The US Congress surprisingly sided with big business and weathy stockholders late yesterday when the House approved (by 2 votes) the Central America Free Trade Agreement, or NAMBLA.
Yes, CAFTA reminds us all of that great treaty NAFTA which has helped keep unemployment in the US at historic lows -- wait a minute, in Michigan we're actually looking at something like 9% unemployment and the rest of the country still is lagging in job creation. I guess there really is something to that offshoring deal, when big corporations fire American workers to hire cheaper labor overseas and then ship products back to the US.
Now that they can ship products from such pro-worker countries as Guatemala, I guess it's just a matter of time before even I lose my non-paying job writing this blo
Yes, CAFTA reminds us all of that great treaty NAFTA which has helped keep unemployment in the US at historic lows -- wait a minute, in Michigan we're actually looking at something like 9% unemployment and the rest of the country still is lagging in job creation. I guess there really is something to that offshoring deal, when big corporations fire American workers to hire cheaper labor overseas and then ship products back to the US.
Now that they can ship products from such pro-worker countries as Guatemala, I guess it's just a matter of time before even I lose my non-paying job writing this blo
I don't know where you got your numbers from, but after NAFTA unemployment really did reach all time lows. The data below is from the BLS.
Year Annual
1990 5.6
1991 6.8
1992 7.5
1993 6.9
1994 6.1
1995 5.6
1996 5.4
1997 4.9
1998 4.5
1999 4.2
2000 4
2001 4.7
2002 5.8
2003 6
2004 5.5
The reason Michigan is losing jobs is because it can't adapt to changes in the global economy, and a lot of it is Michigan's own fault, it isn't because brown people are coming to steal all the lucrative work.
What you are talking about isn't worker's rights, it's protectionism, and I think it's fairly racist to say that an American deserves a job more than someone in another country merely by virtue of them being American.
Actually, I have not said and would never say that someone in non-United States country doesn't deserve a great job that provides them with all the benefits that unionized American workers enjoy.
I agree completely that Michigan suffers the worst of the loss of jobs because of its inability to adapt to these unfair conditions.
I do think that we need to maintain protection for American jobs until we can ensure a global guarantee of fair working practices.
And I get my numbers from the Economic Policy Institute, which published an article on July 20, 2005 article that notes:
"The proposed Dominican Republic-Central American Free Trade Agreement (DR-CAFTA) duplicates the most important elements of NAFTA, and it will only worsen conditions for workers in the United States and throughout the hemisphere (Faux, Campbell, Salas, and Scott 2001). Since NAFTA took effect, the growth of exports supported approximately 1 million U.S. jobs, but the growth of imports displaced domestic production that would have supported 2 million jobs."
In other words, those unemployment figures you produced would have been much lower and toward full employment had the anti-worker NAFTA not taken effect.
Before we expose American workers to competition from overseas, we need to level the playing field with a guarantee that any nation who does business with the United States will provide their workers with good jobs that provide fair benefits. CAFTA and NAFTA work toward the opposite of that -- a race to the bottom for the nation with the WORST workers' rights. It's unfortunate that CAFTA will not improve the conditions for workers anywhere in the hemisphere, including in non-United States countries.
Unbridled capitalism doesn't work -- as we learned in 1929. We need some mitigation of the harsh effects wrought by the free market.
Your definition of a "great job" is fairly skewed, and translates to me as "I deserve to get paid more than my labor is actually worth," which sounds like another take on your favorite question, "What about me?"
Unionized workers are a tiny part of the American labor force, and the reason they fear free trade isn't beacuse they want to help people in other countries, it's because they want to protect their priveleged lifestyle. Michigan doesn't have a problem adapting to unfair conditions, it has a problem adapting to fair conditions, which is usually what freer trade instigates.
As for your data from the Economic Policy Institute (a think-tank funded by big-labor, unlike my government sponsored raw data) its numbers are notoriously bad. For one thing, it assumes that each dollar of imported goods would result in a substituted dollar of domestically produced goods, when in fact, it is actually more likely to result in either an import from another low-cost producer or reduced consumption. As such, they overestimate the number of jobs that were lost in the United States.
In fact, after NAFTA the United States was at full employment. Remember, full employment is the point where actual unemployment is at the natural rate of unemployment. Prior to the 1990's, it was assumed that the natural rate of unemployment was about 6%, then in the 90's, it actually went down to about 4%, which means that employment was at a level greater than full employment.
The best thing that the United States can do is not try to protect low-wage, low-skill jobs and offer inflated wages for them, instead the US needs to transition to an economy in which they are more competetive in high-skill high-paying jobs that define the future of the global economy. Consider if the money we spend on protecting agriculture (which hurts farmers in developing countries) and manufacturing (whcih hurts workers in developing countries) were instead spent on math and science education, which would make our workers globally competetive.
In fact, free trade does improve the condition of workers in the long term. If you look at countries which used to be low-wage producers, their workers are now getting paid more and have a higher standard of living than before they increased their level of trade.
CAFTA isn't unbridled capitalism, it just facilitates the freer flow of goods by removing barriers to trade. The "race to the bottom" simply doesn't exist empirically, it's an antiglobalization activist's doomsday scenario that is consistently proven false by real world experience.
It's true that NAFTA was bad for some people, but it was good for a lot more people. The question, then, is what is better: a status quo that benefits the few, or changing the status quo in a way that will harm some but help a great deal more. In my opinion, it seems that the latter is significantly more democratic, even if some people end up suffering because of it.
If option "A" is starving on your farm which has been destroyed by huge agribusiness and option "B" is taking a job for $10 at the Nike plant, do you really want to argue that Central American workers and American workers are competing in a happy, utopian labor market?
American capital, with all of its tax breaks, subsidies and political clout should be directed to provide good (meaning sustaining and safe) jobs for Americans. Thats not protectionism, its the kind of economic policy which built this country into the economic behemoth that it is today.
The idea that America developed through radical free market policies is an ahistorical ideological fiction created by cynical and blinded right-wingers to justify increased corporate power. You seem smarter than that, Dave. Read some books, man.
-daraka
PS How about we start calculating unemployment the way that Sweden does, by counting those able bodied people who don't have work? Instead, the BLS calculates it based on those recieving unemployment benefits. No job for more than a year? Not unemployed for the BLS. In prison? Not unemployed for the BLS. Even with those more stringent calculations, Swedish real unemployment now is comparable to the US' misleading statistics, and thats with a robust welfare state, unionization rates of 90%+ and a state commitment to macroeconomic policies promoting domestic development. All that and they still manage to donate a larger % of GDP to international aid. Go figure.
The reason that Option A is having your farm destroyed by US agribusiness isn't because of free trade, it's because American farmers and agribusinesses benefit from enormous subsidies and generous protective tarriffs that keep imported agricultural prices high and domestic prices artificially low. That means that producers in developing countries can't compete, and it isn't because of free trade, it's because of the exact opposite, restrictive trade.
I'm not talking about happy utopian labor market. For starters, labor markets are never happy, and second, almost nobody talks about a free market in association with the term utopian, that's the realm of far more imaginative economic theories. What I'm talking about is specialization, and the notion that increased trade with Central America is going to take American jobs is ludicrous. It's not that Nikes used to be made in Detroit and now they're going to be made in Central America, it's that they're moving from South East Asian low cost producers to Central American low cost producers. Americans in turn need to specialize in jobs that Americans are more globally competetive at.
I also think that American capital should be invested in creating good jobs for America, though, as a tangent, most American capital is right now being traded overseas in exchange for manufactured goods, just look at our current account deficit. The problem is that I don't think a Nike factory or agriculture are neccessarily the best jobs for America. Instead, I think that most of the corporate subsidies for what are essentially industries that America is transitioning out of should instead be reinvested in things like math and science education, which have historically made America strong and are considered one of our great weaknesses in the future. I think that the question of what made this country into the economic powerhouse that it is certainly is interesting, but in my opinion subsidies for agriculture and manufacturing don't even make the list.
I'm certainly not advocating a radical free market here, and I don't know which of the things that I said indicated as such. I'm certainly advocating for freer trade, which is a different thing, though all too often confused. I don't think I ever said that America developed through radical free trade, and I'm actually intensively in favor of a government regulation in areas where the market fails (just ask me about telecom monopolies or insurance companies sometime). I think there's a difference, though, between freer trade and radical free markets.
I don't think I ever said that radical free markets were what helped America to develop, though I think the "what helped America develop" question is certainly an interesting and complex one. I can't think of a historical instance of them and I also don't think I'm advocating for them now, so I don't really understand the relevance of that little rant.
Finally, I appreciate you telling me that I'm smarter than a cynical and blinded right winger (I'm going to give you the benefit of the doubt and assume that is what you were saying, since the ideas you attacked weren't mine). I also appreciate the exhortation to read, which I'm going to assume is a general recommendation for the summer and not snide insinuation that I don't read. Reading is very important, and it would certainly help Americans stay globally competetive if they read more. I left my copy of The Life of Pi back home, so it's actually been magazines, not books, this week because it's the beginning of the month. Nevertheless, I feel like I've been consuming my share of the written word.
-Dave
P.S. Actually, unemployment data isn't based on people who are collecting benefits, it's based on a survey of 50,000 households in addition to data collected at the state level. It's based on the percentage of the labor force (everyone who is either working or looking for work) that is not currently employed. That's actually the standard measure internationally, and if you look at most globally reported statistics, it's what they use in order to keep the numbers consistent throughout.
What it means is that if you don't have a job for a year but you're still looking, you are, in fact, counted. If you're in prison, you aren't counted because you aren't looking. There is a reason, though, that the unemployment rate is usually accompanied by another number, the workforce participation rate.
As for the rest of the Swedish economy, I'm not going to knock it, they've done a much better job managing it than most of the rest of Europe. I don't, however, think any country is future, and don't think it's particularly fair to compare Sweden and the United States on only two issues.