Saturday, January 4, 2014

NAFTA's Bad Dream

NAFTA, such a joy to remember, and so important to recall.  I guess the Maquiladora sector has lost out since China had come on the scene so much.  I studied Fair Trade, and learned how NAFTA had disenfranchised local indigenous farm communities and contributed to the refugee immigrants.  It's a tragedy, and the beer is a tragic symbolic illusion.

Twenty Years on, Mexico Is NAFTA's Biggest Lie

  Friday, 03 January 2014 11:13 By Jaisal Noor, The Real News Network | Video Interview
JAISAL NOOR, TRNN PRODUCER: Welcome to The Real News Network. I'm Jaisal Noor in Baltimore.
On January 1, 1994, the North American Free Trade Agreement went into effect. Removing barriers for trade between Mexico, Canada, and the United States, NAFTA created the world's largest free trade area, now linking 450 million people producing $17 trillion worth of goods and services.
Now joining us to discuss this is Timothy A. Wise. He directs the Policy Research Program at the Global Development and Environment Institute at Tufts University. He's the author of the recent article "How Beer Explains 20 Years of NAFTA's Devastating Effects on Mexico".
Thank you so much for joining us, Tim.
NOOR: So, Tim, much of the media is celebrating 20 years of NAFTA. I was reading a piece in The Economist which talks about the benefits that NAFTA has brought the U.S., Canada, and Mexico. It singles out Mexico for having received the greatest amount of benefits from NAFTA. And the article says the only problem is that we're not expanding free trade quick enough. What's your response? What's been the real story of NAFTA, especially on Mexico, in the last 20 years?
WISE: Well, I think it's--that kind of interpretation really misses the--it ignores the underlying and very clear economic evidence that Mexico has performed far more poorly than other middle-income countries who have not been part of agreements like that. And that's all the more remarkable given that, as one of my coauthors on the piece--I think it was our retrospective on NAFTA at 15--Eduardo Zepeda, then of the Carnegie Endowment, said no country will ever have the benefits, the advantages that Mexico had entering NAFTA, and if Mexico can't make it work, we really have to rethink these agreements. Mexico had a 200 mile border with the United States, the largest--the United States being the largest consumer market in the world to consume Mexico's products. It had the longest economic expansion in the United States' history going on right after NAFTA was signed. And it had a surge--it got the surge it wanted in foreign investment, which tripled. It got a surge in trade, which increased dramatically. It kind of got everything it wanted and yet still showed remarkably slow levels of economic growth, incredibly poor job creation, and a real lack of strategic development over the course now of 20 years. It's anything but a poster child for development. In fact, I think out in the world it's seen as more of a warning sign to other developing countries about signing such agreements.

Nuclear Clean Up- Bechtel and Hanford

While Fukushima is a relatively new disaster, it's easy to forget the others all around.  I remember reading about Hanford what must be decades ago now.  The corporate executive and investor system is making Marxism look good.

Nuclear Disaster in the US: How Bechtel Is Botching the World's Costliest Environmental Cleanup Wednesday, 02 November 2011 04:38 By Joshua Frank, AlterNet | News Analysis
Razor wire surrounds Hanford’s makeshift borders while tattered signs warn of potential contamination and fines for those daring enough to trespass. This vast stretch of eastern Washington, covering more than 580 square miles of high desert plains, is rural Washington at its most serene. But it’s inaccessible for good reason: It is, by all accounts, a nuclear wasteland.
During World War II, the Hanford Reservation was chosen by the federal government as a location to carry out the covert Manhattan Project. Later, plutonium produced at Hanford provided fuel for the "Fat Man" bomb that President Truman ordered to be dropped on Nagasaki in 1945, killing upward of 80,000 Japanese. In all, nine nuclear reactors were built at Hanford, the last of which ceased operation in 1987. The U.S. Environmental Protection Agency now estimates that as a result of the nuclear work done at Hanford's facilities, 43 million cubic yards of radioactive waste were produced and more than 130 million cubic yards of soil ultimately were contaminated.
During Hanford's lifespan, 475 billion gallons of radioactive wastewater were released into the ground. Radioactive isotopes have made their way up the food chain in the Hanford ecosystem at an alarming rate. Coyote excrement frequently lights up Geigers, as these scavengers feast on varmints that live beneath the earth's surface. Deer also have nuclear radiation accumulating in their bones as a result of consuming local shrubbery and water. The EPA has deemed Hanford the most contaminated site in North America—a jarring fact, as the Columbia River, lifeline for more than 10,000 farmers and dozens of commercial fisheries in the Pacific Northwest, surges along Hanford's eastern boundary.
In 1989 Hanford changed from a nuclear-weapons outpost to a massive cleanup project. Since then, the site has become the largest and most costly environmental remediation the world has ever seen.
The U.S. Department of Energy (DOE), the agency that oversees energy and the safety of handling nuclear material, supervises the cleanup efforts, which are currently undertaken by Bechtel National Inc.—infamous for its mishandling of Iraq reconstruction efforts—and a handful of other companies like URS and CH2M HILL. But despite more than two decades of cleanup efforts and billions of dollars spent, only a tiny fraction of Hanford's radioactivity has been safely contained. And the final costs for the Hanford cleanup process could exceed $120 billion—higher even than the $100 billion tab for the International Space Station.
Now outrage is brewing at Hanford. Some prominent employees working on the project are blowing the whistle over what they believe to be dismissals of internal scientific assessments, as well as alleged abuses of managerial power that have been called to the attention of the Obama Administration, to no avail. These staffers point to institutional failures within the DOE and Bechtel as toxic as the nuclear waste they're tasked to clean up, asserting that the DOE lacks critical experts on staff to oversee the project and Bechtel rushed through shoddy design plans in order to pocket some quick cash. The consequences are not only jeopardizing safety and putting the project at risk of failure, they are also likely to cost taxpayers even more money should fatally flawed construction ultimately require a complete overhaul.
"We need alternatives to the current plan right now," Dr. Donald Alexander, a high-level DOE physical chemist working at Hanford, says in distress. "We need a different design and more options on the table. This appears to be a hard thing for [DOE and Bechtel] management to accept. They have spent years of time and money on a bad design, and it will delay the project even more."

It's the tail end of summer, and Alexander is about to head off on a weekend camping trip with his son in northern Idaho. While his spirits are high at the thought of his upcoming retreat, Alexander somberly assesses the Hanford situation from his vantage point.
"One of the main problems at Hanford is that DOE is understaffed and overtasked," Alexander explains. "As such, we cannot conduct in-depth reviews of each of the individual systems in the facilities. Therefore there is a high likelihood that several systems will be found to be inoperable or not perform to expectations."
Alexander knows his nuclear disasters well, as he led one of the DOE's first scientific delegations to Russia's Mayak nuclear facility in 1990. Mayak, one of the largest nuclear production plants in the former Soviet Union, suffered a deadly accident in 1957 when a tank containing nuclear materials exploded. The Mayak facilities are comparable to the plutonium production units built at Hanford, which is considered a "sister facility." Since they are so close in design and makeup, Mayak is often seen as an example of what can go wrong with the production of plutonium and the storage of nuclear waste at Hanford. Alexander's team negotiated the transfer of data collected by the Soviets on the health effects of Mayak's radioactive release, establishing a program that allows Russian and U.S. scientists to share nuclear cleanup technologies and research.
Currently, federal employees at DOE headquarters in Washington, D.C., are evaluating whether Bechtel's construction designs at the site have violated federal law under the Price-Anderson Amendments Act (PAAA). An amendment to the Atomic Energy Act of 1954, the PAAA governs liability issues for all non-military nuclear-facility construction in the United States, which includes Hanford.
These concerns are triggering other investigations, some of which have yet to be publicized. Last month, the DOE's Office of Health, Safety, and Security headed to Hanford to conduct a follow-up investigation about safety-culture issues. Their findings could be released as soon as the end of the year. This visit comes on the heels of a June investigation by the Defense Nuclear Facilities Safety Board (DNFSB), an independent organization tasked by the executive branch to oversee public health and safety issues at the DOE's nuclear facilities. In a report addressed to Secretary of Energy Steven Chu, DNFSB investigators wrote that "both DOE and contractor project management behaviors reinforce a subculture . . . that deters the timely reporting, acknowledgement, and ultimate resolution of technical safety concerns."
After reviewing 30,000 documents and interviewing 45 staffers, the DNFSB reported that those who went against the grain and raised concerns about safety issues associated with construction design "were discouraged, if not opposed or rejected without review." In fact, according to the DNFSB, one of these scientists, Dr. Walter Tamosaitis, was actually removed from his position as a result of speaking up about design problems.
It's not just the DNFSB that is concerned with the safety culture and management at Hanford. Seattle Weekly has obtained official documents revealing that the Government Accountability Office (GAO), the Congressional arm in charge of investigating matters relating to contractors and other public fund recipients, visited the Hanford site last month. In an outline sent to DOE personnel in advance of their visit, the GAO wrote that it will look into how contractors are addressing concerns over what they call "relatively lax attitudes toward safety procedures," "inadequacies in identifying and addressing safety problems," and a "weak safety culture, including employees' reluctance to report problems." Their findings likely will be made public in early 2012.
This wasn't the first time the GAO investigated DOE contracts with Bechtel. In 2004, the agency released a report critical of the DOE and Bechtel's clean-up plans, warning of faulty design and construction of the Tank Waste Treatment and Immobilization Plant (WTP), a structure at the heart of the clean-up effort. The WTP building was not designed to withstand a strong earthquake, but only after prodding from the DNFSB did the DOE force Bechtel to go back to the drawing board to ensure the plant could withstand one. As a result, Bechtel's design and cost estimates to finish construction skyrocketed from $4.3 billion to more than $10 billion. And in 2006, GAO released another paper critical of Bechtel's timeline and cost estimates, which seemed to change annually, saying that they have "continuing concerns about the current strategy for going forward on the project."
These flawed plans flew under the radar because the DOE does not have enough staff to thoroughly review every design piece put forth by Bechtel, says Alexander. As a result, expensive mistakes like these could occur again. The lack of key staff to oversee Bechtel's work continues to plague the WTP project to this day.
The concerns of the GAO, the DNFSB, and Alexander all point to a flawed relationship between the DOE and Bechtel, which is both the design and construction authority on WTP. Once operable, the plant will turn the millions of gallons of radioactive sediment currently in the site's waste tanks into glass rods by combining the toxic gunk with glass-forming material at a blistering 2,100 degrees Fahrenheit—a process called vitrification. The rods will then be shipped to an offsite location to be stored indefinitely.
Bechtel's contract is what is known in contractor parlance as "cost and schedule performance based." Such contracts, standard in the defense world, reward contractors like Bechtel for "meeting milestones" within their proposed budget—in some instances, even if plans and construction turn out to be critically flawed. Despite certain mistakes, including those made during the first three years of building the WTP with seismic deficiencies, Bechtel boasted in 2004 that they had received 100 percent of the available milestone fees available to the company through their Hanford contract with DOE.
The DOE is tasked with overseeing the project and signing off on their recommended procedures, but Alexander argues that the agency is incapable of proper oversight. "In the past 45 years, about 400,000 people . . . have been irradiated [because of the Mayak disaster]," reflects Alexander. "It's quite possible that a similar accident could happen here. That's why it is so important that we get the Hanford cleanup facilities up and running properly, as soon as possible."

There is something ominous about Hanford, and it's not just the radioactivity.
The Wanapum Tribe, which survived here for centuries, feasting on the once-mighty Columbia River salmon runs, was evicted less than 70 years ago by the federal government so the feds could manufacture fuel for the A-bomb. It was certainly a marvelous scientific achievement when the first plutonium rolled out of Hanford's B Reactor, which is now just one of the many structures that haunt this dry landscape. But cleaning up Hanford's aftermath may prove even more of an accomplishment than it took to create the nuclear reservation in the first place.
Richland, population 48,000, is the city closest to Hanford. Local bars on the weekends overflow with Hanford contractors, and the cash they put down for shots and rounds of cold beer is abundant. The local watering hole, aptly named the Atomic Ale Brewpub, is decorated with Hanford artifacts and memorabilia, and serves beer like Plutonium Porter and Jim's Radioactive Rye. Richland High School's mascot is the Bombers. Despite its toxicity, locals have evidently embraced Richland's nuclear lore.
Richland's economy has long been sustained by the nuclear industry. Before the current cleanup of Hanford began to bring money into the community, the development of nuclear technologies ruled the town for decades. Just outside a more upscale neighborhood is a sprawling industrial park that serves as the district office for Hanford contractors and DOE employees. Without Hanford contracts employing thousands, Richland certainly would be struggling.

This is tragic and outrageous, but as noted below by SWB, nothing new. Learning about the problem of corporate executives and their tricks and abuses is essential. However, to change it requires recalling and participating in the structures for change, although these are not political votes first and foremost. The Green Party's Jill Stein has a long way to go to get elected President of the US. It won't happen anytime soon. However, voting with dollars and starting community enterprise all can happen yesterday, or tomorrow. Mondragon Co-op Corp in Spain got started in Franco's fascist Spain, and Danish citizen's started the modern wind turbine industry with anti-nuke protests. Check out the Right Livelihood Award and the Goldman Environmental Prize to get a look a various movements taking steps. The US already has plenty of food coops and credit unions, besides natural foods stores and other alternative enterprises. These are the kinds of changes that will have to happen to get back to pre-Reagan US democracy, and go beyond to the levels that can be find in the EU and elsewhere in various outposts.

Thursday, January 2, 2014

Cato/NPR's Welfare vs Min Wage

Welfare Isn’t Too Generous—Wages Are Too Low

Real earnings for workers, by gender, 1973–2011 (2011 dollars)

Real earnings for workers, by gender, 1973–2011 (2011 dollars)
Note: Shaded areas denote recessions.
Source: Current Population Survey Annual Social and Economic Supplement Historical Income Tables, Table P-41, "Work experience- All Workers by Median Earnings and Sex: 1987-2011," and Table A-4, "Number and Real Median Earnings of Total Workers and Full-time, Year-Round Workers by Sex and Female-to-male Earnings Ratio: 1960–2011."
NPR recently published a story that gives undue credence to a Cato Institute study lamenting the generosity of US safety net programs. In reality, welfare benefits are not nearly as generous or accessible as the study claims. The NPR piece provides useful stories from actual welfare recipients, whose experiences more faithfully represent reality.
An important part of Cato’s assertion is that these programs offer a higher level of income than do many low-wage jobs. The real problem here is that wages for the vast majority of Americans are too low, and haven’t kept up with the increased productivity of the labor force.
When the study was first released, we pointed out some of the problems with their analysis. Here’s a quick summary of why their study was so misleading:
The Cato Institute recently released a wildly misleading report by Michael Tanner and Charles Hughes, which essentially claims that what low-wage workers and their families can expect to receive from “welfare” dwarfs the wages they can expect from working. Using state-level figures, their paper implies that single mothers with two children are living pretty well relying just on government assistance, with Cato’s “total welfare benefit package” ranging from $16,984 in Mississippi to $49,175 in Hawaii. They then calculate the pretax wage equivalents in annual and hourly terms and compare them to the median salaries in each state and to the official federal poverty level. Tanner and Hughes find that welfare benefits exceed what a minimum wage job would provide in 35 states, and suggest that welfare pays more than the salary for a first year teacher or the starting wage for a secretary in many states.
So what makes this so misleading?
For one, Tanner and Hughes make the assumption that these families receive simultaneous assistance from all of the following programs: Temporary Assistance for Needy Families (TANF), Supplement Nutrition Assistance Program (SNAP), Medicaid, Housing Assistance Payments, Low Income Home Energy Assistance Program (LIHEAP), Women, Infants, and Children Program (WIC), and The Emergency Food Assistance Program (TEFAP). It is this simultaneous assistance from multiple sources that lets the entire “welfare benefits package” identified by Cato add up to serious money. But it’s absurd to assume that someone would receive every one of these benefits, simultaneously, and it ignores the fact that some programs have time limits.

What’s more, their report carries the clear implication that welfare is (or should be expected to be) pulling low-wage workers out of the labor market by making life on welfare so attractive. In actuality, many low-income working families receive assistance through these programs.
Sharon Parrott and LaDonna Pavetti at the Center on Budget and Policy Priorities provide some solid evidence against some of the claims made by Tanner and Hughes. They provide detailed statistics on how little overlap there is in the assistance families receive for multiple programs, and how few eligible families actually receive any benefits at all.
What’s striking to me is that even Cato’s overblown and exaggerated welfare benefits would leave families in eight states with incomes below the federal poverty line. I’d add that it’s a bit odd to look at hypothetical data, when real data on what low income families actually receive from welfare and work is available. The Congressional Budget Office provides comprehensive data on sources of income for households by income fifths. We looked at this in some detail in the poverty chapter of State of Working America (see here). These reputable data tell a very different story about how low-wage workers live their lives. They are getting far less from government assistance than the Cato report implies and are relying much more on income gained from working.
In 2009, average transfer income for the lowest fifth of workers was $4,633 and average labor income was $12,871. (To be comparable with the Cato report, I’m not including Medicare and Social Security income.) Two things are clear here: government transfers are far less than what Tanner and Hughes claim, and labor income far exceeds government transfers for the lowest income group, meaning that real-world low-income families don’t feel so coddled by lavish welfare benefits that they don’t need to work.
Tanner and Hughes are not telling a realistic story about the lives of low income Americans and the income provided to them by transfer programs. Where they have a point is how poorly work pays for too many American families, particularly low-wage workers. If they want to insure that work pays well for single mothers with two kids, it would seem more worthwhile to push for increases in the minimum wage and affordable child care. Cato’s view instead seems to be that since work alone is failing to provide secure living standards for many Americans, we should take away other sources of income from them, too.
- See more at:

  • Minimum wage jobs are not meant to provide income to support a family. I'd like a questions answered: why haven't adults working for minimum wage developed a skill that allows them to earn more? Why have children you cannot support?
Mike bigdnyc
    • •3 months ago
      Perhaps that used to be the case, but it isn't anymore. In 2000, the average age of a fast food worker was 22. Eleven years later, it's almost 30. Older people aren't taking these jobs because they're unqualified for better paid work, they're taking them because they can't get work elsewhere. Productivity gains and overseas outsourcing have contributed mightily to the bottom line of many corporations, but the American workforce is paying the price.
My turn (Mark of this blog....)
  • In fact what's determining the "minimum wage" is an economic philosophy, not any "economic science" that minimum wage jobs are legitimate, or that sufficient job training and better jobs actually exist or are possible in the current policy environment. People are paid "minimum wages" because corporate executives want to "maximize profits," and because they have bullied society into accepting wage slavery of the rest of humanity as acceptable.  Moreover, as suggested by Mike here, US corporate policies most of all have ignored their social obligations in salary arbitrage overseas. Australia seems to be a good example of some insight into this, since their minimum wage is a "living wage." They pay salaries because jobs are means of allowing human beings to plan their lives and their families with their Human Rights, not just for gambling, get-rich-quick corp exec fantasies to come true to rule the world. Of course, given their current state of tyranny, I advocate co-op enterprise to create new jobs where there are owner-operators, as was begun in Rochdale, UK in 1844, Germany in 1850, Mondragon, Spain in 1959 and Emilia-Romagna, Italy since before the Second World War. The US has some examples, even if the Knights of Labor became defunct in the 1800s. New York City had bunches of food co-ops in the 1970s, some survived, and more have been created recently, as well, in fact.