Rakesh's latest

Louis Proyect lnp3 at SPAMpanix.com
Sun Dec 19 09:28:43 MST 1999



Tom Lehman (a Steel Workers Union staffer)
>If you look at the trade stats you will see that this year January thru
>October our trade deficit in manufactured trade goods has already reached
>about 225 billion dollars.  Interestingly enough our agricultural trade
>surplus has shrunk to less than 10 billion dollars.

Tom, I ask you again: why no surge in US unemployment from that run up of
the the American current account and trade deficits if globalization is
stealing "American" jobs?

Two answers seem possible:

1. unemployment has indeed been rising  due to the influx of mfg imports,
though we have to measure it as a truly radical Keynesian Joan Robinson
would have: the working poor in low productivity 'services', the
discouraged, the incarcerated, the underemployed all cannot find a real
job, and thus should be counted among the unemployed (the EPI reports do
contain excellent evidence of the explosion in low wage and very low wage
employment between 79 and 95).

 But why blame real unemployment on 'trade' or 'other countries' barriers'
rather than 'technological change', 'macroeconomic' policy, the workings of
'the general law of capital accumulation' on a world scale?

It seems possible here that the AFL-CIO is ready to revive the dark side of
Keynesian national policy--beggar-thy-neighbor policies towards the export
of  global unemployment.

 What Seattle marks the ensconcement of is simply the Buchananish view that
foreign ruling classes due to their trade 'barriers' and use of child labor
that force the relocation of 'our' corporations abroad are truly at the
root of American labor's weakness so evident in the inability to take
advantage of a tight labor market--though no labor movement can actually
proclaim openly such a fundamentally nationalist outlook (but read between
the lines). With this nationalism comes greater legitimacy for the revival
of myths of a common American identity founded in a common history, the
kind of crap that the Schlessingers, if not Buchanans,  have been
promulgating for some time.

2. the massive imports only represent the real surplus the US enjoys gratis
at the expense of the rest of the world by simply printing and handing over
greenbacks (or IOU's as Enrique would put it) for real goods and services
(foreigners will continue to hold dollar denominated assets because they
need dollars for oil, other commodities, intl transactions, weapons and
military protection, etc). Indeed the supply side relief such fire sale
imports have provided vis a vis profitability difficulties explains the
American boom and therewith the low unemployment rate (Robt Gordon has
suggested so much).

If the AFL-CIO's internationalism is for real, let them couple their call
for the lowering of other countries' trade barriers with a demand for the
US to dismantle its military state; withdraw from the Gulf and allow OPEC
to accept a basket of currencies, instead of only the dollar; cancel
foreign debt; allow inclusion of commodity stabilization mechanisms, nixed
by the US Congress back in 1947; weaken intellectual property rights that
allow US high tech exports to sell above value; and reverse deflationary
IMF policy.

All this would indeed help American labor against the dislocations caused
by distress exports meant and needed to secure dollars.  American labor
indeed does not benefit from American imperialism, and should instead
spearhead the movement against it. But quite the opposite seems probable
presently--I would not trust at all Sweeney and Hoffa (Carey was indeed a
much more sympathetic figure).

At any rate, unless the AFL-CIO is willing to fight the burden its OWN govt
imposes on the rest of the world and thereby via those distress exports on
American labor itself, it is in no position to dictate to other govts what
they are allowed to do in earning the dollars they must have to operate in
a world hegemonized by the US.

By the way, I checked out the pen-l archives at csf.colorado.edu; there are
posts there from around Dec 9 by Korea expert Martin Hart Landsberg that I
think speak quite well to the same point I was trying to make in my earlier
posts.

Yours, Rakesh


Louis Proyect
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