Strange as it may seem, Barack Obama has much in common with the storied matchmaker of Jewish legend. This Polish entrepreneur announced to the poverty-stricken rabbi of a poverty-stricken Polish town that she had found a match for his even more poverty stricken, unattractive son – no less than the queen of England. The Rabbi refused to consent to the match on the grounds that the queen was not Jewish. But the matchmaker persisted, and over time wore the rabbi down with tales of the advantages of such a match to his flock. “Phew,” announced the relieved matchmaker, “That’s half the job.”
After years of negotiations, Barack Obama persuaded eleven other Pacific Rim Countries, including Mexico, Canada, and Australia, to sign on to trade- and investment-opening Trans-Pacific Partnership (TPP). That’s half the job. Now he has to persuade enough congressional members of his own party to join a majority of Republicans in ratifying the deal. That won’t be easy, thanks to Hillary Clinton’s recent proof of a statement attributed to Harry Truman, “If you want a friend in Washington, get a dog.”
After defeating her for their Democratic party’s 2008 presidential nomination, Barack Obama spared Hillary Clinton years of wandering in the political wilderness by naming her his secretary of state. In return, Mrs. Clinton last week announced her opposition to the president’s painfully negotiated, legacy-building Trans-Pacific Partnership agreement (TPP), which she had once dubbed “the gold standard” of trade agreements. That was then, this is now. Fortunately, an otherwise friendless president has two dogs, neither of which is seeking his party’s presidential nomination.
Clinton’s opposition puts what is almost certainly the final nail in a coffin already almost nailed completely shut. Even before she made her latest move to win support of the left wing of her party, persuading enough Democrats to join the majority of Republicans in voting to approve the trade agreement seemed a difficult task for a lame-duck president whose ill-concealed disdain for his party’s congressional delegation deprives him of the reservoir of good will on which some of his predecessors could draw. Some congressional Democrats believe that past deals have benefitted large corporations and rich investment bankers at the expense of unskilled workers, middle-income families and the environment. Others hew to the line laid down by their trade union funders. Still others are suspicious of globalization and of markets, and therefore of measures that give open markets greater sway over how the world’s resources are allocated. That group includes Bernie Sanders, the socialist running as a Democrat in that party’s primaries; trade unions; senators from states home to industries counting themselves among the losers or eager to remain aboard Massachusetts senator Elizabeth Warren’s bandwagon as it pulls the party ever-further left.
All of this despite some potential economic advantages TPP holds for America. As a country that already imposes few and mostly low tariffs, the US (and, I should add, Australia) should benefit from the twelve-nation Pacific-Rim deal that phases out some 18,000 tariffs and trade restrictions. Like all trade deals, TPP creates losers as well as winners.
· Winners: Farmers who raise cows for milking or eating, or chickens, or who grow soybeans now subject to a 35 percent tariff, will benefit from phased reductions in tariffs levied on their products in key markets. And sugar growers whose powerful lobby limited the increase in import quotas to an insignificant amount count themselves among the winners, or at least not the losers.
· Losers: Big Pharma producers of certain medicines. They lost their battle to extend the 12-year period of protection from the competition of generics, accorded them by Obamacare, to other countries, where that protection of their intellectual protection will initially be limited to five years and a bit longer if they cut prices. Some studies suggest that the shorter protection period will make it impossible for the pharmaceutical companies to recoup the cost of research and development, to the ultimate pain of patients here.
· Winners: Environmentalists who regard this as the greenest of any trade pact ever entered into by the U.S.
· Losers: Philip Morris and other tobacco industry companies will no longer be allowed to sue governments imposing restrictions on smoking, as Philip Morris is doing in Australia.
REO Speedwagon’s legendary guitarist Gary Richrath, a native of my hometown of Peoria, passed away on September 13 at age 65, which is a ripe old age for a rock star. His death marks an end to a musical era—I encourage you to skip the schlocky ballads of the band’s latter years and listen to the high-intensity, guitar-jamming madness of “157 Riverside Avenue” to get a true measure of his prodigious talent.
Last week, the Census Bureau released its annual report on income, poverty, and health insurance in the United States. Don’t worry if you missed it. So did the Wall Street Journal, which noted several days later that the White House had failed to comment on the rather grim numbers. On Friday, the Journal’s editorial page dryly remarked, “it seems we’re on the wrong White House email lists.”
President Obama believes the Republicans are hijacking the economy. He made this latest statement in an email sent out to supporters of the Democratic Senatorial Campaign Committee.
"Tonight, Republicans will hold their second presidential primary debate. And just like last time, we can expect each candidate to go heavy on extreme rhetoric and light on real solutions," the president of the United States writes. "Unfortunately, the situation on Capitol Hill isn't any better."
Of course Obama is asking for money for the Democratic organization.
Deep in the transcript of the interview ABC’s David Muir conducted with Hillary Clinton yesterday comes an indirect but very tough shot at the man she worked for and hopes to replace. In the course of answering a question about her mother, Clinton described her mother’s difficult upbringing and praised her for her hard work. Her mother’s experience, she said, and those struggling to get ahead today, inspire her presidential run.
Two weekends ago, the Federal Reserve Bank of Kansas City held its annual monetary conference in Jackson Hole, Wyoming. The left flew in hundreds of protesters donning green T-shirts that demanded “Higher Wages for America” and chanting, “We’re Fed Up.” The crowd was an assortment of college kids on their summer break, disgruntled middle-aged teachers, senior citizens, and blue-collar union members. Think Occupy Wall Street.
Warren Buffett had it right, “Only when the tide goes out do you discover who’s been swimming naked.” Peer through the fog of commentary on recent share price gyrations and you can see the unclothed figures of Chinese president Xi Jinping and his fellow managers of the Chinese economy, the very one that in recent years has been providing about half of global economic growth even though it accounts for only about 15% of world output.
The economic recovery is barely worthy of the name, and there is evidence that inequality in America is increasing. Ignoring the first rule of statistics—correlation is not causation—progressives see this as a new reason to expand government. Reduce inequality and the growth rate will increase.
Twenty-one years ago, Fortune boldly declared “The End of the JOB.” Thanks to rapid advances in technology, people had been freed from the tyranny of the nine-to-five workplace. Now they could set their own hours and schedules, do without constant oversight and supervision, and concentrate on a more powerful objective: not just “doing their jobs,” but finding better and more innovative ways of “doing what needs to be done.”
Whatever the outcome of the 2016 presidential election, the summer of 2015 will be remembered as the summer of Trump and Sanders. The other candidates, especially the Republicans, could learn a lesson from the two renegades, who have figured out how to capitalize on the fact that America is in a funk even as its economy improves.
On Friday, the government reported that the economy added 215,000 jobs last month, and that the unemployment rate remained a low 5 percent. That could support a decision by the Federal Reserve Board to raise its key interest rate in September.
Hillary Clinton delivered a speech on the economy earlier today in New York City. Here are the talking points the Clinton campaign sent along to friends and allies, hoping that they'll repeat these lines on cable news and in conversations: