B.J. Bethel

A view of the world from Ohio

Roger Cohen’s down with TPP, but not American jobs

Studying and opposing offshoring is part economics, part being uncool in the eyes of the foreign policy and economic establishment, and mostly “Groundhog Day” with Bill Murray.

Whether it’s neo-Keynesian and Krugman-ite economists, foreign policy wonks who see trade as just a card to play in global politics, the idiotic free market arguments that see free trade as a matter of principal and not policy – it’s the same false arguments that were made during NAFTA have survived 25 years. The same arguments are replicated in favor of he Trans-Pacific Partnership, the potential “Garfield: Tale of Two  Kitties,” “Aloha,” or “Hyde Park on the Hudson) of trade deals.

That TPP is being addressed is due only to the insurgent campaigns of Bernie Sanders, and most in particular Donald Trump, who has won the delegate count for the Republican nomination on a platform based primarily on American primacy in economics and – like a true free-marketer would say – considering our own interests in the matters of world trade. Detractors call it populist, others would say working class.

If you discuss globalization or American manufacturing its the same reoccurring nightmare, where you keep going to school without your clothes, or you repeatedly fall off the same cliff. Article after article, pundit after pundit, it’s waking up to Sonny and Cher all over again:

  1. Globalization is good because interlinking countries and their economies lessens war. True in some cases, not true in others. Ask Europe how comfortable it feels knowing Putin controls the spigot on their gas and oil.
  2. Killing trade is bad because it makes our allies poorer. If only these concerns were shared for the flyover plebes, the working class types, the NASCAR fans those who would benefit from manufacturing jobs. Then your populist Trump-ian doomsday wouldn’t have occurred.
  3. Opening our markets to the world opens our companies to new customers. It’s a net gain. For who? The overarching theory on free trade in the 1990s was America’s working class would suffer job losses for a 15-20 year period before things stabilized, when other economies would see a growing working class with higher wages, and the losses would even out. This has not happened. Job losses continue in manufacturing sectors.

Roger Cohen of the New York Times declared in a commentary Thursday, June 2, 2016, “If TPP fails, China wins.” Cohen is referencing the Trans-Pacific Partnership, a trade agreement between the United States and 11 Asian countries comprising 40 percent of the world’s economy. A trade agreement that has been negotiated in secret, has not been made public except in stolen extracts that have been leaked surreptitiously. An agreement many of our elected legislators haven’t seen, had access to, or had an opportunity to write. But corporate lawyers have had a large part in filing the details and putting the deals and negotiations together.

Cohen talks about America’s failing status in the world, how most countries have little regard for the United States – except Vietnam, which is one of the 11 countries involved in TPP. Not signing TPP would be a sign of de-committment to them and other countries, a signal that China will be the dominant faction in Asia, not the United States, and they’ll be dictating power in the region.

Cohen spends five paragraphs in an 800-word column agonizing over Vietnam’s image of the United States before he gets to what he’s really writing about.

But such long-term transformations, pulling hundreds of millions out of poverty in Asia, are not the stuff of an American election characterized by anger above all. Among the popular one-liners is this: International trade deals steal American jobs. Not one of the three surviving candidates backs the Trans-Pacific Partnership. Hillary Clinton was for it — and right — before she was against it — and wrong. Bernie Sanders and Donald Trump are simply against it, big time.

Those angry, selfish populists want to keep their jobs and stay employed. Actually, they want their jobs back. Manufacturing is disappearing as a matter of employment in the United States. If you go to a rust belt city, walk into a Walmart or Wendy’s, you won’t be greeted by a teenager, which was the case 10 years ago. Most likely it will be a former supervisor in his 40s or 50s, a single-mom who once had her child in a house but is now in an apartment with help from SNAP – the typical angry crowd, angry because they can’t afford anything. The one demographic in the world – working class American whites – which has seen its mortality rate rise in recent years.

Cohen admits the deal doesn’t adequately address currency manipulation or medical copyrights which could drastically change the prices of prescriptions. As far as jobs go, Cohen goes through an exercise of mental gymnastics and euphemism that a 5 year old wouldn’t take on its face.

The Obama administration has acknowledged that some manufacturing and low-skilled jobs will be lost, but argued this will be offset by job growth in higher-wage, export-reliant industries. The Peterson Institute for International Economics, in a report issued this year, found the accord would stimulate job “churn” but was “not likely to affect overall employment in the United States,” while delivering significant gains in real incomes and annual exports.

“Job churn,” a phrase George Orwell lived to see die, is Cohen and the Obama administration’s kind way of saying if you work in a blue collar job that involves making or building a product, there’s a good chance it will disappear. These jobs would supposedly be replaced by “higher-wage, export-reliant” industries, while somehow magically delivering higher incomes and exports.

This same argument was made in regard to NAFTA and the $8 billion it had brought in business to the state of Ohio, a heavy manufacturing state – or was. Dayton’s auto-heavy manufacturing base was the fuel for the local economy – not just the plants themselves, but the machine shops and small parts manufacturers they kept in business in small towns and suburbs throughout the western half of the state. The actuality was different – Ohio from 2000 to 2011 lost $22 billion in payrolls due to what the Dayton Daily News (who I work for) called a state whose jobs were “under siege.”

In Montgomery County alone, where Dayton is the county seat, payrolls dropped $3 billion – 27 percent. That’s over a quarter of personal income gone in 11 years. That job loss isn’t a churn, it’s catastrophic.

Cohen calls out Trump for calling TPP “the biggest betrayal in a long line of betrayals” of American workers, and not citing evidence outside currency manipulation, but the deal has largely been kept secret – which means its doubtful there’s good news in it except for those who put it together. I’m not a Trump supporter, but on this issue we have much common ground, and he’s right to be skeptical, especially given the NAFTA track record.

Cohen called on Congress to resist “populist ranting” and fears increased tension abroad if the deal isn’t ratified, but blows off growing tension at home over job losses and a country that operates currently with two separate economies. The one Cohen wants to service – the economy of Wall Street, Manhattan and D.C. – and the economy the rest of us are stuck with – rising health insurance, lower wages and higher debt.

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