deal. Dismissing all of the issues that were raised was a bad (and purely political) decision. They wanted this deal so bad they would have said anything- which is exactly what happened with NAFTA.

    Free traders over-promise. He’s now the latest in a long line.

  75. 75
    benw says:

    @Elizabelle: Normally Drum’s okay, but that piece is so full of self-contradictory hedging that it’s clearly just an excuse to run the clickbait headline. Trump’s “worth watching”? Bah!

    In better news, KThug gets out the truth-hammer and lays into Jeb and Marco.

  76. 76

    @Kay:

    I can’t tell you how excited I was to read that working people in the US are now wholly dependant on the negotiators for Canada and Mexico advocating on behalf of their own working people. So great that our own crack negotiating team was ready to accept any demand Japan made, even if it resulted in a “sharp increase” in imports from Japan.

    You’re fighting an old war. A Tesla or Leaf has 20% as many parts as a conventional car. In a few years, whatever turns out to be the Honda Civic of electric cars will have 1/10 as many parts and require 1/10 as much labor to build and assemble. These are exclusive vehicles now, but by the time the TPP gets implemented they’ll be common here in the US. Those jobs you are fighting for will be gone regardless of what the TPP says and fighting for policies that made sense when cars has 35,000 parts will be utterly senseless when they only have 3,500. Canada and Mexico are fighting for the subcontractor industry because that’s what they have. The US has the design industry plus benefits from moving the ball forward as quickly as possible, so it doesn’t make sense for us to fight for an industry we already know is lost. Better to fight for what will replace it.

  77. 77

    Good to see theTom Friedmans of the BJ commentariat extolling the virtues of globalization!

  78. 78
    gvg says:

    A minor point in this but be careful about putting any stock in the “trump is against this” line. Trump said the rich should pay more in taxes but his actual eventual proposal was tax breaks for the rich and the loss of EIC for the poorest so I think you have to consider him an actual liar.
    My impression is most people of both political parties are against trade deals and Obama has not actually convinced anyone. It might pass but I wouldn’t bet a cent on it.

  79. 79
    Kay says:

    @🚸 Martin:

    Martin, I’m tired of free traders over-promising. President Obama doesn’t have any earthly idea on “job gains” from this deal, any more than he did on the last trade deal he negotiated (which fell short of projections) or NAFTA.

    For Democrats to send Kerry and the rest of them out crowing about “600k net jobs!” or “1.2 million net jobs!” or whatever number Rubio pulled out of his ass is just reprehensible. They know it’s bullshit. The think tank study they used to extrapolate the numbers – that think tank- denies that they can pull job numbers from the study. That think tank no longer predicts job numbers, because they were wrong on NAFTA net jobs.

    I get that they want the deal. They should sell it on ideological, theoretical free trade grounds, because that’s what it’s based on. The idea that is “about” labor standards is just nonsense. Any labor standards are an afterthought, and won’t be enforced anyway. They never enforce them. They can’t even stop wage theft in this country. They’re going to be cracking down on jailing labor organizers in Vietnam? How?

  80. 80
    Cervantes says:

    @Kay:

    They should sell it on ideological, theoretical free trade grounds, because that’s what it’s based on.

    It’s based on projected profits that are far more concrete than ideology and theory.

  81. 81
    gene108 says:

    @🚸 Martin:

    Absolutely we need better policies here, but the focus on trade is misplaced and complaining about the trade distracts from where the focus needs to be.

    The work environment has become so hostile to workers, both white collar and blue collar, where there are no longer any “safe jobs” anymore – public school teachers, used to have job security, but not so much, same with becoming a college professor, etc. – that people will resist any change, because change has always been bad.

    I don’t blame people.

    To unravel why American workers get dicked over more than the rest of the world is something no one has come to total agreement on and what to do about it. There’s some general agreement the rich need to pay more in taxes and re-investing in infrastructure, schools, etc. will probably help, but that’s not going to reverse a 40 year trend.

  82. 82
    Kay says:

    @schrodinger’s cat:

    theTom Friedmans

    Well, they’re making progress. During NAFTA they argued that anyone who questioned it was denying workers in Mexico jobs. Now the argument is we’re denying Mexican workers the benefits of US labor standards, even though the people who were opposed to NAFTA are the very same people who forced them to address labor standards at all!

    It’s absolutely breathtaking that the President and Republicans in Congress are now the international labor advocates, while labor unions, who actually ARE international labor advocates, are somehow “anti foreign workers”. It’s the most brazenly dishonest rhetorical shift I believe I have ever seen.

  83. 83
    Kay says:

    @Cervantes:

    It’s based on projected profits, Cervantes. Maybe you can tell me the formula where “profits” translates into “jobs”. That’s a false promise. If these companies are paying less for labor and less in tariffs their profits will certainly go up.

    Now tell me how the President and the Republicans in Congress reached “jobs” because the think tank who made the projection weren’t comfortable making that leap. They know “profits” can go to many other areas than “jobs”, as does everyone else who works in this country.

  84. 84

    @Kay: Those numbers are bullshit – I won’t argue with that. But they very well can’t go out and say that our economy will suffer unless we do this and half a dozen other things, which is unfortunately true. So they sell each component on its own merits, because that’s the only way that our political system will allow. This very thread illustrates that clearly enough. If the deal doesn’t protect MY job or MY industry, just as it is, then we view it as a bad deal.

    Look, the days of picking a trade and working it, without retraining, for decades died ages ago. We should not fight to preserve the 700,000 auto mechanic jobs in this country. We should be working as hard as possible to eliminate them, because they are economic potholes. They enrich only those workers, and make everyone else poorer. We’re better off enacting policies to help retrain those workers, and telling the other 100 million people that have complained about how much they dump into auto maintenance to keep their money and use it for more economically beneficial things – savings, sending kids to college, health care, whatever.

    But nobody can go out there and say that we are going to sacrifice these 700,000 workers for the betterment of the remaining 100M, though that is exactly what these trade deals do. US households spend $80B per year on auto maintenance (excluding gas, etc.) If we got to keep that $80B by driving the industry forward, where would we spend it? How many jobs would get created? Yes, you’ll lose a bunch in the process – and that’s really shitty if you are one of those jobs, and yeah, Ohio will get hit hard here, but you’re going to lose them anyway because if we don’t drive the industry forward, then the Japanese or Germans will.

    Americans need to get it in their head that long-safe jobs no longer are – and really haven’t been for years. You need to be agile and educated. Do we need better domestic safety net policies? Absolutely. Do we need to make education more attainable? Absolutely. Retraining? Trades? Unions? Wages? Benefits? Yes – you aren’t wrong on those. But we can’t protect jobs through tariffs and trade policies. It works for a little while, but not long. If the job is going to go, let it go and put policies in place to help those who are affected.

  85. 85

    @Kay: Whether you work for an investment bank or flip burgers at a fast food joint, whether you have a PhD or high school diploma your fate is precarious and depends on the whims of your employer. You are looked upon as a cost to be minimized, either by automation or by outsourcing or by other even lower paid workers. Ultimately, this is a consumer based economy, if people don’t have disposable income its going to collapse unto itself.

  86. 86

    @🚸 Martin:

    You need to be agile and educated.

    Tell that to the adjuncts who are slaving for no benefits and paltry pay, often with PhDs and excellent publication records.

  87. 87
    Kay says:

    @🚸 Martin:

    Martin, Democrats have to do something about wages. People know their wages haven’t gone up for a decade. Telling them it’s all part of “disruption” is just not going to cut it. My God, Larry Summers knows this. He’s running around the country giving speeches where he admits that these policies are not a sufficient response to the electorate.

    If they don’t know what to do and it’s just a matter of people riding a wave of disruption and hoping they don’t drown then admit that! It’s not like people don’t know their wages haven’t gone up. They know!

  88. 88

    @Kay: Wages have been stagnant for the last three decades.

  89. 89
    Kay says:

    @schrodinger’s cat:

    I saw adjuncts were organizing, joining the Fight For 15’ers. So much for “educated” being a route to the middle class.

  90. 90
    Daulnay says:

    @NobodySpecial:
    Exactly. This is a terrible deal for anyone who wants an open Internet and a reasonable and just IP policy. The non-corporate tech sites I read don’t like it much. It also grants corporations some real leverage to coerce civic government that corps. didn’t have before. So it’s a terrible deal for people who want civic government to prevail over corporate government, which is most of us , isn’t it?

  91. 91
    Cervantes says:

    @Kay:

    I was agreeing with you …

  92. 92

    @Kay: That formula is laid out here: http://www.balloon-juice.com/2.....nt-5505221

    You need to look very carefully at what is being invested in. US policies are terrible regarding how sustaining profits are converted into disruptive jobs, but that was exactly what was happening up until the 1970s. To some extent US policies have never adapted to the computer/communication age. Unions have not always been helpful in this regard either. But California is a pretty good example of how it can go. We’ve moved from an aerospace economy to a tech one, from lots of machinists and technicians to lots of programmers. Everyone dismisses that economy, but it has a very high standard of living, continues to grow, and is a leading export economy that the US leads on.

    Why didn’t other parts of the US invest in disruptive economies? Because they were working too hard to protect their old economies and not hard enough to build their next ones. This shit is hard. People are going to get left out. But you can’t stop that – that’s going to happen no matter what. You’re trying to hold the ocean back with both hands. It’s noble, but its futile.

  93. 93
    Kay says:

    @schrodinger’s cat:

    For Democrats, if Bernie Sanders, who is a 70 something man who is from a small state and has been around forever is drawing crowds of 20,000 people that skew young, they should maybe pay attention to that.

    Those young people are responding to something that the mainstream Democratic Party isn’t saying and it isn’t “anti-foreigner” or whatever, because Sanders doesn’t play that game.

  94. 94

    @Kay: What I said about adjuncts is true for STEM also, not just humanities. Only difference is that STEM PhDs can find employment outside academia somewhat more easily.

  95. 95
    JimGod says:

    @🚸 Martin: It’s dismissed cause its an economy that only benefits a few. What’s a 50 year old factory worker who loses his job supposed to do? Take a programming class and apply to work at Amazon? Yeah right. What am I supposed to do? I hope to have my PhD in 2 years. Am I destined to work as an adjunct, barely scrapping by? I can’t code to save my life, I’ve tried it. How am I supposed to participate in this wonderful new economy? Its trade deals like this that push working class people away from the Democrats. They either don’t vote or go Republican cause hey, black or guns or gays. Morally and politically, this is a shitty deal and should be rejected.

  96. 96
    Kay says:

    @🚸 Martin:

    But California is a pretty good example of how it can go. We’ve moved from an aerospace economy to a tech one, from lots of machinists and technicians to lots of programmers. Everyone dismisses that economy, but it has a very high standard of living, continues to grow, and is a leading export economy that the US leads on.

    Martin, my eldest son works for a large US tech company. You know as well as he does that teaching everyone to code isn’t a sufficient response to stagnant or falling wages. He just got back from 2 weeks in Ireland, for work. They’re teaching everyone to code too. He doesn’t think his own pay (which is high) in that industry is sustainable. He thinks he’s doing much better than the 18 year old coming up will, in a comparable position.

    I’m actually pleased my other two are doing work that can’t be outsourced to the cheapest labor market- one will be an electrician and the other will be higher-skilled health care.

  97. 97
    jl says:

    @Ryan:

    I agree. Dean Baker has been following estimates of the TPP’s effects on growth through reduction of conventionally defined trade barriers, like tariffs. Those benefits are almost too small to measure, probably about most around 0.03 percentage points of GDP growth per year. Because those barriers between US and major trading partners are already very low.

    The real action is international big corporate investment protection and profit guarantees, and the attempt to spread the current, and historically very extreme, rent seeking US patent and copyright protection system.

    Donald Trump Says His Tax Cut Will Lead to 6% GDP Growth and President Obama Says TPP Will Boost Growth
    http://www.cepr.net/blogs/beat.....ost-growth

  98. 98
    p.a. says:

    @Kay: yes this is a key POLITICAL point. If it’s such an awesome deal, why is it sub rosa? Corporate interest in keeping priveleged info secure? Then they should drop out of the agrement. This is DLC-Obama and the Dem. faction of Big Money run amok. The tell- look at the non-Obot supporters.

    If I may indulge in some Foxish ignorance: I don’t need to know the details of the agreement. Just the process and its supporters is enough to know it stinks.

  99. 99
    Elie says:

    @🚸 Martin:

    Excellent comment with which I very much agree. Up until I read your argument, I could not put into words my problems with the arguments I read against trade deals in general and this one in particular. The US can’t really sit this out anyway — if we did not pass it, the trade deal would go forward without us — unable to influence it or really protect our markets or workers as opponents to the deal imagine that we could. Your excruciating main point, however, is changing domestic policy on redistribution of income. This is the 6000 ton gorilla that is essential to change. Now THAT is urgently needed. That is the important, in fact essential back end that has to happen — not trade per se.

  100. 100

    @Kay: If everyone can code then the demand for coders is going to go down, that’s just micro 101.

  101. 101
    Cervantes says:

    @JimGod:

    What am I supposed to do? I hope to have my PhD in 2 years. Am I destined to work as an adjunct, barely scrapping by? I can’t code to save my life, I’ve tried it. How am I supposed to participate in this wonderful new economy?

    What’s your field?

  102. 102

    Does anyone know how TPP will affect the generic prescription drug industry?

  103. 103
    Kay says:

    @JimGod:

    My middle son applied for and got an apprenticeship in skilled trades. They had more than 500 qualified applicants for 15 slots. The (one) woman who was accepted has a degree from U of Michigan.

    These people are trying. They want to work. They have the entry-level requirements. They just have a lot of trouble finding work (or even a path to work) that pays more than 15 bucks an hour.

  104. 104
    jl says:

    @🚸 Martin: You make good arguments, but I think besides the point, if I understand it correctly. China is not part of the TPP. You seem to be talking about conventional trade barriers such as tariffs, and this not what the TPP is mostly about. I think you miss the point. Why the misplaced obsession with conventional trade barriers that are already very low?

  105. 105

    @schrodinger’s cat: You’re reading that problem wrong. The adjunct situation is a byproduct of education not adapting to the same trends. A little bit of that is teachers and unions fighting the inevitable, but most of it is the industry as a whole refusing to accept what is happening. I can go to a software-driven platform and learn more for ¼ the cost of a university course. And it will be adapted to my specific needs, will be flexible around my schedule, and won’t require that I travel. I’m currently learning Mandarin as quickly as my daughter in a conventional classroom – and I’m doing it with a few apps on my phone that cost a few hundred dollars. She has to be a specific room at a specific time, and I do it whenever I have time. Some days it’s a few minutes here and there. Other days its more intensive.

    The cost of education is plummeting. Ask any programmer what they’ve learned in the last 3 years and how much time they’ve spent in a classroom. But schools are not responding to this. We are digging in trying to preserve this 1950s way of delivering education while everyone from the students to legislatures are finding ways to cut our funding for that service. The increases in tuition aren’t going to improving education but to other services to try and convince people to keep this engine going. This is the equivalent of getting a free toaster oven for opening a checking account. But the reality is that education funding is following the value that everyone receives from the industry, and that value is falling. Regular faculty generate money from other areas so they don’t get cut, so adjuncts are bearing the pain directly.

    What you are seeing is a fundamental failure of the educational system. The adjuncts are just a visible symptom. It’s not that we are necessarily underfunding education, it’s that education is not adapting, and we are not measuring the thing that we want to improve. There is not a single university in the US that is measured on educational attainment. Quality of instruction is completely unknown and unmeasured. The thing the adjuncts are hired to do is therefore valueless. Universities are measured on reputation, which adjuncts deliver none of. If you want to improve the lives of adjuncts, start to measure educational attainment. Why don’t we measure it? Because education has not adapted – because unlike every other successful industry, we refuse to make the changes needed to measure the thing we produce. Some of it is because the faculty are straight-up terrified of what they might find, and some of it is that they just don’t want their jobs to change, even if that change helps students.

  106. 106
    jl says:

    @schrodinger’s cat: I don’t think anyone really knows. The issues are very complex. The fear among smaller drug manufacturers is that provisions of the TPP will make it harder for companies to enter generic market after the patent expires. As I understand it, as part of effort to impose current, and historically very extreme US patent system to the rest of the world, there were charges that US was trying to impose stricter US rules on the rest of the world.

    Of course, we do not really know because he text of he deal is inaccessible, and I think the rules for passage of the TPP do not permit enough time for adequate analysis and debate of a complex issue. THIS stuff is the main rationale for the TPP, and far more important than getting rid of additional conventional trade barriers like tariffs, which are the rough equivalent of a state sales tax between US and its major trading partners. Why is this simple point so difficult for many commenters to understand?

  107. 107

    @🚸 Martin: Please your answer is total BS. Post docs and grad students do research, the stuff that gives a research university its prestige how much are they rewarded for it?

  108. 108

    @JimGod:

    It’s dismissed cause its an economy that only benefits a few. What’s a 50 year old factory worker who loses his job supposed to do?

    It doesn’t benefit a few – it benefits many, but that benefit is extremely diffuse and so it’s easy to dismiss as not happening at all. US standard of living is inarguably much better, but it’s almost impossible to convince people of that. In 1970, we spent ¼ of our income on food and now it’s 10% (and we have much greater food options now). Incomes may have been far too stagnant during this period, but we’ve also gained a lot of flexibility in how our income can be spent. Food security is a seriously good benefit.

    I’m not dismissing the 50 year old factory worker. He’s pretty fucked. But he was fucked no matter what. That’s my point. You can’t solve this by winding the clock back to save him. You can provide better social policies, though. That’s what Europe did. Maybe that factory worker starts a new business around on-demand small scale manufacturing. Shit, my 17 year old son is doing that now using me for capital. A couple grand gets you a decent assortment of manufacturing tools and you go out and use your skills to enter the hipster economy. Use etsy as your storefront, get a squarespace website. Yes, you need to learn some new things, but find a way to use your old experience. The problem is the transition – how do you feed your family while you do this? Where do you get the capital to start? These are domestic policy problems, though, and they have existed for decades and have nothing to do with trade.

  109. 109
    Corner Stone says:

    @schrodinger’s cat:

    Good to see theTom Friedmans of the BJ commentariat extolling the virtues of globalization!

    Excellent comment.

  110. 110
    Corner Stone says:

    @🚸 Martin:

    I can go to a software-driven platform and learn more for ¼ the cost of a university course. And it will be adapted to my specific needs, will be flexible around my schedule, and won’t require that I travel. I’m currently learning Mandarin as quickly as my daughter in a conventional classroom – and I’m doing it with a few apps on my phone that cost a few hundred dollars. She has to be a specific room at a specific time, and I do it whenever I have time. Some days it’s a few minutes here and there. Other days its more intensive.

    For several minutes I’ve tried to determine the right words to describe what, exactly, this post is dripping all over the place. Is it privilege? Condescension? Obliviousness?
    Maybe it’ll come to me.

  111. 111

    @Kay: I think you’re missing why people should learn to code. Half a century ago, having the skills to make things set you up for all kinds of jobs in the US building cars, planes, bridges, and so on. Programming is what manufacturing was in the 1950s – everything from websites to robotics. It’s just the basic set of skills you need to participate in the economy. It doesn’t dictate what you build – you still need to figure that out, but its a necessity to building almost anything today. You’re currently watching the banking, taxi, and hotel industries getting tipped over by software. Look who the auto industry is afraid of: Apple, Google, Uber. These are software companies and they’re coming after traditional manufacturing – and they’ll probably win, because the incumbents can’t adapt. The next generation of auto workers are all going to be programmers.

  112. 112
    Cervantes says:

    @schrodinger’s cat:

    Does anyone know how TPP will affect the generic prescription drug industry?

    If I were to tell you that in the US the brand-name pharmaceutical manufacturers have spent more than any other single faction on lobbying for the TPP, what would you infer about the likely effect on the availability and pricing of generics?

    One can’t know for sure without the final text — there have been leaks along the way; Wikileaks has some documents — one can guess and act accordingly.

  113. 113
    Linnaeus says:

    @jl:

    Dean Baker has been following estimates of the TPP’s effects on growth through reduction of conventionally defined trade barriers, like tariffs. Those benefits are almost too small to measure, probably about most around 0.03 percentage points of GDP growth per year. Because those barriers between US and major trading partners are already very low.

    The real action is international big corporate investment protection and profit guarantees, and the attempt to spread the current, and historically very extreme, rent seeking US patent and copyright protection system.

    This is a key point that deserves more attention than it seems to be getting. Trade barriers are already as low as they’ve ever been and can’t get much lower – even Paul Krugman, a strong supporter of most trade agreements has noted this. Which suggests that the effect on jobs – positive or negative – probably won’t be all that much. So what we’re seeing here isn’t so much free trade as it is managed trade.

  114. 114
    JimGod says:

    @Cervantes: Political Science, of course. Naturally. First field comparative, second American Government.

  115. 115
    Corner Stone says:

    @Kay:

    People know their wages haven’t gone up for a decade. Telling them it’s all part of “disruption” is just not going to cut it.

    And as has been said many times when this topic comes up, 90%+ of people who work for a living hear someone blather about “disruption” (or opportunity, or innovation, or any synonym that equals change) they instinctively pat for their wallet and crouch a little as they prepare to fight or flight.
    It’s quite easy to say that these jobs are fucked and have been for some time, and that the solution isn’t working to make these jobs viable in some aspect but rather to promote a better safety net/societal response network. That is not going to happen. Period.
    Uber, but for your whole fucking livelihood.

  116. 116
    Cervantes says:

    @🚸 Martin:

    Apple, Google, Uber. These are software companies

    Uber, yes. Google, mostly. But Apple, no.

    Just a note.

    Not disagreeing with you about the increasing ubiquity of computing.

  117. 117
    Elie says:

    @🚸 Martin:

    I’m not dismissing the 50 year old factory worker. He’s pretty fucked. But he was fucked no matter what. That’s my point. You can’t solve this by winding the clock back to save him. You can provide better social policies, though

    This is the core to remember… this. Too many are using paradigms from the 80’s and 90’s or before. The train we are running to keep up with or catch is much faster. We are in or we are out. Out is not where we want to be or need to be if we look at the issue holistically. It boils down to how we keep people employed and just enough ahead of evolving innovation (through education and social policy) to stay employed and keep building our economy. It will be lumpy and uneven so our domestic redistribution and education is essential. We are in a disruptive innovation environment that we cannot pretend is not there. We can either try to slam the door on it or jump aboard and manage it best we can for our future.

  118. 118
    Cervantes says:

    @JimGod:

    Political Science, of course. Naturally. First field comparative, second American Government.

    Re the comparative aspect, do you use any statistical analysis?

  119. 119
    JimGod says:

    @🚸 Martin: There is no mass employment in programming, it is a small genre of work by default. You seem to be saying manufacturing is doomed anyway, so ship it all to Asia and tell the factory worker tough titties. Sorry, I don’t buy that argument. If we had a guaranteed minimum income with a universal health insurance scheme, your argument might hold water. But we don’t and we ain’t getting either anytime soon with this band of freaks in Congress, so your argument doesn’t hold up.

  120. 120
    Daulnay says:

    @🚸 Martin:

    I don’t understand how the distribution of money within the US (this entire argument is about how much money goes to US executives vs US workers) should be regulated within a foreign trade deal. Domestic inequality needs to be resolved by domestic policies.

    Because trade policy determines how contributors to the U.S. economy get paid. When money-scarce and people-plentiful countries open ‘free’ trade with money-plentiful and people-scarce countries, the returns to money drop in the money-scarce countries and increase in the money-plentiful countries. The economic share of people in the people-scarce countries drops. This is basic, basic trade economics 101 (though usually the examples use two other resources, and the freighted words ‘capital’ and ‘labor’.) Often, but not always, almost everyone is better off with open trade, because it increases economic efficiency in both countries. At least, that’s the theory. It certainly isn’t the actual result for the U.S. lately.

    The argument so far presented is that this brings increased money back to the US. That’s GOOD. That’s what a good trade deal ought to do.

    That kind of mercantilist thinking has been debunked for well over a century. No modern economist would be caught dead arguing that a trade deal should be measured by whether or not it resulted in a increased inflow of money.

    The economy is not zero-sum.Raising wages in Vietnam doesn’t reduce wages in the US (domestic policies do that),

    Actually, free trade without some counterbalancing efforts in domestic policy should reduce wages for uneducated labor in the U.S., since Vietnam is capital-poor and uneducated-labor-rich, comparatively. It’s the embrace of free trade — without domestic policies to counter free trade’s effects — that cause wage reduction.

    For example, people have complained for ages about Apple manufacturing devices in China, but nearly half of the cost to manufacture the device (not profits, COGS) is distributed back to the US to pay for components made here, the engineers that designed the parts, and so on. And these are good jobs. The money that has stayed in China has helped the Chinese middle class rise. And what do they spend their money on, now that they have it? iPhones, where the majority of the money flows back to the US (because the profits also flow back here). Are the engineering jobs created here not worth it? The new factories to make glass and semiconductors that are located in the US? The jobs that oversee the huge global supply chain that are all in California? The hundreds of thousands of new programming jobs?

    You have to look at the overall picture. And that picture shows that the median American worker has seen no benefit whatsoever from free trade. All the economic benefits of the policies of the last 35 years have gone to the top 10%, which includes those programmers, and mostly to the top 0.01% inside that 1%. Yes, the median American worker has seen lower prices on iPhones, but has seen such stong downward pressure on wages as a result that there has been zero net benefit.

    That’s an utter failure of free trade. You can blame domestic policy for that failure, but free trade has given the wealthy a lot more leverage over ordinary workers than they had before NAFTA. The effects of free trade on domestic labor prices are a feature, not a bug.

    Why are we so focused on trying to preserve jobs that are increasingly low-skilled, and even more increasingly inevitably going to be automated out of existence? I know that’s a shitty deal for machinists, but you know what – their job was going to be eliminated no matter what. Trade isn’t what killed it – software is.

    The Germans had a different response to free trade, and their ordinary people have done much better than ours over the last 30 years. But their wealthy had made peace with labor unions, instead of using free trade to break unions like the U.S. manufacturers did. Our wealthy used free trade to kill jobs, so that they could profit more. The German corporations did not, instead figuring out how to increase their workers’ productivity. That included a lot of increased automation and software; U.S. companies competed by shifting production to where labor as cheaper, rather than automating. So you have it backwards.

    All of the benefits of free trade flowed to the wealthy in the U.S. and there’s no reason we should embrace more of the same. The TPP deal and the others like it are poisonous to general prosperity, to an effective government, to our struggle against corporate domination of our society, and to intellectual freedom.

  121. 121

    @Corner Stone: Disruptive innovation of today, is the creative destruction* of yesterday.

    By yesterday I mean the WWII era, coined by Joseph Schumpeter.

  122. 122
    JimGod says:

    @Cervantes: I’ve taken two stats course and officially disdain it. I’m taking qualitative research methods this semester and that will be how I do my research. I’m not a quantitative person at all. The usual suspects in the discipline will claim I’m not doing real science cuz science is only numbers, but whateves.

  123. 123

    @schrodinger’s cat: Research doesn’t give universities prestige – not measured as you are suggesting. Rankings aren’t based on the quality of papers published. It’s based on dollars spent, faculty awards (members of national academies, etc.). Tenure-track faculty are usually in the denominator, so you want as much productivity per tenure-track as possible. For the best rankings you want as many post-docs and grad students working for you that aren’t counted in the denominator as possible doing work that can be attributed to the tenure faculty. And since their work isn’t directly measured, you pay them as little as possible.

    But most of the reputation is earned either through sports franchises or through selectivity and neither have anything to do with teaching. Harvard could deliver the shittiest education on earth for all we know – the fact that they are extremely difficult to get into and get donations from wealthy alumni is the primary driver of their reputation because those are the things being measured. That Harvard alums cannot help but fall upward is the real motivation for students to attend.

  124. 124
    Keith G says:

    @Corner Stone: I just died a little.

  125. 125

    @🚸 Martin: Who is actually doing the research that is helping the tenure track faculty get the awards get into NAS etc?

    ETA: So you are actually advocating screwing over the people that are actually making the university run. Good to know.

  126. 126
    Cervantes says:

    @JimGod:

    I’ve taken two stats course and officially disdain it. I’m taking qualitative research methods this semester and that will be how I do my research. I’m not a quantitative person at all. The usual suspects in the discipline will claim I’m not doing real science cuz science is only numbers, but whateves.

    That course on qualitative research methods that you’re taking this semester — does it involve the use of computers (or computerized data bases)?

    To heck with the usual suspects! I’m not interested in telling you that you are (not) doing “real science.” I’m much more interested in how you think about using computer-aided analysis in your chosen field of inquiry.

  127. 127

    This is what University admins who post on Balloon Juice think, excerpted from Martin’s comment.

    Tenure-track faculty are usually in the denominator, so you want as much productivity per tenure-track as possible. For the best rankings you want as many post-docs and grad students working for you that aren’t counted in the denominator as possible doing work that can be attributed to the tenure faculty. And since their work isn’t directly measured, you pay them as little as possible.

  128. 128
    Daulnay says:

    @🚸 Martin:

    Now, is this rapid globalization hurting some Americans? Yes, but that’s mostly not a function of globalization

    90% is not some. It’s nearly all.

  129. 129
    Elie says:

    @JimGod:

    Just because our political environment right now is toxic, does not mean that it has to stay that way. It puts pressure on us to fix and change it (shit, I know its damned hard). I don’t want to sound like Pollyana.. “just change it” is fraught with all the questions: “how”.”when”. “with what”. We have to own it — we DO own it, the results and accountability to future generations, whether successful or not.

  130. 130
    JimGod says:

    @Cervantes: If you can wrap your mind around it and present it well, then go for it. I can’t. I conceive comparative politics in old case study methods. I’m not opposed to statistical regression, but I would have to co-author a paper with someone who make all that work. It’s just not me. My view is the discipline is over-quantified right now. Stats analysis papers are a dime a dozen. We need to have qualitative methods make a bit of a comeback to balance it all out. And no, we are not using databases in this course.

  131. 131
    Timurid says:

    @🚸 Martin:

    The problem is that even if everyone is “agile” and well educated, they will be in a footrace against the many other agile and well educated people chasing the few available jobs.

    You are correct about the decline of labor intensive fields like agriculture, industry, many services, traditional white collar work, etc., but the industries that are replacing them are not labor intensive. They are instead labor efficient. There just don’t have to be that many “knowledge workers” to keep the economy running.

    It’s not as simple as the buggywhip factory closing and everybody going to work at the jetpack factory instead. The problem is that they’ll only need a fraction of those people to make all the jetpacks they’ll ever need…

  132. 132
    JimGod says:

    @Elie: How long till we detox? 10 years? 20? 40? Until that time, you all would have us adopt this piece of crap, screw over the American worker, who has damn near nothing to fall back on, and just wait for the political situation to change (which it won’t cause these very voters will not vote for the Democrats after the Democrats screwed them over).

  133. 133

    @Cervantes: Apple counts in this case. Personally I think they’ll be the winner in this space because of their expertise at manufacturing and supply chain management, but their investments in mapping and operating systems and lower-level development will be key as well.

    Put another way, the lack of software talent – particularly at the design/decision making level at incumbent automakers is a big problem. Apple does not lack for that talent or for that representation at the design/decision making level. Software is inherently part of every Apple business plan at the highest levels, so they count as a software company in my book (even though they are probably the most formidable manufacturing company in the US.)

  134. 134
    Keith G says:

    @JimGod: Hell Jim, from what I heard I thought that in about a decade every other American would either be writing code for apps or building wind turbines and solar cells.

    Ya telling me it ain’t so?

  135. 135

    @Keith G: You forgot selling stuff on Etsy with capital from their wealthy parents.

  136. 136
    Corner Stone says:

    @schrodinger’s cat:

    So you are actually advocating screwing over the people that are actually making the university run. Good to know.

    For me, it’s not so much that he is vocally advocating for screwing over people who have comparatively little power but that it’s the way it should be. Like that’s just how it is and so let’s move on! Shiny gadget squirrel!

  137. 137
    Cervantes says:

    @🚸 Martin:

    they are probably the most formidable manufacturing company in the US

    And they got there by integrating software and hardware, not by thinking of themselves as purveyors of one or the other.

  138. 138

    @schrodinger’s cat:

    Who is actually doing the research that is helping the tenure track faculty get the awards get into NAS etc?

    ETA: So you are actually advocating screwing over the people that are actually making the university run. Good to know.

    Just because I explain how it works, doesn’t mean I advocate for it. Institutions are going to do the things they are incentivized to do, just like people. If you want to change the outcomes, then change the incentives. Right now we measure tenure-faculty. Everything else will get discounted.

    What I advocate for is to measure learning outcomes directly. That will incentivize teaching. That will bring value back to the adjuncts and TAs. That will also undermine some of the reputation attributed primarily to exclusivity in admissions.

  139. 139
    Daulnay says:

    @🚸 Martin:

    You’re currently watching the banking, taxi, and hotel industries getting tipped over by software. Look who the auto industry is afraid of: Apple, Google, Uber. These are software companies and they’re coming after traditional manufacturing – and they’ll probably win, because the incumbents can’t adapt.

    The taxi and hotel industries are getting tipped over by sleazy businessmen trying to use “it’s just software!” to evade government regulations on the taxi and hotel industries. Uber’s doomed in every country that has effective taxi regulations. Uber’s pretending that its employees are ‘contractors’, to avoid the wage and insurance regulations. It is fundamentally a scam.

    Apple (a hardware and design company) is someone to be afraid of. So is Google, just because of its size and power. but neither are entrepreneurial companies any more. and I expect both to fail. Other more agile companies will beat them, probably the ones that are working on collaborative design and printed automobiles. ((Yes, printed on 3D printers. Google it, if you’re still foolish enough to use Google instead of a less predatory search engine)).

  140. 140

    @🚸 Martin: You are undermining your earlier arguments about how education is the answer to the current labor woes. It is not a magic bullet as your own subsequent comments suggest.

    ETA: BTW most of the post-docs in the STEM field have more than a passing familiarity with coding.

  141. 141
    Corner Stone says:

    @Daulnay:

    The TPP deal and the others like it are poisonous to general prosperity, to an effective government, to our struggle against corporate domination of our society, and to intellectual freedom.

    IMO, the bolded part is where we are not paying enough attention in this discussion. We can argue about tariffs, IP laws and jobs going away whatever we do but one of the bigger takeaways for me is that we’re going to get more of the same. It’s virtually guaranteed. Big Corp and Big Money are going to get what they want then turn around and buy more representation to get more of what they want. Or less of what they don’t. And all the pro free trade arguments I’m seeing are all using a radically different social system as on of the legs on their stool. Based on what exactly? Reagan was one of the worst things that ever happened to this country and as we all know, he couldn’t get through a primary now as an R, at virtually any level. And looking at the floor of about 47% of people will vote R no matter what happens or is said, where are we going to find partners that will silently agree to build a better, more robust network to help the auto mechanic transition to Apple Senior Coder?

  142. 142
    JimGod says:

    @Keith G: What you did there…………………. it has been seen. ;)

  143. 143

    @Corner Stone: If most of Apple’s work force is going to be based in China why not shift the administrative headquarters there. That’s what makes the most economic sense, think of the cost reduction when everyone is working in the same time zone. Its a win-win for the investors.

  144. 144
    dollared says:

    @🚸 Martin: So improve all those employment and social policies, and then approach us with the TPP. The core of the Neoliberal Miracle you advocate is this: the American Middle Class gives up its quality of life and the balance of power in the workplace gets tipped drastically in favor of corporations. In exchange, the middle class is promised government policies and expenditures for education, retraining, health care, retirement, etc. The trade deals get passed and the jobs are lost. And then the political class says “gosh, we’re sorry, we spent all the money on tax cuts for the rich.” And so none of the benefits are ever delivered.

    We’re super glad you made your smart bet on Apple, Martin. Now go live in Akron and feel what it’s like to be screwed by neoliberal Democrats.

  145. 145
    Elie says:

    @JimGod:

    LOL! No!

    We can’t just sit around and wait for it to change. WE have to change it or it won’t get changed. I think you are not being fair. Oh yeah, lets take a shitty deal and then sit around to wait until things become fair”. That is not what is being proposed. Blocking the trade deal will not bring back or assure the outcome you want. The outcome you want comes with a price tag of political effort inside this country. Easy? No. No choice though because blocking that deal is not going to make the profound changes to the nature of work and industry not happen. The inequality is already there. You know this. You know already the scope of disruption we are undergoing. That ship has sailed and there is no way we can reverse it. We can manage it and be clear eyed in seeing the situation as it is, not what we wish it were. The US is vulnerable in so many many ways, not least of which is our very dysfunctional politics and shitty K-12 education. We can’t address it by trying to lock the world out or not participating in a global economy already strongly operating. Its like trying to manage immigration by building a wall. It doesn’t work and it ultimately deprives you of the means for improving and making progress happen.

  146. 146
    Daulnay says:

    @🚸 Martin:

    Programming is what manufacturing was in the 1950s – everything from websites to robotics. It’s just the basic set of skills you need to participate in the economy.

    Read “Peopleware” by Tom deMarco. It’s not something just anyone can pick up, so it’s not going to be a ‘universal’ profession or part of everyone’s toolkit.

  147. 147

    @Timurid:

    The problem is that even if everyone is “agile” and well educated, they will be in a footrace against the many other agile and well educated people chasing the few available jobs.

    It’s not as simple as the buggywhip factory closing and everybody going to work at the jetpack factory instead. The problem is that they’ll only need a fraction of those people to make all the jetpacks they’ll ever need…

    It’s always been a footrace. It’s just that it used to be a race that was stable within generations (you probably did a job that displaced your father’s job who did one that displaced your grandfathers) and now the race is faster and is happening within a single career span.

    And you are right that they will only need a fraction of people to make the jetpacks, but that’s okay. You’ll need more engineers to design the jetpack over the buggywhip, and by virtue of people being able to travel farther/faster/cheaper there will be new opportunities for commerce and services. As I noted, the benefits are extremely diffuse but the benefits are and always have been there. Containerized shipping wiped out a lot of longshoreman jobs, but holy shit did it create a fuckton of other jobs and benefits. There are entire industries that couldn’t exist without containerized shipping and almost all of the jobs created are better than hauling wooden crates off of a steamer ship. So much so that it would have been cheaper economically to just pay every longshoreman to retire immediately than to resist the move to containerization.

    That’s what I was getting at with the sustaining/disruptive comment above. A better domestic policy would be to have the jetpack manufacturers simply pay for every buggywhip employee to immediately retire if only to get government to drop any efforts to protect that industry. I don’t think that’s at odds with what others here are saying – who are complaining more that the jetpack industry will reap the profits of the better market while the buggywhip workers get fucked. My point is that’s not relevant to trade – its related to profits from market efficiencies not being returned to the broader economy, and that’s simply a domestic policy issue. It’s taxes and worker benefits and protections and really basic meat and potatoes issues. Trade may accelerate it in places, but it’s tangential.

  148. 148
    JimGod says:

    @dollared: Drop the mic and close the club, nothing more needs to be said on this issue. Good day. I SAID GOOD DAY SIR!!

  149. 149
    JimGod says:

    @Elie: I’m sorry, but this is all my balls. We can reverse it. Put up tariffs on all imports. It is the simplest, greatest subsidy to American business. It worked for over 150 years. And in case you haven’t noticed, 47% of the country votes R no matter what. In gerrymandered districts. Every year. While the Ds come out once every 4. You got a solution to that? Until you do, “working for change” don’t mean shit.

  150. 150
    Timurid says:

    The TPP reminds me of the Redeker Plan from World War Z.

    Even Obama and other “liberals” have come to the conclusion that the mass middle class in the US (and likely elsewhere in the West) is doomed. The best that they can do is retain some degree of control during the collapse and hopefully protect some remnant population. Martin is right on one thing… free trade isn’t the real problem. The real problem is a vast and growing labor surplus.

  151. 151
    dollared says:

    @Elie: No, you block the deal because it is the only way to get the elites to listen. Anything else signals that they never have to deliver the goods. Ever.

  152. 152
    Daulnay says:

    @Elie:
    The ship has hardly sailed. Whether or not we block these treaties will affect whether or not our governments can effectively regulate economic activity inside the United States, whether or not corporate officials have leverage to threaten workers with job loss, whether or not we roll back the corporate efforts to create IP. We can give up, roll over, and let the wealthy dominate and direct our society, or we can fight.

  153. 153
    kc says:

    a potentially legacy-making achievement for President Obama,

    Not in a good way.

  154. 154
    Keith G says:

    @Corner Stone:

    …here are we going to find partners that will silently agree to build a better, more robust network to help the auto mechanic transition to Apple Senior Coder?

    I imagine that we will get that whole robust network up and running about the time that code is able to write itself (that is, code creating code on a macro scale, as it is already happening on smaller scales).

    And then poof….the once mechanics who are now coders will still be unemployed.

  155. 155

    @Keith G: We can always go back to selling each other locally grown food and cutting each other’s hair.

  156. 156
    Keith G says:

    @schrodinger’s cat: There just might be a middle ground.

  157. 157

    @schrodinger’s cat:

    You are undermining your earlier arguments about how education is the answer to the current labor woes. It is not a magic bullet as your own subsequent comments suggest.

    I never suggested coding was a guarantee to a great job. I said it is increasingly a necessary requirement to one. If you can’t code, you’re excluded from a pretty huge swath of the economy.

    @Daulnay: I’ve read it – have it on my shelf. Consider that programming is rapidly democratizing as well. Just knowing how to write SQL queries or HTML – things that generally aren’t considered ‘programming’ in the academic sense opens up opportunities. Jobs that were clerical 5 or 10 years ago can’t be done now without at least having a conceptual understanding of how to code – not because I’m driving for ever greater productivity, but because all of the things I interact with are all software driven and as a result have been able to become massively larger and more complex and you need those skills just to handle the complexity.

  158. 158
    Daulnay says:

    @Timurid:
    There is no labor surplus, not any more than there has been in the past. What has happened is that several enormous pools of severely underutilized labor have been added to the global labor force over the last 40 years, through free trade. Adding China alone to the global labor pool increased it by 20%, India almost that much. Technological advances aren’t really a problem, unless the ‘job creators’ driving our economy make them one to get higher profits.

    In the long run, we might be see a return to a normal labor balance. China at least seems to be approaching the point where labor is no longer underutilized, its period of high growth is over.

  159. 159
    jl says:

    And, regarding arguments that the US does not want those old fashioned supposedly low sill manufacturing jobs anyway, the fact is that the lost of manufacturing jobs in the US has not resulted in substitution into higher skill jobs at all, but no jobs, or lower skill part time service work for many workers.

    And, the production technology will be different in the US and other countries. What may be low skill and environmentally damaging jobs in other countries will be higher skill and less environmentally damaging here.

    Also, the argument about helping lower income country workers move up the income scale is weak, since many countries are undemocratic, and institutionally unresponsive to, and sometimes actively suppress workers’ and union members’ rights, and popular support of less pollution. The Vietnamese labor unions oppose the deal, and certainly do not think the TPP is a big chance for them for higher pay and better working conditions. So I don’t see how that argument works either. And I don’t see how the US owes Australian, NZ or Canadian workers any big favors.

    The trade deals have become a big multinational corporate scam, iMHO, shamelessly sponsored by the US government. I’ve read Krugman reporitng that his contacts in the US govt economic and trade analysis departments say the WH is pushing the deal for BS geopolitical national interest strategy (that is BS foreign policy wonk BSers) and not economics at all.

  160. 160
    Daulnay says:

    @🚸 Martin:
    ‘Coding’ isn’t the same as being able to use a computer for things. Yes, everyone has to be able to use computers, no one is disputing that. And it helps to be able to understand what’s going on, too. But neither of those are “coding”, any more than being able to use Excel is “coding”

  161. 161

    @🚸 Martin: You are being willfully obtuse.

    1. The current status-quo is heavily geared towards capital at the expense of labor
    2. It is a direct result of economic policies pursued since the Reagan administration onward, that means at least some of the damage can be reversed if there is political will. It is not some naturally occurring phenomena on which we have no control over.
    3. It is an unstable equilibrium, if people have no money to spend the consumer driven economy will shrink.
    4. The increases in productivity has not resulted in increased wages.
    5. Your ineffective solutions are micro (learn to code, get an education) for a problem that is macro.

    And I am done with this discussion.

  162. 162
    El Caganer says:

    @schrodinger’s cat: Or we could just sell each other code.

  163. 163

    @El Caganer: I have some vintage FORTRAN code I had used for my master’s thesis, do you think it will fetch a good sum on Etsy?

  164. 164
    Keith G says:

    @schrodinger’s cat: I find it interesting that we (a society that uses a form of capitalism) are so flummoxed by a version of the efficiency paradox.

    On one hand, the acolytes of capitalism preach that more economic efficiency is a societal good as when ACE Widgets refines its production from a labor forced of 1000 down to 300 while still maintaining a high out put.

    On the other hand, increased shareholder value from X to 3X does not one thing for the 700 fired workers and their families and often their communities.

    Is there a legitimate argument within capitalism that states that increasing efficiency and shareholder value to it’s highest possible level is not always a social good?

  165. 165
    Ruckus says:

    @🚸 Martin:
    Speaking as a machinist, many jobs will not be eliminated as long as we have an industrialized world. The production of cheap parts will be sent overseas and will be or already have been automated. But there will always be a demand for people to make the tooling used in many of the fields that now make up our modern economies. The way some of the things that these machinists produce will change or already has. Some one even has to produce the tools that make 3D printers that many think will be the future. And many things that are built with metal are done locally and are not reasonable to ship long distances. An example was Sony made TVs here because the shipping costs made local production feasible. I bid on work for them because the cost and time of shipping the tooling to Japan was more than the cost of the most expensive repairs. This has changed a bit with the advent of non CRT TVs and will change for other fields in the future as well. But there is always a need for local products in a world the size of this one.

  166. 166
    Elie says:

    @Daulnay:

    We can also work to distribute the wealth on the back-end. You just seem unwilling to think that can happen because, well, you know “its hard”.

  167. 167

    @Keith G: What is good for Wall Street is not necessarily good for Main Street and in the age of globalization this is more true than ever.

  168. 168
    Eolirin says:

    @JimGod: Import tariffs would be very unlikely to result in some kind of economic boom, as the US economy is heavily driven by consumption and this would drive up prices, and would hurt what exports we do have. You’re much more likely to tank the economy. And without the exact same worker protections and strong unions and domestic policies that you need in the face of open trade, you would see no benefit at all in terms of improving inequality; the new jobs would be low paying.

    Trade agreements aren’t going to solve the wage and labor problems we have in the US, no matter what direction they go (unless they start being written primarily by Labor Activists and Union groups anyway).

    That doesn’t mean there aren’t very good reasons to oppose TPP. Arguing against it is pretty easy, but protectionism and wage reduction isn’t really a valid line of attack. There isn’t going to be more offshoring of labor to Vietnam if this passes, we’ve already had that adjustment. There will be worsened ability for countries to regulate themselves against corporate abuse. We will be exporting shitty US IP law to more of the world, in a way that very well may kill people due to rising drug prices. Those are both shitty things that should be opposed, and since there’s also pretty much no upside to the agreement, it’s grounds to oppose the whole thing. But the idea that this will have an impact on employment or wages in the US in any significant way is kinda crazy. The actual trade effects are going to be minimal, and much of the benefits accrue to US corporations, and reinforce US standards. It’s bad entirely because it makes it harder to try to make things better, not because it makes things worse for the US.

  169. 169
    Ruckus says:

    @Keith G:
    Is there a legitimate argument within capitalism that states that increasing efficiency and shareholder value to it’s highest possible level is not always a social good?
    Yes. Without legal and economic controls the majority will suffer, and suffer greatly. This is already quite apparent in our society as well as many others around the world. An example would be Nicaragua, after the war ended. People were building sweat shops to produce clothing and many of the women worked in them because that’s all there was. Micro lending was born to make small loans, on the order of $350 for the mostly women to purchase their own sewing machines and for other small independent businesses. Sounds great until you learn what the interest rates were, 18-25%. Most of the companies making the loans had better than a 99% repayment rate so making the argument of the great risk of these loans sounds a little hollow. Yes the poor got something but the rich got still more on the backs of said poor. It is always so without controls no matter the economic construct of a society.

  170. 170
    Corner Stone says:

    @schrodinger’s cat:

    I have some vintage FORTRAN code I had used for my master’s thesis, do you think it will fetch a good sum on Etsy?

    What?! You better put that code to work, friend! All this time it’s been living in your house and not paying rent? You’re never gonna get rich that way.
    But, since you’re selling, do you have any in chocolate flavor?

  171. 171

    @Ruckus: There was a spate of suicides in India among farmers who could not pay the microloans because of failed monsoons. This was a while ago. After death of the person who had taken the loan the family could write off the loan. So many committed suicide, because that was economically efficient.

  172. 172

    @Corner Stone: It actually lives on the 51/4 inch floppy! I have no idea how to even access it, since none of my existing computers even has that drive.

  173. 173
    Keith G says:

    @Elie:

    We can also work to distribute the wealth on the back-end. You just seem unwilling to think that can happen because, well, you know “its hard”.

    Laughing this much hurts.

    Christ yes, it’s hard. What was happening the last time we initiated a society-wide programmatically integrated system of “back-end” wealth redistribution?
    1. The threat of leftist insurrection.
    2. A world-wide economic depression (leading an enhancement of #1).
    3. 1 out of five Americans left jobless.
    4. Eventually, an existential military conflict.

    It’s becoming increasingly clear to me that the period of economic enlightenment that powered the American post-war society in a historical oddity and not likely to be revisited until the next round of existential chaos.

  174. 174
    dollared says:

    @Elie: because it has never happened, and we have abundant evidence to the contrary…..

  175. 175
    Corner Stone says:

    I wish I had more time on this thread before it all but died. So much goodness to unskew.
    But, sigh, too busy learning to code in Mandarin while Uber driving someone to pick up a gift they bought on Etsy.
    They would’ve picked it up themselves but their car needed a repair and they couldn’t find any mechanics.

  176. 176

    @Corner Stone: Easy peasy download an app so you can fix the car yourself!

  177. 177
    Corner Stone says:

    @schrodinger’s cat: Onto my $600 iPhone? The apps that only cost a few hundred bucks?
    On it!

  178. 178
    Ruckus says:

    @schrodinger’s cat:
    I have a little first hand knowledge about the micro loan industry in Central America but have heard very little about other parts of the world. But this sounds about right, make a program that might possible work at a high cost, with the risk all on the consumer and stand back and see, Profit!
    What could possibly go wrong?
    And if that sounds familiar, it should, it is a reasonable description of our current economy in the US as well.

  179. 179
    Keith G says:

    @Ruckus: Indeed. What I was rhetorically getting at was if there was elite-level argumentation being made about the negative externalities that are a matter of course in the current version of capitalism that we are now using.

    Yes there are leaders who are voicing worries about the type of impacts that occasionally get covered by the network news, but with the possible exception of Bernie Sanders, is anyone talking about how rotten the system is that at it’s best function produces such dislocations and harm?

  180. 180

    @Keith G: I think it was also the threat of Communism that kept the worst instincts of capitalists in check.

  181. 181
    Kay says:

    United States negotiators stress that the Pacific agreement seeks to level the playing field by imposing rigorous labor and environmental standards on trading partners, and supervision of intellectual property rights.

    Since no one believes that (and that is based on past performance) maybe the United States negotiators could explain how, specifically, the labor standards will be enforced. They might also explain why they have failed to enforce in every agreement prior.

    Maybe we could demand they enforce the labor standards as aggressively as they enforce the intellectual property rights. Deal? Why or why not?

  182. 182
    Ruckus says:

    @schrodinger’s cat:
    It would probably be easier to restudy Fortran and rewrite the code than trying to find a 5 1/4 drive and editor and retrieve the code.

    ETA I’m assuming that you haven’t used Fortran in years.

  183. 183

    @Ruckus: Suicide epidemic in India linked to microfinance.

    I don’t need the code. If I did, I have the hard copy of the program somewhere. It was the quantum mechanics required to get the result that was hard, coding was actually the easy part.

  184. 184
    Ruckus says:

    @Kay:
    Why or why not?
    Easy peasy.
    Global IP rights make rich people money, labor restrictions are local and cost them money.
    Nothing that changes that outcome will be discussed in any meaningful way.

  185. 185
    JimGod says:

    @Keith G: I just love how some here seem to think if we just “work for change” and clap harder, it’ll all work out, so shut up naysayers!! It is the height of intellectual vapidness.

    @Eolirin: So if we make it so a Ford car costs the same but a Honda is twice as expensive, you don’t think people will guy the American made option. Same for clothes, iPhones, etc.? You think everyone will just sit down and the economy will crash? I don’t believe that. Someone upthread said Apple is one of the great American manufacturers, which is hilarious when you consider all the manufacturing is done in China…..

  186. 186
    Ruckus says:

    @schrodinger’s cat:
    Thanks for the link. When you said it at first, I was not surprised, knowing what (and who) I know about the industry.
    I figured that if the code was still on a 5 1/4 floppy that you most probably didn’t have any real need for it. I threw away long ago, some Fortran code that I had on punch cards, from when that was removable media.

  187. 187
    El Caganer says:

    @schrodinger’s cat: I was a COBOL programmer for a few years when I worked at Conrail. I wore an onion on my belt, as was the fashion at the time.

  188. 188
    Ruckus says:

    @schrodinger’s cat:
    I’m also impressed with the quantum mechanics bit, I like it when people use actual advanced science to accomplish their work. OK I know most of us use science to accomplish our work any more but most don’t understand it or even know that they are.

  189. 189

    @Ruckus: Thanks! I was trying to find the probability of ionization of an atom after beta decay and calculate the energy of the emitted X-ray.

  190. 190
    Ruckus says:

    @Keith G:
    To answer your ending question, Not in any meaningful way.
    Sanders biggest asset is that he doesn’t come from wealth, isn’t wealthy now and most likely will never be. He has a perspective and experience in the wealth “wars” to understand what money, specifically too much money, does for everyone. I’m not convinced that he can be successful playing in their sandbox but there is no doubt that he understands that wealth of nations doesn’t mean wealth of the few.

  191. 191
    Kay says:

    @Ruckus:

    I love the spiffy new website:

    https://ustr.gov/tpp/#what-is-tpp

    It’s just a bullet-pointed list of assertions. “TPP is great”

    From the beginning they have treated people like absolute morons on this, and it looks like that’s the marketing plan!

  192. 192
    Ruckus says:

    @schrodinger’s cat:
    I can see why someone would think that but I don’t see it. Several of the uber wealthy got more so by WWII and they carried that into the 50-60s. It was a business opportunity for them, nothing more. And it morphed into the conservative scared of everything situation that we see today. And they still make money off of that.

  193. 193
    Ruckus says:

    @schrodinger’s cat:
    That sounds vaguely familiar.

  194. 194

    @Ruckus: Let me elaborate: I meant that democratically elected governments were more responsive to labor concerns when Communism was still seen as a credible alternative.

  195. 195
    Ruckus says:

    @Kay:
    What was the old Madison Ave slogan?
    “If you’ve got something good, sell that, if you’ve got nothing, bullshit is your friend.”

  196. 196
    Linnaeus says:

    @JimGod:

    I just love how some here seem to think if we just “work for change” and clap harder, it’ll all work out, so shut up naysayers!! It is the height of intellectual vapidness.

    I think that’s a little unfair. Working for change just means doing the hard political work of making our society a more just and fair place. That’s true whether we’re talking about trade deals or not, and I would hope most folks here would agree with that.

    That said, there are good reasons to be skeptical of this trade deal. As I (and others) have mentioned, trade barriers between the US and its major partners are already quite low, so any effect on jobs by lowering or eliminating those barriers probably won’t be all that much in either direction. That process is already well advanced. The big issue for the US is patent and IP protections, and that really does deserve a lot of scrutiny. What are the gains and drawbacks from that?

    Kay brings up a good point about enforcing labor and environmental standards. We’re told that there are tougher standards in this deal than in deals past, which may very well be true. But then it comes down to enforcement, and the linked NYT article only mentions a “dispute-settlement process”. We don’t, however, know what that process is and who has access to it, which is especially important in light of the fact that nonstate actors, with the exception of businesses, don’t have access to the ISDS process.

  197. 197
    Ruckus says:

    @schrodinger’s cat:
    Ahhhh. Maybe. That might have been the general consensus (from morons like J McCarthy) but I think from the upper levels of the economy, they saw a possible advantage rather than anything else. The wealthy always look for an advantage rather than a rational reasoning. I think they see that they can always buy their way out. Example, the Bush family, the Russian oil big wigs. Government is occasionally an impediment, often an enabler and sometimes an enforcer for the wealthy. For the rest of us it is sometimes a protector from the wealthy, but most often not. We have experienced both for the last 50 yrs, but lately much more often the not a protector side than anything.

  198. 198
    Carolinus says:

    @Cervantes:

    If I were to tell you that in the US the brand-name pharmaceutical manufacturers have spent more than any other single faction on lobbying for the TPP, what would you infer about the likely effect on the availability and pricing of generics?

    The US currently has 12 years of data protection for biologics. Canada has 5 years. A number of the other nations involved have none. What ultimately was agreed to is a minimum of 5 years for all TPP signatories and there’s also some vague (voluntary?) additional mechanism that can extend that up to 8. Early reaction from Big Pharma seems pretty negative.

  199. 199
    henqiguai says:

    @Kay (#89): Late to the party, as usual.

    So much for “educated” being a route to the middle class.

    *Not* being educated (that includes trades trained) is a sure-fire fast-track to poverty and probably a foreshortened lifespan.

  200. 200
    burnspbesq says:

    @Daulnay:

    It also grants corporations some real leverage to coerce civic government that corps. didn’t have before.

    I said months ago that if the final agreement contained the investor-state dispute-settlement rules that were being bruited about at the time, that would be a deal-breaker for me. Nothing has happened between now and then to change my mind.

  201. 201
    Cervantes says:

    @Carolinus:

    Thanks! Do you have a source?

    I see the following reported just this afternoon:

    US negotiators eventually conceded and agreed that brand-name drug manufacturers would have a market exclusivity period of 5 to 8 years. Currently, biologic makers enjoy 12 years of market exclusivity and patent protection. […]

    Doctors Without Borders contends that the TPP “will still go down in history as the worst trade agreement for access to medicines in developing countries.”

    So that is being reported today.

    Meanwhile as late as July, here’s the kind of thing we saw:

    Law360, New York (July 17, 2015, 4:37 PM ET) — A group of lawmakers, generic-drug industry advocates and public health experts on Friday denounced proposals in the Trans-Pacific Partnership to strengthen exclusivity protections for brand-name biologics, warning that the provisions would seriously harm access to affordable copycat medicines. The objections were voiced in a media briefing with Democratic Reps. Jan Schakowsky of Illinois and Rosa DeLauro of Connecticut as well as representatives of Mylan Inc., AARP, Doctors Without Borders and the American Foundation for AIDS Research. […]

    At issue are draft provisions of the TPP that would expand monopoly power for branded biologics, in part by extending the 12 years of U.S. market exclusivity to the other 11 countries that are parties to the deal. Those parties instead prefer biologics exclusivity ranging from zero to eight years. If the 12-year standard goes through, it would weaken biosimilars overseas and effectively doom Democratic efforts to dial back the 12-year standard domestically.

    That’s from July. If things look better now, I’m happy to hear it, but the proof is in the pudding.

  202. 202
    burnspbesq says:

    @JimGod:

    Put up tariffs on all imports

    That ship sailed about 20 years ago, unless you’re prepared to abrogate a couple of dozen binding international agreements, that we worked like hell to convince the rest of the world to sign on to.

  203. 203
    Kay says:

    For steel makers, auto-parts manufacturers, garment companies and solar panel producers, as well as their hundreds of thousands of workers, the question is whether the gradual reduction of import tariffs and other trade barriers will unintentionally provide a back door for more Chinese goods to enter the United States.

    This is where we run into trouble when we make these fake “increased profits = X # of “middle class” jobs” projections.

    John Kerry is going to have to show me the 600,000 new jobs- Mitch McConnell has to show “1.2 million”, but who’s counting, really? It’s somewhere between -600k and 2 million. Marco Rubio said 2 million.

    The Obama Administration’s response to every question so far has been “we will enforce” but why would they start enforcing now? They never have before.

  204. 204
    Cervantes says:

    @Carolinus:

    My response to you is above, “in moderation.”

    We can’t fix that, so don’t feel obliged to wait for it or to respond.

    Have a great evening.

  205. 205
    Kay says:

    The conclusion of the Trans-Pacific Partnership negotiations may also leave American negotiators with more time to focus on another Chinese priority, a bilateral investment treaty, Mr. He added. The planned agreement would provide greater legal protections for China’s fast-growing investments in the United States as well as more protections for American investments in China.

    Glad to see Democrats have the customary laser-like focus on the middle class. They should definitely spend the next year protecting Chinese investments in the US. Democrats can do that and Republicans will yell at Planned Parenthood some more. Maybe together they can get voter turnout down to 30%.

  206. 206
    jl says:

    @Kay: @Linnaeus:

    From what I have read, the standards are tougher, but the enforcement mechanisms are very weak. The dispute resolution processes in leaked drafts are designed for corporations, not labor unions or governments, or NGOs. In many cases, only corporations will have standing to use the dispute resolution process. And then there is the problem of gradual institutional corruption that occurs in corporate arbitration systems, when corporations can offer far higher current and future compensation for arbitrators who issue rulings favorable to corporations. Maybe that part of the draft has changed, or maybe it has not. Certainly way too many outstanding, and rather complex, issues to deal with the time provided by fast track.

    @Kay: Seems like not bothering with the TPP at all would have left even more time to deal with problems regarding our trade with China.

  207. 207
    JimGod says:

    @burnspbesq: I’m totally prepared to abrogate. Look we’ve done it repeatedly with numerous treaties and agreements, the US does what it wants, sad but true. And if not abrogation, a declaration of renegotiation could also be used. It’s time to start tearing these things up; the neoliberal consensus has been an absolute failure and its time their bastard spawn free trade agreements be renegotiated or trashed all together.

  208. 208
    Thoughtful Today says:

    Gotta love a post that gets a person all riled up and ready to comment only to read commenters making better points than the ones they had in mind.

    NobodySpecial says: “It makes the rentiers money, and the rentiers own Congress.”

    C.V. Danes says: “My understanding is that negotiations stumbled over the best way to word “feed the rich, f’k the poor.””

    Sherparick says: “Joseph Stiglitz and a co-author point out that this deal is mostly about vacuuming up more money for the 1%, e.g. that it is all about extending monopolies, rent seeking, and guaranteeing “expected profits” if Government regulations change to restrict a corporation’s right to poison, injure, and inevitably kill some their workers, customers, and host country citizens.”

    Watchman says: “Clinton’s NAFTA deal destroyed American manufacturing. Obama’s TPP will destroy the rest. Who needs Republicans with Democrats like these?”

    Comrade Dread says: “Oh, we’re getting fucked. … The question is how badly and whether or not the wealthy and corporate interests decide to leave a $20 on the nightstand or not after they’re done.”

    Keith G says: “… the American working class has been, and is being, successfully hollowed out and there is an upwards drift of wealth to the economic class that is already wealthy enough, then one must consider both NAFTA and Clinton era banking legislation as being key components of enabling the new American kleptocracy.”

    schrodinger’s cat says: “Neoliberal economic policies have socialized risk and privatized profit. Currently, the economic system benefits the few at the expense of the many. I hold Reagan the most responsible for this change but Bill Clinton has also lent a hand in dismantling the New Deal policies where banking is concerned.”

    Kay says: “They should sell it on ideological, theoretical free trade grounds, because that’s what it’s based on. The idea that is “about” labor standards is just nonsense. Any labor standards are an afterthought, and won’t be enforced anyway. They never enforce them. They can’t even stop wage theft in this country. They’re going to be cracking down on jailing labor organizers in Vietnam? How?”

    JimGod says: “Its trade deals like this that push working class people away from the Democrats. They either don’t vote or go Republican cause hey, black or guns or gays. Morally and politically, this is a shitty deal and should be rejected.”

    p.a. says: “This is DLC-Obama and the Dem. faction of Big Money run amok.”

    Daulnay says: “… the median American worker has seen no benefit whatsoever from free trade. All the economic benefits of the policies of the last 35 years have gone to the top 10%, which includes those programmers, and mostly to the top 0.01% inside that 1%.”

    “The TPP deal and the others like it are poisonous to general prosperity, to an effective government, to our struggle against corporate domination of our society, and to intellectual freedom.”

    Corner Stone says: “Big Corp and Big Money are going to get what they want [from trade agreements] then turn around and buy more representation to get more of what they want.”

    jl says: “.. the fact is that the [loss] of manufacturing jobs [from trade deals] in the US has not resulted in substitution into higher skill jobs at all, but no jobs, or lower skill part time service work for many workers.”

    “Also, the argument about helping lower income country workers move up the income scale is weak, since many countries are undemocratic, and institutionally unresponsive to, and sometimes actively suppress workers’ and union members’ rights, and popular support of less pollution.”

    “The trade deals have become a big multinational corporate scam”.

    Exactly.

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