Archive for the ‘Jobs’ Category

Proposed Demands for Occupy Wall Street: Jobs for All, Medicare for All, MORE Social Security

January 30, 2012

In a helpful review and constructive critique of the current status of the Occupy movement, Ismael Hossein-Zadeh makes several good suggestions.  And I’ve seen some other comments more recently that seem worth sharing with you, in case you haven’t seen them.  Hossein-Zadeh focuses on proposing demands for the movement, and as I generally agree with that approach, that discussion makes up the bulk of this entry.  But I also cite and quote some other commentaries here, to present a broader set of views to help you make your own assessment.

Here’s how Hossein-Zadeh sums up OWS’ achievement thus far:

Occupy Wall Street (OWS), giving vent to the pent up anger of the 99%, has inspired the people in the United States and other parts of the world to expose capitalism for what it is: a profit-driven system that tends to enrich and empower a tiny minority at the expense of everyone else. The movement has successfully shown how the two-party machine of the US politico-electoral system has increasingly become a charade, as the moneyed 1% is essentially in charge of the government. Regardless of its shortcomings and how it would evolve henceforth, the movement’s achievements have already been truly historical, as it signifies an auspicious awakening of the people and a new spirit to fight the injustice.” 

It would be hard to deny the second observation, that the movement has focused public attention on how the two major parties and the government have come to be dominated by the rich.  But I have some reservations about whether the maldistribution of wealth and power can be attributed to capitalism as such.  It also appears that not all participants in the Occupy movements are against capitalism.  And finally, I’m not sure that replacing capitalism with some other form of economic organization is either possible, or necessary to address the problems raised by the movement.  I’ll expand on those reservations further below.

Commentators, mainstream and otherwise, have proposed that the movement formulate specific demands, or criticized it for not doing so.  Among those defending the absence of specific demands, one of the more thoughtful appeared in this past weekend’s Financial Times:

“The most prevalent criticism of the Occupy movement in the media is that it lacks a clear agenda or programme.  This misses the point.  What Ocupy is doing primarily is opening up a space – which you might call the space of deliberative democracy – as a necessary counterpoint to the often over-managed and media-controlled routines of official politics.  What will fill that space cannot, by definition, be decided in advance.”  Harry Eyres, “A Vital Space to Occupy,” FT January 28/29, 2012, Life & Arts p. 22, which I think you can access without a subscription at

On the other hand, just a few days earlier, three members of the economics working group at Occupy London in fact suggested several issue areas to focus on:  Tax policy, the housing shortage, and income inequality.  See their discussion at (David Dewhurst, Peter Dombi, and Naomi Colvin, “How Hayek helped us to find capitalism’s flaws,” FT, January 25, 2012).

And, there are several useful pieces in the February 2012 issue of Z Magazine, including this comment from Kevin Zeese  of Occupy Washington, DC on a major tactical issue that has bedeviled the movement:

“When we were organizing Occupy Washington, DC before Wall Street began, we were in conversations with movements around the world.  The Spanish indignados told us that an occupation should last no more than two weeks.  After that it becomes a diversion from the political objectives.  This has been experienced by occupiers around the country.

“Occupying for a short time accomplishes many of the objectives of holding public space – the political dialogue is affected, people are mobilized, and people can see that fellow citizens can effectively challenge the corporate state.  Staying for a lengthy period continues to deepen these goals, but the impacts are more limited and the costs get higher.”

As a subscriber, I’ve just read Kevin’s article on the goal of Occupy and several others, including one by Andy Kroll on how the 99% won a major victory in Ohio, and another by Frederick Nagel on electoral politics and OWS, in my hard copy of the February 2012 issue, but I believe selected articles from that issue will soon become available online.  Check at

Because I think the organizing impact of Occupy is its most important achievement so far, I repeat here my own assessment, from my December 2011 blog entry:

“To me, the most profound gift and achievement of Occupy Wall Street thus far is that it has catalyzed organizing for a better world.  Organizing is, after all, most fundamentally the development of common understandings and relationships of trust that enable people to act collectively to further their common interests.  From this perspective, OWS is already a success (if still only a beginning), in that it has changed the terms of popular discourse, and developed common understandings and relationships of trust, both by its actions and by the success of those actions in shining a spotlight that couldn’t be ignored on the maldistribution of wealth, income and power in our country.  And I think such organizing is not only critically important but perhaps the only possible answer to the seemingly intractable problems of our time.  We apparently face simultaneous climate change, resource depletion, and economic collapse, together with elites of wealth and power in control of a political and propaganda apparatus that makes addressing any of these problems, or even recognizing them, even more difficult than it would otherwise be.  I have worried that the situation could degenerate into chaos, a war of each against all.  The Occupy movement(s) can’t solve all of these problems, but perhaps by bringing back an emphasis and focus on the common good, they can contribute very substantially to easing the transition out of the world we know to the one that is emerging.  Maybe we can face the future helping one another, and producing and sharing the means of survival and community, in the spirit of the Occupations, rather than fighting over scraps that are inadequate, in any event, to go around.”

In the context of the all but hopeless situation we seemingly faced last fall, these achievements are truly monumental.  But to build on this beginning, where does the movement go from here?

Hossein-Zadeh discusses three major criticisms that have been made of OWS: (1) the vagueness of its demands and lack of a program for change; (2) lack or insufficient mobilization of working people; and (3) reluctance to organize and coordinate nationally.  After a very informative and useful discussion of these points, he concludes,

“The Occupy movement seems to be at a crossroads. It may continue with the self-imposed policy of ‘no leadership,’ ‘no program,’ ‘no organization’; limit itself to sporadic protest and occupation activities around general goals such as peace, democracy and social justice—and quite likely witness its gradual decline. Or it could grow and become a true vehicle for meaningful changes in favor of the 99% by making specific winnable demands, by communicating with and organizing the broader layers of the working people around such demands, and by building a nationwide political organization of, by and for the 99% with its own candidates for public office.”

Specific, Winnable Demands:  Jobs for All, Medicare for All, MORE & BETTER Social Security

As the collection of articles in Z and the piece in FT by Occupy London participants indicate, at least some Occupiers are willing to formulate demands, and are not averse to involvement in electoral politics.  My focus here is what the most useful demands might be in the context of US politics, society and culture, both for their own sake and as organizing vehicles.  As daunting as the task may seem, I think Hossein-Zadeh has come up with a very promising and simple program, with which I generally agree, in suggesting that the movement demand “jobs for all,” “Medicare for All,” and “no cuts in Social Security.”  At one point he formulates the healthcare demand, as “affordable healthcare for all.”  And his third demand is to “save Social Security.”  Since how we formulate or phrase things matters, I propose that we stick with “Medicare for all” as the healthcare demand, and that we work to INCREASE AND EXPAND rather than merely “save” Social Security.

I understand these demands “are more radical than the Democrats can stomach, but make some Occupiers yawn.”  Shamus Cooke, “Reform vs. Revolution Within Occupy,”  I have the summer and fall issues of Adbusters.  (If you don’t, you may want to get them:  Adbusters is the Canadian magazine that has been credited with catalyzing the initial Occupation of Wall Street last fall).  I know that underlying some of the motivation to Occupy Wall Street is a profound disillusionment with consumerism and other attitudes and ways of life that have become dominant or at least widespread in our culture, but that not only fail to satisfy but indeed frustrate our ultimate and deepest needs and desires, and are destroying the biosphere, and with it the possibility of continuing life in any form remotely similar to what we now have, or have known.  It is to the resumption of that debt-driven consumerist way of life that the actions of the Obama administration  and the Fed are directed.  And I believe that the resurrection of that way of life, if it can be effected (though I don’t think it can), would renew and speed up that process of destruction, which has been slowed somewhat by the economic crisis.  So there are many who say we need more than “just” jobs, healthcare, and a good social safety net.  And they’re right.

And yet, “only a truly mass movement of working people has the potential to achieve the various [as yet inchoate] demands of the Occupy movement.”  [Shamus Cook’s article, above.]  To me, anything that buys time, by forestalling the dissolution of existing institutions – the good with the bad – and the possible descent into chaos, has the potential to broaden the base of resistance and allow time and room for creation of the conditions for continuing civility and civilized life, of community.  So the demands that may bore some people – jobs, Medicare, and MORE Social Security – which provides not only retirement security but aid to younger people with disabilities, by the way  – are eminently sensible and appealing to me.  A people that has united and mobilized to achieve such demands would be better informed and empowered and in a better position to achieve more fundamental change, while people who are struggling for the means of sustenance can’t even think about such things.  And if we add to my trio the demand that these things be paid for by taxing Wall Street, large corporations and the rich and substantially dismantling the war machine, we have the makings of a comprehensive program with enormous appeal to, if not the entire 99%, at least substantial majorities for each component and for the program as a whole.  So with that prelude, let’s take a look at Hossein-Zadeh’s suggestions in more detail.

“Jobs for all” speaks for itself and is pretty hard to misinterpret or confuse, and we have ample historical examples and precedent in the Works Progress Administration, Civilian Conservation Corps, and other New Deal programs.

I would shy away from formulating a demand as “affordable healthcare for all,” though, because the opposition and even many people in favor of the general idea may argue that there are many ways in which it might be fulfilled.  Some even argue that we already have affordable healthcare for all (based on the availability of emergency rooms).  Okay, I know that’s crazy, and cruel, but it’s what some people think, and argue.  And it’s important to Simplify, Simplify, and – did I mention the importance of simplicity?  Partly because there are devils waiting in the wings to kill any good social program with details, and anyway, in simplicity there is clarity.  So I would demand “Medicare for all,” because that demand is based on a specific, existing program, and expanding it to include everyone is the simplest way to meet the demand without risking confusion over the details, which are already practiced by the existing Medicare program.

Similarly, I would not formulate the third demand as “save Social Security,” because there are many ways in which that might be done, including by cutting benefits and increasing the eligibility age, both of which have been proposed by people whose real goal is ultimately to gut the program.  I would formulate the third demand as, “MORE Social Security,” by which I mean, EXPAND the program to lower the retirement age and increase benefits.  This would not only directly help a great many people, but would be a useful stimulant to the macro-economy.  More detail is available from Steven Hill, “Don’t Cut Social Security, DOUBLE It,” and Joshua Holland, “We’re Being Conned on Social Security – How We Could Easily Raise Benefits or Allow People to Retire Earlier,”–_how_we_could_easily_raise_benefits_or_allow_people_to_retire_earlier?page=entire.   Demanding MORE Social Security also has the advantage of seizing the initiative, playing offense instead of defense, and combining clarity with simplicity.

Why the Resistance from Occupy Wall Street?

Hossein-Zadeh gives an example of an effort to have a practical demand adopted by OWN.  On December 18, 2011, the “Demands Working Group” proposed the following demand to the New York City General Assembly:

“JOBS FOR ALL—A Massive Public Works and Public Service Program:

“We demand a democratically-controlled public works and public service program, with direct government employment, to create 25 million new jobs at good union wages. The new jobs will go to meeting the needs of the 99%, including education, healthcare, housing, mass transit, and clean energy. The program will be funded by raising taxes on the rich and corporations and by ending all U.S. wars. Employment in the program will be open to all, regardless of immigration status or criminal record” [6. “Proposal for Sunday, 12/18, General Assembly: Jobs for All – Demands Working Group”:].

Hossein-Zadeh reports that this Proposal did not pass the General Assembly.  I don’t know how I could determine why it didn’t, and in any case have not had time to try, but the fact certainly gives one pause.  I suggested above some reasons why the demands I’m advocating here might make some Occupiers yawn, and reflect a bit further here on some of the possibilities.  These thoughts go not just to rejection of the above Proposal by the General Assembly in NYC, but also to some other issues my proposed demands might raise.

I can only speculate, but perhaps OWS might be reluctant to endorse demands favoring Medicare or Social Security in part because of the relative youth of many of its participants.  Although I know it’s something of an obsession even for many young people now, and catastrophic medical problems can certainly strike at any age, at least in my own early twenties I was not terribly concerned about medical insurance, let alone retirement income, and many young people (and others of all ages) have been deceived (by a very well organized propaganda campaign) into thinking that Social Security can’t possibly last, and won’t be available to them in their later years.  And it’s understandable that people concerned about getting a job in this impossible market and putting food on the table, and perhaps paying off student loans in the process, would have a hard time focusing on their retirement income.  All I can say is that as organizing tools, and as practical and realistic demands, I respectfully recommend the three-part focus on jobs, healthcare, and security in old age, formulated as “Jobs for All,” “Medicare for All,” and “MORE Social Security.”

These three demands, and the demand that they be paid for by taxing Wall Street, large corporations, and the rich, and by dismantling much of the war machine, have several great things in common.  As poll after poll has shown, they are, or have the potential to be, enormously popular with the great mass of the public.  Each would give a much-needed helping hand to millions of people in need, while also stimulating the economy as a whole, so the total benefit would be even greater than the sum of its parts.  And together they would promote both the reality of the common good and the underlying idea that we should care about and for one another, that we have interests in common that we can and should address collectively, through government as well as other forms of social organization. That we need not and should not be engaged in a perpetual war of each against all. That core idea, along with the living standards of the 99%, has been under relentless attack for several decades now, and each of the proposed demands is a blockbuster defense.  Simply by demanding that Social Security be DOUBLED, OWS could transform the debate on that subject, putting advocates of cuts on the defensive and focusing attention on the benefits of the program, and the ease of expanding and strengthening it.

Regarding the relentless attack on the common good that has been going on for at least 30 years, a very good overview is in Bill Moyers’ January 13, 2012 interview, “Jacob Hacker and Paul Pierson on Engineered Inequality,” vimeo and transcript both available at  I also recommend my Financial & Economic Crisis: An Assessment and Action Plan (, for an analysis of the problem and some rudimentary suggestions as to how we might transition to a new and sustainable economy.

To Vote, or Not To Vote?

So what is to be done in order to implement these demands?  The recent, amazing and successful lobbying effort to stave off repressive regulation of the internet shows that even without taking to the streets, it’s possible for people to mobilize and defeat powerful forces.  And the Occupy movement has shown that taking to the streets can also be effective, at least up to a (very important) point.  But some people who want fundamental, compassionate change, perhaps including many Occupiers, may balk at the idea that we should vote at all, let alone try to run candidates for office and build a political machine or party to do so.  Chris Hedges stands out, at least in my mind, as one of those who argue that the ballot box is useless and nothing but direct action is meaningful in the present crisis.  But as I’ve argued before, and as Noam Chomsky frequently points out,

“[W]e do still have enormous freedom to agitate, organize, protest and struggle for change. The ballot box isn’t useless, it just isn’t being used nearly enough. But we still have it. And for its use to be more effective, we need a great many more people who recognize our real problems and demand that our political structures and players address them. It isn’t yet quite true, as Leonard Cohen said so long ago, that ‘the cities they are broke in half, and the middlemen are gone.’ So ‘let me ask you one more time, O children of the dust: All these hunters who are shrieking now, do they speak for us?’

“But it won’t be enough to ask just one more time. We need to keep asking, nagging, agitating, informing, sharing information and analysis – in a word, organizing – to build a sufficient and sustained opposition to the evils of our time, and to regain and defend the commons and the common good.”

To say that we should mobilize at the ballot box is not to say that a new party needs to be built from scratch.  That is one option, but there are also several organizations working to build alternative political parties – check them out.  There are also organizations working to reform the Democratic Party.  Daunting or perhaps hopeless as that task may appear, I still take some encouragement from the work of Progressive Democrats of America, which works both inside and outside the Democratic Party, and endorses a very limited list of candidates.  For my money – or vote – it would be hard to beat, as a candidate, Elizabeth Warren, now running for the US Senate from Massachusetts.  I mention these details to illustrate the alternatives, but my basic point is, as  Hossein-Zadeh suggests, there is nothing quite so effective to pressure an officeholder as an alternative candidate running or threatening to run against him or her.  So it seems, well, quixotic to eschew the electoral process in favor of exclusively street actions, for the same reasons it seems inadvisable to refrain from formulating any specific demands.

A footnote to the discussion:  What about capitalism?

I understand many participants in OWS consider capitalism as intrinsically flawed, and believe at least some would demand some sort of revolutionary restructuring of our economy and society.  Personally, I’m not sure an economic system has yet been devised which is not in some sense flawed or at least, subject to abuse by those in power.  I understand there are people who think having government do just about anything is “socialism.”  But that deprives the word of useful meaning.  If socialism is defined as public/government ownership of the means of production, I don’t see it as a solution to all the problems created by our current economic system.  I actually think the ultimate answer lies in the direction of decentralized, more walkable communities, with more participatory forms of government than we now have, and that might be more practical on a small-scale, local or regional basis.  But how do we get there from here?  I would favor a nonviolent, incremental or evolutionary approach to a restructured economy, with the details necessarily emerging gradually over time.  I tried to at least hint at some of the directions such a restructuring might take toward the end of my paper on the Financial & Economic Crisis,

In any case, to me, power is the key variable, and the ultimate problem is its unfair or repressive exercise.  “Power corrupts; absolute power corrupts absolutely.”  So I think the fundamental problem we face now arises from the concentration of power and its inevitably repressive exercise, and the failure of the 99% thus far to confront and resist it effectively.  And so the answer, for me, lies in developing and exercising the political will to restructure the economy, and in organizing to make that possible.

On a longer-term, evolutionary basis, greater decentralization seems both desirable and inevitable.  And the more organized we are, the more smoothly that evolution can take place, and the more humane and compassionate the outcome can be.

But to the extent it makes sense to address problems on a national level, I propose that we demand jobs for all, Medicare for all, and MORE Social Security.  And doing so does not require, and need not await, the overthrow of capitalism as such.  In fact, as one who grew up in the Fifties and Sixties of twentieth century US, I think fondly of the so-called “mixed” economy, with a relatively progressive tax structure, a smaller and controllable financial sector, and a limited welfare state, that we had then.  It’s the dismantling of the domestic safety net built by FDR and LBJ and the movements that pressured them that has led us to the present pass, and the deregulation of the financial and other key sectors, by Bill Clinton’s repeal of Glass-Steagall as much as anything else, that have pushed us to, if not quite yet over, the brink.  Interestingly, I find a useful statement on this topic in a recent Financial Times editorial, “Ruling capitalism”:

“By capitalism, we mean well-regulated free-enterprise economies – systems where resources are governed mostly by the responsible choices of private individuals, within ground rules that are clear, consistent and immune from bias in favor of any special interest.  …

“The excesses that drove the bubble and the breakdown that followed happened because leaders forgot that free enterprise requires rules.  When some people benefit not from bringing useful products to market but stopping others from doing so; when some takes risks from which they reap the gains but others face the losses; when many are deprived of opportunities to make their way in the job market – that is not capitalism but an economy captured by cliques.”  FT, January 27, 2012.

Personally I find the FT’s view of capitalism somewhat utopian, or perhaps I should say naïve, in that the editors seem to believe the system can be made to work fairly toward the common good by the adoption of proper rules by the leadership and the exercise of moral values by capitalists themselves.  While Adam Smith certainly recognized and indeed assumed the key role morality should play in an economic system, it seems clear that the control of capitalist excesses requires, in addition, the exercise of political control by an organized people.  But making capitalism function humanely seems to me ultimately to present no more of a problem than we might encounter with any economic system.

So where do we go from here?  National Organization and Coordination?  A Solidarity Social Forum in Olympia

Hossein-Zadeh usefully discusses the promise of national organization and coordination in his article, at pp. 4-6, and I have nothing to add here to that discussion, at  (  There are both strengths and weaknesses in a decentralized movement.  But as for what comes next, in case you haven’t already heard, the Alliance for Global Justice, fiscal sponsor of OWS, has announced a Social Forum to be hosted by Occupy Olympia (WA) and held in Olympia this February 18-19.  For details, check in with the Alliance at, and see  Then spread the word!

Are We Already In the Second Great — Or the Even Greater — Depression?

June 6, 2011

A rash of depressing data on the US economy culminated last week in a terrible report Friday on jobs creation. The best analysis I’ve seen is Mike Whitney’s weekend piece on the CounterPunch site, reproduced below. I differ with Whitney in a key respect: While his analysis speaks in conventional terms of the need for stimulus and the consequences of the government not providing it, I think it matters greatly what form such stimulus might take.

There was a point when anything that stimulated economic activity would have helped. The image is sometimes used of dropping cash from helicopters to stimulate spending. That’s been done, but the helicopters all dropped their loads in the Wall Street area, and now so much has been spent that it would be reckless to have further stimulus that did not take into account the need for sustainability. That topic is covered in my paper (click on the Financial & Economic Crisis report) of May 2009.

There are no jobs because we’ve exported them all (as Paul Craig Roberts analyzed in a lengthy article on CounterPunch this past week) and the wages of what jobs remain have been stagnant for going on thirty years and without money to spend consumers can’t revive the economy. My piece and others have dealt with the deeper issue that we need a new economy and James Howard Kunstler’s commentary week before last had an especially incisive summary of some things that could be done:

One way to think about it is to stop using the word “growth” and substitute the term “economic activity.” There are lots of useful things we can do to rearrange daily life in the USA that would put people to work, but they would tend to defy the status quo. We could recognize that peak oil means that we have to grow our food differently and make local agriculture a more up-front piece of the economy. We could rebuild the railroads so that people don’t have to drive everywhere. We could rebuild our inland ports to move more bulk freight on boats. Notice these are very straightforward activities, unlike the manipulation of financial paper and markets. We’re not interested in focusing on agriculture and transport reform. Business and political interests are arrayed against changing anything. Something’s got to give.

With that qualification, here is Mike Whitney’s excellent summary of the current situation:

Policymakers Have Made Another Depression Unavoidable
Down, Down, Down

Equities markets have been battered all week by bad economic data sending investors piling into “risk free” Treasuries. The Dow Jones slipped 276 points on Wednesday followed by a 41 point loss on Thursday. The benchmark 10-year Treasury has ducked below 3 percent repeatedly signally a slowdown that could lead to another recession.

On Wednesday, the S&P/CaseShiller home price index confirmed that 5-year long housing crash was still gaining pace. Home prices have fallen to their lowest level in 8 years with no end in sight. Meanwhile the Chicago Manufacturing Gauge recorded its biggest decline in 2.5 years while factory orders dropped in April by the most since May, 2010. There was also bad news on the unemployment front where privately-owned businesses hired only 38,000 workers from April to May, nearly 100,000 less jobs than analysts had predicted. Also, consumer confidence fell to its lowest reading in six months.

So, housing, manufacturing, unemployment and consumer confidence are all down, down, down and down.

Friday’s unemployment report was also worse than expected. The Bureau of Labor Statistics (BLS) reported that unemployment rose to 9.1 percent while the Labor Force Participation Rate remained stuck at 64.2%, well below the normal rate of 67%. According to Calculated Risk, “The current employment recession is by far the worst recession since WWII in percentage terms…(The BLS report) was well below expectations for payroll jobs, and the unemployment rate was higher than expected.”

So, no new jobs are being created and the economy is quickly decelerating. It’s all bad.

On Friday, the chairman of RIT Capital Partners Jacob Rothschild issued a warning about the fragility of world markets and the bleak prospects for future growth. He said,
“The risks ahead are glaring and global. It is likely that the withdrawal of the fiscal and monetary stimuli which will surely come soon will have an impact on global growth. Indeed there is already evidence of some slowing down.”

Commodities have already been walloped, but the real carnage is yet to come. This is from Bloomberg:
“Commodities plunged yesterday as investors accelerated sales following year-to-date gains through April of more than 23 percent for silver, oil, gasoline and coffee. The Standard & Poor’s GSCI index of 24 commodities sank 6.5 percent in the biggest one-day drop since January 2009, bringing its loss this week to 9.9 percent.
“It was a train wreck waiting to happen,” Michael Mullaney, portfolio manager at Boston-based Fiduciary Trust, said in a telephone interview. Speculation drove commodity prices well above reasonable levels, “and we are going to see it shake out some more before we get back to normal prices,” said Mullaney, who helps manage $9.5 billion.”

Even a whiff of deflation will send commodities tumbling, which is why investors should be worried about the recent data. The economy is quickly losing steam and troubles in China, Japan and the eurozone have only added to the uncertainty. According to Bloomberg:
“A ‘sudden’ slowdown in China may lead commodity prices to fall as much as 75 percent from current levels, Standard & Poor’s said.

“Unexpected shifts in government policies or problems in the banking sector may trigger such a slowdown, S&P said in a report e-mailed today…..”Given the extent to which China has bolstered commodity prices, that’s something that we have to be concerned about,” S&P analyst Scott Sprinzen said by telephone from New York.”…..(Bloomberg)

The fact that 10-year Treasuries have dipped below 3 percent should also be of concern, because it’s an indication that the policy is wrong. This is the real problem. When investors are still so scared that they’re still loading up on “risk free” assets a full 3 years after the crisis began, then something is fundamentally wrong. The 10-year is saying quite clearly, “Whatever you are doing is not working, so stop it.”

The Fed’s bond buying program (QE2) has done nothing to increase activity, lower unemployment, stimulate growth, restore confidence or expand credit. It has been the biggest policy bust in Fed history, and now the economy is slipping back into a coma.

Remember, the economy is not a sentient being. It does not consider whether a policy is good or bad. Like any system it merely responds to input. If spending increases, incomes will increase, demand will increase, employment will increase and the economy will grow.

Conversely, contractionary policies are contractionary. This is something the deficit hawks don’t seem to grasp. If you slash government spending, lay off workers, and trim the deficits, then spending will slow, incomes will shrivel, GDP will wither, and the economy will slip back into recession. In other words, if you take steps to shrink the economy, then the economy will shrink. This is why the economy has lost momentum, because congress and the White House have cut the blood flow of stimulus to the patient, so now we are headed back into ICU.

The Republican mantra, “job killing stimulus” is … idiocy squared. The economy needs stimulus because stimulus IS spending…government spending. And, as we noted earlier, the economy does not care “who spends”; it merely responds to input. And the input that’s needed now is more spending. Government spending will do just fine.

Consumers are still deleveraging from the losses they sustained during the financial crisis, so they’ve cut back on their borrowing and spending. This creates a problem, because consumer spending represents 70% of GDP. So if consumers don’t load up on debt again, there will be no recovery. (Every recovery since WW2 has been the result of a credit expansion.) This is why Fed chairman Bernanke has tried to induce more borrowing by lowering rates to zero and buying US Treasuries from the banks (which, in effect, creates negative interest rates) But it hasn’t worked. Negative rates have not sparked another credit expansion because there are times when people will not borrow regardless of the rates or the inducements. John Maynard Keynes figured this out more than 80 years ago, but Bernanke has “unlearned” the lessons of the past. As a result, we are headed for another slump.

Consumers aren’t spending, businesses aren’t investing, and credit is not expanding. At the same time, state and federal governments are trimming budgets and laying off workers. So, all the main players are cutting, cutting, cutting. Naturally, the economy has responded in kind; housing prices are falling, unemployment is rising, manufacturing is stalling and consumer confidence is dropping.

There’s nothing here that should surprise us. We are headed into a Depression because policymakers have made another Depression unavoidable. A policy-driven Depression is different than a financial crisis. It is a matter of choice. It means that the objectives of the people who control the system are different than our own. There are those who will benefit from another severe downturn, but most of us will only needlessly suffer.

Restoring Food and Trade Sovereignty at Home and Abroad

March 5, 2011

Restoring Food and Trade Sovereignty at Home and Abroad (Organized by Samantha Chirillo) (LAW 142). Public Interest Environmental Law Conference, March 3-6, 2011. U.S. farm and trade policies have caused the loss of food security at home and abroad. Although the problem started during the Great Depression, U.S. farm policy since the 1950s and more recent ‘free trade’ agreements have subsidized petrochemical-intensive agribusiness, reduced the demand for and price of local food, and forced many family farmers out of business while disempowering communities. Grassroots efforts to rebuild community food systems and pass comprehensive trade reform (the TRADE Act) are making headway.

Panelists: Sarah Kleeger, Open Oak Farm, Adaptive Seeds, Southern Willamette Valley Bean & Grain Project; Mary Ann Jasper, Sales and Distribution Coordinator, Stalford Farms; Willamette Seed & Grain, LLC, Corvallis Sustainability Coalition’s Local 6 Food Action team; Robert Roth, Founding Member, Lane County Fair Trade Campaign.

A Statement of the Problem
By Robert Roth – March 6, 2011

  • What I have to say today is at the edge of my own understanding.  I’ve been paying attention to trade policy for years, but only recently made the connection with domestic US farm policy.  This talk is not a definitive analysis, but a starting point.  I will post my notes for this talk and a brief list of references and resource on my blog.
  • I enforced what has been called the law of deception, prosecuted fraud, for about 20 years.  Forest is this:  Both “farm policy” and “trade policy” are marketing terms, and forms of deception – real purpose & effect is to make as much money as possible as quickly as possible for people who already have too much.  As collateral damage, industrial agriculture and unfair trade policies are destroying the biosphere.
  • The food-related problems we have, both in agriculture & trade, are a direct result of government policy essentially dictated by agribusiness and multinational corporations.  So we need to pay attention to the US Farm Bill and to trade policy, if we’re to repair the world, continue to eat, and perhaps, avoid the civil unrest and violence that can occur when too many people find themselves unemployed and without access to food.
  • About a billion people are chronically hungry.  It’s been suggested the blow-ups in the Middle East, although they have many causes, were triggered by high unemployment and new food price hikes.  And people have spoken of those blow-ups as conceivably triggering WW III.  Resource wars at any rate appear increasingly likely.
  • How did we get here?  US farm policy since roughly end of WWII has not only ravaged the soil and water but driven millions of small & mid-sized farms out of business, concentrating control in the hands of agribusiness corporations.
  • Beginning late 20th century, trade agreements globalized this process, decimating the farming sectors of poorer countries & forcing newly impoverished farmers & farm workers to migrate for survival.  Globally, 17 corporations now control the bulk of food production.
  • We face resource depletion, climate change, & economic collapse, all pretty much at once.  Policy-makers are doing everything possible to avoid or slow down the economic collapse (“massive campaign to sustain the unsustainable” – Jim K.) & these measures are accelerating resource depletion and climate change.  But part of the problem they’re not addressing is that in the US, there are no longer enough living-wage jobs to sustain the economy.
  • It seems possible we face a comprehensive system breakdown.  But if so, I have no sense of how long that might take, and suspect that if it does occur, it will take longer than some of us expect.  In the meantime, we can help the economic situation and create sustainable jobs, while at the same time addressing some of the threats to the biosphere, by addressing the problems of industrial agriculture.
  • [When I was in grammar school – 1950s – current events newsletter said we could feed 25 billion people with the new chemical farming methods.  Hasn’t worked out that way.  (Where did that newsletter come from?  System for the indoctrination of the young. – Dewey)]
  • So, restoring food security & trade sovereignty requires that we address the farm Bill – next one is due in 2012 – & stand current trade policy on its head.
  • Real beginning of the problem, per Bob Jensen interview with Wes Jackson, “Future Farming”:

About 10,000 years ago humans moved from gathering/hunting to agriculture, tapping into the first major pool of energy-rich carbon — the soil. … Humans went on to exploit the carbon of the forests, coal, oil, and natural gas. But through all that, we’ve continued to practice agriculture that led to soil erosion beyond natural replacement levels. That’s the basic problem of agriculture.

[In addition to] soil loss, the industrialization of agriculture has given us pollution by toxic chemicals, now … present in our farmlands and streams. We have less soil, and it is more degraded. We’ve masked that for years through the use of petrochemicals … . But that “solution” is … in fact part of the problem. There are no technological substitutes for healthy soil and no miraculous technological fixes for the problem of agriculture. We need to move past the industrial model and adopt an ecological model.

  • We need a whole new system of food production, with less chemically dependent agribusiness and much more locally based, smaller-scale, more labor-intensive, and sustainable farming.  Jackson & Wendell Berry call for a “50-year farm bill” – op ed in NYT Jan. 2009.
  • BTW, agriculture also led to a further set of problems: it made possible cities, with centralized, hierarchical control by power elites and the concentration & maldistribution of wealth.  These problems have characterized much of human history and are still with us.  Useful to note the continuity.
  • Fast forward to European colonization of the Americas (as described by Mark Ritchie & Kevin Ristau, “Crisis By Design: A Brief Review of US Farm Policy” (1987):

From the earliest days of European colonization, America’s commercial agriculture … was dominated by large-scale [operations, including] the slave plantations of the South, huge Spanish haciendas in the Southwest, and the bonanza wheat and cattle farms of the West….[most] in the hands of wealthy individuals or foreign investors.  By the mid-1800s…the federal government [had established] policies putting family farmers on much of the land….But…farm families…[immediately] found themselves caught in a classic cost/price squeeze.  Skyrocketing prices for [items such as] seeds, credit, and transportation could not be covered by the prices the grain monopolies were willing to pay for their crops.  Freight rates were controlled by the railroads, while interest rates were set by the big city banks.  [There was a] series of rural depressions and panics in the late 1800s and early 1900s….[F]amily farmers organized political movements…[and federal legislation to fix their problems] was passed by Congress three times, but vetoed twice by Pres. Coolidge and once by Pres. Hoover.

  • Then came the New Deal.  Production controls, price supports, farm credit.  A national grain reserve.  “Public utility” model.
  • But stabilizing prices hurt grain speculators, who thrive on price volatility, and supply management reduced farm acreage, cutting sales of pesticides and fertilizers sold by farm chemical & oil companies.
  • Grain corporations thrive on high volume, low-prices, as they can store food, buy low & sell high, which smaller farmers don’t have the resources to do.  1940s-50s – powerful interests manipulated policy, set prices below cost of production.
  • Total # of farms in the US: 6.5 m./1935→2.05 m. 1997, with most of the decline among family farms.
  • Big corporations also manipulate subsidies: under “Freedom to Farm” Act, 1996-98, top 1% of subsidy recipients got avg. $249,000; top 10% got 61% of $$.
  • Oregon received over $1.5bn. in federal farm subsidies 1995-2009; but it all went to 13% of the state’s farms.  87% got nothing.
  • Policy also favors agricultural products geared for export.  Willamette Valley went from relative food sufficiency 50 years ago, when it was a major canning center, to specializing in grass seed production & importing 95% of our food.
  • So-called “free trade” agreements globalized this process, as big subsidized operations drove smaller local farms out of business throughout the world.
  • E.g., Mexico used to subsidize small farmers.  NAFTA required that Mexico stop those subsidies and credit programs.  But under US farm policy, the federal government here still gives billions in subsidies to big agribusinesses, which can thus sell corn in Mexico for less than it costs to grow.
  • This arrangement drove over one million small Mexican farmers out of business.  Nearly seven million farm workers became unemployed.  Many came here.
  • At the same time, trade agreements cause job losses among the people already living here.  At least ten thousand Oregon jobs were lost in 2009 due to trade agreements.  This causes tension between current residents and newly arriving immigrants.
  • Part of a solution:  reorient US farm policy toward support for smaller farms.
  • As James Howard Kunstler, author of The Long Emergency, wrote in May 2009:  There’s no way we can continue the petro-agriculture system of farming. … President Obama and Ag Secretary Vilsack have not given a hint that they understand the gravity of the situation. … [But it] happens to be one of the few problems we face that public policy could affect sharply and broadly — if we underwrote the reactivation of smaller, local farm operations instead of shoveling money to giant “agribusiness” (or Citibank, or Goldman Sachs, or AIG…).
  • Wes Jackson interviewed by Bob Jensen:  [P]rotecting the soil is not only an ecological imperative but an opportunity for positive economic and cultural change as well. The proposals we’re discussing would increase employment opportunities in agriculture — sustainable farming will require more “eyes per acre,” and replacing fossil-fuel energy with human energy and ecological knowledge makes good economic sense.
  • [Right now, globally, 70 percent of food is grown on farms less than 2 hectares (4 acres) in size, tended in large part by women.]
  • 2008 Farm Bill perpetuated market deregulation and volatility.  But the Institute for Agriculture and Trade Policy found small gains for local food system support (Farmers Market Promotion Program), support for beginning farms & ranchers, and for organic agriculture.  But the Institute concluded, the bill did nothing to address the larger problems.  For starters, we should re-establish a publicly-held grain reserve and stronger antitrust enforcement.

On trade policy, the TRADE Act would have existing trade deals renegotiated, and require consideration of consumer, environmental, labor and other protections in future pacts.  But Obama is instead pushing a NAFTA-style deal with Korea.  So the next step for us is to defeat the Korea Free Trade Agreement.  Ron Wyden chairs a Senate subcommittee that could help a lot to achieve that result.  Call and ask him to do so, and to sponsor comprehensive trade reform like the TRADE Act from the last Congress.   If you live outside of Oregon, please contact your own Senators and Congressional Representative with that message.

Selected Bibliography & Resources

Allen, Will, Kate Duesterberg and Ronnie Cummins, “The Real Gold Standard: Local and Organic Food and Farming,”

Anderson, Cassandra, “Monsanto Shifts ALL Liability to Farmers,” February 21, 2011,

Astyk, Sharon, “Are We Seeing the Early Signs of a Seed Availability Crisis?”, Casaubon’s Book website, December 11, 2008.

CounterPunch website,; on the economic and financial crises, articles by Mike Whitney, Pam Martens, Michael Hudson and others; and anything by James K. Galbraith, Simon Johnson, Robert Pollin, Robert Reich.

Cummings, Ronnie, “How Industry Giants Are Undermining the Organic Movement: The Organic Monopoly and the Myth of ‘Natural’ Foods,”

Devinder Sharma’s ZSpace Page, “Caught In The Food Pirates’ Trap,” March 1, 2011.

Gray, Heather, and K. Rashid Nuri, “Witnessing a Shift in the Worldview of Agriculture: How Organic Agriculture Can Feed the World,”

Hansen-Kuhn, Karen, “Making US Trade Policy Serve Global Food Security Goals,” Institute for Agriculture and Trade Policy, January 2011.

Harkness, Jim, “Is Famine the New Normal,” Policy Innovations, a publication of the Carnegie Council, February 17, 2011.

Institute for Agriculture and Trade Policy,; Communications, Ben Lilliston, (612) 870-3416,; see esp., “Farm Bill Perpetuates Market Deregulation and Volatility” (press release), May 13, 2008; see also, January 07, 2011 press release, “Health leaders call for healthy Farm Bill,” and

Jensen, Robert, “An Interview with Wes Jackson: Future Farming,”

Mazzei, Umberto, “International Speculation and Rising Food Prices,”

Murphy, Sophia, “Concentrated Market Power and Agricultural Trade,” Ecofair Trade Dialogue Discussion Papers, No. 1/August 2006/English Version.

Public Citizen’s Global Trade Watch,, Oregon Fair Trade Campaign,, and Alliance for Global Justice,, on trade policy and issues.

Ritchie, Mark, & Kevin Ristau, “Crisis By Design: A Brief Review of US Farm Policy,” League of Rural Voters Education Project (1987).

Roth, Robert, “The Financial and Economic Crisis: An Assessment and Action Plan,” May 18, 2009, accessible at (see Pages).

Seattle Farm Bill Principles, Supporting Healthy Farms, Food and People, Guidance for the 2012 Farm Bill,

Willoughby, Robin, “Good for Farmers? The World Seed Conference,”

Stop the Third Worldization of the United States and Advance Global Justice – Take Action Now For Comprehensive Trade Reform!

September 16, 2010

Over the last 15 years the United States has entered into a number of treaties that have been called “free trade agreements.” In fact, these deals are not really free, and they’re unfair. They manipulate the rules of trade to benefit large corporations and investors at the expense of small farmers and other working people. They allow consumer, food safety, environmental, labor, and other laws to be attacked as interference with profitable trade. They have also undermined the U.S. economy by facilitating and encouraging the outsourcing and off-shoring of millions of jobs. In Oregon alone, some 10,000 jobs were lost to trade in a recent 12-month period. That number is almost certainly low because it includes only workers who have applied for and received Trade Adjustment Assistance. On a broader scale, from 2001-2006, one in six US manufacturing jobs, 2.9 million in all, were lost. (Charles McMillion, “New analysis of US job market: Jan. ’01 to Jan. ’06 — jobs lost in almost every industry that faces outsourcing or import competition,” February 9, 2006) ( For more details on the impact on the economy, see, Paul Craig Roberts, “Government Is The Largest Employer: The Fading American Economy” (April 8, 2008) at, and “American Economy: R.I.P” (September 12, 2007) at Roberts points out that the US trade deficit is actually larger than the total output of US manufacturing, making it difficult for exports to grow the economy and unlikely that exports alone can solve the deficit.

The Third Worldization of the United States

Job training or retraining is beside the point when there are no jobs for those workers. The U.S. has become a services economy, with not enough capital and workers making things anymore. Our manufacturing base has been substantially dismantled, with family-wage jobs being replaced by lower-paying service jobs without comparable benefits. That and the inequality between increasingly super-rich and increasingly impoverished Americans threaten the Third Worldization of the United States, in process and already considerably far along. Inequality in the US has now reached levels not seen since 1928. Of every dollar of real income growth that was generated between 1976 and 2007, 58 cents went to the top 1 percent of households. A recent report from the Economic Policy Institute, “State of Working America,” details how, despite significant productivity gains, median household income has remained stagnant, and shows that wealth has increasingly gone to the top 5 percent (and especially the top 1%) of Americans; as of 2004, the top 20 percent controlled 85 percent of the nation’s wealth. EPI warns, “Today’s economic crisis finds America’s working families in an ever harder place. … [R]ecent developments are compounding a broader economic failure that has been not months or years, but decades in the making.” David Rosen finds most disturbing the graph in the EPI report showing that in 2006, the top 1 percent controlled 23 percent of all income. “[T]he super-rich have [thus] regained the position they held just prior to the 1929 stock market crash when they controlled 24 percent of all income.” David Rosen, “Suffering the New Normal: The End of the American Century?”

The Role of Trade

The trade deficit – the amount by which the value of goods and services imported into the U.S. exceeds the value of goods and services we export – “is actually a central reason why American growth has lagged and President Obama’s stimulus hasn’t led to a robust recovery: since February 2009, the government has injected $512 billion into the American economy, but during roughly the same period, the trade deficit leaked about $602 billion out of it and into foreign markets.” Alan Tonelson and Kevin L. Kearns, “Trading Away the Stimulus,” New York Times, 9/9/10. However, while Tonelson and Kearns offer a useful perspective on the overall problem, I think at least some of their solutions would run afoul of trade agreements to which the U.S. is already a party.

These agreements include the North American Free Trade Agreement (NAFTA), the Central American Free Trade Agreement (CAFTA), and the World Trade Organization (WTO). While they have some problems in common, a few key differences are worth noting. Under the WTO, for example, signing governments can sue each other in trade courts, separate from and independent of the courts of the member countries, for policies and laws that interfere with trade. For example, the Government of Brazil has successfully sued the United States in trade court for U.S. subsidies of agricultural products that compete with those of Brazil. So far, the U.S. has been paying fines to Brazil rather than change the subsidies, with the result that some Brazilian agricultural producers are now in effect being subsidized by the U.S. Government. Under NAFTA, however, not only governments but investors, including companies, can sue to overturn the laws of member countries, and Canadian companies have filed a number of actions that allege U.S. laws interfere with their ability to profit from trade with us.

Until now, the “investor rights” provisions of the trade agreements have had their impact primarily in Third World countries, as U.S.-based companies used the agreements to undermine competitors in Latin America. The main trade agreements involved here are NAFTA, between the US, Canada, and Mexico, and DR-CAFTA, between the US, the Dominican Republic, and Central American countries. These agreements have contributed greatly to forced migration to the United States, by undermining the economies of their Third World signatories. For example, Mexico used to subsidize small farmers, and thus had a thriving agricultural sector that could meet the needs of its people. Under NAFTA, however, Mexico had to stop subsidies and loans to small farmers. But, under US farm policy, the federal government here still gives billions of dollars in subsidies to big farming operators, often called agribusinesses. These U.S. agribusinesses could thus sell corn in Mexico for less than it costs to grow. Naturally, Mexican farmers can’t compete successfully on that basis. This arrangement drove over one million small Mexican farmers out of business. Nearly seven million farm workers became unemployed. No longer able to make a living in Mexico, many of them came to the US.

At the same time, job losses among the people already living here causes tension between current residents and the newly arriving immigrants. This tension has at times and in places flared into racism and xenophobia – fear of “the other” – and these reactions have been encouraged and exacerbated by various reactionary people and organizations. Immanuel Wallerstein, “Xenophobia All Over the Place!” (September 8, 2010) (

One Place I’d Rather Not Go From Here

Writing for the Institute for Policy Studies, Walden Bello discusses how the left has failed to solve these problems, while thus far the right looks to win big in the next election by exploiting them – without, however, offering any real solutions. He suggests that a reinvigorated right with fewer apprehensions about state intervention could combine technocratic Keynesian initiatives with a populist but reactionary social and cultural program, and points out, “There is a term for such a regime: fascist.” Bello quotes Roger Bootle, author of The Trouble with Markets, to remind us that millions of Germans were disillusioned with the free market and capitalism during the Great Depression. But with the failure of the left to provide a viable alternative, “they became vulnerable to the rhetoric of a party that, once it came to power, combined Keynesian pump-priming measures that brought unemployment down to 3 percent with a devastating counterrevolutionary social and cultural program.” (Is that the understatement of the year, the decade, or what?  But you get the idea., September 5, 2010.)

Comprehensive Trade Reform: The TRADE Act

Of course we need more than trade reform, and I suggest in at least a rudimentary way many of the things that should be done to save us and our situation in a piece called “Avoiding the Even Greater Depression – We Could Still Build A Sustainable Recovery” (September 2, 2010), published at with an update at But comprehensive trade reform could go a long way toward addressing the decimation and disintegration of the US economy. To that end, in 2009, Rep. Mike Michaud and Sen. Sherrod Brown introduced the Trade Reform, Accountability, Development and Employment (TRADE) Act. The TRADE Act would change the rules to set standards for labor, environmental, consumer and other protections. It would address the provisions of trade agreements that undermine our economy by rewriting the rules governing international trade. The TRADE Act has now been cosponsored by over half the Democrats in the House. In broad terms, the TRADE Act would establish mandatory standards for future trade agreements regarding labor, the environment, consumer safety, trade in services, public procurement, agriculture, intellectual property, and other concerns; require the review and renegotiation of existing trade pacts, such as NAFTA, CAFTA and the WTO, so that they meet the new standards; and reassert congressional authority and public oversight in the trade policymaking process.

As the TRADE Act was gathering momentum, President Obama announced last June that he would seek passage of the Korea Free Trade Agreement (Korea FTA) soon after the elections in November. This maneuver has caused many trade reform activists to divert their attention to changing or opposing the Korea FTA. The Korea FTA embodies many of the worst provisions of previous agreements. Some activists for fair and sustainable trade have therefore focused on changing the provisions of the Korea FTA, calling for it to be renegotiated along the lines of the TRADE Act. Led by Citizens Trade Campaign – one of my favorite organizations, by the way – over 500 faith, family farm, environmental, labor, consumer protection and civil society organizations have signed a letter to President Obama asking that he renegotiate “the most damaging aspects of the Korea FTA” and promising that if it is brought before Congress without the needed changes, they will work to defeat it. However, I think this is a strategic mistake. As others have pointed out, that approach leaves the proponents of just and fair trade open to “divide and conquer” tactics, whereby a change desired by one group could be used to “pick off” that group, for example, by offering a labor gain here or an environmental gain there while leaving other provisions intact, thus undermining overall opposition and achieving passage of a fundamentally flawed agreement.

I therefore believe the best position is to ask your U.S. Senators and Congressional Representatives to join in cosponsoring the TRADE Act now pending in Congress (or thank them if they’ve already done that, as Oregon U.S. Senator Jeff Merkley and Congressmen Peter DeFazio and David Wu have done); to oppose any trade agreement that is not modeled on the provisions and principles incorporated in the TRADE Act, including the Korea Free Trade Agreement (Korea FTA); and to support the review and renegotiation of existing trade agreements such as NAFTA and CAFTA to reflect and incorporate the principles and protections of the TRADE Act.  An outline of this approach with many important details appears in a template letter posted by the Alliance for Global Justice at

Trade agreements must be negotiated under democratic mechanisms with broad-based citizen participation. They must not be negotiated behind closed doors and then “fast-tracked” for Congressional approval without meaningful review. The Korea FTA was not negotiated by a democratic or transparent process. As drafted and agreed to by the Bush administration, it contains all the worst provisions of prior trade agreements, including provisions that would allow Korean corporations to sue in trade court to overturn federal, state and local laws. An outline of the flaws in the Korea FTA shows why it would be better to reject it and start over with the TRADE Act as a blueprint, rather than trying to amend the Korea FTA in detail. I use Oregon as an example because that’s where I live. As now drafted, the Korea FTA would:

Accelerate Job Loss: According to the Economic Policy Institute, the Korea FTA would displace about 888,000 more U.S. jobs within seven years, as the result of imports, with thousands of job losses in Oregon’s high-tech and green-tech sectors, among others. The Korea FTA would also ban “Buy Local” procurement preferences. As AFL-CIO President Richard Trumka has said, the Korea FTA “is the last thing working people need. With a fragile and incomplete economic recovery…we should not be putting in place new trade agreements that will speed up the offshoring of U.S. manufacturing.”

Weaken Local Sovereignty: The Korea FTA would allow Korean corporations to sue in trade court to overturn federal, state and local laws. There are about 135 Korean corporations with around 270 establishments now in the United States, and the Korea FTA would let them all sue in foreign tribunals to overturn U.S. laws. Korean corporations currently operating in Oregon include Hynix Semiconductor Manufacturing America Inc., Hanjin Shipping Company, Ltd., Hyundai America Shipping Agency, Inc., and C.J. Corp. The Korea FTA would hasten the Third-Worldization of the U.S., doing to us what previous trade agreements have done to other countries.

Prevent Banking Reregulation: Written before the recent collapse, the Korea FTA would prevent the U.S. and South Korea from limiting the size of banks or insurance companies, from banning risky derivatives, and from instituting capital controls.

Allow Human Rights Abuses: The current trade model embodied in the Korea FTA has caused enormous harm to many and provided enormous benefits for a disproportionate few, and accepting the Korea FTA in its present form would open the door to similar agreements with Colombia and Panama, raising issues of grave human rights violations and suppression of trade unions. The Korea FTA even has an “annex” that could allow goods made by sweatshop workers under the North Korean dictatorship to enter the United States.

Undermine Environmental Protection: Oregon’s strong environmental and land use laws would be among the many public interest policies at risk of attack under the Korea FTA’s investor-to-state provisions. The Bush administration pressured the South Korean government to weaken its auto emission standards, and the Korea FTA would lock-in these weaker standards. The Korea FTA would also trump most new measures designed to combat global warming.

Trade agreements must respect the basic rights of workers and provide for dispute resolution and effective enforcement. No trade agreement should prevent countries from establishing their own domestic agricultural policies to promote food sovereignty. Trade agreements must not undermine environmental standards or their enforcement. Trade agreements must respect national and local sovereignty with respect to economic development, capital flows, procurement and other issues. The TRADE Act would address these and other problems caused by past agreements and serve as a blueprint for a new model of trade that Americans can unite behind.

Trade reform could not be more urgent. Working people in Oregon and throughout the United States face a continuing crisis. The economy is down, and may not yet have hit bottom. Federal stimulus has ameliorated some of the worst impacts, but does not solve the longer-term problem, that there are not enough family-wage jobs in the U.S. to produce adequate levels of aggregate demand for a sustained economic recovery. This is in considerable part due to the export of jobs that has been facilitated by existing trade agreements.
A bipartisan poll recently conducted by Mark Mellman and Whit Ayres shows U.S. voters are unified in their concern over the loss of manufacturing jobs. In a poll of 1,000 likely general election voters, “We have lost too many manufacturing jobs” is the top concern among independents and working class voters, even compared to government debt, loss of life in Iraq and Afghanistan, the high cost of health care, illegal immigration or terrorism. Eighty-seven percent favor having a “national manufacturing strategy,” 77 percent say that “jobs being shipped overseas” is among the issues they worry about most or worry about a great deal, and 92 percent have a somewhat or very favorable impression of goods made in America. Other highlights from the poll are that 86 percent of voters want Washington to focus on manufacturing, and 63 percent feel working people who make things are being forgotten while Wall Street and banks get bailouts. Two-thirds of voters believe manufacturing is central to our economic strength, and 57 percent believe manufacturing is even more central to our economic strength than high-tech, knowledge or financial service sectors. The poll shows overlap among Tea Party supporters, independents, non-union households and union households on these issues. And it found all that without even offering the more fundamental choices, such as withdrawal from NAFTA, for which voter support has been growing for some time.

All of our Congressional representatives, and a third of all U.S. Senators, are running for re-election right now. Ask your federal legislators and other candidates whether they will promote passage of the TRADE Act, reject the Korea FTA in its present form, and support U.S. withdrawal from the North America Free Trade Agreement (NAFTA) and the Dominican Republic-Central America Free Trade Agreement (DR-CAFTA) and the adoption in their place of new treaties negotiated under the principles and containing the protections provided in the TRADE Act. Doing so is in the national interest and the interests of working people. It is also what likely general election voters want, both in Oregon and throughout the country.
Stop the Korea FTA and pass the TRADE Act — do it now!


Oregon Senator Ron Wyden is the chairman of the Senate Subcommittee on International Trade. If you’re an Oregon voter, thank Sen. Jeff Merkley and Congressmen David Wu and Peter DeFazio for cosponsoring the TRADE Act, and tell Sen. Wyden: “The Korea FTA is another NAFTA – Send the Korea FTA back to the drawing board. Pass comprehensive trade reform (the TRADE Act, HR 3012 and S. 2821) before moving forward with any more trade agreements.” Wherever you reside, and especially if your Senator is running for re-election this year, give him or her – and all Congressional candidates – the same message.

Contact your senators and members of Congress at:

Because lawmakers value letters and phone calls more than emails messages, it would also help to send a letter or make a phone call. You can call the Congressional Switchboard at (202) 224- 3121 and they’ll put you through to the office of any Senator or Representative. Or, write to:

Senator [Name]
United States Senate
Washington, DC 20510


Representative [Name]
House of Representatives
Washington, DC 20515

Again, you may find helpful the  sample letter posted by the Alliance for Global Justice at   Further resources are online at, and You can also contact the Oregon Fair Trade Campaign at (503) 736-9777 or

Obama’s $50 Billion Jobs Proposal – Too Little, Too Late?

September 7, 2010

President Obama has proposed a $50 billion program to create jobs. Since I just called for a new stimulus package a few days ago, I can’t say it’s too late. It may be too late to catch the popular imagination and with that, the support it will need to happen. But $50 billion is certainly too little. It might make sense if all the economy needed was a shot in the arm. But for a $14-trillion economy like ours that’s practically in tatters and needs substantial rebuilding, $50 billion just repeats Obama’s typical pattern of timidity. However, if that’s all he intends to propose, it would make more sense to disburse it directly to the States, where it might at least be timely spent, and do some immediate good. Details of what I think would be more useful appear in my September 2nd post.

Labor Day Buffet, or Waking Up In The 1930s and Why The Right Is Winning as The Great Jobs Depression Worsens – Is the Economy As Broke As Lehman Was? And of course, What You Can Do About It

September 6, 2010

What to do about it all is described in outline form in my September 2, 2010 entry on this blog, Avoiding the Even Greater Depression: We Can Still Build A Sustainable Recovery. I don’t know whether time is running out forever, or whether we’re just losing precious time. I guess when time runs out it’s always forever, isn’t it? But what I mean is, I don’t know whether we’ve already lost, or are losing, our last, best chance to begin to set things right, or whether, with the passage of time, it’s just become harder to do so, and perhaps likely that we will. Deep and excellent analyses of the problems we face are contained in the articles identified by their titles in the caption to this entry, and a few others whose inclusion would have made the title too long. They appear at (David Michael Green, Why the Right Is Winning); (Dean Baker, Burning Down the House); (Michael Hudson, Is the Economy As Broke As Lehman Was?); (Robert Reich, The Great Jobs Depression Worsens); Stier, Waking Up In the 1930s); (Walden Bello, The Political Consequences of Stagnation).
Bigger or smaller pieces of the solution are referred to, more or less, in some of them. I don’t think I have a monopoly on good ideas. But I don’t see much in the way of comprehensive prescriptions elsewhere, so again, if you’re looking for a program to address what’s happening, see my 9/2 entry, and the sources I cite. The likelihood of my program being enacted looks pretty slim, to put it mildly; but the likelihood of anything short of effectively addressing the problems outlined above is just about nil.

There is at least one thing further I want to mention about the rest of today’s buffet. There is in some of the articles, and in Jim Kunstler’s excellent piece of this morning, titled In The Headlights (, an assumption or conclusion that it’s because people are stupid that they’re taking all of us down for the count. While I understand not everyone has the same mental capacity, or intellectual ability, I think it misses the boat to ascribe so much of what’s happening to stupidity. Lack or paucity of intelligence is something for which a person is not responsible. And to call people stupid is to miss the workings of that vast propaganda system that does the job, with more funding than most of us can imagine, of keeping people confused, focusing their attention on trivialities, perhaps dividing them through skillful manipulation of xenophobia, even just burying them in irrelevant information. That system, its origins and general operations, is described in Noam Chomsky’s “Propaganda and Control of the Public Mind,” a brief talk available in transcript or on CD from David Barsamian’s Alternative Radio (; 1-800-444-1977). An even briefer but excellent illustration is provided by John Pilger (Faking the News) at

Polling data consistently show that the American public is generally to the left of policymakers in government and the media, perhaps more compassionate and even savvy than they, which I think says something for their intelligence. To the extent there is some explaining to do beyond the confusion, xenophobia and rest that I attribute to the propaganda system, I think denial is a more likely culprit than stupidity. I’m afraid I don’t understand denial – the apparent ability not to see or understand what is in front of your face, under your nose, assaulting your senses. But if you substitute “denial” for “stupidity” wherever the latter appears in the essays mentioned above, and perhaps elsewhere, I think you’ll be closer to an accurate statement of the problem.
I wish I could close with, Happy reading! But this is heavy fare. Let me wish you instead, Good understanding, and a chance to do something about where we’re otherwise going.

Avoiding the Even Greater Depression: We Can Still Build A Sustainable Recovery

September 2, 2010

Former assistant Treasury secretary Paul Craig Roberts rightly argues that new federal stimulus financed by deficit spending and spent in the “throw money out the window” manner can’t revive the economy because there are no jobs to call workers back to: The jobs have been outsourced to China, India, and elsewhere via the so-called “free trade” agreements. (“Economists Haven’t Got a Clue: Death By Globalism,” September 1, 2010, However, Roberts’ prescription is to cut the military budget to bring down the deficit. However, any form of austerity, including military budget cuts, would have the anti-Keynesian effect of depressing the economy further. We need more federal stimulus; the problem with the first attempt is that it was too small. (Martin Wolf, “Obama was too cautious in fearful times,” Financial Times, September 1, 2010; see further, e.g., Mark Weisbrot, “Why Fiscal Tightening Will Hurt Spain’s Economy: Drawing the Wrong Lessons From Germany’s Recovery,” September 1, 2010,; Mike Whitney, “Land of Squandered Opportunity: An Avoidable Depression,” August 5, 2010,

Of course, the military budget – and US military adventurism around the world – should be cut very substantially for reasons of policy and morality. So the solution is in substantial federal stimulus, to pump up aggregate demand, but financed by a combination of military budget cuts and deficit spending. The proceeds, if targeted to permanent job creation in energy conservation (e.g., weatherization of homes and businesses and other forms of increased efficiency), truly green energy production, mass transit, agriculture, and other fields – not “infrastructure” to preserve the dying auto-based economy – can grow the economy on a sustainable basis.
Thus far, only a fraction of the money thrown at economic recovery has been allocated to the “real” economy where many of the workers who still have jobs are struggling just to keep food on the table. Substantially more is needed in the short-term. But looking ahead, we should keep in mind that the economy that was operating prior to the onset of the financial crisis was unsustainable and cannot be revived, in part because it was based on over-consumption financed by excessive and continuingly increasing leverage (debt). An economy running on ever-increasing debt is one huge Ponzi scheme, and that’s what Treasury and the Fed are still trying to revive.

Instead, we should reexamine the various so-called “free trade” agreements to redress the damage Paul Craig Roberts describes and ensure that the effort to rebuild our economy is not undermined by the continued off shoring and outsourcing of jobs. These agreements include the North American Free Trade Agreement (NAFTA), the Central American Free Trade Agreement (CAFTA), and the World Trade Organization (WTO).

The Trade Reform, Accountability, Development and Employment (TRADE) Act ( would address the provisions of these agreements that undermine our economy by rewriting the rules governing international trade to make it a positive force for working people in the U.S. and around the world. The TRADE Act is now cosponsored by more than half the Democratic Members of Congress. While details may still change, in broad terms, the TRADE Act would establish mandatory standards for future trade agreements regarding labor, the environment, consumer safety, trade in services, public procurement, agriculture, intellectual property, and other concerns; require the review and renegotiation of existing trade pacts, such as NAFTA, CAFTA and the WTO, so that they meet the new standards; and reassert congressional authority and public oversight in the trade policymaking process.

Even more immediately, we need repaired and improved infrastructure, with the emphasis on energy conservation, mass transit and renewable sources, education to prepare workers for the jobs of the future, and a universal healthcare system to enable U.S. firms to be viable and compete. Investing almost entirely in mass transit rather than automobile-related infrastructure could be a critical part of the solution. We should rebuild our rail system for the shipment of goods as well as alternative transportation. Restoration of train service in the vicinity of major cities would alone greatly decrease the need for air transit of a few hundred miles, which is comparatively inefficient and wasteful of scarce resources. The initial federal stimulus continued to reflect a belief that resources are unlimited, all but ignoring the need for a new efficiency. As James Howard Kunstler observes (

“One very plain and straightforward example at hand is the announcement … of a plan to build a high-speed rail network. To be blunt about it, this is perfectly … stupid. It will require a whole new track network, because high speed trains can’t run on the old rights of way with their less forgiving curve ratios and grades. We would be so much better off simply fixing up and reactivating the normal-speed track system that is sitting out there rusting in the rain—and save our more grandiose visions for a later time.

“… With the airlines in a business death spiral, and mass motoring doomed, we need a national passenger rail system desperately. But we already have one that used to be the envy of the world before we abandoned it. And we don’t have either the time or the resources to build a new parallel network.”
We also have the opportunity to re-tool old factories for the production of products used in the new green industries. U.S. Senator Sherrod Brown has sponsored a bill that begins to address this need. We should explore the regionalization of manufacturing to reduce shipping costs and provide jobs throughout the country, providing opportunities in states where manufacturing has not previously been a major economic activity.

There is considerable public support for such measures. A bipartisan poll recently conducted by Mark Mellman and Whit Ayres shows U.S. voters are unified in their concern over the loss of manufacturing jobs. In a poll of 1,000 likely general election voters, “We have lost too many manufacturing jobs” is the top concern among independents and working class voters, even compared to government debt, loss of life in Iraq and Afghanistan, the high cost of health care, illegal immigration or terrorism. Eighty-seven percent favor having a “national manufacturing strategy,” 77 percent say that “jobs being shipped overseas” is among the issues they worry about most or worry about a great deal, and 92 percent have a somewhat or very favorable impression of goods made in America. Other highlights from the poll are that 86 percent of voters want Washington to focus on manufacturing, and 63 percent feel working people who make things are being forgotten while Wall Street and banks get bailouts. Two-thirds of voters believe manufacturing is central to our economic strength, and 57 percent believe manufacturing is even more central to our economic strength than high-tech, knowledge or financial service sectors. The poll shows overlap among Tea Party supporters, independents, non-union households and union households on these issues. And it found all that without even offering the more fundamental choices, such as withdrawal from NAFTA, for which voter support has been growing for some time.

Margaret Kimberley ( makes some additional useful suggestions, such as true healthcare reform (which would relieve considerable stress on existing businesses) and drastic cuts in wasteful as well as dangerous military spending (see further below). Apart from the horrendous impact on millions of people, the lack of universal healthcare places U.S.-based businesses at a competitive disadvantage to their counterparts in other industrialized countries, all of which have such programs. More generally, the social safety nets in other countries – unemployment benefits, welfare systems, and pension systems – are more generous, and these not only benefit their people as individuals and families but also strengthen their economies as a whole. (Jeremy Gantz, “America, The Is A Better Way: It’s Called Germany,” July 23, 2010,

There is yet an additional dimension to the difficulty of economic reconstruction for long-term prosperity and sustainability. When we recovered from past recessions, we had abundant natural resources. With cheap oil now substantially gone and the Old Economy threatening the biosphere itself (breathable air, drinkable water, arable land), it’s both futile and unwise to attempt a “jump start.” We need an economy restructured as if people and the Earth matter, not billions to build or rebuild highways and tax breaks to buy cars and trucks nobody wants anymore. James Howard Kunstler again:

“The truth is that we’re comprehensively bankrupt, and no amount of shuffling certificates around will avail to alter that. The bad debt has to be ‘worked out’–i.e. written off, subjected to liquidation of remaining assets and collateral, reorganized under the bankruptcy statutes, and put behind us. We have to work very hard to reconfigure the physical arrangement of life in the USA, moving away from the losses of our suburbs, reactivating our towns, downscaling our biggest cities, re-scaling our farms and food production, switching out our Happy Motoring system for public transit and walkable neighborhoods, rebuilding local networks of commerce, and figuring out a way to make a few things of value again.
What’s happened instead is … that our politicians [are mounting] a massive campaign to sustain the unsustainable. That’s what all the TARP and TARF and PPIP and bailouts are about. It will all amount to an exercise in futility and could easily end up wrecking the USA in every sense of the term. If Mr. Obama doesn’t get with a better program, then we are going to face a Long Emergency ( as grueling as the French Revolution.”

The creation of more jobs at higher wages will require a complex process of reconstructing an economy as if people and the Earth mattered. We need something – indeed many things – to be substantially different, including, for example, the means of producing food by sustainable agricultural practices. We need very substantial changes to the system of food production, with less chemically dependent agribusiness and much more locally based, smaller-scale and sustainable farming. Given the myriad difficulties of the present moment, the new agriculture envisioned by Wes Jackson in Robert Jensen’s excellent interview in CounterPunch ( and the 50-year plan to create it are eminently realistic, and would be one good way to start. We need not only new and better ways of farming but more people on farms, and if there isn’t the money to pay them but there are people starving for lack of work, that’s a flaw in the economy that can be fixed by human action.

Most immediately, more funds should be allocated to facilitate economic recovery. And the first priority should be further financial assistance to the States. What Robert Reich pointed out in his blog post ( on 4/09/09 entitled “Why It Makes No Sense for States to Cut Services and Raise Taxes Now” turned out to be right on the money: huge state and local budget cuts have essentially negated almost half of the federal stimulus.”

Late reports indicate Obama is conferring with his advisors to devise a few more tax cuts that would reward job creation. If only they had had this crew on the Titanic; those deck chairs needed rearranging just before they sank! Give me a break – or lots of Democrats are in for a long vacation. Obama should demand another stimulus, including enough to help the states maintain vital services and avoid tax increases, and Congress should heed the request. Ths current political environment makes this difficult, and the GOP will do everything possible to prevent it and/or paint it in a bad light. Mike Whitney, “The GOP’s Midterm Strategy: Make Sure Obama Fails,” But the political environment also demands that the Obama and the Democrats do something drastic, and they may as well, for once, do the right thing. Edward Luce, “Obama’s Democrats face midterm election meltdown at every level, according to polls,” Financial Times, 9/1/10, p. 1.

Another step that could be implemented relatively quickly would be the cessation of our foreign military adventures deceptively advertised as the “war on terror,” under whatever new marketing terms, now shifting from Iraq to Afghanistan and Pakistan. The so-called “war on terror” has been an enormous waste of resources as well as human lives, in that a substantial consensus among knowledgeable analysts finds – as was predicted – that the result has been not a decline, but an increase in terrorism. At the same time – and apart from the appalling and immoral loss of human life – an increasingly glaring fact about these wars is that we just can’t afford them anymore. We’re waging them on credit, and increasingly on credit from foreigners. And the resources wasted on these destructive activities are wholly unproductive from an economic standpoint (, as well as needed elsewhere.

More deficit spending of the “throw money out the window” variety would probably not even achieve much for the reasons Roberts cites, and would at least ultimately make matters worse, while fiscal austerity by any means, including by cutting military spending without compensating action to replace the demand that spending now represents, will pretty much insure the Even Greater Depression of which Mike Whitney has written so well and so many times of late, most recently at (“The Recovery Is Dead: The Backward Slide Into Recession,” 8/31/10).   A carefully targeted and structured federal stimulus program would take considerable finesse to pull off, but would offer hope of a real recovery and a better future.