While the White House thinks a trade deal will help the U.S. contain China’s power and influence, it will actually make global corporations in the U.S. even more powerful and influential than they’ve already become. The rich keep getting richer.
Suppose that by enacting a particular law we’d increase the U.S.Gross Domestic Product. But almost all that growth would go to the richest 1percent.
The rest of us could buy some products cheaper than before. But those gains would be offset by losses of jobs and wages.
This is pretty much what “free trade” has brought us over the last two decades.
I used to believe in trade agreements. That was before the wages of most Americans stagnated and a relative few at the top captured just about all the economic gains.
Recent trade agreements have been wins for big corporations and Wall Street, along with their executives and major shareholders. They get better access to foreign markets and billions of consumers.
They also get better protection for their intellectual property – patents, trademarks, and copyrights. And for their overseas factories, equipment, and financial assets.
But those deals haven’t been wins for most Americans.
The fact is, trade agreements are no longer really about trade. Worldwide tariffs are already low. Big American corporations no longer make many products in the United States for export abroad.
The biggest things big American corporations sell overseas are ideas, designs, franchises, brands, engineering solutions, instructions, and software.
Google, Apple, Uber, Facebook, Walmart, McDonalds, Microsoft, and Pfizer, for example, are making huge profits all over the world.
But those profits don’t depend on American labor — apart from a tiny group of managers, designers, and researchers in the U.S.
To the extent big American-based corporations any longer make stuff for export, they make most of it abroad and then export it from there, for sale all over the world — including for sale back here in the United States.
The Apple iPhone is assembled in China from components made in Japan, Singapore, and a half-dozen other locales. The only things coming from the U.S. are designs and instructions from a handful of engineers and managers in California.
Apple even stows most of its profits outside the U.S. so it doesn’t have to pay American taxes on them.
This is why big American companies are less interested than they once were in opening other countries to goods exported from the United States and made by American workers.
They’re more interested in making sure other countries don’t run off with their patented designs and trademarks. Or restrict where they can put and shift their profits.
In fact, today’s “trade agreements” should really be called “global corporate agreements” because they’re mostly about protecting the assets and profits of these global corporations rather than increasing American jobs and wages. The deals don’t even guard against currency manipulation by other nations.
According to Economic Policy Institute, the North American Free Trade Act cost U.S. workers almost 700,000 jobs, thereby pushing down American wages.
Since the passage of the Korea–U.S. Free Trade Agreement, America’s trade deficit with Korea has grown more than 80 percent, equivalent to a loss of more than 70,000 additional U.S. jobs.
The U.S. goods trade deficit with China increased $23.9 billion last year, to $342.6 billion. Again, the ultimate result has been to keep U.S. wages down.
The old-style trade agreements of the 1960s and 1970s increased worldwide demand for products made by American workers, and thereby helped push up American wages.
The new-style global corporate agreements mainly enhance corporate and financial profits, and push down wages.
That’s why big corporations and Wall Street are so enthusiastic about the upcoming Trans Pacific Partnership – the giant deal among countries responsible for 40 percent of the global economy.
That deal would give giant corporations even more patent protection overseas. It would also guard their overseas profits.
And it would allow them to challenge any nation’s health, safety, and environmental laws that stand in the way of their profits – including our own.
The Administration calls the Trans Pacific Partnership a key part of its “strategy to make U.S. engagement in the Asia-Pacific region a top priority.”
Translated: The White House thinks it will help the U.S. contain China’s power and influence.
But it will make giant U.S. global corporations even more powerful and influential.
White House strategists seem to think such corporations are accountable to the U.S. government. Wrong. At most, they’re answerable to their shareholders, who demand high share prices whatever that requires.
I’ve seen first-hand how effective Wall Street and big corporations are at wielding influence — using lobbyists, campaign donations, and subtle promises of future jobs to get the global deals they want.
Global deals like the Trans Pacific Partnership will boost the profits of Wall Street and big corporations, and make the richest 1 percent even richer.
But they’ll bust the rest of America.
http://www.nationofchange.org/2015/02/17/trade-deals-boost-top-1-percent-bust-rest/
Not surprisingly, it appears that the agreement will promote the interests of giant, multinational corporations over the interests of labor, environmental, consumer, human rights, or other stakeholders in democracy, AND FURTHER CONCENTRATE OWNERSHIP OF THE NON-HUMAN PRODUCTIVE CAPITAL MEANS OF PRODUCTION!
The REAL STORY is a story about the collusion among a globally wealthy ownership class to further concentrate private sector ownership in ALL FUTURE wealth-creating, income-generating productive capital asset creation on a global scale. A sorta FREE TRADE ON STEROIDS!
This is a battle between two property system choices: economies such as China in which the productive capital assets are primarily state-owned or state-sponsored communism or socialism and economies such as the United States, Great Britain, Canada, Mexico, Australia, Japan, etc in which the productive capital assets are primarily privately owned, although also largely concentrated among less than 10 percent of the population so as to require massive earnings redistribution, and thus welfare support open and disguised.
But there is another alternative, a balanced Just Third Way (http://www.cesj.org/thirdway/thirdway-intro.htm), based on an understanding of binary economics, by which over time the economy’s productive capital assets will become almost entirely individually owned by 100 percent of the citizens. Such an economy would produce efficiencies of production fully using ever-advancing technologies of production that will fuel a greater growth of the world economies by eliminating the problematic condition of the exponential disassociation of production and consumption through ordinary citizens gaining access to FUTURE productive capital ownership to improve their economic well-being, without taking anything away from those who already own.
It is critical that private property ownership in productive capital be extended to ALL people because of the increasing power of productive capital to produce more and more of the wealth or products and services needed and wanted by society. Because productive capital––the non-human factor of production––is an independent productive power separate from human labor power, and represents an increasing role in creating wealth, the question to be addressed is: Who has the right to acquire ownership of productive capital?
While people have private property rights in their own labor, due to tectonic shifts in the technologies of production it is not enough for individual survival if people cannot get jobs, or if jobs, in reality are no longer doing a substantial part of the wealth creation. As exponential technology shifts destroy jobs and devalue the worth of labor, people need not only private property rights in their own labor, but also private property rights in the productive capital assets that are doing ever more of the work.
We as a nation, and other nations, can no longer limit people to personal rights while restricting ownership acquisition rights in wealth-creating, income-producing productive capital assets to those already well-capitalized. To be a just society, all individuals MUST have effective property rights not only in their labor and personal use possessions but also in FUTURE productive capital asset creation. Because of this imbalance, the result has been that the consumer populous is not able to get the money to buy the products and services produced increasingly by the non-human factor––physical productive capital––as a result of substituting machines for people. And yet you can’t have mass production without mass human consumption.
Broadened, private sector individual ownership of FUTURE productive capital assets as a societal objective is the ONLY individual private property-rights approach that will provide solutions to income inequality, unemployment, underemployment and anemic GDP growth––all of which is rooted in the tectonic shift in the technologies of production and its concentrated ownership. This reality, as a practical matter, is destroying jobs and devaluing the worth of labor, widening the income gap between the rich and poor and struggling (each resentful and suspicious of the other), and resulting in our inability to achieve double-digit GDP growth in the United States and other countries.
To solve this challenge, several policies must be implemented in the United States:
1. Tax reform is needed to incentivize broadened individual ownership of corporations by their employees. As an incentive, provide a tax deduction to corporations for dividend payouts, which would tighten-up the right of each owner to his or her full share of profits, a basic and historic right of private property. It would eliminate double and triple taxes on corporate profits, shifting the burden of taxation to personal incomes after exempting initial incomes that would allow low and middle class citizens not to pay taxes on incomes needed to cover basic living expenses. It will also encourage corporations to finance their growth through the issuance of new full voting, full dividend payout shares for financing their productive capital growth needs through Employee Stock Ownership Plans (ESOPs) and Capital Homestead Accounts (CHAs). Politically we need to insist that politicians lift barriers to the democratization of future ownership opportunity based on sound principle, rather than redistributive taxation.
2. As increasingly more workers acquire ownership stakes in FUTURE corporate productive capital assets using ESOP financing mechanisms, workers will build second incomes to support their living expenses, which in turn means they will be better “customers with money” to support demand for the products and services that the economy is capable of producing. By reason of the higher marginal spending rate on the part of workers second incomes, more of the additional income earned by the new capitalists (who have many unsatisfied consumer needs and wants) will be spent on consumption than if the income had been earned by those capitalists who now have concentrated the ownership of productive capital exclusively, and who have few, if any, consumer needs and wants. Such broadened incremental consumption will fuel a demand for more consumer products and services, which in turn will provide incentive for greater productive capital investment.
3. For all Americans, the Federal Reverse needs to create an asset-backed currency that can enable every man, woman and child to establish a Capital Homestead Account or “CHA” (a super-IRA or asset tax-shelter for citizens) at their local bank to acquire a growing dividend-bearing stock portfolio to supplement their incomes from work and all other sources of income. The CHA would process an equal allocation of productive credit to every citizen exclusively for purchasing full-dividend payout shares in companies needing funds for growing the economy and private sector jobs for local, national and global markets. The shares would be purchased using essentially interest-free credit wholly backed by projected “future savings” in the form of new productive capital assets as well as the future marketable products and services produced by the newly added technology, renewable energy systems, plant, rentable space and infrastructure added to the economy. Risk of default on each stock acquisition loan would be covered by private sector capital credit risk insurance and, if necessary, government reinsurance, but would not require citizens to reduce their funds for consumption to purchase shares.
4. Reform the tax code such that the tax rate would be a single rate for all incomes from all sources above an established personal exemption level (for example, an exemption of $100,000 for a family of four to meet their ordinary living needs) so that the budget could be balanced automatically and even allow the government to pay off the growing unsustainable long-term debt. The poor would pay the first dollar over their exemption levels as would the stock fund operator and others now earning billions of dollars from capital gains, dividends, rents and other property incomes.
5. As a substitute for inheritance and gift taxes, a transfer tax should be imposed on the recipients whose holdings exceeded $1 million, thus encouraging the super-rich to spread out their monopoly-sized estates to all members of their family, friends, servants and workers who helped create their fortunes, teachers, health workers, police, other public servants, military veterans, artists, the poor and the disabled.
6. Eliminate all tax loopholes and subsidies.
These polices would result in rapid and substantial economic growth with the GDP rate in double digits. As a result of the stimulus effect, more REAL, decent paying job opportunities and further technological advancement would be created while simultaneously broadening private, individual ownership of FUTURE wealth-creating, income-generating productive capital assets, which would support second and primary incomes for ALL Americans.
In this new FUTURE economy, a citizen would start to benefit financially at the time he or she enters the economic world as a labor worker, to become increasingly a capital owner, whose productive capital assets contribute as a non-human worker earning a second income, and at some point to retire as a labor worker and continue to participate in production and to earn income as a capital owner until the day you die.
As we ALL contribute to the building of a FUTURE economy that can support general affluence for EVERY man, woman and child, at some point as the technologies of production further advance there will be far less need for human workers and productive capital asset ownership will become the primary income source for most people. As general affluence becomes more widespread people will be free and economically secure to pursue their creative desires and pleasures, further contributing to the cultural and societal development of the country.
Support the Agenda of The Just Third Way Movement at http://foreconomicjustice.org/?p=5797
Support Monetary Justice at http://capitalhomestead.org/page/monetary-justice
Support the Capital Homestead Act at http://www.cesj.org/homestead/index.htm and http://www.cesj.org/homestead/summary-cha.htm. See the full Act at http://cesj.org/homestead/strategies/national/cha-full.pdf
See “Financing Economic Growth With ‘FUTURE SAVINGS’: Solutions To Protect America From Economic Decline” at NationOfChange.org http://www.nationofchange.org/financing-future-economic-growth-future-savings-solutions-protect-america-economic-decline-137450624 and “The Income Solution To Slow Private Sector Job Growth” at http://www.nationofchange.org/income-solution-slow-private-sector-job-growth-1378041490.
http://www.nationofchange.org/trans-pacific-partnership-trade-agreement-protectionists-1383056946
