Thursday, December 22, 2016

One Problem for Democratic Leaders Is Democratic Voters

[ed. There's a lot to be learned including new attitudes toward Vladimir Putin and Wikileaks (and how quickly public opinion changes). More importantly, has anyone ever heard of the Industry Trade Advisory Committees and their roles in negotiating trade agreements? Not me. Editorial emphasis below:]

Leaders on the Democratic left who want to represent the have-nots face an obstacle: their own voters.

Keith Ellison, a congressman from Minnesota and a candidate for the chairmanship of the Democratic National Committee, argues that Democrats “have to stand for a strong, populist economic message.” He warns that “the way the working class is always controlled is that it’s divided.” (...)

Mark Muro, the director of the Metropolitan Policy Program at Brookings, analyzed the differences between those communities that supported Hillary Clinton and those that backed Donald Trump. The findings of Muro and Sifan Liu, a Brookings research assistant, suggest that Democrats who are calling for a return to progressive populism will encounter more hurdles than they expect.

In their Nov. 29 essay, “Another Clinton-Trump divide: High-output America vs low-output America,” Muro and Liu determined that:
The less-than-500 counties that Hillary Clinton carried nationwide encompassed a massive 64 percent of America’s economic activity as measured by total output in 2015. 
In other words, the Clinton counties are the ones in which the economy is booming; they are hardly fertile territory for a worker insurrection.
Muro enlarged on his findings in an email:
America’s most important, competitive, and often export-intensive industries — what we call its “advanced” industries — cluster tightly in such metro counties. Some 70 percent of these crown-jewel industries are concentrated in the 100-largest metros — the core of what Hillary won.
In a separate February 2015 study, “America’s Advanced Industries,” Muro and four colleagues report that the 50 industries in this heavily high-tech sector are crucial to America’s future growth:
These industries encompass the nation’s “tech” sector at its broadest and most consequential. Their dynamism is going to be a central component of any future revitalized U.S. economy. As such, these industries encompass the country’s best shot at supporting innovative, inclusive, and sustainable growth.
The importance of these industries does not stop there:
At the same time, the sector employs 80 percent of the nation’s engineers; performs 90 percent of private-sector R & D; generates approximately 85 percent of all U.S. patents; and accounts for 60 percent of U.S. exports. Advanced industries also support unusually extensive supply chains and other forms of ancillary economic activity. On a per worker basis, advanced industries purchase $236,000 in goods and services from other businesses annually, compared with $67,000 in purchasing by other industries. (...)
Democrats addressing trade and globalization concerns face not only a base sharply split over these issues, but also growing difficulties in the party’s traditional responses to employment dislocation. Both job training and education have become increasingly ineffective.

An August 2016 study by Robert G. Valletta, an economist at the Federal Reserve in San Francisco, “Recent Flattening in the Higher Education Wage Premium,” shows that since 2010 the steadily rising economic gains from completing college and, even more so, from a graduate degree, have leveled off.

The swelling number of workers with postsecondary education combined with the worldwide economic slowdown have resulted in a process economists call “skill downsizing.” Those with graduate degrees are forced to take jobs that a college graduate could do, college graduates are forced to take jobs that someone with less education could do, and so on down the line, leaving fewer and fewer good jobs for the newly trained or retrained.

What would a progressive approach to globalization look like? A call for a radical reform of the trade negotiation process to curb the leverage of corporate and special interests is one Democratic alternative.

This leverage has been institutionalized through the creation of Industry Trade Advisory Committees that grant special access to trade negotiations to corporations ranging from pharmaceuticals to aerospace, energy to investment banks, steel to textiles.

Two critics of current trade policy, Jared Bernstein, a former economics adviser to Vice President Biden, and Lori Wallach, the director of Public Citizen’s Global Trade Watch, wrote a September 2016 essay for the American Prospect, “The New Rules of the Road: A Progressive Approach to Globalization” in which they acknowledge some basic facts:
Despite Trump’s nostalgia for a bygone era when the United States was insulated from global trade, stopping or slowing trade is not at issue. Global trade volumes — imports plus exports — have grown from 25 percent of global GDP in the mid-1960s to 60 percent today. In the United States, that same metric has grown from 10 percent to 30 percent.
Bernstein and Wallach go on to point out that trade agreements
are not mainly about cutting tariffs to expand trade nor are they about jobs, growth, and incomes here in the United States. Rather, they’re about setting expansive “rules of the road” that determine who wins and who loses.
The problem is not with trade itself, which the authors recognize is both desirable and inevitable, but lies instead in the design of the negotiation process:
With 500 official U.S. trade advisers representing corporate interests having been given special access to the policy process while the public, press, and largely Congress have been shut out, it is not surprising that corporate interests have thoroughly captured the negotiating process and ensured they are the ‘winners’ under these rules.
Bernstein and Wallach make a potentially constructive attempt to deal with one aspect of the Democratic Party’s key dilemma: the struggle to prevail in national elections while accommodating the conflicting interests of diverse constituencies — including the conflict between the Sanders-Warren-Ellison wing and the free-trade wing.

Conciliation along these lines has become more difficult as international competition crosses national boundaries, indifferent to domestic regulation and legislation. The 2016 election demonstrates beyond a shadow of a doubt that ducking and weaving around the anguish of displaced workers guarantees sustained minority status.

The nation’s displaced work force includes not only the white working class but millions of Hispanics and African-Americans who are loyal to the Democratic Party. Effective and muscular policies focused on reversing the devastation that globalized trade, automation and competition with foreign workers have inflicted on middle and lower income Americans are essential to encourage defecting whites to return to Democratic ranks — and they are also crucial for reviving Election Day enthusiasm among the nation’s growing population of minority voters. In this regard, the political desires of the two groups are not irreconcilable.

by Thomas B. Edsall, NY Times |  Read more:
Image: Pew Research Center/NY Times