Trade pact to be negotiated, and opposed, during Labor Day week

Government officials from at least nine Pacific Rim counties will gather in Chicago September 6-15 to pump some life into negotiations for a new Trans-Pacific Partnership (TPP) free trade agreement. On September 5, Labor Day, unions and other critics of the agreement will hold a rally in Chicago’s Grant Park, near the downtown hotels housing the visiting delegations.

Frustrated by a stalemate in the World Trade Organization, the Bush administration almost a decade ago started concentrating on bilateral and regional channels to seek its objectives. So far, success has proved just as elusive, even with the support of the new Obama administration.

Widespread public opposition to FTAs of any kind prompted President Obama’s trade representative, Ambassador Ron Kirk, to launch an unprecedented 50-state “outreach” in 2010 to sell TPP. According to a November 2010 Pew Research Center poll, now only 35% of Americans believe that free trade agreements benefit the United States.

TPPFTA negotiations began in earnest on March 15 last year with the governments of eight countries -- Australia, Brunei Darussalam, Chile, Malaysia, New Zealand, Peru, Singapore, and Vietnam, yes, Vietnam – on board with the U.S.

On March 14, Richard L. Trumka, president of the AFL-CIO, and the presidents of the Australia, New Zealand, and Singapore labor movements, issued a joint declaration on how the TPPFTA fails to meet the standards for a fair agreement. The shortcomings they cited were chiefly in the areas of transparency, worker rights, investment, environment, procurement, intellectual property, and consumer protection.

In a memo for reporters on August 26, the Citizens Trade Campaign summarized its case against TPPFTA. “With high U.S. unemployment,” it stated, “pressure builds for a fair deal or no deal.” (http://www.citizenstrade.org)

The American Enterprise Institute, like other business organizations, strongly favors the agreement, to the point of considering it a possible model for all 21st century trade pacts. (http://www.aci.org)

No one expects negotiations to be concluded by its deadline of November this year. The issues are so complex, and bound to become more so as other Rim nations join the current nine, that it doesn’t not seem possible – or desirable – for TPPFTA to be wrapped up even by November 2012. If ever. Read more!

China’s secret deals strip African people of their country’s natural wealth

“Buccaneers are cutting themselves a large slice of Africa’s resource cake,” says Global Witness, a private watchdog agency that has exposed a series of scandals involving China and corrupt African leaders.

In its own follow-up investigations, Economist magazine in its August 13 edition ran an unusually long article with the subtitle: “China’s oil trade with China is dominated by an opaque syndicate. Ordinary Africans appear to do badly out of its hugely lucrative deals.”

Because of the volume of oil Angola sold to China over the years at rigged, non-market prices, the profit to China’s secret syndicate could amount to tens of billions of dollars, according to the Economist. Moreover, the syndicate promised to build cross-country highways, low-cost housing, hydroelectric plants, and other forms of infrastructure, but has delivered little.

Another dimension of the scandals is that the syndicate’s cash props up certain regimes and thereby fuels violent conflict. In Guinea, for example, the syndicate came to the rescue of the cash-strapped rulers after government officials massacred 150 protesters in a stadium and raped scores of women. A month later, the syndicate transferred $100,000,000 to the country as part of a minerals deal.

Model for Plunder

“Rather than fixing Africa’s lack of infrastructure, Chinese entrepreneurs and Africa’s governing elite look as if they are conspiring to use the development model as a pretext for plunder,” the Economist concluded.

Global Witness has individual reports on eight African countries in which the syndicate has one-sided deals for current and future wealth: Angola, Cote d’Ivoire, Democratic Republic of Congo, Equatorial Guinea, Liberia, Madagascar, Republic of Congo, Sudan, and Zimbabwe.

Global Witness conceived and co-launched Publish What You Pay (PWYP) campaign with more than 300 member groups seeking to promote greater transparency in the oil, gas, and mining industries. “A concerted coordinated response is urgently required that cuts across the political, institutional, and industry spheres,” says Global Witness. A key problem is the secrecy provided by U.S. shell companies that stash the syndicate's (and other) ill-gotten gains in American banks.

In the last Congress, two Senators – Levin, a Democrat from Michigan, and Grassley, a Republican from Iowa – introduced legislation to make it harder for corrupt politicians, terrorists, and other criminals to form and hide behind anonymous U.S. shell companies. That effort got nowhere. In July President Obama signed a new Strategy to Combat Transnational Crime, which proposes a series of laws to achieve its goals. That effort looks to be a victim of the continuing mindless debate about the U.S. federal deficit and future budgets.
Read more!

Free Trade hits black workers hardest

Thanks largely to free trade agreements, urban black workers are suffering from especially high joblessness, William Lucy, former secretary-treasurer of a large AFL-CIO union, writes in the Cleveland Plain Dealer.

Unemployment rates reach almost Great Recession heights in cities with a large population of blacks, Lucy points out: 18% in Cleveland, 25% in Detroit, 22% in Milwaukee.

“There are some politicians who would have us believe that the proposed free trade agreements with South Korea, Columbia and Panama will heal the jobs crisis and restore the manufacturing jobs lost. Either those politicians have historical amnesia, or they have not been to Cleveland to see what we've seen,” he writes, adding:

“Since the North American Free Trade Act was signed in 1994, more than 682,900 jobs in America have been displaced to Mexico. The bulk were in manufacturing, the very jobs that helped to create a black middle class. The South Korean FTA is estimated to cost the United States another 159,000 jobs. During a time when so many are struggling to find jobs or straining to hold onto the jobs that they have, how could anyone think that more free trade agreements are what our communities need?

“Maybe they can't see the effects of an auto factory or textile factory shutting down. Maybe they can't fathom the devastation that happens when a company relocates an entire electronics assembly line to another country. Maybe they don't understand that for all the hundreds of thousands of jobs lost, those are communities devastated, workers who can't provide for their families, an entire segment of the population struggling to maintain the economic gains they've made.“

Lucy is founding president of the Coalition of Black Trade Unionists and former secretary-treasurer of the American Federation of State, County, and Municipal Employees. His article appeared in the August 13 issue of the Plain Dealer.

Read more!

The skimpiness of U.S. minimum wages

Would raising minimum wages really cause people to leave the job market, as many charge? Yes, a minimum wage of $80 or $100 an hour would certainly have that effect, but the federal minimum of $7.25 doesn’t seem dangerously high. The Canadian province of Ontario has a minimum of $10.25 and thousands of unemployed Canadians don’t sneak across the border to supplement their jobless pay by snaring a job in the U.S.

“Americans should face the truth: we pay poor people crap because we can, because they have few choices and nowhere else to go but jail.”

So writes Salvatore Babones on his Website Benchmarking America. He supports his case by citing the most recent OECD data, which puts the U.S. the federal minimum pay at the bottom of the rate paid by 10 rich countries.

“What’s more,” he adds, “people working minimum-wage jobs in all the other nine countries have some form of national health insurance coverage, so their true wages on a like-for-like basis are even higher than in America."

Babones is a senior lecturer in sociology and social policy at the University of Sydney in Australia. His current academic project evaluates U.S. performance over time and against other countries. The paragraphs above on minimum wages are a summary of one of dozens of his analyses, illustrated and salted with plain-speaking prose.

His book, “Benchmarking America,” will be published next year. Meantime, previews of some chapters are available on his Website of that name, as well as on Facebook. He speaks and leads a discussion on Monday, August 15, at the Economic Policy Institute (EPI) in Washington.
Read more!

Wealth gaps between whites and blacks at record high

The median wealth of white households is 20 times that of black households – the largest since the government began publishing such data a quarter century ago.

So reports the Pew Research Center in its analysis of newly available U.S. Census Bureau data from 2009. Among other significant points made in the Center’s report:

-- Plummeting house values were the main reason for the inflation-adjusted decline in wealth (assets minus debt) of both whites and blacks. Among white households, the decline was from $134,992 in 2005 to $113,149 in 2009. Among black households, it was from $12,124 in 2005 to $5,677 in 2009.

-- Wealth disparities between whites and blacks have always been much greater than gaps in income, which covers the annual inflow of wages, interest, and other sources of income.

-- In 2009, about a quarter of all black households had no assets other than a vehicle, compared with just 6% of white households.

The Pew Center report can be found at http://pewsocialtrends.org/2011/07/26/wealth-gaps-rise-to-record-highs-between-whites-blacks-hispanics/

For detailed timely information on income and wealth disparities in the U.S., see the Economic Policy Institute’s State of Working America at
http://www.stateofworkingamerica.org/. Read more!