March 22, 2018

Fake trade war to protect white-collar info sector, not blue-collar manufacturing

A key element of the supposed realignment of the GOP is the inclusion of blue-collar workers from industry and manufacturing -- courting their votes, to flip crucial Rust Belt states, in exchange for dramatic policy shifts away from the Reaganite orthodoxy of de-industrialization and globalization.

Over a year into the would-be realignment presidency, the White House and Congress have very little to show for it. I sounded the alarm in a post last summer, right after the list of US priorities was released for the re-negotiation of NAFTA. There was nothing in it about manufacturing and re-industrialization, but only intensifying the benefits to agribusiness and perhaps getting the finance and info-tech sectors a slice of the action by entering the Mexican market, which they did not get the first time NAFTA was negotiated.

Today Trump will announce tariffs against China as punishment for their theft and coercive measures regarding intellectual property developed by American companies. Whether they steal it outright, or insist on handing over source code, trade secrets, etc. as the cost of doing business in their large market, China has been sapping the revenues of the developers of intellectual property for decades now.

The tariffs are intended to correct that form of bad behavior, and will only be lifted once China eases up on its parasitism of American IP developers.

Unfortunately, that does nothing whatsoever to help out blue-collar workers in manufacturing or industrial commodities like steel, and it does nothing to help re-industrialize our economy. It is entirely aimed at economic activity that is informational rather than material and productive. And those whose jobs are endangered by Chinese bad behavior on IP are white-collar professionals with already handsome salaries.

As our manufacturing companies have off-shored their production to countries where the cost of materials, labor, and regulation is cheap, they have kept in this country the informational tasks like design and marketing, as well as the organizational tasks carried out by senior management.

Informational tasks are not so labor-intensive -- you only need a certain amount of designers working a certain number of hours to design the thing you're going to produce, whether the production levels will be in the tens, thousands, or millions. So there's little benefit to sending these tasks out of the country to cheap-labor hot-spots.

Plus, if the cheap-labor country also gets ahold of the design and other informational secrets, what's to stop them from taking over the entire process from design to production -- leaving the American originators to only market and distribute the off-shored product? That would imperil the jobs of high-level professionals and executives, not middle managers or assembly-line workers -- and American executives are not about to commit career suicide en masse.

So, support for this form of "trade war" against China (or whoever else) fails to qualify as realignment toward the interests of blue-collar workers and the re-industrialization of our economy. It only benefits the elites of the two parties -- corporate managers from the manufacturing sector on the GOP side, and the IP professionals on the Democrat side (including not only the developers but the lawyers who defend it). And it only leaves in place the de-industrialized nature of our economy, striving instead to protect info-tech and globalist management careers.

True realignment will be signaled by a trade war aimed at re-shoring the material production of industrial commodities like steel and finished manufactured goods like clothing, electronic devices, and cars.

On that front, so far the evidence is that the Trump admin (and obviously the cuckservative GOP Congress) have surrendered.

The US Trade Rep Lighthizer, despite being more of a hawk, has already said that they have given up on trying to get a higher American-made content into cars made in the NAFTA countries, which was the only fig-leaf item they began asking for, regarding re-industrialization.

Contrast that with campaign-Trump's promise to "put a 35% tax on every car, truck, and part" coming in from Mexico, so that it wouldn't make sense for American car companies to keep their factories in Mexico, and would bring them back here to avoid the tariff.

Lighthizer and others on the White House economic team have also said that Trump's initial announcement of steep tariffs on steel and aluminum have been totally neutered, as all major exporters of steel into the US will be granted exemptions.

Reflecting this sabotage of the plan to re-industrialize, the stock price of US Steel had risen by a few percent during the week that Trump made the initial announcement, but has since fallen by 20% as it has become clear that the Establishment continues to veto Trump and his trade hawks on re-industrialization -- and as it has become equally clear that Trump continues to show no desire to actually fight the Establishment when they veto his announcements, preferring to focus instead on the theatrics of the announcements themselves.

As the Establishment's co-optation of the "America-first" insurgency proceeds, now we can add "economic nationalism" to the list of subverted plans. It began meaning re-industrialization of the US economy, to benefit blue-collar workers in the Rust Belt (and in the case of industrial commodities, the company owners as well). Now it means keeping our economy de-industrialized, but struggling to protect the yuppies by keeping the white-collar professional and managerial jobs here.

We've seen this co-optation already succeed in the domain of foreign policy and war, where "America first" now means the same ol' false song of globalism, and failing to prop up our crumbling empire, only with different rationalizations -- from championing democracy and human rights, to who gives a damn if our #1 ally is Medieval jihadists who blew up the World Trade Center on September 11th?

We've seen the same co-optation on immigration as well, going from a campaign that pledged to deport millions of illegals, end sanctuary city policies, question birthright citizenship, unapologetically use the term "anchor baby," curtail legal immigration especially for guest-worker visas, and end for good Obama's executive amnesties -- to an administration that will end up not even putting a dent in the illegal population numbers, does nothing to sanctuary cities, refuses to even bring up anchor baby citizenship, ramps up guest worker visas, and trades a massive greater-than-DACA amnesty in exchange for no change in legal immigration until 10 years (i.e., never).

Oh, and building The Wall -- which has now, for the second year in a row, been reduced to pathetic funding to extend existing fencing for 30 miles. That's not what the mobs chanted at the Trump rallies -- "Extend, existing, fencing! For only, thirty, miles!" And who was going to pay for that wall? Mexico -- through all manner of executive branch actions (increasing fees on visas from Mexico, taxing remittances into Mexico, tariffs on Mexican goods, etc.) that did not require a single assenting vote from the cuckservative Congress. Trump doesn't even bother adding that part in when he gets heckled by his own crowds about building The Wall.

Devotees of the Trump personality cult may not notice any of these developments, but they are most definitely being noticed by the small sliver of cautious Obama voters who decided the election in Trump's favor.

That's why all the momentum has swung in the Democrats' direction since roughly the end of last summer, when General Kelly purged the populist-nationalists from the White House on behalf of the Establishment. Decisive Trump voters figure if they aren't going to get realignment from the GOP, they'll try their luck with a realignment from the Dems -- and so far, the winning Dems have been those who walked away from multicultural liberalism, focusing on quasi-populist economics instead of liberal social issues.

The realigning Dems have come out against Nancy Pelosi being the Speaker the next time the Dems take back the House, unlike the ossified Republicans who have not pledged to kick out Ryan and those like him if the GOP were to keep the House. Sadly that included Trump himself, who was happy to keep on Ryan as Speaker after getting showered with empty flattery from the notorious brown-noser.

The labor unions and steel country are a natural Democrat base, so when the Bernie-style Dems take over the government, there will be real advances toward re-industrialization. Realignment has never taken place from within the party that set up the orthodoxy to begin with, and this time will be no different -- the Reagan regime will be undone by a realigning figure from the opposition party, such as Bernie Sanders.

1 comment:

  1. The other sell-out aspect of focusing on IP is that it places the blame only on foreign societies, rather than blaming American companies and managers and stockholders who have sent the manufacturing and industry out of the country in pursuit of cheaper costs.

    If China is ripping off American-developed IP, that's only China's fault. Same with imposing the tough restrictions on us giving them our tech secrets etc. as the cost of doing business in their market.

    If China is accepting our factories, that's the fault of greedy American management and the stockholders they're acting on behalf of, who are destroying our working and middle classes in order to get higher profits for the top, by sending production to cheap countries.

    Trump campaigned on how bad "our leaders" were, and that he didn't blame the other countries for screwing over our workers. It's not China or Mexico's job to look out for Pennsylvania's steel workers. That's our leaders' duty, and they have totally sold out the working and middle classes here.

    With Trump and his semi-hawks having capitulated on that narrative, that only leaves the Bernie-style Dems who feel no compunction blaming corporate greed right here in America. That's where the re-industrialization reforms will come from.


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