Friday, December 28, 2007

Canada post-NAFTA: An era of economic insecurity

Americans aren't the only ones unhappy with NAFTA. A new study from the Canadian Centre for Policy Alternatives reaches a similar conclusion: Free trade has failed to live up to its promises.
Twenty years after Canada signed the Free Trade Agreement its biggest boosters have grown wealthier but promises of better jobs and rising living standards fell short, says a study released by the Canadian Centre for Policy Alternatives.

The Canada-US Free Trade Agreement was signed on January 2, 1988. The study examines what’s happened since: It takes a sample of 41 Canadian Council of Chief Executives (CCCE) member companies – the leading supporter of free trade – and finds they shrank their workforce by 19.6% while their revenues grew by 127%.

“Its promoters said free trade would create more and better jobs but that promise was clearly hollow,” says the study’s author, CCPA Executive Director Bruce Campbell. “There are fewer jobs today in the traded goods sector than there was before free trade.”

“And contrary to the CCCE promise of better public services and social programs under free trade, governments slashed programs by 26% -- more than six times deeper than the OECD average – largely at the urging of lobby groups like the CCCE.”

Among the study’s key findings, between 1987 and 2006:

  • The 41 companies’ combined revenue grew from $142 billion to $310 billion while they shrank their combined workforce by over 118,000.

  • The Big Three automakers shrank their Canadian workforce by over 50%--from 87,626 to 43,000. Their revenue grew by 70%, from $38.9 billion to $67.3 billion.

  • Despite the massive Alberta oil boom, the three major oil companies in the sample cut their combined workforce by almost one-third, from 22,500 to 15,428. Their revenues soared from $13.7 billion to $53.4 billion--a 290% rise.

  • Corporate profits are at a 40-year high, but Canadian workers’ wage share of the economy has fallen steadily.

  • Only the richest 5% of income earners saw rapid growth in their inflation-adjusted incomes from 1992-2004.
  • [all emphasis added]
    Shrinking workforces, corporate profits at record highs, falling wages and rising inequality. Canada's experience under NAFTA pretty much mirrors our own. Free trade did create some new jobs over the past 20 years, but about one third of them were in the services sector at lower average wages than those lost. Sound familiar?

    Wednesday, December 26, 2007

    Poverty threatens our domestic tranquillity

    The LA Times is running a series of editorials on the values and issues they feel will shape the 2008 election, i.e. the environment, liberty and justice, etc. Today, they focused on our country's domestic tranquillity, which they believe is being tested by new challenges, chief among them persistent poverty and the fraying of our connective infrastructure. It's pretty good stuff, especially the part about poverty. Here's an excerpt:
    If tranquillity is best assured by "a more equal distribution" of the nation's wealth, we have much to fear. Our schools are faltering; our healthcare system leaves millions without access to doctors. Many are homeless or face the loss of homes. Some seethe at illegal immigrants who compete with Americans for jobs. In our America, 60 million people survive on $7 a day.

    As we contemplate the coming election, we seek a president who understands that the unchecked spread of poverty is not a natural condition but rather a failure of government, and that action is required. Democrat John Edwards has been the most ardent anti-poverty crusader in the campaign; his ideas include strengthening labor laws, stimulating job creation and distributing housing vouchers for poor families that could be used anywhere, not just in government housing. The latter proposal alone would vastly expand shelter for those in need. The rest of the Democratic field offers little in the way of ingenuity, opting instead for the obvious observation that money spent in Iraq could better help America's poor.

    On the Republican side, lack of specificity is matched by conspicuous indifference. When the GOP candidates were invited to debate poverty at Morgan State University in September, not one of the then-front-runners attended; present were Mike Huckabee, Duncan Hunter, Sam Brownback, Tom Tancredo, Ron Paul and Alan Keyes. Now a leading contender, Huckabee frames fighting poverty as a "pro-life" position; more constructively, he also addresses issues such as prison reform. Other Republicans have done meaningful anti-poverty work -- John McCain in housing and Mitt Romney in healthcare.

    Although these candidates present ideas that might contribute at the margins, none goes far enough. Here are some ideas we'd like to hear them discuss:

  • President Bush came to office on a promise of "compassionate conservatism," but in housing, as in so many other areas, he's proved far more conservative than compassionate. His administration has sought, for instance, to cut Section 8 housing vouchers by 850,000; his successor should not only replenish the voucher program but add to it. There is no poverty worse than homelessness.

  • The next president should support and pay for early childhood programs such as Head Start; he or she also should endorse tax breaks for college students and their parents. Low-income students would benefit if community college tuition, in particular, were tax-deductible. And here's a proposal we would welcome: federal assistance for states educating the majority of the nation's illegal immigrants. Education can lift a poor person into prosperity; the government owes its people this chance to raise themselves.

  • Free trade is an engine of growth and jobs and thus opportunity. Yet open markets bring dislocation, and for the worker whose plant moves to Mexico, it is cold comfort that jobs are being created abroad. For Democrats especially, this last issue is a trying one. President Clinton was a champion of free trade and a supporter of NAFTA -- this page supported it then and still does. Today's candidates, however, are less enthusiastic. Edwards blames the pact for sending 1 million jobs abroad. Sen. Barack Obama calls for it to be "renegotiated." Sen. Hillary Rodham Clinton says it should be "fixed." Rep. Dennis J. Kucinich veers into absurdity by proposing to scrap NAFTA and withdraw from the World Trade Organization.

  • Our goal should not be to abandon free trade but rather to make it work -- for the economy and also for the poor.
    These are good ideas that I'd like to hear discussed too, but will it change anything? The candidates will say whatever they think will get them votes. Bush is a prime example of that. People really believed he would be "compassionate." I guess the best we can do is vote our conscience and hope the next president really does care about poverty and inequality. That pretty much rules out all Republicans.

    Sunday, December 23, 2007

    Merry Christmas

    You may believe Jesus is "the reason for the season" or you may believe in Santa Claus. Whatever you believe is fine with me. I don't want to fight. I don't want a "war on Christmas." In fact, what I do want is peace on earth, but that looks impossible for the immediate future, so I'll simply wish everyone a Christmas day filled with love, peace of mind and goodwill.

    I also wanted to share a couple pictures of my granddaughter Gracie with you because I think children exemplify the unconditional love of Jesus - and in my opinion, that love is the true spirit of Christmas.

    I hope she brings a smile to your face and lightens your spirits like she does mine.

    Merry Christmas and God bless.

    Friday, December 21, 2007

    The Party of Nyet

    That title was inspired by Kevin Drum to describe the Republicans. I like it, and it certainly fits considering the obstructionists have set a record. These are the details from Campaign for America's Future [emphasis added]:
    The Republican Senate minority today filibustered an omnibus budget bill, setting a modern-day record for blocking the most legislation during a congressional session. A new report released today by the Campaign for America's Future details the 62 times conservatives have used the filibuster to block legislation (or force modification of bills) in the first session of the 110th Congress. In just the first year of this two-year Congress, their use of the filibuster in the Senate topped the previous record, reached during the entire 107th Congress.

    The new report outlines every bill filibustered, vetoed or threatened to be vetoed by President Bush. Conservatives filibustered bills to end the occupation of Iraq, provide soldiers in Iraq rest time equal to their deployments, support renewable energy and grant residents of the District of Columbia representation in Congress. Today's record-breaker involved a $516 billion budget package passed by the House to fund the federal government in 2008. The conservative minority demanded $20 billion additional funding for the war and opposed House language to bring troops home, and threatened a filibuster to prevent the bill from getting an up or down vote.

    "In just one session, a minority in Congress has prevented a mind-blowing 62 pieces of legislation from going to the floor for an up or down vote," said Campaign for America's Future co-director Roger Hickey. "Our report shows how over and over again, the uncompromising minority has thwarted the will of majorities in Congress and of the American people, holding the Senate floor hostage to a radical right-wing agenda."
    And to think this is the same party that's been running around for decades crowing about their values. They're nothing but a bunch of immature bullies:
    Eric Lotke, Campaign for America's Future research director and lead author of the new report, calls the obstruction a "deliberate strategy." He observes that the congressional Republicans block legislation, then blame the Democrats for getting nothing done. "It's like mugging the postman and then complaining that the mail isn't delivered on time."
    Deliberate obstruction. They must be so proud. Yet, for all their efforts, they've actually failed. It turns out that 2007 Democrats have been more successful than Newt Gingrich's 1995 Republicans, although I'd really call it a Pyrrhic victory since our biggest problems are still hanging over our heads.

    Wednesday, December 19, 2007

    Edwards' rhetoric appeals to working people

    There are reports that John Edwards is closing the gap in Iowa despite the fact the Des Moines Register went with Clinton. In case you haven't heard, this is what they said:
    "Edwards was our pick for the 2004 nomination," the editors wrote. "But this is a different race, with different candidates. We too seldom saw the positive, optimistic campaign we found appealing in 2004. His harsh anti-corporate rhetoric would make it difficult to work with the business community to forge change."
    Harsh anti-corporate rhetoric? Spoken like a true corporate-owned (Gannett) newspaper.

    Edwards is finally starting to draw larger crowds as the primary nears because he's talking about the concerns of working people. That rattles corporate America because, as Jonathan Tasini puts it, these folks don't understand what many Americans understand:
    We don't need a candidate--or, for that matter, a president--who believes that their job is to get along with business, or that the way to turn things around in America is to have a pleasant conversation with business. This has been the chain around our collective necks for lo these many decades. We need a president who, first and foremost, understands the interests of working people and, then, asks the question: how can business serve those interests?

    We need a president who understands what it means to have trade that benefits people, not corporations.

    We need a president who understands that the greed of the health care industry is literally killing people.

    We need a president who understands what it means to support unions.
    Whatever the outcome in Iowa, as long as working people feel like they're under siege, the anti-corporate rhetoric won't be going away anytime soon.

    Tuesday, December 18, 2007

    Cause and effect, Republican style

    This is the problem: Republicans agree debt is U.S. security threat

    This is one of the main causes (h/t Zfacts):
    "The US budget for Iraq in FY 2006 comes to $3,749/Iraqi. This is more than double their per person GDP. It's like spending $91,000 per person in the US."
    This is their solution: GOP contenders say cut federal spending

    Among their suggestions:
    'Let the programs go that don't work. Don't lobby for them forever," said former Massachusetts Gov. Mitt Romney.

    Former New York Mayor Rudy Giuliani called for across-the-board cuts of up to 15 percent, including reduced federal spending on health care. "Rather than relying on a nanny government, let's rely on people to decide their own health care."

    Former Sen. Fred Thompson..."We've got to spend more for the military as a matter of fact, but we've got to look at Social Security and Medicare and do some things that won't hurt anybody badly.
    So let's see...after burning through the surplus Bush inherited from Clinton, slashing taxes for the rich multiple times, and spending hundreds of billions of dollars in Iraq to search for non-existent WMDs, the Republican candidates are telling us we have to reign in spending and cut domestic programs.

    I have a better idea and it won't hurt too badly - vote for anyone but a Republican.

    Thursday, December 13, 2007

    U.S. awakens to "soft power"

    Led by the military, war-weary US awakens to 'soft power'
    After six hard years of war, the United States is awakening to the idea that "soft power" is a better way to regain influence and clout in a world bubbling with instability.

    And nowhere is the change in thinking more advanced than in the US military, which is pushing for greater diplomacy, economic aid, civic action and civilian capabilities to prevent new wars and win the peace in Iraq and Afghanistan.
    Hmm...I seem to recall diplomacy being recommend before we went into Iraq, before we lost all these lives, before we squandered all this money, and before Bush ruined our reputation and standing in the world.

    At least the military isn't waiting on the Bush administration to change their thinking, which the article describes as a "a mixed bag."
    The military wants civilian agencies to do more to prevent wars, but is not waiting for them to get their act together, analysts say.

    Instead, it has stepped up thinking and planning for what it calls "phase zero," military jargon for conflict prevention.

    "I think they've come to the conclusion that insurgencies are really hard to fight. And so it would be better if they could not have the conflict in the first place," said Robert Perito, an expert at the US Institute of Peace.

    "In conflict prevention, of course, there is very little military component to that. It's mostly all political and economic.
    Americans will be dealing with the ramifications of the Iraq war for decades to come. Maybe conflict prevention will be the one good thing that comes out of all of this.

    Wednesday, December 12, 2007

    Blackwater's plans for New Year's Eve

    Blackwater sure is intent on putting themselves out there as equals to our military. Yesterday, we learned about their paratroopers parachuting onto the field during halftime at the SDSU "Fleet Week" game and today there's more news. Go read my post over at BFM: Blackwater at New Year's Eve Armed Forces Bowl

    But before you go, check out this YouTube video of a Blackwater parachutist landing on the field at the Fleet Week SDSU game (around the 2:45 mark). He's holding the American flag and his parachute is emblazoned with the Blackwater logo. Eisenhower must be rolling over in his grave.

    Tuesday, December 11, 2007

    Blackwater Mercenaries Honored as Veterans

    San Diego recently honored mercenaries from Blackwater USA during their Fleet Week activities. Outrageous. They don't deserve this type of recognition.

    Read my post, Our Soldiers and Blackwater Mercenaries are Not Peers, over at Blogging for Michigan and then give me your opinion.

    Monday, December 10, 2007

    A dream the president should have

    My online friend Larry left me a copy of a poem by Colleen Redman that I thought was worth sharing. (Thanks, Larry!) I tracked down the author's blog, Loose Leaf Notes, and found the poem. It's called a Dream for President Bush. Redman wrote the poem prior to the invasion of Iraq and its been passed around at peace marches in Washington.
    I want President Bush to have a dream
    like the one that Ebenezer Scrooge had
    I want him to be visited by the ghosts of Iraqi children
    who cry out, "But mankind was your business"

    I want all the Tiny Tims of the world
    to get their 401k money back
    from the white collar criminals who stole it

    I want them to not go to war for oil,
    good ratings, or weapon sale quotas
    because this white collar mafia is in power

    I wish President Bush would have an affair
    I wish he'd take off his black pointed cowboy boots
    and look at the moon more often

    And then I wish he'd wake up
    and be inflicted with what Jim Carey had
    in the movie "Liar Liar"

    I wish all the billboards across the country read:
    "Give back the votes your brother stole"
    and the poets would shout from every street corner,
    "The emperor wears no clothes"

    I want his mouth washed out with soap
    every time he says "weapons of mass destruction"
    and for him to wear a Darth Vader helmet
    if he ever says "the axis of evil" again

    I hope President Bush looks out his White House window
    when we descend on Washington marching for peace
    like hordes of starlings who know their way home
    because it is in their nature

    I want President Bush to have a dream
    like the one that Martin Luther King had
    I want him to be visited by the ghosts of King,
    John Lennon, Paul Wellstone, and the Kennedys

    I want the New York Times to cover the story
    when his mother scolds him for being a bully
    I hope he gets some Gi Joes for Christmas
    and starts to play with real toys
    and not with real people

    Click over to read the rest of it and leave her a comment.

    Thursday, December 06, 2007

    Can we afford to keep waiting for health care reform?

    Clinton failed to pass health care reform in 1993 in part because the Canadian national health care system was held up as "the" model by progressives, and naturally conservatives trashed it and nothing got done. Well, here we are 14 years later and our health care coverage has eroded and the costs have skyrocketed. How has Canada fared? Better than us according to the EPI:
    As the chart below reveals, the cost gap between the United States and Canada has only widened since 1993, and per capita health care expenditures in the United States are now almost double those in Canada ($6,401 vs. $3,359). Canada's per capita health expenditures rose about 65% from 1993 to 2005, while costs in the United States rose by over 90%.
    Yet infant mortality in the United States is higher and life expectancy at birth is less than in Canada. It is also noteworthy that despite Canada's much lower expenditures on health care, Canadians consult with physicians far more often than do Americans. The average number of physician consultations per capita was 6.0 in Canada, versus 3.8 in the United States.
    I read somewhere that Americans want some kind of national health insurance system, but those of us who have insurance now are afraid to give up what we have. In other words, we're more comfortable dancing with the devil we know versus the one we don't.

    What will it take to get real change? Our inaction is costing us money, jeopardizing people's health, and costing people their lives. We can't afford to let our fear immobilize us any longer.

    Tuesday, December 04, 2007

    America, Inc.

    You can't pick up a paper anymore without reading bad news about our economy, but this headline really got my attention.

    Weak Dollar: Airbus, VW Plants in U.S.?
    A rising euro and high labor costs are leading at least two European manufacturers to consider building new plants in the U.S. [...]

    A recent study by the Center for Automotive Research, completed prior to the recent fall of the dollar, found that autoworkers in Western Europe make almost $10 more per hour than their colleagues in the United States make.
    Wonderful. Jobs are being created in this country because we have cheap labor and our dollar isn't worth much. Neither are our homes:

    Home prices see biggest drop in 25 years.

    Add into that mix the financial crisis and the costs associated with the Iraq war and the picture looks pretty gloomy. It doesn't look like conditions will improve anytime soon. So, who's to blame? Danny Schechter @ AlterNet nails it:
    Its probably truthful but not helpful to say that the mismanagement of our economy is an outgrowth of the very corporatist policies that will haunt this country for decades to come, including costly wars, and obscenely high levels of corruption and the list goes on.

    This crisis, however is a bit different because it has built in intensity for years without much visibility or attention. It speaks to structural problems in an economy built on the quick sand of debt and delusion.

    In order for the economy to function, in order for consumption to continue and profits to keep flowing, people have to believe that everything's all right. They want remedies modeled after Alka Seltzer. Put one tablet in water. It fizzes. You drink and feel better in minutes.

    The truth is that confidence is eroding not because "the masses" hate capitalism but because our brand of unregulated capitalism is increasingly not working for them. They know that because prices keep rising and good paying jobs are harder to find. They know that because crime is going up in many cities, and it's harder to make ends meet.

    And some even know that the very concept of the masses has been replaced by highly stratifies classes built on growing income inequality.
    Greed, Republican corporatism, free market ideology...there's plenty of blame to go around. The American consumer shares part of that blame too. We drank the Kool-Aid. We kept spending. We closed our eyes and ears when good paying jobs were sent out of the country. We voted for politicians who tricked us into believing abortion was the most important issue we faced. Then we voted for them again when they told us terrorism was the most important threat. We were enablers and now we're feeling the pain.

    So, what's the prognosis? We shouldn't expect a full recovery:
    The pessimism, moreover, isn't momentary but reflects voters' worries beyond the current business cycle. Early last month, a sobering consensus emerged from a focus group of a dozen Republican-leaning voters in the Richmond, Va., area, sponsored by the nonpartisan Annenberg Public Policy Center at the University of Pennsylvania. The participants unanimously agreed that they didn't think their children's generation would be better off than their own -- breaking with traditional American optimism -- largely due to the debt future taxpayers will inherit.

    "Who's buying our loans?" said former secretary June Beninghove, 67. "Who's going to own us? We are going to give ourselves to another country because of debt."
    And we have reason to believe things will get worse before they get better:
    There is a conflict coming, as this problem turns into an issue. It could lead to an economic civil war. Its won't be just a working class led class war either. Says credit expert Robert Manning:

    "What we've seen with this kind of financialization of the American economy, where the democratic system and so many democratic institutions have been co-opted and literally bought by the financial service industry, is that we're seeing a big backlash from the American people.
    This is what happens when politicians run our country like America, Inc. instead of a Republic. I hope our country can survive the mess they've made.

    Sunday, December 02, 2007

    British government seeks to close Amway

    When DeVos was running for governor last year, supporters threw their weight behind him because they believed he could bring good paying jobs to Michigan like those at Amway, the company his father helped found and DeVos ran for a period of time. I wonder what his supporters think of this news from the London Times:
    John Hutton, the Secretary of State for Business, Enterprise and Regulatory Reform, seeks to close the company in the “public interest”. [...]

    The Government has claimed that the sales people were persuaded to join Amway on the basis that it provides “easy money” or requires “minimal effort”. It also alleged that the business’s primary aim was to recruit staff rather than sell products.
    Those terms "easy money" and "minimal effort" are actually pretty flattering compared to what was recently said in court by Mark Cunningham, Queen's Counsel. I highlighted the pertinent descriptive terms.
    The British subsidiary of one of the world’s biggest marketing groups was accused yesterday of breaking company law by “selling a dream” of unachievable wealth.

    Amway, which had 39,000 selling agents in Britain during 2005-06, is “inherently objectionable”, operates as a lottery and is trading unlawfully, the Companies Court was told. [...]

    The Government investigation claims to have revealed that just 10 per cent of Amway’s agents in Britain make any profit, with less than one in ten selling a single item of the group’s products. It claims that Amway’s main activity is encouraging other people to join its salesforce so that they pay the registration fee and buy marketing materials.

    Mr Cunningham said that Amway attracted new agents, known as Independent Business Owners (IBOs), by offering “substantial financial rewards or easy money”. He said that promise of wealth was “illusionary” and amounted to “dream selling”.

    The group, which has been operating in Britain since 1973, claims that agents can earn a substantial income from selling its range of dietary supplements, cosmetics, jewellery and water purifiers. They are also offered bonuses for recruiting other agents. However, an investigation by the Department for Business, Enterprise and Regulatory Reform showed that only 6 per cent of agents bought Amway products to sell on, the court was told.

    Mr Cunningham said that the vast majority of products offered by Amway to its agents were overpriced even before they were expected to add a further 20 to 25 per cent for retail. “The unattractive pricing explains some the graver vices that are at the centre of the winding-up application,” Mr Cunningham said.

    Agents were encouraged to buy instructions on how to grow their businesses by attracting new agents. The material contained images of success such as luxury cars, boats and foreign holidays.

    Mr Cunningham told the court: “The prospect of substantial rewards and easy money has been at all times, and remains, illusionary.”

    The investigation discovered that 71 per cent of agents made no income from Amway in the year 2005-06 and that 90 per cent had made a loss after paying the £18 fee to renew their registration. In fact, just 101 of the agents shared 75 per cent of the bonuses.

    “The reality of being an IBO is that a substantial majority make minimal financial returns,” Mr Cunningham said. “Our case is founded on the selling of the dream on one hand and the loss or minimal financial return on the other.”

    Mr Cunningham told the court that Amway operates a “pernicious” scheme, which encourages agents to recruit family, friends and colleagues to the group so that they themselves could move up to “that very narrow group that makes any money”.

    He said that the Amway scheme involved targeting the “gullible”, “deluded” and “vulnerable” to join the scheme and accused the group of “dream selling.”
    Those are pretty serious claims, but the Times provided numbers to support the reality behind those "good paying" Amway jobs:
  • 39,000 - agents working for Amway [in Britain]

  • 27,000 - (71%) had no income

  • 11,410 - (30%) earned something

  • 7,492 - (of the 11,410) received average of £13.53 [about $27] per year

  • 101 - agents received 75 per cent of bonuses

  • £116K - paid to top earner Trevor Lowe

  • 26 - number of years Mr Lowe was an agent

  • Of course, the DeVos family made out pretty well - they're worth billions of dollars.

    The case is still ongoing, but if the court rules against Amway, the company will be no longer be allowed to operate in Great Britain. Either way, this case just collaborates what citizens have been saying for sometime now - Amway jobs don't help people achieve the American Dream.

    (Cross posted at BFM.)