A mindless debate between two discredited sets of opponents obscures the real meaning of Trump’s call for imposing a 25% tariff on imported steel and 10% on aluminum.
It pits the ignorant and impetuous Trump and allies against the complacent and clueless clique of unbridled “free trade” among America’s elite corporate and government officials, and the donor class for both major parties.
As a result of this spurious interchange, it becomes almost impossible for Americans to make any sense of the tariff issue or much more importantly, understand how corporate globalization has greatly intensified US inequality, severely hollowed out the American middle class, and devastated industrial communities in both the North and South. Tariffs are a blunt, primitive weapon that offer no long-term solution for US industries and workers.
Instead, America desperately needs a thorough discussion of a set of the central issues kept off the radar screen by corporate and political elites. We need to contemplate why the torrential offshoring of US jobs by Corporate America continues, while just 11% of Americans defend this practice. We must confront the continuing downward spiral of discarded American workers, their families, and their communities if present trends are not reversed and a new American industrial base is not created.
The public must fully repudiate the counsel of the elites and their technocrats who blithely ignore the human costs of de-industrialization. “Don’t trust your own experience of shuttered factories and broken unions, let the experts who got us this far lead us deeper into the abyss,” as Robert McChesney and John Nichols have insightfully summarized this pitch from free traders in People Get Ready.
Yet none of the fundamental issues at stake—the offshoring of jobs, the shrinking middle class, and sharply rising inequality — are part of the current debate.
In one corner of this unproductive battle, we have Trump, who suddenly unleashed his tariff plan while in a fit of pique that left the erratic always-impulsive president particularly “unhinged” by unrelated issues. But even if the self-described “very stable genius” was capable of rational consideration, he would have been blinded by his 19th century view of tariffs and his obliviousness to how the corporate-dominated world economy actually works. In an interview, international economist William K. Tabb, professor emeritus of economics at Queens College, says the Trump’s plan would likely raise prices on a variety of goods while failing to render any serious help to steelworkers and others whom Trump claims to care about.
More broadly, Trump, lacks any awareness that nations as unified entities are not “winners” or “losers” in global trade. Transnational corporations have almost exclusively been the big winners. But Trump instead places the Fortune 500 — who have richly profited from their globalization — in the same boat as the Unfortunate Five Million — those who have lost jobs since the acceleration of offshoring over the past two decades. In the same fashion, he shows no awareness that his massive new tax bill contains massive incentives for US corporations to export more jobs.
However, in his crude way, Trump at least connects government and corporate policy with the suffering felt across numerous traditional industries and in fading factory towns and rural areas.
In the other corner, we have most US CEOs, leading Republicans like House Speaker Paul Ryan, the Koch brothers, and most economists decrying the violation of sacred “free trade” doctrine by tariffs. But the current tariff debate is largely a mere distraction in steering the public discussion away from the real fundamentals of corporate globalization.
For example, free traders are loathe to admit that fully 80% of global trade occurs within transnational corporations and their global supply chains. In other words, four-fifths of “trade” involves transactions like GE shipping parts and machinery back and forth with Mexico, or Apple obtaining iPhones from the notorious factories of their supplier Foxconn.
Nor are “free traders” eager to acknowledge that the offshoring of US jobs have been key in driving down US incomes for the vast majority and been a central factor in the closing of 56,190 factories — 15 a day — between 2001 and 2012. During the 2000-2010 period, Commerce Dept. data show that major US firms created 2.4 million jobs overseas while vaporizing 2.9 million in America.
These job losses have taken an enormous toll on workers and families. Collectively, the free-trade advocates have shown a cruel indifference to how the large-scale offshoring of US jobs has hollowed out America’s middle class and devastated industrial communities wracked by low wages, poverty, falling property values, high rates of domestic and street violence, and afflictions like opioid and alcohol abuse. When the free trade establishment reluctantly admits that a huge problem exists, leaders of both parties airily prescribe “re-training” as a cure-all despite the almost-universal failure of these programs in the US to restore decent living standards and healthy communities.
Moving toward meaningful solutions for America’s disposable workers and communities will require rejecting both Trump’s reckless and unfocused tariffs and the conventional wisdom of the “free trade” chorus of elites and most pundits. Restoring our manufacturing base will demand moving toward democratizing the economy and establishing a broad “industrial policy” coordinating economic, trade, environmental, enforcement of widely-trampled labor rights, and manpower strategies.
We will also need to challenge the very purpose of the US economy and the global economy it dominates. The late British billionaire Sir James Goldsmith sharply outlined the current phase of turbo-capitalism which intensifies the subjugation of the vast majority to maximize profits for the top 1%. As Goldsmith observed, “Today we are proud of the fact that we pay low wages.
This reflects a shift from the paternalistic capitalism exemplified by Henry Ford to an ever-more ruthless neo-liberal capitalism where society increasingly geared solely toward ever-larger profits. “We have forgotten that the economy is a tool to serve the needs of society,” said Goldsmith. “The ultimate purpose of the economy is to create prosperity … and not the reverse. The ultimate purpose of the economy is to create prosperity with stability.”
Progressives need urgently to offer an alternative replacing the current system— where people are simply servants of the economic machinery— with a new vision where a democratic, decentralized economic system is instead dedicated to serving human needs.
Roger Bybee is a Milwaukee-based labor studies instructor and longtime progressive activist and writer who edited the Racine Labor weekly for 14 years. Email winterbybee@gmail.com. A version of this appeared at Progressive.org.
From The Progressive Populist, April 15, 2018
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