February 22, 2014

From this Friday's PBS Newshour, NYT's columnist and professional Republican turd-polisher David Brooks did his best to downplay the economic damage that trade agreements like NAFTA have done to the working class in the United States during a discussion why the TPP (Trans-Pacific Partnership) agreement being pushed by the Obama administration is having some trouble making its way through Congress.

We've already discussed the fact that these agreements have been a race to the bottom on wages, workers' protections, and have led to record income disparity here in the United States, but David Brooks wants us to believe the problems are not due to these bad trade deals and globalization, but technology.

There's no doubt that we've lost jobs because of advances in technology, but automation hasn't caused the downward pressure on wages, encouraged the outsourcing, and put our workers at an unfair advantage that's been so devastating to our economy the way these trade deals have.

If Brooks was a factory worker who saw his job get shipped overseas, or if he wasn't more worried about his stock portfolio than the fate of most of his fellow Americans, maybe he wouldn't think these trade deals were "a wash."

JUDY WOODRUFF: Well, let me ask you both about something that is partly international, but certainly have very much a domestic component, Mark, and that is trade.

The president’s been pushing something called the Trans-Pacific Partnership in an effort to get closer to Asia. He’s in favor of it, but a lot of Democrats aren’t. Explain why the split and where do you see this going?

MARK SHIELDS: Well, every president, Judy, irrespective of party, wants fast-track authority to negotiate without the interference of Congress. Every Congress wants to have its oar in and be a part of it. So, there’s a natural tension there.

But we’re dealing here with the shadow of NAFTA. It’s 20 years since the North American Free Trade Agreement, which — there was much overpromise, that it was going to be great for everybody involved, that it was going to elevate Mexico to the point where the immigration problem would disappear. A Mexican middle class would flourish.

And what we have seen has not been really — there’s been economic growth, no question about it. But it’s not been broadly shared prosperity. And it’s reached now to the point where Democrats have grown skeptical, not simply the hollowed-out towns of Ohio and so much of the Industrial Belt of this country, but to the point where the most sophisticated technology developed in this country, its ingenuity, its genius, is sent overseas to be manufactured, not because there’s better education there, but because there’s repression of workers and suppression of wages.

So it’s cheaper. And that has caught up, I think, with the free trade side of the argument. And I think there’s a great skepticism, not only on the part of Democrats, but on the part of the American people.

JUDY WOODRUFF: I mean, does that say any kind of trade agreement is a problem?

DAVID BROOKS: Yes, they’re in trouble. There’s no question about that.

NAFTA, my reading of the evidence is that it didn’t turn out to be that big a deal one way or the other. It was sort of a wash economically and in a lot of things. But we have do much more than NAFTA.

We have really — since World War II, we have got 60 or 70 years of trade. And the trade agreements we’re talking about here are with Europe. They’re not low-wage countries and across the Pacific with Asia. These are trade agreements that we have 60 or 70 years of pretty guaranteed growth out of these agreements.

And they have the story of global prosperity for this time. I mentioned in my column today that in the last — since 1970, the number of people in this world making a dollar a day has declined by 80 percent, the greatest decline in global poverty in human history.

And why is that? Because of global trade. And so to me every president of either party has traditionally been a proponent of trade, as this one is, and I think there’s a strong evidence it’s growth agenda, and so I understand the political fears about it. But I don’t think they’re merited. And I do think when the president’s — when the congressional leaders are bucking their own president, they’re doing some harm for political reasons.

JUDY WOODRUFF: Where do you think — where do you think…

MARK SHIELDS: I don’t — I mean, I understand very much where Leader Pelosi and Senator Reid are here.

I argue with David. I think what it’s produced is what Professor Harley Shaiken of University of California on this broadcast has called high-productivity poverty. Yes, it’s been economic growth. The trade agreements, Judy, and Europe being the exception, have concentrated on protection of all the corporate rights, of copyright, of patent rights, of licensing, but have ignored workers’ rights.

And you can’t work at the outsourcing of production to Asia and to Southeast Asia and not say that they’re doing it for the lowest unit cost of work. And they’re doing it not to invest there. They invest there to produce there, not to sell there, but to bring stuff back here. And I just think that’s the skepticism and I think it’s a legitimate one.

DAVID BROOKS: I will say two things.

First, we’re beginning to see manufacturing jobs coming back here from China because their wages are coming up. We’re doing OK on that. The reason the economy has hollowed out is to me not because of globalization. It’s because of technology.

We just had this Facebook quote WhatsApp, this app, for X-zillions of dollars.


DAVID BROOKS: The amazing statistic to me was the amount of money, the value per employee of WhatsApp. Each employee got the equivalent — or they didn’t get, but they paid the equivalent of $347 million per employee.

That means we have got companies with very few employees of very high value. That’s why the economy is hollowing out. I don’t think it’s because of globalization.

MARK SHIELDS: I would just add one thing.

I think broadly — and we’re seeing it in Ukraine as well. Broadly shared prosperity is not only a social value and a social justice value. It’s a civic value. And I think that is really something that is of overriding importance to us and should be in every policy we develop.

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