[N]o one is against trade. Trade has taken place since the beginning of human history. The only question is what RULES we put in place to manage trade. The issue of so-called "free trade" and, by extension, how one views the power of corporate America to shape our economic lives is, from my little vantage point, THE deep, systemic change question on the economic vision side.
I have argued for a very long time that "free trade" is just a marketing phrase. It does not exist in the world today -- and perhaps never has. What we have are a very set of complex rules that are about one thing: seeking the lowest wage possible.
So-called "free trade" lives in the same economic neighborhood as sub-prime mortgages, CEO greed, the attack against unions and the divide between rich and poor -- all of which point to the real challenge we must address: the collapse of wages for most Americans. Until we take that head on, we won't get out of the economic crisis we find ourselves mired in.
The issue of so-called "free trade" is precisely an area where we need to have a vigorous, consistent, unyielding "loyal opposition" to the Administration. We can't depend on the president to change the debate on trade because he is a captive of a system that can only see trade in the prism of the debate between two false marketing phrases: "protectionism" versus "free trade".
In another post, Tasini radically re-frames the argument on economic policy beyond the limitations of “free trade” versus “protectionism” to one that examines the relationship between wage growth and productivity. He says:
Basically, the basic bargain was roughly this -- if you worked hard and became more productive, you would see that sweat of the brow in your wages. And from the post-war era until the 1970s, that deal basically held -- as you can see from the lines that are basically close together until the 1970s. (The graphic in the link illustrates his point).
Then, the lines diverge--dramatically. You can see it yourself. If the lines had continued to track closely together as they did prior to the 1970s, the MINIMUM WAGE would be more than $19 an hour. THE MINIMUM WAGE!!!
So, in short: people had no money coming in their paychecks so they were forced to pay for their lives through credit -- either plastic or drawing down equity from their homes. There are lots of reasons that this happened -- greed, the attack against unions, de-regulation, dumb trade deals.
But, the point is: we will never fix the economic crisis, whether through short-term economic stimulus and certainly not through tax cuts, until paychecks are re-inflated. Dramatically.
Tasini argues for a radical way of re-framing the bailout and stimulus debate and designs a bailout plan for the working and middle class in this post.
What do you all think? I think Tasini is on to something. Whether or not you agree with his conclusions, I think he is absolutely right on target when he says the “free trade” vs. “protectionism” debate is a false one between two empty and meaningless marketing phrases. We have to get beyond that type of thinking if we are to come up with creative and effective ways to cope with and come up with solutions to this economic crisis.