Donald Trump, Working Class Hero?

By Anis Chowdhury and Jomo Kwame Sundaram SYDNEY and KUALA LUMPUR, Jul 7 2020 (IPS) - In his early February annual State of the Union address, US President Donald Trump typically hailed his own policies for increasing wages and jobs to achieve record low US unemployment. Directly appealing to labour for a second term, Trump claimed exclusive credit for the US “blue-collar boom”.

‘Blue-collar boom’

During his previous two State of the Union speeches, Trump also directly appealed to blue-collar Americans who put him in the White House in November 2016. As Trump claims manufacturing workers have been the main beneficiaries of his economic policies, including his trade and other policies, this seemed likely to dominate his re-election campaign. In fact, US manufacturing growth had slowed to its lowest level in August 2019 when the purchasing managers’ index fell for the first time since September 2009. Despite his bombast, Trump has failed to reverse the continuing decline in manufacturing’s share of GDP.

Nominal wages have risen by an average of 2.2% since Trump took office, but real wages fell 3.9% after adjusting for inflation. Real labour compensation, including fringe benefits, has declined 4.3%! Meanwhile, more than 53 million Americans, or 44% of all workers aged 18-64, earn low hourly wages, getting barely enough to survive. US unemployment fell to 3.5% in December 2019, its lowest level since 1969, before rising again. However, the story behind the headline unemployment figure is less impressive.

For example, in January 2020, 1.3 million individuals who wanted work, were not counted as unemployed because they had not actively sought work in the preceding four weeks. This figure shot up to 9.4 million in May 2020, declining to over 8.6 million in June.

Of these, ‘discouraged’ unemployed, who believed that no jobs were available for them, more than doubled from 337,000 in January 2020 to 681,000 in June.

Trump himself had ridiculed official unemployment data in 2015, describing them as “phony”, lambasting the practice of excluding people who have given up looking for a job from unemployment statistics. The headline unemployment figure also does not include those working part-time who want to work full-time.

The high US incarceration rate lowers its jobless rate by about 1%. The US has the world’s highest incarceration rate, with more than two million in prisons. Many are discouraged African-American and Hispanic unemployed workers, jailed for minor crimes, often petty drug offences.

US workers better off?

Three-fourths of the post-Second World War (WW2) decline in the labour share of GDP (i.e., paid as wages, salaries or employment benefits) has happened since 2000, after little change in the second half of the 20th century! Overall US labour share of nonfarm business income fell from 65.4% of GDP in 1947-50 to 61.1% in 1994-98, before rising to 63.3% in 2000, and falling thereafter. After recovering from a nadir of 52.4% in 2013 to around 57% during Obama’s second term, labour’s share fell to 53% in 2018.

Low unemployment has undoubtedly raised nominal wages, but after adjusting for inflation, the median household income was roughly the same as two decades before, while the average real wage has barely changed, rising just 0.42% from December 2016 to September 2019.

Meanwhile, the value of fringe benefits – including health insurance, retirement and bonuses – declined by 1.7% during Trump’s first three years. 1.9 million more Americans lack health insurance coverage, raising the total to 27.5 million, i.e., 8.5% of the US population in 2018.

Thus, despite declining joblessness before the pandemic, aggregate real compensation fell 0.22% under Trump. Average real hourly earnings of US$23.24 in March 2019 were not higher than at its peak in March 1974. With the pandemic, real (seasonally adjusted) average hourly earnings for all employees dropped 0.9% from April to May 2020, while nominal earnings of private nonfarm payroll employees fell 66 cents to US$29.37 in June 2020 from US$30.03 in April.

Meanwhile, labour income inequality has increased, with declining real incomes for the unskilled and poorly skilled, as remuneration gains have mostly and increasingly gone to the highest-paid, mainly executives.

Infecting the numbers

Following policy responses to the Covid-19 pandemic, the US labour force participation rate (share of civilian population aged 16 and older working or looking for work) fell from 63.4% in January 2020 to 61.5% in June, well below the pre-financial crisis peak of 66.4% in January 2007, and the post-WW2 high of 67.3% in early 2000.

Job growth has slowed with Trump’s trade wars, with significant job losses in electorally key states. While 2018 saw 223,000 new jobs created monthly, this average fell to 184,000 in the last quarter of 2019. The 1.2 million ‘long-term unemployed’ (jobless for at least 27 weeks) accounted for 19.9% of the unemployed in January 2020, rising to 1.4 million in June.

Apparently, the US jobs survey mistakenly counted 4.9 million unemployed as employed! If corrected, the unemployment rate would have risen to 16.1% in May, and the rate for April would have been more than 19.5% – instead of 14.7%.

According to the Peterson Institute for International Economics (PIIE), even the very large increase in official unemployment since March is underestimated. Adjusting for the extra 4.9 million unemployed, and 6.3 million who have left the labour force since February, the PIIE’s more ‘realistic unemployment rate’ was 17.1% in May, the highest in over seven decades!

However, despite admitting the error, the US Bureau of Labor Statistics (BLS) has not corrected the official numbers “to maintain data integrity”. As the BLS regularly updates its estimates, its decision not to do so in this case has triggered calls for investigation.

As part of the US$2 trillion stimulus package, US$350 billion in ‘forgivable’ loans have gone to small businesses to retain staff. Businesses could access the funds if they retained or rehired laid off workers by the end of June, raising the month’s job numbers. Many employers acknowledge they will lay off these workers once the subsidies run out. Nevertheless, the job retention programme may be extended beyond October to cover the early November polls. Meanwhile, the Becker Friedman Institute at the University of Chicago estimates that 42% of people “furloughed” will never get their old jobs back, while only 30% of those laid off will land new jobs later this year.

Spinning for a second term

Unsurprisingly, Trump is elated with the latest BLS unemployment figures released on 2 July, showing declines for a second consecutive month from 13.3% in May to 11.1% in June. Trump greeted the news, bragging, “Today’s announcement proves that our economy is roaring back”.

In his ‘victory lap’, Trump described the June jobs report as “affirmation of all the work we’ve been doing”, probably hoping it is the ‘good news’ he has been desperately seeking since his ratings started slipping due to his pandemic mismanagement.

He specifically highlighted the “historic” sharp drop in Black unemployment, falling from 16.8% in May to 15.4% in June. Trump also cheered the soaring stock market, largely fuelled by US Fed monetary policy, claiming the economy was on “a rocketship”.

Yet, if enough low-wage workers do not buy into Trump’s story, he will be in trouble come November. But it is not yet clear how US workers view their situation and options, who they will blame, how far Trump will go to secure re-election, and how the electorate will vote.

Read online here: http://www.ipsnews.net/2020/07/donald-trump-working-class-hero/

Rethink Food Security and Nutrition Following Covid-19 Pandemic

Jomo Kwame Sundaram, Wan Manan Muda KUALA LUMPUR, Malaysia, Jul 02 (IPS)  - The Covid-19 crisis has had several unexpected effects, including renewed attention to food security concerns. Earlier understandings of food security in terms of production self-sufficiency have given way to importing supplies since late 20th century promotion of trade liberalization.

Transnational food business Disruption of transnational food supply chains and the devastation of many vulnerable livelihoods by policy responses to the Covid-19 pandemic have revived interest in earlier understandings of food self-sufficiency. But, even if successful, winding back policy will not address more recently recognized food challenges such as malnutrition and safety. All too many food researchers have been successfully compromised, e.g., with generous research and travel funding, by food and beverage businesses to discourage criticisms of their lucrative business practices. It is important for authorities to make sure that food is produced safely for consumers. The authorities should not only be concerned when food exports are blocked by foreign importers for failing to meet phyto-sanitary standards. Is food safe for consumption? Are toxic agro-chemicals putting consumers at risk? Are anti-biotics, used for animal breeding, putting animal and human health at risk of antimicrobial resistance? Are food processing practices compromising consumers' nutrition? Malnutrition threat looming larger The world has to deal with three major types of malnutrition, i.e., dietary energy undernourishment, or hunger; ‘hidden hunger', due to micronutrient deficiencies of vitamins, minerals and trace elements; and diet-related non-communicable diseases (NCDs). Many of the poor typically lack means to improve their condition, with the poorest often lethargic, due to not getting enough to eat, or not being able to gain sufficient nourishment from food due to gastrointestinal diseases, typically due to poor sanitation and hygiene. Although hunger and starvation have reportedly been declining in recent decades, dietary energy undernourishment has been falling more slowly than poverty although the poverty line is supposedly defined by an income level to avoid hunger. The nutrition situation in the world remains worrying as other manifestations of malnutrition -- including stunting, obesity, diabetes and anaemia -- have been growing, or declining slowly at best, according to available official evidence. Micronutrient deficiencies Micronutrient deficiencies threaten human health and wellbeing, but rarely get much public policy attention. ‘Hidden hunger' is due to diets lacking essential micronutrients -- vitamins, minerals, trace elements -- vital for the body to develop and function well. Insufficient vitamin A, iron, calcium and zinc seem to be the major micronutrient deficiencies of public health importance. All too many people are anaemic, with especially serious consequences for women of reproductive age. In many countries, iodine deficiencies have been successfully tackled by iodizing salt, while vitamin A is typically tackled with costly supplements for children under five. Such hidden hunger is usually better addressed by dietary diversity to consume food with the needed micronutrients. Biofortification can help, but for this to work well, close collaboration is needed between nutritionists and dieticians on the one hand, and scientists working to improve food crops and animal-source foods on the other. Child undernutrition Most parents are not aware that the ‘first 1000 days', from conception until the child is two, is most critical for child development. Maternal and infant malnutrition start during pregnancy, especially with pregnant mothers suffering micronutrient deficiencies or diet-related NCDs. We can and must do much more to enable and promote ‘exclusive breastfeeding' for the first six months of every child's life. Various work and maternity leave arrangements as well as childcare facilities should be made available to enable widespread adoption of such practices. While international measures suggest that wasting, stunting and underweight among children are declining all too slowly, child undernutrition remains high, with national shares still rising in many, including middle income countries. Child stunting not only adversely effects children's physical development, but also their cognitive development. How can societies and economies progress if future generations continue to be handicapped from the outset. Non-communicable diseases The crises of obesity, diabetes and other diet-related NCDs in middle income countries remains alarming, with NCDs among the leading causes of premature death and disability. The prevalence of overweight, obesity, diabetes and related morbidities has increased in most countries. Overweight and obesity are risk factors for NCDs, such as diabetes, cardiovascular diseases and cancers, which reduce the quality of life and productivity, unnecessarily raising health costs, both private and public. Often, people are not aware of the consequences of eating much more carbohydrates, calories or ‘dietary energy' than they normally use or need. Over-eating -- often wrongly termed over-nutrition or over-nourishment -- often leads to diet-related NCDs and their consequences. Various non-infectious diseases are due to what we have eaten or drunk in excess, especially processed sugars. Excessive consumption of ‘starchy' foods or carbohydrates raises blood sugar levels which cause diabetes and other problems including excessive weight gain. Thus, sugar ‘addiction' directly contributes to various malnutrition problems. Meanwhile, excessive salt consumption contributes to hypertension or ‘high blood pressure' which, in turn, causes various other health problems. Meanwhile, deep fried food has become the most popular type of ‘fast food', concealing possible staleness or even ‘rotting', as more prepared meals are increasingly purchased and consumed, not prepared at home. Balanced, healthy diets The consequences of not eating properly need to be widely understood. Healthy eating requires dietary diversity. Healthy diets should be adequately diverse, to ensure consumption of various foods. Consuming a variety of nutritious foods can supply all the nutrients people need. We all need macronutrients (carbohydrates, protein, fats), without overeating staples like rice or bread, or fatty, sugary and salty food, and micronutrients, especially vitamins and minerals. Governments, employers, family and peer pressure can help encourage better eating. Food regulations and meal arrangements can thus improve eating practices, behaviour and habits. When people better understand the effects of their food behaviour, and have relevant, easily comprehensible and actionable knowledge and information, many will try to improve their food behaviour. But misleading ‘information' from food and beverage companies and advertising firms is widespread and influential in popular culture. The problem is made worse by popular, even iconic figures who dispense misleading ideas, even half-truths, as part of their own discourses and narratives, often without meaning to do harm, but as part of their own efforts to gain or retain popularity, legitimacy and authority. Various media and popular culture -- at the workplace, at worship and at home -- as well as peers, family and friends greatly influence food behaviours. Women, typically the main caregivers, are particularly important, often choosing the food purchased, prepared and consumed. Transforming food systems Food systems need to be repurposed to better produce and supply safe and nutritious food. Ensuring that food systems improve nutrition is not just a matter of increasing production. The entire ‘nutrition value chain' -- from farm to fork, from production to consumption -- needs to be considered to ensure the food system better feeds the population. Food systems have to improve production practices, post-harvest processing and consumption behaviour. Resource use and abuse as well as environmental damage due to food production and consumption need to be addressed to ensure sustainable food systems. Governments must realize that improving nutrition is crucial for economic and social progress. No country can achieve and sustain development with a malnourished population. Without healthy people, future productivity and progress will be severely compromised. Good nutrition and food safety are necessary for healthy societies and future progress. Governments should use the Covid-19 induced reconsideration of food security in relation to supply chains to better address malnutrition and safety issues. Food security initiatives prompted by pandemic considerations should promote food system changes that will encourage more sustainable and healthy diets. This opportunity to strengthen food systems must also prioritize nutrition, food safety and dietary diversity. Professor Wan Manan Muda is Visiting Professor at Alma Ata University in Jogjakarta, Indonesia. He was Professor of Public Health and Nutrition at Universiti Sains Malaysia, and long active in Malaysian university reform efforts. Link http://ipsnews.net/2020/07/rethink-food-security-nutrition-following-covid-19-pandemic

Are We Going from San Francisco?

Jomo Kwame Sundaram, Anis Chowdhury SYDNEY and KUALA LUMPUR, Jun 30 (IPS)  - Seventy-five years ago, on 26 June 1945, before the Japanese surrender ending the Second World War, fifty nations gathered at San Francisco's Opera House to sign the United Nations (UN) Charter.

UN Charter Nations pledged "to practice tolerance and live together in peace …, and to ensure … that armed force shall not be used, save in the common interest, and to employ international machinery for the promotion of the economic and social advancement of all peoples". They sought "to save succeeding generations from the scourge of war, … and to reaffirm faith in fundamental human rights, in the dignity and worth of the human person, in the equal rights of men and women and of nations large and small, and to … promote social progress and better standards of life in larger freedom". The Charter's contents reflected some contradictions inherent in framing an international organization recognizing national sovereignty as its organizing principle, and various other compromises, often influenced by the convening host nation. Although the conduct of Member States often falls short of the UN's lofty goals, its Charter was nonetheless a monumental achievement, providing the foundation for a rules-based international order. San Francisco Conference Forty-six Allied countries, including the four sponsors – the United States, the United Kingdom, the Soviet Union and China – were originally invited to the San Francisco Conference. The conference itself invited four other States – the Byelorussian and Ukrainian Soviet Socialist Republics, newly-liberated Denmark and Argentina. Poland did not send a representative as its new government was still uncertain. Of the fifty participating states, only four were African and nine Asian. Latin American countries, independent since the mid-19th century, were present and active in deliberations. The Conference was not only one of the most significant international gatherings in history, but perhaps the longest ever. The two month long Conference was attended by 3,500 people, including 850 delegates, their advisers, staff and the secretariat, plus more than 2,500 from the media and other observers. The Conference opened on April 25, 1945 with great fanfare, despite the sudden death of its principal architect and presumed host, US President Franklin Delano Roosevelt, on 12 April. The task of carrying on fell to his Vice-President Harry Truman who had become President. Truman often quoted English poet Alfred Lord Tennyson's Locksley Hall, carried in his wallet, bewildering colleagues, senators and staffers who doubted his commitment to international peace. Tennyson foresaw that nations, realizing they could destroy one another, might agree to form "the Parliament of Man", to resolve disputes peacefully. Clashes and compromises Many serious differences of opinion triggered crises, even at the preparatory stage. For example, the Soviet Union proposed that all 16 Soviet republics should have UN membership to balance the influence of US allies: the US countered by proposing membership for all its 50 states! A compromise was struck, allowing membership for the Soviet republics of Belarus and Ukraine; the Soviet Union then withdrew its opposition to Argentina, which had supported the Axis powers. The most important deliberations concerned the UN Security Council (UNSC), initially composed of five permanent members (US, UK, USSR, China, France) and six elected members. The P5's right to veto provoked a long and heated debate. Others feared that when one of the P5 threatens the peace, the UNSC would be ineffectual. But the P5 collectively insisted that as the main responsibility for maintaining world peace would fall most heavily on them, the veto provision was vital. Australia proposed that no permanent member should be allowed to veto when involved in a Chapter VII dispute over threats to peace. The US delegation blocked this and a Soviet proposal allowing P5 vetoes on procedural matters, e.g., discussion of disputes in which it may be involved. While US officials saw the UN General Assembly (UNGA) primarily as a ‘talk shop', the USSR tried to limit it from discussing sensitive political matters. However, recognizing its importance for legitimacy, the compromise reached permits the UNGA to discuss any issues "within the scope of the Charter". Colonialism was not supposed to be discussed at the Conference to avoid alienating the European imperial powers, whom the US needed to isolate the Soviet Union. But the handful of Asian and African countries attending wanted countries still under the colonial yoke to attain freedom and independence as soon as possible. Although not on the original Conference agenda, after much debate, Chapters XI, XII and XIII provided some norms for colonial administration and pathways for decolonization. Nonetheless, these ambiguous, at best, pronouncements greatly disappointed anti-colonialists around the world. US hegemonic from outset Despite some compromises inherent in framing such an agreement, the UN Charter favoured the US. It promised to protect freedom of action and national sovereignty, as desired by the US, but contained no open-ended commitment to preserve other countries' territorial integrity, like the League of Nations Covenant's Article 10. Article 2(7) placated American sovereigntists and nationalists, declaring: "Nothing contained in the present Charter shall authorize the United Nations to intervene in matters essentially within the domestic jurisdiction of any state." The US and the UK also got what they wanted for existing and new regional and plurilateral arrangements, including defence and mutual assistance organizations. Some US officials were concerned the UN might threaten the Monroe Doctrine privileging the US in the Western hemisphere, while limiting its ability to intervene elsewhere. Some clever drafting of Chapter VIII provided blanket endorsement to regional organizations, also seen as reflecting the principle of subsidiarity. Article 51 enshrined the principle of "self-defense against armed attack, either individual or collective". Although not fully appreciated in 1945, such provisions later helped legitimize various US and other post-colonial security pacts in Europe, Asia and the Americas against the Soviet Union during the Cold War. Conference participants also considered a proposal for compulsory jurisdiction for a World Court, but the US Secretary of State recognized this would jeopardize Senate ratification. Delegates compromised, agreeing to let countries decide whether to accept the International Court of Justice (ICJ)'s jurisdiction. Unsurprisingly, the US has had an uneasy relationship with the ICJ from the outset, never submitting to its authority, and reacting negatively to Court decisions seen as adverse to the US. From Truman to Trump Presiding at the closing ceremony, Truman cautioned that the success of the new world body would depend on collective self-restraint. "We all have to recognize – no matter how great our strength – that we must deny ourselves the license to do as we please. This is the price each nation will have to pay for world peace." Truman is probably turning in his grave watching Trump's jingoist ‘America First' policy undermine the UN and multilateralism. Are multilateralism and the UN now doomed as Trump belies Tennyson's hope and leads the US to up-end the Roosevelt-Truman legacy? Visit this story at http://ipsnews.net/2020/06/going-san-francisco