On May 23, 2015, Keith Brekhus writs on Politicus USA:
A Trade Promotion Authority bill passed the U.S. Senate 62-37 Friday night, with 48 Republicans and 14 Democrats voting for the measure. The bill now heads to the U.S. House where it faces an uncertain future. The measure gives Congress the ability to vote up and down major international trade agreements negotiated by the White House but strips Congress of the ability to amend or filibuster such agreements. Fast track authority is designed to make it easier to push through trade agreements, and the bill was seen as a necessary step towards approving the controversial twelve nation Trans-Pacific Partnership (TPP) trade agreement.
President Obama favors the agreement, as do a majority of Senate Republicans. However, liberal pro-labor Senators likeSherrod Brown (D-OH), Elizabeth Warren (D-MA) and Bernie Sanders (I-VT) have argued that the bill will make it easier for corporations to avoid worker protections and to lower wages by moving jobs overseas.
Organized labor has argued that fast track authority undermines American workers. The AFL-CIO issued a recent statement, that read:
We’ve seen the devastating cost of bad trade deals over the years, so we know that fast track trade promotion authority is not the way to ensure that the American public receives the full and thorough debate on the vast implications of the Trans-Pacific Partnership.
In stark contrast to the AFL-CIO’s assessment, President Obama described the agreement in glowing terms, stating:
Today’s bipartisan Senate vote is an important step toward ensuring the United States can negotiate and enforce strong, high-standards trade agreements. If done right, these agreements are vital to expanding opportunities for the middle class, leveling the playing field for American workers, and establishing rules for the global economy that help our businesses grow and hire by selling goods made in America to the rest of the world.
President Obama’s rosy optimism sounded hauntingly similar to Bill Clinton’s positive appraisals for the North American Free Trade Agreement (NAFTA) before he pushed it through Congress with bi-partisan support in the 1990s. However, a briefing paper by Robert E. Scott at the Economic Policy Institute noted that the optimistic predictions of President Clinton and pro-NAFTA economists never came to pass.
In his publication, “Heading South: U.S.-Mexico trade and job displacement after NAFTA“, Scott estimated that by the year 2010, U.S. trade deficits with Mexico totaled over 97 billion dollars and he estimated that the negative effects of NAFTA had displaced over 680,000 U.S. jobs. Trade agreements that encourage more imports and fewer exports tend to displace domestic workers and tighten an already tough job market while pushing manufacturing jobs out of the country where employers can exploit cheaper labor.
Unfortunately, President Obama seems to be following the path taken by former President Clinton, by aligning with multinational corporations and “free trade” Republicans rather than with organized labor. Multinational corporations who exploit cheap labor overseas, such as the Nike shoe company, will benefit from the agreement. Meanwhile, American manufacturing jobs could continue to shrink, as domestic plants find themselves unable to compete with companies who pay lower wages overseas.
The U.S. House has an opportunity to reject the bill, but given the bill’s popularity with Republican Senators, it is difficult to envision the GOP-controlled House defeating the bill. That difficulty is compounded because some Democrats are also likely to back the President in supporting the bill.
Still, the individual votes could be unpredictable. In the Senate,48 of 54 Republican Senators voted YES. Mike Enzi of Wyoming did not vote. Of the five Republicans who voted no, Susan Collinsof Maine is traditionally regarded as a moderate, but the other four are hard-line conservatives, which means the more conservative GOP House could also offer up some surprise votes. Republican Senators Rand Paul (KY), Mike Lee (UT), Jeff Sessions (AL) and Richard Shelby (AL) were the four conservatives who voted against fast track trade authority.
30 Democrats opposed the measure, along with the two Independent Senators who caucus with the Democrats, Angus King of Maine and Bernie Sanders of Vermont. 14 Democrats backed the proposal. Those 14 Democrats were Michael Bennet(CO), Maria Cantwell (WA), Ben Cardin (MD), Tom Carper (DE),Chris Coons (DE), Dianne Feinstein (CA), Heidi Heitkamp (ND),Tim Kaine (VA), Claire McCaskill (MO), Patty Murray (WA), Bill Nelson (FL), Jeanne Shaheen (NH), Mark Warner (VA) and Ron Wyden (OR).
While the fast track agreement appears to be a raw deal for American workers, there is the possibility that even if it passes, President Obama will negotiate good faith agreements with other nations, that safeguard worker protections and do not undermine American workers. Some of the more liberal Senators who voted to permit fast track authority may be operating under that assumption. However, that authority will likely be extended to future presidents as well, and there is no guarantee that fast track authority, once passed, will not empower the next Republican president to negotiate a terrible deal for American workers.
The Senators should have voted this bill down. Now the responsibility for protecting American jobs from future bad trade deals has been passed into the hands of the U.S. House. Sadly, it is hard to feel optimistic about the fate of the American worker, if he or she is now depending upon John Boehner’s Republican-controlled House to do the right thing.
This 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! It will export production and jobs to countries with far lower labor wages and standards while enriching the OWNERSHIP interests of the already wealthy ownership class.
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.
