Obama’s Aversion to Income Inequality Doesn’t Extend to TPP
In his State of the Union address, President Obama touted his dedication to fight income inequality, yet his administration is working to fast-track a trade agreement predicted to cut pay for 90 percent of American workers.
January 2014 marks the 20-year anniversary of the North American Free Trade Agreement. After 20 years of the US population suffering economic exploitation at the hands of transnational corporations and bought-off politicians, President Obama is carrying on the free trade torch – and lighting a wildfire. As his administration negotiates a massive new free trade agreement, the Trans-Pacific Partnership (TPP), President Obama is set to become an unprecedented champion of corporate globalization. The 12-country TPP will bring on a swath of new handouts to transnational corporations, including weakened environmental regulations, internet policing (remember SOPA?), higher medicine prices and even a clause that gives foreign corporations the power to sue governments for laws that interfere with profit. The effects on working families will be far-reaching: according to a recent study by the Center for Economic and Policy Research, 90 percent of American workers will see a decrease in real wages if the TPP is passed.
And yet, Obama continues to parade his so-called commitment to reducing income inequality. In his 2014 State of the Union address on Tuesday, Obama agreed that “average wages have barely budged. Inequality has deepened. Upward mobility has stalled.” He then proceeded to present his “concrete, practical proposals to speed up growth, strengthen the middle class and build new ladders of opportunity into the middle class.” Yet when one looks at the specifics of some of these proposals, such as putting the TPP on the fast track, the extreme contradictions are undeniable. Obama cannot stand with working families and also live out his global “free” “trade” fantasy.
On January 31, 2014, dozens of organizations across North America are taking it to the streets to protest the TPP and corporate globalization under the banner “20 Years is Enough! No New NAFTAs.” After 20 years of this failed experiment, the results are in: “Free trade” makes the poor poorer and the rich richer. Since 1994, the share of national income collected by the richest 10 percent has risen by 24 percent, while the top 1%’s share has shot up by 58 percent. There’s a wealth of research that all concludes that trade has been a contributor to the widening income gap in the United States (the only contention is to what degree).
Neoliberal trade agreements have resulted in a net loss of 1 million American jobs during the past 20 years. But as Lori Wallach points out, the typical focus on the number of jobs lost from NAFTA and similar trade pacts misses the bigger picture: the decreased quality of jobs available for the 63 percent of American workers without a college degree. Displaced manufacturing workers have had no choice but to find work in the low-wage and union-hostile service sector. Increased competition for these jobs has maintained a downward push on wages while disempowering unions.
And don’t be mistaken – jobs leaving for Mexico do not mean economic booms south of the border, either. The deeper integration of the two economies has meant more privatization, incentives to keep wages extremely low, attacks on indigenous rights and devastation for rural communities that have been forced off their land. It’s clear from the huge influx of migration north during the past 20 years that these policies have not brought along the development that free trade theorists anticipated.
For a more thorough analysis of NAFTA’s impact on workers across North America, check out last week’s Workers’ Scorecard on NAFTA.
It’s no surprise that Obama campaigned on a fair trade platform in 2008, promising to renegotiate NAFTA to represent the needs of labor and the environment. He quickly abandoned that promise and swung the pendulum far to the other side. After deciding that “NAFTA isn’t so bad after all,” he then solidified his pro-corporate trade stance when he launched negotiations for the Trans-Pacific Partnership in 2010. Despite the devastating impacts of the cruel NAFTA experiment, the TPP is meant to take the most harmful elements of this model and expand them across the Pacific to encompass 40 percent of the global economy. The administration clearly hopes the American people won’t notice – the TPP has been negotiated in unprecedented secrecy in which even Congress did not have access to the negotiation texts until just six months ago.
Progressives are faced with a choice. The Obama administration has carried out historically unprecedented levels of deportations, prosecutions for espionage and drone strikes. Will the left let him get away with the TPP? Every major political movement in this country faces a setback if the TPP is passed. And with heavyweight intellectuals such as Noam Chomsky calling the bill a “neoliberal assault” that would further “maximize profit and domination” for transnational corporations, many are beginning to pay attention.
Thanks to the movement consisting of a wide range of progressive organizations, a wrench has been thrown into the radical corporate agenda. To complete a trade agreement this wide in scope, the president has stated he plans to “bypass Congress where necessary.” That means he needs to fast-track the agreement through both chambers with limited debate and no amendments. To get approval to do this, he needs Congress to pass the fast-track bill (also known as Trade Promotion Authority) and sign away their power to participate in the shaping of the TPP. Fast track is controversial and looks like it might not get through – and that’s where progressives are focusing energy.
On January 27, more than 550 civil society organizations signed on to a letter opposing Fast Track for the TPP and are coordinating efforts to demonstrate united resistance. They already have convinced 151 House Democrats to tell the president that they will not support fast-tracking trade agreements. As the pressure continues to grow, it looks like people power may be able to kill Obama’s biggest corporate handout.
Obama will continue to spit promises about working for income equality, but it is time Americans see through the rhetoric. After 20 years, it’s time to abandon the “free trade” experiment and put power back in the hands of working families. AFL-CIO President Richard Trumka called NAFTA “only the first in a series of trade agreements that have undermined millions of middle-class American jobs and weakened our democratic structures. So it is ironic that this year the supporters of that failed model are bringing forward a fast-track trade promotion bill to bring us more of the same: more trade deals that strengthen corporate power and CEO profits while putting downward pressure on wages and opportunities for the rest of us.”
Today, the message “20 Years is Enough! No New NAFTAs” will be shouted by many across the United States. If President Obama honestly cared about income inequality, he would have heard their cries a long time ago. Twenty years of exploitative free trade agreements is enough. Enough union-busting. Enough forced migration. Enough environmental disasters. Enough of the growing gap between rich and poor. It’s time for a new era of fair trade that serves the people.