The right eloquence needs no bell to call the people together and no constable to keep them. ~ Emerson

Wednesday, December 17, 2008

Tough All Over

The Washington Post has yet another article of the sort we have been reading all too often these days, profiling America’s beleaguered and disillusioned middle class. The article describes their frustration over diminished purchasing power. People living in cities, with good educations and professional jobs are worried about “being unable to pay for their children's college education, missing payments on car loans, and not having enough money left each month to dine out with friends or go on vacation.”

This is a generation of workers, after all, who “have come to see these things not as a luxury of modern life but as a right.” They are frustrated over government’s lack of help and they view some individuals within it as inordinately hostile toward organized labor.

It all sounds depressingly familiar but – whoops! – the country in question is China rather than the United States.

Within the past month, nine thousand taxi drivers went on strike in Sichuan province, bringing several large cities to a standstill and sometimes engaging in violence. Police officers demanded reinstatement of a bonus in Hunan province. A thousand teachers in Longhui county struck over unpaid allowances. Fellow teachers in Shaanxi and Liaoning provinces protested earning less pay than that received by other government employees with commensurate experience.

Rural protests by impoverished farmers have been common over the past decade. However, strikes by richer, educated urban Chinese are a more recent phenomenon. Communist officials have been officially sympathetic and responsive to these strikers even as they quietly hunt for organizers and try to ferret out union infrastructure at the same time.

It is not surprising that the Washington Post also reports a poll taken among the Chinese middle class reflects a general pessimism.

In that survey, sixty-six percent are worried about maintaining their standard of living. Nearly two in ten, or someone living in their households, lost a job in the past few months and more than a quarter had their pay or hours reduced. Fifteen percent fell behind on their rent or mortgage at some point in the past year. More than half worry about being able to afford medical care for a sick family member and nearly four in ten are concerned about making house payments and heating their homes this winter.

Overall, eight-two percent saw their country as headed on the wrong track and fifty-four percent characterized its financial predicament a “crisis.” Whoops! again – the survey in question is not about China but rather the most recent Washington Post/ABC News poll of the U.S. middle class.

Communism is not a form a government for which conservatives typically endorse emulation and yet Republican Senators have been following the Chinese lead of late as regards hostility to unions.

Following the scuttling of an auto industry bailout deal, when Republicans could not win sufficient “concessions” from the UAW, the Los Angeles Times published a memo it obtained, entitled “Action Alert – Auto Bailout,” and allegedly distributed among GOP Senators. The memo urged them to “stand firm and take their first shot against organized labor, instead of taking their first blow from it.”

During an interview, National Public Radio asked Republican Senator Jim DeMint of South Carolina to address the charges of union busting made against his Party. “Well, I’m not trying to get rid of the unions,” DeMint replied, “but I am saying that they appear to be an antiquated concept in today’s economy.”

“What I want to do is make sure we have jobs for [auto] workers and we have first-class American automobile companies,” DeMint went on to explain. “And we’re not going to do it with the barnacles of unionism wrapped around their necks.”

New York Times columnist William Kristol has been harshly critical of Republicans for failing to support the automotive bailout on this basis. “I don't think it's very smart for a bunch of Southern Republicans to decide that the future of the Republican Party is to beat up working class union members in states like Michigan, Indiana and Ohio,” he said on FOX News Sunday this past weekend.

That is good advice for conservatives, in my opinion. However, today’s Washington Post stories which highlight, presumably unintentionally, similarities between Chinese and U.S. middle classes, also hold a lesson for liberals pushing President-elect Obama to adopt protectionist trade policies.

The enemy here is poorly negotiated and under-regulated trade deals, not globalization in general. While America often drew short shrift during the global economic boom, it is all too clear that when economic times are tough they are equally tough all over. It matters not whether your markets are free or government-sponsored, whether your government is socialist, democratic, Islamic theocracy or right-wing dictatorship.

Recession in the U.S. results in Americans with fewer dollars to purchase Chinese imports. This hurts China’s economy and Chinese consumption, which, in turn, hurts U.S. exports.

This vicious cyclical nature of the downturn has caused more than a few countries to appreciate that for all its industry, technology, and natural resources, the United States is not boundless in its wealth and power. Economic policies regarding trade and other matters that consistently attempt to plunder its bounty only end up hurting everyone.

This growing realization by our trading partners presents our government with a unique opportunity to bargain in good faith with other nations to replace the unrestricted free trade of the past two decades with equitable fair trade.

Yet this can only happen if certain members of our own government find the self-honesty to reach similar conclusions about our country’s limitations and its role within the world. And, of course, they must understand that, like globalization, the real problem is poor bargaining by management with unions rather than the basic right of workers to organize.

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