America’s Real Industrial Policy: Maximize Profits at All Cost

[hvactec]

The Occupy Wall Street movement—which has gained the support of 54 percent of Americans, according to a Time poll—has, remarkably, apparently inspired free-marketeer House Majority Leader Eric Cantor to address America’s Pakistan-level inequality in speech on Friday.

Cantor intends to explain how to uplift “a single working mom…a small business owner...and how we make sure the people at the top stay there.” (The last category, of course, has seemingly been the entire purpose of Cantor’s political career.)

The OWS movement's core concern is growing inequality, and how to lessen it. Many protesters advocate for more progressive tax policies. Another crucial way to fight inequality, which activists haven't focused on as much, is keeping good-paying jobs in the United States. In my opinion, the movement ought to directly challenge the president and leading Democrats on whether they are serious about preserving America’s productive base and raising the incomes of working families who are part of the 99 percent. Will these political leaders support a concerted “industrial policy” to achieve these critical goals, or will they side with Corporate America as jobs disappear, wages keep plunging and inequality reaches new heights?

Unfortunately, the Obama administration has come closer and closer to fully admitting the wrong thing: that it is willing to sacrifice more of the nation’s industrial base. The three NAFTA-style “free trade” agreements approved last week by Congress at Obama’s urging —illustrate how Obama’s eagerness to promote more off-shoring of jobs and capital at the expense of his working-class constituents. (U.S. corporations’ offshoring of jobs alarms fully 86% of Americans)

Obama's new stance in favor of the deceptively-labeled "free trade" doctrine turns one of his most fundamental appeals in 2008 absolutely counterfeit. "Free" does not accurately describe the repressive anti-labor conditions favored by US firms. Nor does "trade" do justice to the majority of transactions, which actually occur within the same firm, like GE "exporting" machinery and parts to Mexico and "importing" finished products.

AUTO BAILOUT CHAIR ATTACKS INDUSTRIAL POLICY

Even with this disturbing backdrop of the newly inked NAFTA-style deals, it was still stunning to read Sunday's attack on industrial policy by Wall Street tycoon Steven Rattner, whom Obama selected to head up the auto bailout Task Force, which was dominated by fellow financiers. His op-ed was titled "Let's Admit It: Globalization Has Losers."

Rattner’s New York Times commentary was an open admission that a very key Democratic player utterly rejects any systematic effort to save the U.S. industrial base.

First, Rattner’s piece illuminates the mentality that made the GM and Chrysler bailouts so much less constructive than they could have been. Progressives had envisioned the crisis at GM and Chrysler as an opportunity to link Obama’s aim of stimulating the economy with enhanced spending power for workers with building a green economy, by converting some auto factories to the production of high-speed rail vehicles and other non-gasoline powered transportation equipment.

But dominated as it was by Wall Street heavyweights like Rattner (net worth: $188 million to $688 million) and chief economic advisor Lawrence Summers, the Task Force failed even to ensure that the maximum number of jobs possible were retained in the U.S. The final version of GM's recovery plan—closely tailored to the demands of the Task Force—appallingly called for an enormous 98-percent increase in autos produced in Mexico, China, South Korea and Japan for the U.S. market.

Speaking with authority gained from this over-rated “success,” Rattner outlines a strategy for surrendering almost all of what is left of America’s still-considerable manufacturing base and settling instead on an economy built chiefly around financial and computer-based services.

Bizarrely enough, Rattner premises his economic strategy on supposedly trying to aid working families whose incomes have plummeted chiefly, he admits, as a result of corporate “globalization.” But the solution, Rattner insists, is to let go of our "nostalgic" feelings about manufacturing and allow the offshoring of jobs to continue, while focusing our efforts on service industries:

While America still leads in sectors like defense and aviation, our greatest strength, and a source of high-paying jobs, lies in service industries with high intellectual content, like education, entertainment, digital media, and yes, even financial services. Facebook, Google and Microsoft are all American creations, as are the global credit card companies American Express, Visa and MasterCard. ...

We should resist the temptation to plunge deeply into industrial policy. ... Washington is ill-equipped to pick winners and should concentrate its capital on infrastructure and other public investments that the private sector won’t make.

Rattner can imagine a limited role for continued manufacturing here:

We should follow the example of successful high-wage exporters in concentrating on products where we have an advantage, as Germany has done with products like sophisticated machine tools.

Unfortunately, Rattner doesn't know what he's talking about. Milwaukee, for example, was long proudly known as “the Machine Tool Capital of the World.” But with many of the city’s biggest firms—Briggs & Stratton, Johnson Controls, Rockwell International (formerly Allen-Bradley), AO Smith (later Tower) and MasterLock—shifting substantial portions of their production to Mexico, Milwaukee has lost 80 percent of its manufacturing jobs since 1977, according to Marc Levine of the Center on Economic Development at the University of
Wisconsin-Milwaukee.

read more America’s Real Industrial Policy: Maximize Profits at All Cost - Working In These Times

 

[rdean]

Cantor? Screw disaster victims and let them suffer? THAT Cantor?

This is just another "Jobs Jobs Jobs" trick. After Republicans RAN on "Jobs Jobs Jobs", they said that NEVER happened. They NEVER said that. Is one thing to say they were talking about "something else", but it's another to say they never even spoke the words.

 

[waltky]

Politicians collectin' their do-nothin' paychecks, what do they care?...

Jobs Bills Die in US Senate
November 03, 2011 - Another plank of President Barack Obama’s job creation plan has been defeated in the U.S. Senate, blocked by Republicans who objected to a modest tax boost to pay for increased infrastructure spending. Democrats returned the favor by voting down a competing Republican proposal that would have channeled unspent federal funds into public construction projects.

Lawmakers of both parties agree that the nation’s crumbling infrastructure needs repair and expansion, and that far too many Americans are out of work. The solution is obvious, according to Democratic Senator Charles Schumer of New York. “All across the country, there are roads, bridges and sewer systems in need of serious repair. And in each of these places there are thousands of middle class families desperately looking for work. By voting to pass the Rebuild America Jobs Act, the Senate can get thousands of Americans off the unemployment line and back into the workforce,” Schumer said. Borrowing from a jobs plan President Obama unveiled two months ago, Democrats proposed spending $60 billion on infrastructure projects across the nation, paid for by imposing a tax surcharge on annual incomes exceeding $1 million.

Republicans decried the plan as a tax-and-spend scheme that will harm private enterprise. Senator John Thune of South Dakota says there is a better way. “To make it less costly, less difficult, easier for our small businesses to create jobs. If you look at what the Democrat agenda is, it is a doubling down on the policies that have already failed. It is raising taxes on the people who create jobs in this country,” Thune said. Republicans voted to block debate on the Democratic proposal. Moments later, Democrats did the same to a Republican alternative that contained no new tax provisions.

Frustration over partisan gridlock led the Senate’s top Democrat, Majority Leader Harry Reid, to accuse Republicans of economic sabotage for political gain. “Their goal is to do everything they can to drag down this economy, in hopes that President Obama will be defeated [next year],” Reid said. Republicans fired back, accusing Democrats of pushing politically-unviable legislation to draw partisan differences ahead of next year’s general elections. “Democrats have deliberately designed this bill to fail. So the truth is, Democrats are more interested in building a campaign message than in rebuilding roads and bridges,” said Minority Leader Mitch McConnell.

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Report: Extreme US Poverty Surges Since 1990s
November 03, 2011 - A new report says that the number of Americans living in neighborhoods with extreme poverty grew markedly in the last decade, erasing gains the United States made in eradicating poverty in the 1990s.

The Washington-based Brookings Institution research group said Thursday that at least 2.2 million more people now live in communities where at least 40 percent of the residents are poor. That is about a third more than the nearly seven million people living in concentrated poverty in 2000. The U.S. defines poverty as a family of four living off an annual income of $22,300 or less.

The nation's worst economic downturn in 70 years left millions of people out of work, and often forced them out of their homes when they could no longer pay their mortgages. The report's author, Elizabeth Kneebone, said that with falling household income, the "2000s took an economic toll."

Brookings said the midwestern and southern portions of the country were hardest hit, with lost manufacturing jobs and a large number of houses taken over by banks in loan foreclosures.

Recent government reports have also shown the effects of the recession from which the U.S. is still struggling to recover. U.S. household income dropped last year to its lowest level in a decade, while poverty rose to a 17-year high. Nearly 46 million Americans, a new record, now receive government assistance to help them buy food.

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