WHAT IS THE RACE TO THE BOTTOM?
Bosses force workers and governments to either surrender to their
demands or risk loss of jobs and tax revenues.
Investors can easily move their money to nations with cheap wages and
lax regulation. Most workers cannot afford to learn Swedish and move
accross the world.
A Wall Street Journal survey in 1992 reported that one-fourth of almost
500 American corporate executives polled admitted that they were "very
likely" or "somewhat likely" to use NAFTA as an excuse to hold down
wages.(Tonelson 2000, 47). A study of union organizing drives in 1993-95
found that over 50% of all employers made threats to close all or part of
their plants during organizing drives (Bronfenbrenner 1997) The threat
rate increased from 62% to 68% in mobile industries such as manufacturing,
communications, and wholesale distribution.
"What they say to workers, either directly or indirectly, is if you
ask for too much or don’t give concessions or try to organize, strike, or
fight for good jobs with good benefits, we’ll close, we’ll move across the
border just like other plants have done before " says Bronfenbrenner.
The threats made to workers are also made to governments. In the end,
jobs are more important than ballots - the investors are in control, not
voters. This is why politicians pretend to be liberal (or "compassionate
conservatives") during elections, yet move rightward as soon as the
election ends. This makes people, especially liberals, apathetic and
lacking hope. For example, 74% of Americans agreed with Al Gore when he
attacked corporations. However, only 51.2% of Americans actually voted.
(Footnote:
http://www.businessweek.com:/2000/00_37/b3698004.htm
At the recent Democratic convention, Vice-President Al Gore criticized
a wide range of large corporations, including "big tobacco, big oil, the
big polluters, the pharmaceutical companies, the HMOs." Do you agree or
disagree with Gore's sentiments?
Strongly agree 39%
Somewhat agree
35%
Strongly disagree 13%
Somewhat disagree 9% )
The race to the bottom also happens within nations: between 1973 and
1997 7 million jobs went from the worker-friendly Northern States to the
business-friendly Southern States.
(http://www.epn.org/faq/index1.html#jobs)
For example, Louisiana has the 3rd highest adult illiteracy rate, and
graduates the fewest high school graduates in the entire nation. While one would assume this
would be a bad place to invest, it also gives subsidies to chemical industries, and makes the poor pay for them with sales taxes on food. The factories are so badly policed that pollution
from the chemical and gas/oil industry kills 500 people each year. A large proportion of the dead are Blacks - making the situation an example of "Enviromental Racism", where pollution is dumped on powerless minorities.
While promising jobs to the state’s people, Louisiana’s concentration in the oil/gas and
chemical industries actually accounted for the loss of 20,000 jobs relative to the national
average. When you sleep with the dogs, you wake up with the fleas.
Sometimes the rich are not satisfied with just moving their money, and
emmigrate. ("Brain drain") Since so many jobs involve serving rich people,
workers must follow them ("strain drain").
Wealthfare
As corporations use the race to the bottom to gain power, government
handouts in the form of special-interest spending and tax subsidies are
used make them stay put.
The Progressive Policy Institute has identified $225 billion worth of
"corporate welfare" - questionable, special-interest spending and tax
subsidies - in the USA alone. It has also called ffor Congress to save
$265 billion over 5 years by eliminating or scaling back 120 specific
programs. However, the PPI can hardly threaten to move to Mexico.
Investors, who claim to hate the effects of "politics" are happy to
vote with their investments. Politicians have no need to actually create
jobs, when they can simply steal jobs from worker-friendly,
"uncompetetive" places. This why Alberta, Canada (Their actual slogan -
"The Alberta advantage" is a race-to-the-bottom reference) is growing in
wealth and population (profitable price-gouging in the oil industry is
also a factor). Workers come here to find the jobs that were stolen from
their communities.
There is no reason wealthy nations and areas should have different
standards and policies from each other. We all need a living wage and safe
meat - Albertans are the same species as Swedes or Japanese. However, they
might fear having to compete on their own merits, instead of simply using
politics to undercut everyone else.
But we have to stay competetive!!!!
Interestingly, when neos are not telling rich nations to be more
competetive, they are telling us not to expect labor standards in the
third world because the third world needs to be competetive. If they
actually cared about the third world, they would want rich nations to have
higher standards, so that the poor can have an edge.
If neoism is so bad why do some poor people support it?
Neoism is a vicious cycle. The effects of neoism mean that the poor get
less from government. Meanwhile sales taxes mean they pay more. Then neos
tell them that government is not worth the cost.
For example, in Canada, funds to healthcare were cut by neos, causing
suffering and in some cases people crossing the border for surgery. Then
American neos used this as "proof" that public health was not worth it!
This is the same sort of "siege tactics" used by terrorists - people
choose between people dieing due to underfunded healthcare (letting the
seige go on) or people dieing under profit-health (surrendering to
plunder).
Of course, lack of education in critical thinking, (thanks to neos)
monopolistic corporate media (no antitrust action thanks to neos) and
religious indoctrination by billionare preachers (people turn to religious
fundamentalism when they suffer - "there are no atheists in foxholes")
play their part as well.
People who lack education base their opinions on pointless
personal anictodes, so this one is for them: my brother needed his
appendix removed, but the underfunded hospital said it was not urgent
because "he was not in enough pain". His appendix burst, and it cost MORE
to clean up.
Does democracy require wealth?
After the Seattle protests put neos under the spotlight, they have
tried to redefine their institutions as charities that intend to create
democracy. This is strange, seeing that "political freedom, once
established, has a tendency to destroy economic freedom." according to
neo godfather Milton Friedman.
While police were busily gassing protestors outside, Bush said
"Trade creates growth which creates democracy" . This marxist-style
economic-determanist claim basically goes like this:
1. Neosim creates growth.
2. In the poor countries, this means
industrialization.
3. Industrial development creates a middle class,
4. which agitates for democracy instead of authoritarianism.
Let's look at these claims:
1. Is disproved nation-by-nation in this FAQ.
2. Neoism has only
meant more unskilled low-paid laboring. Industralization needs high paid
workers worth replacing with machines.
3. Neoism leads to a very rich
and very poor class. The rise of the middle class in the west happened
during the 40s and 50s, eras of unionization. Neos, of course, oppose
unions.
4. In the west, democracy was achieved before
industrialization. When the US constitution was written, most Americans
were farmers. India is a democracy, especially the province of Kerala,
where there is no starvation dispite being one of the poorest places on
Earth. Meanwhile, some of the most vicious dictatorships were industrially
developed: Nazi Germany was industrialized, and the USSR only collapsed
after economic downturn, not economic growth.
Conclusion: The neo claim that democracy is impossible without wealth
is just an excuse for keeping the poor under "competetive" dictatorships.
Will trading with dictators turn them to democrats?
Ever since appeasement failed to stop Hitler, people have not wanted to
do business with dictators. For example, a boycott of South Africa played
a part in the ending of Apartied (Today the WTO would overrule such an effort). Neos, however, say that we should
instead do "constructive engagement", because trade will introduce
"ideas". Just how democratic ideals are contained in shipment of oil, or
electric chairs, is not explained. Historically the arrival of a shipload
of maskara has not put people in the streets calling for revolution. And
why the same process only goes one way and would not "introduce us to
ideas of dictatorship" is a bit vague.
Nazi Germany and fascist Italy ("they got the trains running on time")
were both popular with investors. (For information on the business-friendliness of the Nazis, check out
_The Arms of Krupp_ by William Manchester: This quote is from the outside jacket:
"Europe's richest and most powerful family...financed Hitler's "terror election" of 1933. During the Nazi era the Krupps ruled one hundred and thirty eight (138!) PRIVATELY OWNED concentration camps, and Hitler honored their loyalty by decreeing special tax exemptions...")
Albert Speer points out:
"Hitler made clear his negative attitude
toward a state economy, such as had to result from state socialism. He said "the sole
prerequisite for true higher development, nay, for the further development of all mankind" is
"in the furtherance of private initiative. When this war is decided...the private initiative of
German industry will achieve its greatest era!"
[Albert Speer _Infiltration_ Appendix 9: state
socialism versus capitalism]
Much of the Bush family
fortune came from investing in nazism. After the war, investors opposed
democracy in Japan.
While there are examples of failed embargos - Cuba and Iraq come to
mind - the idea of "constructive engagement" is too dangerous to avoid. We
landed soldiers on D-day, not a shipment of deoderant and Cheese-wiz.
Yet neos, who have succeeded because people have forgotten the lessons
of the great depression and the New Deal, are depending on us forgetting
the lessons of appeasement.