Wednesday, June 29, 2016

Trump's Economic Plan: Where's the Beef?

He claims that trade deals 'rape' the American people.

In the same speech, he called for the return of waterboarding 'and worse.' This is also someone who's lawyers in the past has argued that a husband can't rape his wife and has been accused personally of rape.

The candidate also repeatedly compared the controversial Trans Pacific Partnership (TPP) trade deal to rape. The remarks came just hours after Trump delivered a speech on trade policy outlining his populist protectionist views on America’s economic role in the world. Unlike in that speech, Trump didn’t use a teleprompter on Tuesday and three times compared TPP to “the rape of our country”.
The remarks were not the first time Trump has referenced rape on the campaign trail. In May, the real estate developer said “we can’t continue to allow China to rape our country”, and at his announcement speech in June 2015 he accused the Mexican government of deliberately sending rapists across the border into the US.

If there is a lasting theme with Trump through the many years he toyed with running for President, it's been his obsession with 'bad trade deals' and the idea that other countries are 'raping' us. 

He was saying this in the 80s. But it's always nonwhite countries he mentions: Japan, China, Mexico, etc. 

I ask where's the beef as that's all that's here. His whole economic plan is to rip up trade deals and push 'fair trade.'

But that's what everyone says. Bill Clinton when he supported NAFTA also pushed for wage and enviornmental protections, regulations, etc. 

But what's 'fair' in our minds is not necessarily going to be 'fair' in the minds of the countries we negotiate. Trump, like Bernie in the primary acts as if it's just up to us. 

As for simply taking unilateral action-we saw how well this worked in Brexit. 

Jamelle Bouie on the clear racial aspect of 'ripping up bad trade deals.'

"My backlash theory: Civil rights + globalization broke social contract between *white* workers & *white* elites."

"Idea that Trump's message could resonate with a larger group of voters only makes sense if you ignore extent to which it is white nostalgia."

"And that's why it's happening now, in the wake of Great Recession, as nonwhites begin to achieve more than nominal equality."

"That's why it takes form it does: These workers are now subject to same market forces as nonwhites AND no longer get status of whiteness."

"There's a lot of truth in this. Even Brexit would not have passed with more minority voters."

"In any case Trump's entire 'populist' pitch is being anti trade. He also says that wages are too high and that he wants to eliminate the minimum wage, while having huge tax cuts for the rich with no way to pay for them: which will mean in effect, tax hikes for everyone else in terms of lower government spending."

"Even the claim that he won't cut Social Security is more myth than legend."

He also thinks that kids with Schizophrenia 'fake it' but I digress.

We can point out that Trump praised outsourcing himself in the past.

But Matt Yglesias makes the more fundamental point that rescuing the American worker by bringing back manufacturing jobs is fool's gold.

"American trade policy could certainly be improved upon, but the fact of the matter is that nothing Trump or any other trade skeptic proposes is going to bring back the heyday of American manufacturing jobs, for the simple reason that when you look at the data, the decline of manufacturing employment actually doesn't reflect a broader decline in the state of American manufacturing. In fact, the output — as measured in inflation-adjusted dollars — of the US manufacturing sector is higher than it's ever been, even as manufacturing employment has barely recovered from its recession-era lows."

"One reason for these divergent trends is that as you might expect, the segments of the manufacturing supply chain that tend to migrate to Mexico or Asia are the ones that are the most labor-intensive and have the lowest value added in terms of complexity or intellectual property. So when factories go overseas, they tend to be unusually "jobful" factories relative to the ones that stay."

"The other reason is that companies involved in manufacturing are working relentlessly to improve the productivity of their operations and do more with less labor. This is, in some respects, a cause of the relatively high wages we associate with the manufacturing sector — workers can get paid more when their work generates a lot of value. And it's in some respects a consequence of relatively high wages. If you have to pay a lot for your workers, it makes sense to invest in figuring out ways to use less of them."

"Either way, the very strong implication is that any steps we take to strengthen the manufacturing sector are going to have a fairly marginal impact on manufacturing employment."

"For better or for worse, the bulk of employment growth in the future is going to come from health care and other in-person services — and we're going to have to find a way to make a services-oriented economy work, not waste our time pining for the good old days of factory work."

I think that's the real key. Just like Americans in the early 20th century begun to leave the farm for the factory, Americans have now stopped working for the factory.

What's next? It's how to bring work place regulations and labor laws into the 21st century 'gig economy' as Nick Hanauer has talked about and Hillary has proposed.

This way your benefits can be portable between jobs and laws governing wages are observed.

Here is Hanauer's book

For more on the trouble with Trump's protectionism, see here.

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