Missing the Point #1
OK Greg. I’m on plenty of records as a fervid supporter of universal health insurance. Let’s stipulate that it would help – although certainly not cure – eroding US competitiveness.
But as many of you got, neither competitiveness nor trade policy was my central point. It was that globalizing “American” businesses are disconnecting from the future of the US economy – defined as the people who work here. Given that big business is by far the major influence on Washington policymakers, it’s no surprise that national policies have systematically undercut the bargaining position of labor – and the social contract in general. Its also no surprise that the US Government, the world’s most influential, under Democrats as well as Republicans, has led the way in organizing the “constitution” of the global economy to protect capital and leave labor and non-market social interests to the mercies of a 19th century dog-eat-dog market system.
Seems to me the questions are:
1.Is my assertion true?
2. If true, does it matter?
3. If it matters, how do we deal with this? (“We” as both Americans and citizens in this globalizing society.)
Ask yourself, if the CEOs and major investors saw that their future depended on the health and future prosperity of the American people, would we have a universal health care system that cost us 5 percentage points of GDP less? Or a first class education system from 3 year olds up. You bet we would. Just like they supported public investment in education, housing, transportation systems in the 50s and 60s when what was good for America also seemed to them to be good for General Motors.
The world has obviously changed. And one of the changes that have escaped us is the disconnection between “our” companies and “our country.”
This is not about trade, as I tried to point out. It’s about the rules for an integrating world economy. Why is it that so many liberals, who agree that social regulations are essential for a well-functioning domestic economy, support a global economy without them?
On NAFTA: it was a deal among, as Castañeda put it, “the rich and powerful” in all three countries. It forced “reforms” on a more than willing Mexican elite that benefited – guess who? The rich and powerful. One blogger asks if I’m suggesting the Mexicans go back to the leftist policies of the 60s and 70s – as if that question should stop the conversation. In fact, Mexican growth was higher, the distribution of income and wealth was more equal and poverty was falling in those ‘bad old days” than it has been in the time of NAFTA. But don’t ask me. Ask the hundreds of thousands of Mexicans who risk their lives crossing the border in search of a decent job. Mexico’s chief export other than oil is its workers. Then ask yourself what kind of a development model is it that sends out of the country its most ambitious, risk-taking and hard working workers?
Nobody wants to challenge what you actually said because they really have no answer for it. Insincerity and snark - we wouldn't have right wing rhetoric without them.
Your initial post had the virtues of both sincerity and candor lacking in the reponses to it.
The thing that vexes me most about Delong's response is the idea that union manufacturing will be "high value" in China. That's totally laughable in an authoritarian country.
Even if a $50G/year job would transfer to China and stay $50G/year, wouldn't American workers still have the grievance you suggest? The grievance is that their fellow citizens are selling them down the river in collusion with fellow elites from abroad.
I signed up for the draft at 17 years old in order to qualify for student loans - I could've been forced to die for my precious nation, and for this commitment I don't even get the status quo of 1987. I get a rapacious, vampiric investor class that tells me to practice "personal responsibility" when Mercedes sells Chrysler.
The fact that a $50G job turns into $5G job only reinforces the point. But then again, the jobs wouldn't be moving if they actually remained "high value" now would they?
February 27, 2007 9:13 AM | Reply | Permalink
Jeff, It seems you missed my main point: if the answers to your questions 1 and 2 are both yes, and I'm willing to concede as much, the answer to 3 is to focus on domestic-based solutions, which are far more likely to be effective and politically feasible than international social contracts. Overcoming the forces you emphasize to win sufficient political support behind a genuinely progressive domestic economic agenda will be hard enough. It would be vastly more difficult to accomplish internationally, and with far less potential payoff to workers, if any. I'm just saying we should focus on what's most doable and most likely to improve conditions for workers here -- stuff like health care, infrastructure investment, etc, which also helps our competitive situation. The proposed policies in your first post aren't just politically difficult, they aren't worth the trouble from the standpoint of the benefits they might provide to U.S. workers. --Greg
February 27, 2007 9:31 AM | Reply | Permalink
Greg:
Why is it so easy to make trade deals where the citizens of nation A sells his compatriots down the river, and citizens of nation B do the same to their 'brothers' in nation B?
It's a process that occurs between elites with no 'democratic' input at all.
Changing the mentality of a tiny minority of elites is an insurmountable obstacle, yet getting single payer healthcare is a walk in the park? I don't get it.
February 27, 2007 9:55 AM | Reply | Permalink
On what reasoning or evidence do you base your claim that a new global social contract wouldn't help US workers much?
You yourself admit that globalization is a "very important" contributor to growing inequality and economic insecurity for American workers, and there is plenty of evidence to back up this point.
Richard Freeman, for example, estimated that up to 1/3 of the growth in US wage inequality in the 1980s is attributable to trade, the trade deficit, and immigration. And the problem is only going to get worse.
The problems of American workers are not just domestic, they are global. The policy response must therefore be global as well.
There are analogies to the post-World War II situation here. Then, the problem was to prevent another depression. The answer was, in part, a set of international institutions -- the Bretton Woods system -- to allow nations to run full-employment domestic economic policies with fewer international constraints. The United States underwrote the whole system as the world's "consumer of last resort," committed to rapid growth and free trade to allow Europe and Japan to recover through export-led growth policies.
That paradigm for global economic growth has broken down. The United States cannot continue to borrow forever at current levels to underwrite the export-led growth of Europe and Japan and China and India to boot. We need a new model. There needs to be a re-balancing of the global economy in which Americans save more, produce more, and export more, and the rest of the world consumes more.
This is where your argument that the new equitable global economic growth model that Faux is groping for won't help American workers breaks down. The current growth model is not sustainable. The alternative -- doing nothing on the global front, as you argue -- is almost certainly not more of the same debt-fueled growth. It may well be prolonged economic stagnation and even further increases in inequality and insecurity for American workers. Or worse.
February 27, 2007 10:50 AM | Reply | Permalink
KingElvis, Let me try to communicate my thinking in another way. I think there's a very strong argument to be made that achieving universal health care would do more to strengthen the economic circumstances confronting American families, and the overall condition of the U.S. economy generally, than any other single policy. It certainly would do far more than signing some sort of social compact with Canada and Mexico, or any particular trade agreement -- even a big one with all of the conditions you and Jeff might want. Universal coverage also would help to offset some -- though by no means all -- of the pressures on corporate costs that have been partly responsible for offshoring and stagnant wages. We could argue about that policy question if you want, but I really don't think it's a very close call. (Other steps -- including a tax overhaul -- would also be needed so that average workers would regain their share of productivity growth that has been going instead to corporate profits).
So on the political side of the issue, I think it would be more productive for progressives to focus their limited capital and energy on a debate that occurs entirely within our borders. I'm not at all saying that we shouldn't push for environmental and labor standards when conducting trade negotiations with other countries. But I think it's misplacing priorities, and counterproductive politically, to emphasize trade over health care and other domestic priorities.
By the way, I also think an ambitious public investment program that would strengthen U.S. productivity while providing good jobs would also do more to counteract globalization's effects than international agreements on any terms.
February 27, 2007 11:51 AM | Reply | Permalink
Thanks for the response. I think I understand you better. You're putting it into the world of politics - the 'art of the possible.' However right and true one is (elites screw their own countrymen!), when you get into policy recommendations, you inherently have to descend from an ideal Heaven to a real earth.
To criticize myself, I think you could also say it's counter productive (politically anway) to focus on 'the war on the middle class' of Lou Dobbs fame, since it would likely only antagonize the same elites who, clearly are in complete control of government.
Then again isn't the same 'exploitative' attitude that allows elites to disregard my livelihood going to allow them to disregard my health and crumbling infrastructure?
How are we going to get these same elites on board for a nationalist project of building infrastructure and creating jobs when, by Faux's formulation, they're a 'post national' uber-class that tells workers of the nation it happens to be in "frankly my dear, I don't give a damn."
I will allow, however, that you have to spend your limited resources in the most efficient way possible, and universal health might be that one. As you seem to imply, it might have the possibility of swaying elites because of efficiency arguments, but again I come back to the notion of cosmopolitan uber class who is fine with an uncompetitive US labor market.
Saying all that, it's important not just to lament - you can't just take it lying down - so picking a struggle with a slightly better chance of winning is waranted.
February 27, 2007 12:39 PM | Reply | Permalink
Greg - too bad Clinton didn't hold out on Wall Street and at least get National Health Insurance as a quid pro quo for NAFTA. Instead he gave them NAFTA for nothing and watched them knife health care.
Now you come around thirteen years later and "offer" National Health Insurance INSTEAD OF jobs. Is this history repeating itself as farce?
I understand realism and all, but still, why lead with a pulled punch?
Egalitarianism still matters.
February 27, 2007 6:43 PM | Reply | Permalink
Greg – We’re talking apples and oranges. My proposal is a stab at the problem you say you recognize: global economic elites who are disconnecting themselves from the rest of us, but who dominate Washington policy and have created a global economy with the rules and values of the robber baron era.
Of course we need universal health care, but it is not going to solve the problem of global corporatepower(which is at the core of the question of how to govern the global economy) any more than it is going to solve the problem of global warming. Or Iraq, for that matter. Should we stop thinking about anything else?
We’re not setting next week’s legislative priorities for Nancy Pelosi here. We can, if we try, walk and chew gum at the same time.
February 28, 2007 7:03 AM | Reply | Permalink
No, Jeff, the problem is economic insecurity, stagnant wages, and crappy jobs -- not "global economic elites disconnecting themselves from the rest of us." Your "solution" wouldn't solve much of anything connected to those economic problems. And it wouldn't reconnect global economic elites to the rest of us either, I'm afraid. Best, Greg
February 28, 2007 7:52 AM | Reply | Permalink