Jobs Leaving The U.S. INCREASED Under Trump In 2017

(Cartoon image is by Tom Tales in The Washington Post.)

One of the campaign promises Donald Trump made was to stop the flow of American jobs to other countries. It was just another lie. In 2017, the number of jobs leaving the country actually increased. And it's going to get worse. He tells us that the new tax plan will bring jobs back to this country. The truth is that it will have the opposite effect. Companies will be taxed less on overseas money than the money they make in the United States -- giving them more incentive to ship jobs overseas (where they can not only take advantage of abusively low wages, but also lower taxes).

Here's how Tim Fernholz describes it at Quartz Media:

“We’re just shipping company after company after company is leaving this country and leaving jobs behind,” president Donald Trump said on the campaign trail last year. “And I’m going to get it stopped.”

So far, not so good. A group that advocates for federal workers says government records show (pdf) more than 10,000 jobs at federal contractors have been sent over overseas since Trump was elected. That’s more than double the average annual amount during Barack Obama’s presidency. The organization, Good Jobs Nation, funded by unions and faith groups, wants the White House to hold these contractors accountable.

All told, in the year since Trump was elected, more than 93,000 jobs have been certified by the Department of Labor as lost to outsourcing or trade competition, slightly higher than the average of about 87,000 in the preceding five years. But federal contractors made up 10% of that number, rather than the previous average of 4%. That suggests companies that work for the government like General Motors, Boeing and United Technologies aren’t worried about political repercussions from the man in the White House.

Consider United Technologies, which is the parent company of Carrier, a maker of air conditions and heating equipment. Carrier became famous shortly after the election when Trump loudly and personally intervened to “prevent” the company from outsourcing jobs to Mexico by offering it tax breaks. Since the spotlight has shifted along with Trump’s limited attention span, Carrier announced more layoffs, including 215 after the holidays. Local labor leaders say they feel betrayed.

The reality is that the president has little leeway in federal contracting law to prevent companies, even those hired by the government, from shifting jobs overseas.

To actually protect good jobs in the United States, major fixes are needed to US trade and tax laws that make it profitable for companies to shift production and earnings overseas, as well as more investment in training workers for jobs that add more value. While the US currently enjoys low unemployment and (slowly) rising wages, low-skill workers still struggle to find jobs that can support a family or afford the education for work that does. It’s not clear, however, that the Trump agenda is going to bring them much relief.

Consider the tax bill being debated on the floor of the senate today. While the focus of the debate is on how much debt the bill will add, one consequence of the law will be making it easier for companies to shift jobs overseas. The bill would stop taxation on US companies’ routine foreign earnings, but experts say it is has not put in sufficient guardrails to prevent jobs from moving overseas.

Companies must pay 20% on their earnings at home, and a 10% minimum tax on any earnings that exceed the firm’s “routine” earnings abroad from investments in factories and equipment abroad. While this is designed to target companies shifting intellectual property overseas to shell corporations, tax expert Steven Rosenthal says it creates a “perverse incentive” to invest more in “routine” foreign production to lower its effective tax rate on foreign earnings. “To put it another way, the firm would pay $1 million in tax on $20 million in foreign profits but $4 million on the same amount of earnings from a factory in the US,” Rosenthal writes.

Faced with those incentives, it’s not hard to imagine what major multinationals will do. American workers, however, will face a tougher adjustment to the new rules Trump and Congressional Republicans are writing.

Trump's Tax On Corporations Exporting Jobs Won't Happen

We know that Donald Trump's "plan" to create new jobs in this country won't work. His solution is to cut taxes for the rich and for corporations, but cutting taxes doesn't create jobs -- jobs are only created by increasing demand.

But Trump also promised to keep corporations from exporting good American jobs. That sounded good to some workers during the campaign, and got him some votes -- especially in the Rust Belt. But that's not going to happen either.

A few days ago, Trump said he would levy a 35% tax on companies that closed American plants and moved to another country to take advantage of low wages. I don't know if he's serious about that or just blowing more hot air, but it doesn't matter. It won't happen. Remember, Trump and others in his family have their own products made in foreign countries to save money of worker wages.

Both houses of Congress are controlled by the Republican Party. And there's only one sin greater than taxing the rich to a congressional Republican -- taxing corporations. Remember, this is the party that gave corporations a tax break to help them outsource American jobs, and killed efforts by Democrats to repeal that tax break. There is no way they would allow a new 35% tax on any corporations for any reason.

Trump's promise to tax corporations for exporting jobs is just hot air. The outsourcing will continue, and it will continue because the corporations want it to continue -- and the congressional Republicans want whatever the corporations want.

(The illustration of Donald Trump above is by John Spooner in the Sydney Morning Herald.)

Why Do Americans Like Free Trade Agreements ?

President Obama is currently negotiating a free trade agreement with Pacific nations -- the Trans-pacific Partnership (TPP). I think this is a bad deal for Americans, especially American workers. Just like other free trade agreements (NAFTA, CAFTA, etc.), this agreement will encourage the offshoring of U.S. jobs and result in a further downward pressure on worker wages in the United States.

And it seems that a significant number of Americans agree with me about jobs and wages 9see the charts above). All of the charts on this page were made from a new survey by the Pew Research Center. They questioned a random national sample of 2,002 adults between May12th and 18th (and the survey had a margin of error of 2.5 points). Note that 46% said free trade agreements costs this country jobs, while only 28% said they create jobs. And a similar 46% said they result in lower wages for U.S. workers, while only 33% said they raise wages.

Looking at those results, one might think that most Americans would oppose free trade agreements (including the TPP), but that would be wrong. As the chart below shows, 58% of Americans believe free trade agreements have been good for the country. How could this be? The bottom chart gives us a clue. It seems that a plurality of Americans say free trade agreements lower the price of goods.

Personally, I find that to be sad -- and very troubling. A lot of Americans seem to be willing to throw American workers under to bus to save a few pennies on the things they buy. In my opinion, this is backwards. We should be willing to pay a few pennies more to keep good jobs in this country (and help American workers make a decent wage).

"Free Trade" Only Benefits Large Corporations

These two charts show what has been happening to this country (and the American worker) thanks to the "free trade" agreements. Those agreements were supposed to benefit American workers by providing more markets for products produced in the United States. But what they really did was hurt American workers by allowing corporations to shut down plants in this country, so they could abuse workers in poverty wage countries -- and then let those corporations ship those products made in other countries back into the U.S. without tariffs or penalties.

The chart on the left shows the trade deficit of the United States between 1962 and 1992 -- before the "free trade" agreements. The chart on the right shows the ballooning trade deficit of the United States after those "free trade" agreements were passed. Those agreements allowed foreign companies (and American corporations making products overseas) to ship much more into this country, while very little more was shipped from this country to other countries (and American workers continued to see their jobs outsourced to other countries).

Now a new trade agreement is being worked out -- the Trans Pacific Partnership (TPP). And believe it or not, it is even worse than the other trade agreements (like NAFTA and CAFTA). It will give multi-national corporations the power to defy American laws, promote even more outsourcing of American jobs, and balloon the U.S. trade deficit to even greater heights.

The TPP must be stopped. We cannot afford to give even more power to the corporations and lose more American jobs.

It's Caused By Greed, Not Need

Very true! American workers are available and qualified to do any of the jobs the giant corporations are shipping overseas. Those jobs are not leaving because of need, but because of greed. Exploiting the desperation of those living in third world poverty is nothing more than theft -- the theft of jobs from American workers and the theft of labor from third world workers. Unfortunately, in a capitalist system, corporate theft is praised and rewarded while individual theft is punished. This must be changed. Theft is theft, whether done by an individual or a corporation.

Green Party - TPP Is Bad Deal For Workers

American workers are already in a bad situation -- with the median income falling and companies shipping good American jobs to other countries. Now the federal government is negotiating a new free trade agreement -- the Trans Pacific Partnership (TPP). This agreement will further depress wages for American workers, because it will do the same thing the other free trade agreements have done -- make it easier for big corporations to ship jobs overseas, and use that threat to lower wages in this country.

The TPP will be a boon for big corporations (a group that doesn't need any help), but it will be a bad deal for American workers (who need the government to take some kind of action to help them). Unfortunately, even the president and the Democrats seem to have bought into the lie that whatever is good for corporations is good for all Americans (a belief that has never been true, and is especially untrue when it comes to agreements like the TPP).

The Green Party understands this. Here is what Green Party Shadow Cabinet member Richard McIntyre had to say about the TPP on September 26th:

As the Trans Pacific Partnership (TPP) talks continue behind closed doors, the case for the trade deal becomes more and more untenable. Reviews of the impacts of past free trade pacts, as well as modelling of the TPP, paint a grim picture of lower labor standards and greater inequality.

The Center for Economic and Policy Research (CEPR) has been producing excellent critical research on globalization for over a decade. One of the center’s early publications, “The Scorecard on Globalization: 1980-2000” made a clear and accessible indictment of the right wing economics that took hold in the US and elsewhere in the late 1970s and early 1980s. It was released when the debate over globalization was at its hottest, just before 9/11, and CEPR became a go-to source for documenting the results of twenty years (at that time) of market fundamentalism on income growth, life expectancy, health, and education.

The Center publishes many useful special issue reports including a new one by David Rosnick on the effect of the proposed TPP trade agreement on wages. In my view this agreement will lower labor standards, strengthen the hand of management and ownership, and it has been negotiated in a profoundly anti-democratic manner. Rosnick adds a statistical estimation of the TPP’s possible effects on wages. He does this by critiquing a study produced by the pro-TPP Peterson Institute for International Economics.

His results are consistent with the predictions of standard academic trade theory. The so-called “factor price equalization” theorem states that wages and returns to capital will be equalized across countries that establish free trade. Since most of the countries currently expected to sign the agreement have lower wages than the US, orthodox trade theory predicts that wages would fall in the US if we enter the agreement.

Rosnik separates out the likely effects of TPP on different groups of people. Workers in the bottom quarter of the income distribution are unlikely to be affected much, as their income is determined more by the minimum wage rate. Those at the top of the income distribution will likely gain due to easier enforcement of copyrights and patents. These gains and losses are not large but they are consistent with the overall direction of economic policy since the Reagan era: increasing protection for capital incomes and increasing exposure of workers to competition from low wage countries.

This policy set has been more consistently applied under recent Democratic than under Republican Presidents. Reagan and both Bushes included some “protectionist” elements in their coalition but the Democrats under both Clinton and Obama are increasingly the party of Hollywood, trial lawyers, cultural liberals, the West Coast technology giants, and finance capital, with a certain kind of charity for the poor. Not bad people necessarily but generally the winners from recent globalization of capitalism.

TPP’s proponents rely on an old argument that free trade is beneficial even if some groups lose because, at least in theory, the winners – capital and those who have monopoly-like positions in the labor market – could compensate the losers and still have something left over. In this case, as even the pro-TPP studies indicate if you dig into them, the expected gains for the US are so small that no one is even talking about trying to compensate the losers. In fact, the issue here is not necessarily the gains and losses that economists are most comfortable estimating but the extension of corporate control over both the global economy and the global policy-making apparatus.

If the economic argument for free trade is that overall output will rise, the political argument is that it is always necessary to pursue freer trade so as to beat back the forces of protection. Thus for the Peterson Institute researchers it is better to have a less ambitious agreement soon than to wait for a better agreement as waiting might allow protectionist “special interests” to gain control of the agenda. Given the evident failure of the now decade old Doha round at the WTO this is not an idle fear. The people don’t support these agreements and so moving fast and more or less undercover has been the Obama administration’s TPP strategy.

Studies like Rosnick’s at CEPR and his opponents at Peterson create the impression that economists can predict things with a precision that they are simply not capable of. For one thing, Rosnick’s predicted effects are drawn from data on current and recent past trading patterns, not on the new ones that TPP might generate. More important, as Rosnick himself intimates, the effects of these agreements are swamped by large and unpredictable events such as 9/11, the financial crisis, etc.

Most American economists generally support free trade out of an almost religious belief in the power of markets and not because of empirical studies. Such studies tend to justify pre-determined beliefs rather than the other way round, in the case of the Peterson Institute study the beliefs of the political and economic elites. Increasing the effective labor pool and securing foreign property rights have been consistent aspects of American trade policy for a generation and a half. It is good that CEPR continues to expose specious claims to the contrary.

GOP Jobs Program

I have often said on this blog that the GOP doesn't want to do the necessary things to create jobs in the United States -- and that is true. But that doesn't mean they are against creating jobs at all. The Republican policies have resulted in the creation of millions of new jobs -- in other countries (where their corporate masters can take advantage of a poverty wage scale). In fact, the Republicans have even created tax breaks for corporations that want to ship good American jobs overseas, and blocked Democratic efforts to eliminate those tax breaks. The GOP is not against job creation. They just ant those new jobs to be low wage, no benefit jobs -- and if they can't make that happen here, they are perfectly willing to do it in another country.

Stop The Outsourcing

If you are blaming China for the outsourcing of American jobs, then you're blaming the wrong people. China couldn't take a single American job unless an American corporate mogul decides to send that job there. It's time to stop the outsourcing of good American jobs. And the first thing to do is to stop paying the giant corporations to outsource our jobs (by giving them tax breaks to do it). And personally, I would like to see an import tax on goods made abroad for American corporations when they try to bring them here to sell (after abusing cheap foreign workers to make them).

American Job Losses To China

When China was allowed to join the World Trade Organization, Americans were told that the United States would benefit from it by opening up Chinese markets to American goods (thus creating more jobs in the U.S. to produce those goods the Chinese would be buying). It hasn't worked out that way. In fact, there is a huge and growing trade imbalance with China (where imports from China far outweigh exports to China), and that imbalance is costing more and more American jobs every year.

The charts above, from the Economic Policy Institute, show the problem. The top chart shows the millions of jobs being lost to China and the bottom chart shows the states most impacted by those job losses. As you can see, the problem grows bigger with each passing year.

Part of the problem is because of currency manipulation. Instead of letting the Yuan float freely against other currencies on the world market, the Chinese control it, pegging it at a certain value against the dollar. This gives them a favorable advantage in trade with the U.S.

But there is another thing that has negatively affected trade with China -- the outsourcing of jobs from the United States to China by large corporations. These corporations have taken good-paying American jobs, mostly in the manufacturing section, and sent them to China where they can pay far lower wages -- and then import the goods produced back into the United States. In the final analysis, these corporations are not just outsourcing American jobs, when they import the goods they have made in China they are adding to the trade imbalance. Here's how the EPI puts it:

Foreign-invested enterprises (both joint ventures and wholly owned subsidiaries) were responsible for 52.4 percent of China’s exports and 84.1 percent of its trade surplus in 2011 (Ministry of Commerce, China 2012). Outsourcing—through foreign direct investment in factories that make goods for export to the United States—has played a key role in the shift of manufacturing production and jobs from the United States to China since it entered the WTO in 2001. Foreign invested enterprises were responsible for the vast majority of China’s global trade surplus in 2011.

The crazy thing is that the American government has been a party to both the job losses and the trade imbalance. When the Republicans were in power, they made it possible for the companies outsourcing jobs to actually gets tax cuts to help them in their outsourcing of jobs -- and those tax advantages for outsourcing still exist. And even though it has become obvious that this outsourcing is seriously hurting the American economy, the Republicans still support it -- having blocked Democratic efforts in the 112th Congress to eliminate the tax advantages for outsourcing.

The government has also failed to see that certain standards were met regarding workers -- allowing China (and the companies who outsource there) to abuse workers by paying poverty wages and giving no benefits -- thus undercutting American workers, and encouraging more outsourcing.

The fact is that the Republicans don't want to solve this growing problem. They represent the corporations, and the corporations love the ability to outsource (and get tax breaks for doing it). And as long as the corporations are happy, the GOP couldn't care less what happens to the rest of America. They are still invested in their failed "trickle down" theory -- that what is good for the rich and the corporations is good for everybody. They ignore the fact that the policy has increased poverty, destroyed jobs, is shrinking the middle class, and has resulted in the widest gap in wealth and income between the rich and other Americans since before the Great Depression.

We must do something about this something that will stop the outsourcing, even the balance of trade, and stop currency manipulation. The first step would be to kick more Republicans out of office and flip the House of Representatives. Then pressure must be put on Democrats to eliminate the tax advantages for outsourcing, punish the companies that continue to do it (if necessary by putting tariffs on goods to make up for wage abuses), to strongly support worker unions, and to create more jobs in this country.

This problem is not going to rectify itself. We must demand and vote for real change.

Willard Tells Another Outrageous Lie

If there is an American vehicle that is so iconic that it is known all over the world as an American product -- it would have to be the Jeep. Invented as a military vehicle for our troops in World War II, the Jeep has undergone many changes to keep it safe and legal -- but it is still instantly recognizable as a close relative of the original military vehicle. And it is a popular vehicle with consumers (heck, I'd love to own one myself).

That may be why Willard Mitt Romney chose the Jeep as the latest victim of his lies. He knew that outsourcing this American icon would anger many in this country, so basically that is what he accused the president of causing. He wanted Americans to think the president had so mismanaged the economy that Jeep was going to have to ship American jobs to China to survive and keep making the vehicle. It is just not true.

Willard took a small grain of truth and built an enormous lie around it. The grain of truth is that the company that makes Jeep is considering opening a plant in China to increase their sales in that country. But NO American jobs would be lost if it happened, and NONE of those vehicles built in China would be shipped back to the U.S. for sale. The Jeeps sold in this country would still be built in this country. In fact, instead of outsourcing American jobs, Jeep is planning to increase its American workforce.

Jeep officials were so incensed by Willard's outrageous lie that they felt it necessary to put out a statement rebutting the lie. That statement said:

I feel obliged to unambiguously restate our position: Jeep production will not be moved from the United States to China. 

North American production is critical to achieving our goal of selling 800,000 Jeep vehicles by 2014. In fact, U.S. production of our Jeep models has nearly tripled (it is expected to be up 185%) since 2009 in order to keep up with global demand. 

We also are investing to improve and expand our entire U.S. operations, including our Jeep facilities. The numbers tell the story: 

• We will invest more than $1.7 billion to develop and produce the next generation Jeep SUV, the successor of the Jeep Liberty -- including $500 million directly to tool and expand our Toledo Assembly Complex and will be adding about 1,100 jobs on a second shift by 2013. 
• At our Jefferson North Assembly Plant, where we build the Jeep Grand Cherokee, we have created 2,000 jobs since June 2009 and have invested more than $1.8 billion. 
• In Belvidere, where we build two Jeep models, we have added two shifts since 2009 resulting in an additional 2,600 jobs. 

With the increase in demand for our vehicles, especially Jeep branded vehicles, we have added more than 11,200 U.S. jobs since 2009. Plants producing Jeep branded vehicles alone have seen the number of people invested in the success of the Jeep brand grow to more than 9,300 hourly jobs from 4,700. This will increase by an additional 1,100 as the Liberty successor, which will be produced in Toledo, is introduced for global distribution in the second quarter of 2013. 

Together, we are working to establish a global enterprise and previously announced our intent to return Jeep production to China, the world’s largest auto market, in order to satisfy local market demand, which would not otherwise be accessible. Chrysler Group is interested in expanding the customer base for our award-winning Jeep vehicles, which can only be done by establishing local production. This will ultimately help bolster the Jeep brand, and solidify the resilience of U.S. jobs. Jeep is one of our truly global brands with uniquely American roots. This will never change. So much so that we committed that the iconic Wrangler nameplate, currently produced in our Toledo, Ohio plant, will never see full production outside the United States. 

 Jeep assembly lines will remain in operation in the United States and will constitute the backbone of the brand. 

It is inaccurate to suggest anything different. 

Sergio Marchionne

In the end this was just one more of the hundreds of lies Willard has told in his quest to become president. But this one could have cost this company a lot of money (if people had gotten so mad they stopped buying the vehicle). He is utterly shameless in his lying.

Willard And Low-Wage Jobs

There are two ways that a businesses can improve its profits -- either sell more of the product or service they offer, or cut the wages (and benefits) of their employees. If you have wondered how American business has continued to thrive (especially corporate America) while the country still has a sluggish economy, it is because the corporations have chosen the second method -- and while it is devastating for the country as a whole, it is working to improve corporate profits.

Corporations are still exporting the good American jobs (like manufacturing jobs) to foreign countries, destroying the power of unions, and stealing worker productivity by keeping wages stagnant in spite of increased worker productivity. They are doing this with the help of their Republican puppets in Congress -- and they can more quickly increase this process of redistributing income from workers to corporations (and their executives), if they can put a Republican (like Willard Mitt Romney) in the White House. That's why they have given so many millions to Willard's super-PACs.

Meanwhile, the country is struggling to overcome the loss of the good-paying jobs. While their has been some job creation in the private sector, as the chart above shows, most of the new jobs are low-wage jobs -- meaning even if people are able to replace their lost job with a new one, they will probably have to work for much less in income (and benefits). The good jobs are still going to other countries, where workers can more easily be abused.

Willard Mitt Romney has claimed to be a job creator. The truth is that he and his company, Bain Capital, have been responsible for destroying or shipping overseas more jobs than they ever created -- and the few jobs their companies have created are mostly low-wage, low-benefit jobs. A perfect example of this is the jobs created at Staples (one of the companies Bain took over). Here is a picture of employment from that company (from Under The Mountain Bunker):

41 percent are part-time jobs.

Hourly wages for sales associates are less than $9 an hour.

Retail salespeople make about $20,670 a year, according to the Bureau of Labor Statistics, which is lower than the federal poverty line for a family of four.

Staples describes its own workforce this way: “Many of our associates, particularly in retail stores, are in entry-level or part-time positions with historically high rates of turnover.”

Staples has been listed by the National Employment Law Project as one of the 50 largest low-wage employers in the country.

In 1987, a year after Staples was founded, there were 13,347 office supply stores across the country. Ten years later that number was cut in half, to just 6,178 office supply stores.

When Staples was founded in 1986, the market share of small and medium-sized sellers of office supplies was 20 percent. By 1998, it had plunged to just four percent.

The market share of large superstores, meanwhile, shot up from less than one percent to 20 percent during that same period.

Are these the kind of jobs you want to see in America. If Willard is elected, that's all America will get. The good jobs will continue to leave the country, and the corporations will continue to get tax breaks for exporting those jobs.

Campaign Buttons

Making a few thousand campaign buttons in the United States is not going to save our economy, but it is illustrative of what the campaigns and the parties think about job creation. The Democrats made their buttons in the United States, using union workers. And those same Democrats know that jobs are only important to pulling this nation out of this economic mess if they are good American jobs. They want to tax companies shipping U.S. jobs to foreign countries and give tax breaks to companies bringing jobs back to this country. Meanwhile, Republicans want to continue tax breaks for companies outsourcing jobs to other countries. The only thing that matters to them is fattening corporate profits, regardless of how damaging that may be to the workers and citizens of America.

Clarification

This is true. Willard Mitt Romney (aka Wall Street Willie) didn't personally outsource a single job to another country. But he made many millions of dollars by showing other companies how to outsource those jobs, and many millions more by investing in foreign companies who were the recipients of those outsourced jobs.

Job Creator ?

This is not a spurious claim by the Vice-President. While the head of Bain Capital, Romney shipped many corporate jobs overseas (while laying off American workers). He created jobs -- they just weren't American jobs. Why would anyone think he would do any different if elected president? He has already shown he cares more for corporate "people" than for real people.

Obama Wants To Punish Outsourcers

Since the Republicans regained power about three decades ago they have given corporations the "keys to the kingdom". They have done this by giving subsidies and tax cuts, removing regulations (including those that protected consumers), suppressing unions,
and blocking efforts to raise wages. But perhaps the most unscrupulous and damaging (to this country) thing they did was to encourage corporations to send American jobs to foreign countries. They even went so far as to give tax breaks to corporations that outsourced American jobs (and it has put millions of Americans out of work).

This is still going on, but President Obama has decided that it's time to stop it -- at least the government help these outsourcers have been receiving. The president has announced he will be proposing legislation that will reward corporations that bring jobs back to this country with new tax breaks, and punish companies that don't by removing the tax breaks they have been getting for their outsourcing. In other words, he's going to make it more expensive to outsource jobs and cheaper to create jobs in this country.

This kind of effort has been badly needed for years now. It simply makes no sense to reward companies for sending American jobs to other countries. Of course, the proposal will need to be approved by Congress -- and we can be assured the Republicans and blue dogs will fight it tooth-and-nail. In fact, with the Republicans in control of the House of Representatives it is doubtful that the proposal can be passed.

It's still smart of the president to bring it up at this time. The Republicans have already been embarrassed by their effort to stop the payroll tax break for working Americans (and they could still face further embarrassment on that). Now he's putting them in the position of having to vote in favor of outsourcing American jobs. They'll either have to go along with the president's plan, or explain why they didn't to the voters in the upcoming election (and that will be hard since a huge majority of Americans opposes outsourcing of jobs).

It looks like the president is finally learning how to play political hardball, and I'm loving it. He either gets what he wants to help Americans, or he gets a bunch of new Democrats in Congress next November. It's a win for the president (and the American people) either way.

(Note -- the above cartoon is from Fellowship of the Minds.)

Millions Of American Jobs Sent Abroad

The above chart (from the good folks at Think Progress) shows the effect the Republican economic policies have had on American jobs. Note that during the last year of the Clinton administration a few jobs were being sent overseas but just as many jobs were being created in this country. But after Bush took office things began to change radically. More jobs (even before the recession) were being lost in the United States, while an increasing amount of jobs were sent to other countries (and the corporations received tax breaks for doing that).

By the end of his eight years in office, Bush had the job situation really out of whack. The corporations had laid off at least 2.9 million workers while they had hired about 2.4 million workers in foreign countries. And nothing has changed to this day. The Democrats tried to take away the corporate tax breaks for exporting jobs, but the Republicans were able to keep that from happening. So while Americans are suffering (with barely enough jobs being created here to keep up with the number of new workers entering the workforce), American corporations continue to send good American jobs to other countries.

Republicans like to say that cutting taxes and giving subsidies to corporations creates new jobs. But it doesn't help this country to climb out of the continuing recession when the jobs being created are in other countries. This has to change.

NOTE -- The above job loss figures only count the jobs lost from American corporations. Jobs lost at small businesses and from all branches of government must be added in to get the true job loss picture.

New Jobs Not The Same As The Old Jobs

In January the unemployment rate in this country dropped to about 9% according to the government. This caused some celebration among some pundits, who claimed it was evidence that the economy is rebounding. I wish that was true, but its not. Even the wizards at the Labor Department admitted that the cause of the drop in the unemployment number was most likely due to many more people giving up on finding a job (at least through unemployment agencies).

The truth is that the number of jobs created in January barely kept up with the number of new people entering the job market, while millions of Americans have given up trying to find work (when you add in those who have given up and those working part-time because they can't find full-time work, the jobless figure climbs to 16-17%). But the lack of jobs is not the only problem.

There is also the matter of the quality of the few new jobs being created. These new jobs come with much lower wages and fewer benefits than the millions of jobs lost in the Republican recession. Many higher wage jobs, especially in industrial work, are still being outsourced to other countries (where they can be changed into low wage jobs).

Also, some jobs that used to be done by higher paid people are now being done by those in lower-paying positions. For example, in the health-care industry "tasks that were previously performed by doctors, nurses, dentists or other health-care professionals increasingly are being performed by physician assistants, medical assistants, dental hygienists and physical therapist aides."

Another example is Lowe's, a chain of home improvement stores. They are cutting 1,700 store manager positions (high paying jobs), and hiring more weekend sales clerks (very low-paying jobs). By cutting high-wage jobs and pushing the work down to lower-wage employees, companies can fatten profits without increasing sales or production. And many companies are taking advantage of the recession to do exactly that.

The Bureau of Labor Statistics is projecting that one of the fastest growing sectors of the economy, as far as jobs are concerned, will be among "food preparation and serving" workers. In the ten-year period ending in 2018, the number of jobs in that area is expected to grow by around 394,000 jobs. The problem is that these jobs pay an average of only about $16,430 (including tips). And they don't come with many, if any, benefits.

This is exactly what corporate America wants -- a low-paid work force with plenty of unemployed people to keep those low-wage workers from demanding too much. We are witnessing the destruction of the middle class and a return to the time before unions helped workers achieve a decent and stable income. A time when the rich controlled most of the wealth and income of the country, and everyone else was reduced to begging for scraps.

This is not the way to bring this country out of recession. Republicans still seem to be convinced that if rich people are given enough money they will create decent good-paying jobs for the rest of America. But that is not, and never has been, how unregulated capitalism works. The corporate moguls know this, and that's why they are encouraging their Republican puppets to bust the unions (the only force in America that pressures business to give workers a fair deal).

The good jobs are leaving (with the blessing of our idiot politicians), and they are being replaced by crap-jobs (and not even enough of them). It's a corporate mogul's wet dream, and that's why they are pouring millions into our political system to help Republicans. They know the Republicans they're buying will use whatever excuse they can (like deficit reduction) to keep things just like they are.

Get used to the pain folks. Until we wake up and put a real progressive in the White House and progressive majorities in Congress, this is the way it's going to be.

Chamber Of Commerce Kills American Jobs

The recent Supreme Court decision allowing unlimited campaign spending by corporations and other organizations has resulted in millions of dollars being spent by these groups to support Republican business-oriented candidates this year.   One of the biggest spenders in supporting the Republican Party has been the U.S. Chamber of Commerce (USCOC).

The USCOC has taken many millions of dollars from business interests and spent it in this current election campaign.   In recent days they have been exposed as taking much of this money from foreign corporations.   Although the donations have already been shown to go into the same 501c(6) account that is paying for the political ads, the USCOC is refusing to come clean and provide a list of all their political contributors or how they are able to separate the foreign money from the American money.  

This is important because it is against federal law for foreign entities of any kind to fund election campaigns in the United States.   But it gets even worse than that (although breaking the law is bad enough).   We now learn that a lot of that money is coming from foreign companies that benefit from the outsourcing of American jobs.

I have often wondered why the USCOC and there Republican brothers have opposed any effort to slow down or stop the sending of American jobs overseas.   It was obvious that some American companies that outsource were funding campaigns.   Now we learn that many foreign companies are also funding the campaigns of Republicans who defend outsourcing, and they are doing it by laundering that money through the USCOC.

The U.S. Chamber of Commerce likes to brag about how they work for the betterment of all American businesses.   I wish that was true, but it's not.   The people they act to protect are just the giant corporations -- both American and foreign corporations (because these are the entities that provide the bulk of their funds.   Frankly, I think they should change their name to the International Chamber of Commerce (and stop funding election campaigns).

There is little doubt that they USCOC has broken the law by soliciting foreign money to spend in American election campaigns.   And there is no doubt at all that they are a huge supporter of outsourcing American jobs to other countries.   They should be investigated.

Republicans Throw American Workers Under The Bus

The Republicans have once again proven that they simply don't care about American workers.   Their unanimous action in the United States Senate yesterday shows that.   President Obama and the Democrats were trying to make good on a campaign promise to stop the outsourcing of good jobs to other countries, but the Republicans refused to invoke cloture and limit debate on the bill so it could come up for a vote on final approval.

A few decades ago, the U.S. Congress passed a bad bill.   It gave tax cut benefits to companies that created jobs in other countries.   At the time, it was considered a good thing to allow American corporations to grow and prosper by taking advantage of poverty wages being paid in other countries.   Incredibly, the congressmen/women either could not see or didn't care about the effect this would have on American workers.

The effect was catastrophic.   It almost immediately had the effect of depressing wages for American workers.   Companies now had the advantage of being able to threaten workers who wanted their wages to keep up with inflation -- they could threaten to move those jobs to other countries if American workers didn't accept wages that feel further behind in buying power each year.   For those who refused to accept the declining buying power, they watched their jobs go overseas.

This depression of American workers' wages, along with the outsourced jobs that allowed corporations to bank ever growing profits, created over the years a division of wealth and income between the rich and the rest of America that had not been seen since the "Roaring 20s".   That vastly uneven division of wealth and income created the conditions that started the Great Depression, and today's equally uneven distribution is the reason the current deep recession happened and continues to hurt millions of Americans.

While the rich corporations and Wall Street bankers are doing well in the current economic mess (thanks to a huge bailout by American taxpayers), the loss of 12 to 15 million jobs in this recession continues to plague the rest of America.   America will not climb out of this recession until the uneven wealth and income distribution is brought into a much more manageable ratio, and many of the jobs lost are replaced by new good-paying jobs.

Even an idiot can understand that this country can no longer afford to ship good-paying jobs overseas and replace them with minimum wage jobs (or no jobs at all).   The Democrats understand that.   The bill they offered would not outlaw outsourcing, but it would remove the tax benefits of doing so, and hopefully convince some American companies to create new jobs in this country instead of some low-wage country.

But the Republicans long ago sold out to the giant corporations (and the huge donations these corporations funnel into their campaign chests).   They have decided that fattening the bank accounts of their corporate masters is more important than saving or creating jobs for American workers.   This policy of theirs is short-sighted and will result in the continuation of the economic recession for many more years, but they don't seem to care.

They are claiming that the bill would hurt job creation by making American corporations pay more in taxes.   What they won't tell you is that the jobs they are talking about are jobs to be created in foreign countries, and the American corporations can avoid the higher taxes by creating jobs in this country.

American workers need to remember this when they go to the polls to vote in November.   It is the Republicans who have thrown them under the bus.   It is the Republicans who want to continue the failed "trickle down" economic policies of Reagan and Bush.   It is the Republicans who think the status quo is acceptable.

Jobs Being Created Are Not Good Jobs

George Bush, with his policy of accelerated Reaganomics, made a real mess of the United States economy before he left office. It was not bad enough that he presided over a massive outsourcing of good American jobs, but his deregulation, tax cuts for the rich, and deficit spending created the worst income distribution since the 1920s and kicked off a serious recession resulting in the loss of millions more jobs.

In his entire eight years in office Bush only created about a million jobs (while his predecessor, Bill Clinton, created 23 million in his 8-year stint in office), and more than lost those in his recession (which started in the last part of 2007). President Obama is already poised to have created more jobs in his first two years in office than Bush did in eight years. That is a good thing, but not as good as you might believe.

The problem resides in just what kind of jobs are being created. This is not a new problem. Even back in the Bush administration, while good jobs were being sent overseas (where wages could be cut to less than minimum wage levels), the new jobs being created were low-wage jobs that would not allow a man/woman to support a family. Unfortunately, the problem is persisting under the current administration.

The chart above is indicative of the problem. The chart shows the five fastest growing jobs in the United States. Only one of those jobs (registered nurse) is above the median wage in America. The other four (food preparation and serving, home health aide, warehouse stock clerk, medical assistant) are well below the median wage and approaching the minimum wage. The problem is even worse when you consider the median wage has been depressed for the last twenty or more years and won't buy nearly what it once would have bought.

While the cost of nearly everything has climbed sharply for the last twenty years, the wages of the bottom 80% of Americans have been stagnant. This alone would have accounted for the pain being felt by middle and working class people, but it was made even worse by the millions of jobs lost by the Bush recession. Now the new jobs being created are lower-paying jobs than the jobs that were lost. It's hard to rejoice in the creation of these kind of jobs.

President Obama has said he wants to give tax cuts to companies that don't outsource jobs (and hopefully bring good-paying jobs back to the United States). That would be a good start, but much more needs to be done. This recession will not be ended by the creation of minimum-wage jobs (even a lot of them). That would just continue the pain being currently felt by ordinary Americans. And it would set the country up for another, possibly worse, recession or depression.

The vast difference in both accumulated wealth and income distribution between the richest 5% of Americans and the rest of America was the real cause of this recession (while the financial mismanagement by Wall Street was just the trigger). The only real cure for our current economic woes is to find a way to more equitably distribute the nation's income.

The nation's health is not determined by how rich the richest 1-5% can get. No matter how hard they try, this small number of people just don't have the purchasing power to keep an economy as large as ours growing. While the Republicans (and the rich) don't want to admit it, America has always seen its best times when the working and middle class people have had adequate purchasing power to live a decent and comfortable life. When these people have the money to buy, everybody benefits -- even the rich and the corporate interests.

Minimum wage jobs may be fine for high school students, but they won't support a family. And they won't lift this country out of the recession.