I want to continue the discussion about neoliberalism (despite some negative comments in a former post) and how it fits in with our political parties and their agendas for the upcoming election. The issue of trade is a good example of how this works. If we are to say that neoliberalism permeates trade agreements like the Trans Pacific Partnership (TPP) what does this really mean and how does it help us understand the type of leadership we have at present and will have when one of our candidates is elected in November?
If we use the example of the TPP, there are two basic camps within the Democratic Party. Bernie’s populists are anti TPP and believe the agreement should be abandoned. Bernie is a threat to neoliberalism in how he conducts his campaign and what he stands for. He views the state and society in a way that is not held to ransom by the market – the market where the rules are rigged. He does not even have to use the word neoliberalism because his entire political blueprint is the antithesis of it. He doesn’t believe the market or the current system we function under can solve any of our major issues, including the issue of trade. That is why his position is for getting rid of the TPP, it can’t just be changed to make it right.
The Hilary camp is also supposedly anti TPP though this is in doubt. Hilary has been affiliated with globalization from the beginning which makes it suspicious when she claims not to support the TPP. As an example, at the recent meeting of the Democratic National Convention Drafting Committee, the Clinton majority discarded specific language opposing the deal and replaced it with general language about workers’ rights and the environment. There are also various levels within the Hilary camp itself. The more conservatives would prefer to keep the TPP, but change it. This is an example of the middle ground position centrist Democrats adopt to try to appease both the conservatives and more progressives within their ranks. But this position cuts to something far more disturbing even if it is unintentional. Neoliberalism itself surely is characterized by its ability to conceal or manage the great problems of our time which is buried in any compromise approach.
In the past Hilary has stood for abiding by the “rule of law”, the law after it undergoes changes that favor those with the money and power over those without it. In this construct of the law, people have no status compared to corporations. If you consider the text of the TPP, it is such a law. It has been drafted to favor the corporate position over that of the individual. It generates the rules that organize the market, but it is not a free market. When markets takes on the neoliberal form, the bargaining positions of both parties are not equal and inequality is the end result. The TPP functions within this system that is damaging people’s lives. The conservative centrists who support Hilary’s position have internalized neoliberalism, they frame it as something that is real and pragmatic, that can’t be changed (and they criticize diarists who speak about it). They perhaps have been fortunate enough in the system to get by, to even succeed within this market of vested interests.
This difference of opinion about trade creates a tension between the Bernie and Hilary’s camps, but superimposed on this is the Obama camp which is pro TPP and wants to get the agreement passed into law. Obama’s position can be seen then as even more towards the neoliberal end of the spectrum.
Now for the Trump camp. We see that he is very clearly anti TPP. But he is erratic and his sincerity on this is also in doubt. To illustrate, he is very much in favor of big tax cuts which are known to cause even more inequality, so what he would give with one hand he would take away with the other. But his supporters are uncomfortable with the market and do not support the TPP.
Neoliberalism under international trade agreements serves to maximize profits and the domination of corporations. A good example of how this works is the way labor is organized under such agreements. In the labor marketplace we see neoliberalism at its finest – reducing job opportunities as it narrows the field in which humans can operate. Each crisis or economic crash or new policy direction brings about the loss of more jobs, always narrowing the scope of opportunity. Displaced workers who have lost jobs because of industry closure become invisible.
These trade agreements make jobs more easily outsourced to countries that are also signatures in the agreement. Industries are attracted to saving money by taking their industry off-shore. In the case of the TPP, there are a large number of Asian countries where workers’ conditions and wages are unprotected – the sweat shops. These are the American jobs that are being lost overseas. Workers in states like Pennsylvania, Illinois, Ohio, Michigan, Wisconsin, and Indiana have been affected in this way. A consequence of this is that the workers of the world are pitted in competition against one another which lowers wages and increases insecurity further. And a key issue for many American voters this election is about jobs. This is the group of voters the Trump camp has been able to leverage for support. He is making a promise to keep jobs in America and that is a very attractive message. The Democrats know that they need to step up to the mark because a very clear position from the Trump camp, whether sincere or not, could allow him to walk through the door.
In summary, some of the problems faced by the Democratic Party are due to a recent lack of consistency on where they stand on trade. They appear to be deviating too far along the neoliberal spectrum in trying to pander to all sides. Now they are being challenged by Bernie and Trump on the issue. There is also the problem of Obama where it becomes a thin tight rope to oppose (but not oppose) the position of the current leader of the party.
Could the TPP be changed (rather than discarded) as suggested by the Hilary camp? At the very least it would mean taking out the Investor State Dispute Settlement Mechanism (ISDS) which is heavily in favor of corporations. Even if the ISDS is removed, what else could they change? To make things right the TPP agreement would have to be completely overhauled as the entire text embodies a power imbalance. There is no minor changes that would be able to turn this around to make it a fair playing field.
The fracturing of the political parties over trade reflects the frustration of people with neoliberalism – and how the episode of the 2007-2008 financial crisis was not dealt with properly. The rigged marketplace has been allowed to continue as the inequality gap widens. The Sanders and Trump camps represent the push for economic justice despite the differences in how they may go about this. Trump’s inconsistency and allegiance with other GOP policies makes Bernie more sincere. The Hilary camp may or may not be catching on. With 85 percent of House Democrats voting against fast track on the TPP last year, let’s hope they catch on soon.