Who says this is a do-nothing Congress? Sure, it can't agree on expanding the childcare tax credit or approve an increase in the minimum wage. Yet, as Congress prepares to adjourn, legislators were rushing to protect and expand tax subsidies for some of the largest, most profitable corporations in the world. Under current law, US exporters can set up largely paper presences in foreign tax havens like Barbados. The exporters can then exempt between 15 and 30 percent of their export income from taxes by routing products through these entities, called Foreign Sales Corporations. In a recent case filed by the European Union, however, the World Trade Organization ruled that the FSC tax break was an illegal subsidy.
Precedent has shown the United States more than willing to bend to the will of the WTO. For example, when the WTO ruled against an Endangered Species Act protecting sea turtles, the United States quickly eased its regulations. Yet when a multibillion-dollar tax incentive is at stake, Washington falls all over itself to protect corporate welfare.
Immediately after the WTO ruling against FSCs, the Clinton Administration, a few members of Congress and the business community began meeting in secret to work out a bill that eliminates FSC in name only while actually expanding export subsidies for a total cost to taxpayers of about $4 billion a year. The beneficiaries? General Electric, Boeing, Raytheon, Cisco Systems, Archer Daniels Midland and others. The House approved this bill with only forty minutes of debate and no amendments allowed, by a vote of 315 to 109. The bill was held up in the Senate because some objected to the tax break for arms manufacturers and subsidies for tobacco exports. Despite the objections, the bill is expected to be tacked onto a must-pass budget bill and signed by the President.
The proponents of this giveaway claim it will promote US jobs. However, the Congressional Budget Office, whose director was appointed by Republicans, has written, "Export subsidies do not increase the overall level of domestic investment and domestic employment.... In the long run, export subsidies increase imports as much as exports." The nonpartisan Congressional Research Service reached a similar conclusion.
It gets worse. The tax break may actually subsidize moving US jobs overseas. There is no requirement that a substantial portion of a product covered by the subsidies be made with US content or with US labor. An Administration official said that an eligible product could have "little or no US content" and still qualify.
Not only is the legislation not economically justifiable, it is not likely to comply with the WTO ruling. The EU has already stated that the changes aren't adequate, and it intends to seek authority to retaliate by imposing 100 percent tariffs on some $4 billion worth of US goods.
I am not a fan of the WTO. It is an unaccountable, secretive, undemocratic bureaucracy that looks out for the interests of multinational corporations and investors at the expense of human rights, labor standards, national sovereignty and the environment. But by pointing out that export subsidies like FSCs are corporate welfare, the WTO has done US taxpayers a favor. It has once again highlighted the fact that US trade policy is written by and for corporations, with no concern for workers, human rights or environmental protection.
If Western Europe is to be independent it must defend its welfare state.
While the differences between George W. Bush and Al Gore may still be coming into focus for many Americans in the final weeks before the election, one is already stark. On tobacco, the leading cause of preventable death in America, Bush would return the nation to the failed laissez-faire attitudes of the past. A Gore administration could be expected to continue the course charted by President Clinton, the first truly anti-tobacco President.
Indeed, a Bush administration would solve so many of tobacco's problems that the Texan is virtually one-stop shopping for an industry that has drenched his campaign with cash. For one thing, he'd change the civil justice system. Clinton vetoed tort reform bills, but Bush has made such "reform" a keystone of his proposed social policy and points with pride to his record in Texas--in 1995 he placed draconian restrictions on the right to sue. Bush would help mitigate the fallout from the recent $145 billion verdict in the Engle lawsuit--the Miami class action on behalf of thousands of Floridians sickened by cigarettes--by signing a bill pending in Congress that would send all class actions to federal court. There, Engle would be decertified, downgraded into a handful of individual lawsuits, long before trial by a federal system hostile to tobacco class actions.
As to regulating cigarettes, Bush would likely work with a Republican Congress to enact a "compromise" regulation law, limiting some forms of tobacco marketing and granting toothless federal oversight in return for liability limits and giving tobacco a seat at the table of any regulatory process. Bill Clinton was the first President to make the regulation of tobacco one of his signature policy initiatives. Although the Supreme Court ultimately shot down Food and Drug Administration oversight of cigarettes, Clinton used the bully pulpit of the presidency to put tobacco on the national agenda in a way it had never been before, fulminating against the industry for peddling nicotine to children.
Bush's record indicates he would pay lip service to keeping kids off cigarettes but would put much more energy into vilifying plaintiffs' lawyers for getting rich from lawsuits that attack the industry for targeting children. Bush has pledged to kill off a multibillion-dollar RICO action by the Justice Department that charges that the cigarette companies concealed their product's deadliness, and he would likely rescind or stymie numerous Clinton executive orders, nascent regulations and programs dealing with everything from secondhand smoke to funding research on Big Tobacco's internal documents.
Finally, Bush would be likely to back incursions by domestic cigarette makers into foreign markets. He would be much less disposed to sign on to a proposed World Health Organization treaty on tobacco and health and very prone to weaken it, to the benefit of a global tobacco industry now menacing Asia, and to the detriment of millions of potential new smokers who will become victims of cigarette-related disease.
It offers a blatant apologia for economic inequality--but few question the faith.
Ruy Teixeira and Joel Rogers's America's Forgotten Majority has been credited with convincing Al Gore last summer to adopt a populist campaign strategy built around "working families" and the mantra, "They're for the powerful, we're for the people." Republicans immediately accused the Vice President of "class warfare," and Business Week worried that Gore's rhetoric was tapping into a broad "anti-business" public mood. Pundits thought (or hoped) there would be a backlash among "suburban independents," but thus far none is visible.
Though Gore is a highly ambiguous class warrior and has skillfully targeted only the most egregious (and unpopular) corporate powers, this is a bold and welcome turn toward class politics in the United States. And though Ralph Nader and the revitalized political operations of the AFL-CIO undoubtedly deserve some credit too, there's a chance that Teixeira and Rogers have helped do for the Democrats what Kevin Phillips's "Southern strategy" did for the Republicans in 1968 and beyond.
What have they done? Simply pointed out what Michael Zweig calls "America's Best Kept Secret"--that the majority of Americans are "working class," not "middle class," and that failing to realize that simple fact leads to a cascade of illusions, both political and otherwise. This is the larger point that will endure, regardless of how Gore's populist strategy works in November (if, indeed, he sustains it until then). We cannot get our politics right, or our economics and culture, for that matter, until we have a better, more consistent grasp of the vagaries of class in our society. America's Forgotten Majority: Why the White Working Class Still Matters and The Working Class Majority: America's Best Kept Secret, each very different in its concepts and details, lay a strong social-scientific foundation for bringing social class out of the closet and making it a permanent part of our public discourse.
Teixeira and Rogers's contribution lies most completely in their political arithmetic, which emphasizes the importance of class and unionism as well as race and gender. When they extend from that, their sense of what they call core working-class values is thinner and less accurate, in my view, and their policy prescriptions are too narrowly focused on this year's election and contain what would be a crucial strategic error if put into practice. But their arithmetic is clear and compelling, and Zweig complements and strengthens their analysis in the other areas.
The arithmetic begins by dividing voters into a "middle class" and a "working class," based on one clear and simple characteristic--the possession or lack of a bachelor's degree. About 30 percent of voters have one, while the vast majority (the working class) do not. Teixeira and Rogers understand that both income and occupation are also relevant to understanding class dynamics, but information on them is not consistently available in the voting data, and, besides, there is such a strong correlation between college education, occupation and income that it doesn't matter much for their purposes. "Managerial and professional workers," for example, are much more likely to have bachelor's degrees and are paid from 34 percent to 140 percent better than other workers; they, like the "college-educated," with whom they overlap so strongly, are about 30 percent of the labor force.
Teixeira and Rogers next divide voters into the Democratic base (union households, blacks and Hispanics) and, by implication, the Republican base (nonunion whites). In 1996 the Democratic base constituted one-third of voters, while nonunion whites made up the other two-thirds of the electorate; the base voted 66 percent Democratic, while the much larger group of nonunion whites gave Democrats about 40 percent of their vote. This combination was enough for Clinton to win without a majority, but the basic arithmetic condemns Democrats to a hard struggle to get from marginality to deadlock, at best, until they can win at least half of the white, nonunion working-class vote. Thus, the subtitle "Why the White Working Class Still Matters," to which should have been added "Particularly the Nonunion Part."
This calculus gets trickier and trickier, but the payoff is worth it. When Zweig speaks of a "working-class majority" based on occupation, he includes white, black and Hispanic, both union and nonunion. Teixeira and Rogers emphasize this same overwhelming working-class majority, but what they most often refer to as "the Forgotten Majority" is not truly one: Once all blacks, Hispanics and union whites (groups that contain large working-class majorities) have been set aside as part of the Democratic base, this Forgotten Majority--white nonunion workers without a bachelor's degree--is actually only 45 percent. But this does make them the single largest group in the electorate, and, what's more, they are the real swing vote in US politics today. Using 1996 figures, Teixeira and Rogers's map of the electorate looks like this:
This breakdown of the electorate is the single most valuable aspect of America's Forgotten Majority. The nonunion white working class is such an enormous part of the voting populace that, though an important part of the Republican base, it produced more Democratic votes than any other group of voters. Gaining a percentage point among the Forgotten Majority, then, is worth more, numerically, than two or three points among any other voter group. (In a tactic that has helped win them mainstream attention, Teixeira and Rogers laboriously show how the Republican, Reform and Green parties might win the Forgotten Majority, but their main analytical effort is directed at Democrats.)
Teixeira and Rogers are primarily geared to argue against the New Democrat notion of suburban "soccer moms" and "wired workers" as the crucial swing vote in US politics. They show conclusively that this group (the college-educated) is simply too small and not volatile enough to constitute the key "suburban independent." White, nonunion, college-educated men are, in fact, the immovable base of the GOP, nearly as solidly and consistently Republican for the past half-century as black voters have been for the Democrats. White, nonunion, college-educated women represent more appealing ground--indeed, they've been an important part of what's kept the Democrats competitive for the past twenty years--but Teixeira and Rogers see little room for growth there. Conversely, the nonunion white working class is the true "suburban independent," constituting three-fifths of suburban voters. What's more, these voters "were far and away the most volatile segment of the electorate...the real 'swing voter'" of the nineties. They're the ones searching for a new politics because, until the past few years, their median family income was stagnating and their average real wage was declining.
Within this group, Teixeira and Rogers pay special attention to nonunion working-class white men, partly because the Democrats have more room to grow among them than with Forgotten Majority women, and partly because they have been particularly fickle at the polls over the past decade. Even more important, however, is that this particular working-class group--not protected by a union, a bachelor's degree or affirmative action--has lost much ground in wages and benefits over the past quarter-century, while often being culturally and politically lumped into the "white male" power structure with whom they share little but the color of their genitalia.
In fact, nonunion white working-class men constitute a large group that is politically open to having its existence remembered and appealed to. Teixeira and Rogers point out that this group of white men is nearly twice as numerous as the New Democrats' "soccer moms" and that "simply breaking even among these forgotten majority men would be equivalent to achieving landslides among...college-educated white women."
The Teixeira-Rogers analysis contains bad news for progressive Democrats as well--those who, like me, thought that registering and turning out more blacks, Hispanics and union households could lead to a majority. A great deal of effort has gone into this strategy, and it has by no means been in vain. Blacks, particularly in the South, and Hispanics, particularly in California, are a stronger presence in the electorate, and the difference between the union household vote at 19 percent of voters (as it was in 1994) or at 25 percent (the AFL-CIO goal this year) would have meant the difference between Newt Gingrich and Dick Gephardt. But for the Democrats to achieve a ruling majority (the White House plus large majorities in both the House and Senate), a mobilized class-based appeal to the nonunion white working class would be necessary.
Teixeira and Rogers are somewhat less convincing in arguing against a gender-gap strategy targeted on nonunion white working-class women, who by themselves make up more than a quarter of all voters. It's hard to rule out efforts that would bring nonunion working-class white women into a broad coalition with blacks, Hispanics and union households. But how could Democrats do that without a class-based appeal that would attract Forgotten Majority men as well as Forgotten Majority women?
Affirmative action and the right to choose, both of which are usually cast in terms most appealing to college-educated women, have probably gained Democrats just about all they can among working-class women. Thus, Teixeira and Rogers argue, "the best approach to mobilizing the forgotten majority lies in universalist, transracial issues that should have substantial appeal to the Democratic base as well." These include issues like universal healthcare, starting with children; saving the Social Security guarantee without cutting benefits or increasing payroll taxes while adding a government subsidy to encourage wage workers to save (and invest); increasing the earned-income and childcare tax credits and expanding family and medical leave; and reducing school class size while increasing construction and teacher salaries. Also important are tight labor markets and strengthened worker rights, things that could make organizing a union less formidable while tending to increase wages and job security in the meantime.
This, of course, is pretty much the Gore-Lieberman program, as prefigured in Clinton's last two State of the Union speeches, though Teixeira and Rogers would do it all at a much greater magnitude. Where they disagree with Clinton-Gore-Lieberman--on affirmative action--they are wrong. But here's where Michael Zweig's broader economic-class analysis can lend a hand.
Zweig argues for a class-based politics as well and is equally compelling in pointing out the limitations of racial and gender-identity politics. But he wants to complicate and supplement identity politics, not eliminate it. Zweig is very clear that any working-class agenda that implicitly denies the continuing importance of racial and sexual injustice is doomed to fail for the most traditional of reasons: It divides the working class precisely along lines where it is most easily divisible. Though Zweig is open to the possibility of a class-based affirmative action supplementing the existing, racially based kind, he's opposed to any further relaxation of the current affirmative action regime--which has already taken a beating nationally in both jurisprudence and legislation.
Teixeira and Rogers make a huge mistake, in my opinion, when they advocate the replacement of race-based affirmative action with a class-based version. (They say nothing about gender-based affirmative action, which affects a majority of voters, but presumably it would disappear as well.) Their intention is to unify people around class interests, but the predictable impact would be exactly the opposite. Few issues in US politics play so differently at the symbolic level versus the level of actual details. There are many legitimate issues to discuss about particular programs in higher education and for specific work categories like police, fire and construction, but the issue of fairness in the details is never as simple as the widespread but false assumption that there exists some kind of sweeping government-ordered quota system based on nationally legislated group rights. President Clinton's phrase "mend it, don't end it" defended affirmative action (and thereby the continuing problem of racism and sexism) at the symbolic level while legitimizing discussion of the details. Challenging that Clintonian consensus by reopening the symbolic debate is not a winning political strategy, precisely because it forces people to choose between their race or gender interests and those of their class. If your goal is to split the Democratic base from the Forgotten Majority, this is exactly how to do it.
The larger point is one that Zweig makes particularly well. Class in America deserves special attention right now because it has been so thoroughly neglected for so long; but a class-based politics needs to be built on and around the achievements of the civil rights and women's movements, not counterposed to and made competitive with them. The whole point of "universalistic, transracial" political programs is to convince white working-class men that they can advance their interests better by adding key government assistance to all workers, not by subtracting it from blacks and women. The progress of working-class blacks and women, on the other hand, is currently stymied by the absence of a class politics that can complement (and maybe even revitalize) the fight for racial and sexual equality.
Zweig's investigation of politics goes beyond the electoral, focusing instead on how a broad working-class social movement (often in alliance with segments of the professional middle class) could reshape workplace and community power relations as well as national politics. He sees labor unions playing a central role in such a movement and is particularly enthusiastic about the AFL-CIO's "organizing for change, changing to organize" strategy.
A plain-spoken economist, rigorous thinker and clear writer, Zweig defines the American class structure basically by occupations and the amount and kind of power people have in the workplace. In this schema, there are three classes: a "capitalist class," defined by ownership and control of giant profit-making enterprises; a "working class," defined by a lack of power at work and in society at large; and a "middle class" of managers, professionals and small-business owners who have a degree of autonomy and influence at work that makes them different from the working class but nowhere near as powerful as the capitalists.
If this sounds like classic Marxism (capital, labor and the petty bourgeoisie), don't let that distract you. Zweig never mentions "relations of production" or any of the other key Marxian concepts that have been transformed into mind-numbing sectarian jargon over the past half-century. The Working-Class Majority is, in fact, a refreshing restatement of the classical Marxist view, but it is updated by its delicate analysis of occupations in the United States today and by its post-cold war refusal to call for the elimination of the capitalist class. Rather, Zweig charts a politics based on the understanding that over the past two or three decades the capitalist class has again achieved the kind of overweening power, both nationally and internationally, that was once at least partially checked by strong labor movements and progressive governments. Unchecked, the capitalist class, often despite its best intentions, will systematically make life worse for workers and eventually even undermine capitalism's splendid (but ultimately unsustainable) ability to create wealth.
No one has claimed that Al Gore's campaign theme "They're for the powerful, we're for the people" was influenced by Zweig's analysis, but Gore's rhetorical emphasis on the power of "the few" is consistent with the kind of politics Zweig is after. In the end, the current Democratic policy package, though a minimalist version, moves exactly in the direction Zweig and Teixeira and Rogers want. The difference is that their complementary class analyses offer a much more expansive sense of possibility for US politics and, taken together, a wider range of options, in both thought and action, for achieving that possibility. They are also part of a larger trend in academic thought (much of it organized around the Center for Working-Class Studies at Youngstown State University) struggling toward a fresh framework for consistently remembering the working-class majority.
Both books suffer from their lack of attention to the professional middle class (which includes all three of them, as well as me and most of the readers of this review), the real cultural power we have as a class and the differences between us and the working class. Teixeira and Rogers's "core working-class values," with their emphasis on "individual achievement," sound suspiciously middle class to me, and this both oversimplifies and distorts their analysis. Likewise, Zweig's principled refusal to discuss incomes grossly underestimates the power of money in a capitalist society. "Rich" and "poor" are key terms in the vernacular sense of class because everybody realizes that the size of your income makes a huge difference in the kind of life and prospects you have.
Neither of these books adequately links its social-scientific terms and statistics with the common conception of class in America. It's also a bit embarrassing to praise two books for calling attention to a "working class" they define so differently. But each, in richly textured detail, systematically destroys the debilitating vernacular notion that almost everybody (all those who are neither "rich" nor "poor") is "middle class." This notion is so spectacularly false that precise definitions don't matter. What's important to understand is that there is a college-educated professional and managerial "middle class," and we have been doing quite well for the past two decades, whether we're white, black or other; and there is a much larger "working class" (of various races, genders, incomes and occupations, union and largely nonunion) that has been struggling and, for the most part, losing ground for most of that time. The problem with lumping all of us together into a ubiquitous "middle class" is that they tend to disappear, and we tend to think that their experience, interests and values are just like ours.
The connotations of "middle class" in the US vernacular almost always include "college educated" and "comfortable standard of living." Thus, the totemic "soccer mom" is regularly envisioned as a computer support specialist married to a systems analyst (two of our fastest-growing occupations), with a minivan and a family income approaching $100,000. She's actually much more likely to be a clerical worker married to a retail salesman (two occupations growing even faster), with a family income of $42,000 and a six-year-old Chevy Cavalier. A politics that does not recognize and speak to the real soccer moms is doomed to confusion and failure. One that consistently does, on the other hand, has many more possibilities for progressive change than is dreamt of in the dominant philosophies.
Only months after a major victory on China trade, Big Business is again scavenging for cheap labor. This time, the high-tech industry is pressuring Congress to allow additional foreign technicians--particularly computer programmers and engineers--to work temporarily for US corporations. Congress, with the President's blessing, is poised to deliver a sweet deal to the industry, at the expense of US and foreign workers.
The 1990 Immigration Act set aside 65,000 H-1B visas each year to allow "the best and the brightest" from around the world to work in the United States for up to six years. In 1998, when the high-tech industry complained about an unbearable shortage of skilled US workers, Congress raised the annual H-1B ceiling to 115,000. The industry promised it was a one-time solution. But tech companies devoured the visas. Now their Washington lobbyists claim they are still starving for qualified workers.
Such evidence as exists, however, casts doubt on the alleged labor shortage. A recent study by the IT Workforce Data Project concluded that over the past fifty years, "there is no evidence that any serious shortages of technical professionals--engineers in the past, information technology specialists now--have ever occurred." If the industry faces a tight labor market, it's self-imposed. The industry has largely ignored its vast underrepresentation of women and minorities. Few tech firms recruit at African-American job fairs, and less than 1 percent of blacks with high-tech degrees have Silicon Valley jobs. The corporations also often shun older workers, who might require retraining or better pay.
The tech industry craves cheap labor, not skilled workers. H-1Bs, which are temporary and prohibit the holder from switching employers, fill the bill. H-1B workers cannot unionize, are likely to accept uncompetitive wages and do not receive the employment benefits that similarly skilled Americans would demand. Many companies reportedly force their foreign employees to work in factorylike conditions and routinely withhold wages and violate contracts. Foreign workers, dependent on their jobs for legal residence in the United States, are defenseless: If they complain, they risk being fired; if they quit, their employer can sue them. Their only legal remedy is a bureaucratic federal complaint process with few enforcement options. These foreign temps--indentured servants of the new economy--can either put up or go home.
Nonetheless, Bill Clinton, Congress, Al Gore and George W. Bush support raising the H-1B ceiling to approximately 200,000. Why? The computer industry alone has pumped more than $72 million into federal campaigns. Orrin Hatch and Spencer Abraham, sponsors of the Senate's leading H-1B bill, have received nearly $1 million in high-tech campaign contributions. David Dreier and Zoe Lofgren, authors of the industry-endorsed House legislation, each enjoy tens of thousands in Silicon Valley funding. Other powerful legislators have also profited handsomely from cooperating with Big Technology.
The industry is reminding its political welfare recipients that expanding the H-1B program is a top priority for the nation's tech firms. Their lobbyists are meeting one-on-one with politicians and are barraging Capitol Hill with daily "fact sheets." Chairmen of House and Senate campaign committees have received letters explicitly warning that tech companies will not support legislators who dawdle on H-1B. With control of Congress up for grabs, opposing the industry hardly seems worth the risk.
Representative Tom Davis, who chairs a GOP campaign committee and supports raising the H-1B ceiling, acknowledged, "This is not a popular bill with the public. It's popular with the CEOs." Once again, powerful corporations and unprincipled politicians are preparing to take advantage of vulnerable foreign labor, while many US workers are left out in the cold.
Activists have achieved power. Now they need to figure out how to use it.
Madame Curie's denial of radiation dangers is emblematic of the legacy we now face as America's romance with the atom draws to a close.
The Supreme Court once championed antitrust laws as valued tools to limit corporate power and to promote the autonomy, diversity and economic rights of people and firms without power. Not anymore.
Chase should immediately open its archives to slavery researchers.