DISPATCHES

TRUMP BACKS DOWN, CLAIMS VICTORY IN TRADE WAR

Donald Trump declared partial victory in his trade dispute with China after the White House announced that the US would hold off on imposing tariffs after China agreed to reduce its trade surplus with the US.

Trump’s chief economic adviser, Larry Kudlow, told reporters (5/18) China had offered to reduce its trade surplus with the US by $200 billion. Two days later, he said the number was merely a “rough ballpark estimate,” and that the two countries never expected to reach an agreement and merely planned to issue a statement laying out next steps. But markets celebrated with the Dow spiking over 300 points as fears of a bruising clash between the world’s two largest economies eased.

The reality behind the scenes is significantly less rosy, Ben White reported at Politico (5/21).

The temporary trade détente is masking continuing internal White House battles over how hard to push China for major concessions. It also papers over threats that a tariff battle could easily reignite over multiple flash-points including US sanctions on China telecom giant ZTE, which Trump suggested would be eased (coincidentally after a Chinese company with strong ties to the government invested $500 million in a Trump development in Indonesia) and China’s role in high-stakes talks between the US and North Korea.

“In the long-term there is a 100% chance that the trade war reignites because we have not crafted anything close to a long-term solution,” said Derek Scissors, a China expert at the American Enterprise Institute, in Politico (5/21). “There is also real risk in the short-term because this agreement is very unstable in terms of what the US is actually going to gain. The Chinese may ultimately not give up anything the president can actually use politically.”

Trump issued a series of tweets praising the relatively muted joint statement in which the Chinese only pledged to “significantly increase” purchases of US goods and services and included vague promises by the Chinese to crack down on intellectual property theft and the forced transfer of technology by US companies doing business in China.

“Under our potential deal with China, they will purchase from our Great American Farmers practically as much as our Farmers can produce,” Trump tweeted. “China has agreed to buy massive amounts of ADDITIONAL Farm/Agricultural Products — would be one of the best things to happen to our farmers in many years!”

Trump did inject a note of caution, tweeting that “China must continue to be strong & tight on the Border of North Korea until a deal is made.”

Democrats blasted the agreement for its lack of major reforms, BusinessInsider.com noted. Senate Minority Leader Chuck Schumer (D-NY) said the president needed to stay strong and “not sell out for a temporary purchase of goods.” Sen. Ron Wyden (D-OR) had even harsher words. “After all the tough-guy rhetoric, the administration is simply getting rolled on trade with China,” Wyden said in a statement.

Republicans also took issue with the direction of the negotiations. Some of Trump’s outside advisers on trade during the campaign, including former Nucor CEO Dan DiMicco and American Enterprise Institute scholar Derek Scissors, suggested the administration hadn’t secured enough in the negotiations.

Sen. Marco Rubio, a Republican from Florida, suggested China was “winning” the negotiations.

“Their concessions are things they planned to do anyways,” Rubio tweeted. “In exchange they get no tariffs, can keep stealing intellectual property & can keep blocking our companies while they invest in t

Farmers were hopeful China would resume buying American soybeans after China stopped purchases of US soybeans during the dispute. China has nearly tripled imports from Russia, Bloomberg reported (5/17). China also reportedly increased purchases from Canada and Brazil, Bloomberg reported.

After the truce was declared, soybean prices for July delivery rose 2.7%, to $10.25-1/4 cents per bushel in Chicago, the highest price since May 4, but it was still below the closing price of $10.35 a bushel on April 2, the last session before China said it would impose a 25% tariff on imports of US soybeans, Marketwatch reported (5/21).

GORSUCH’S FIRST MAJOR OPINION ALLOWS BOSSES TO STEAL FROM WORKERS. The Supreme Court held (5/21) that employers can force their employees to sign away many of their rights to sue their employers. As a practical matter, The ruling in Epic Systems v. Lewis will enable employers to engage in small-scale wage theft with impunity, so long as they spread the impact of this theft among many employees, Ian Millhiser noted at ThinkProgress.

Neil Gorsuch, who occupies the seat that Senate Republicans held open for a year until Donald Trump could fill it, wrote the Court’s 5-4 decision. The Court split along party lines, and Charles Pierce noted at Esquire.com (5/21), “if any innocent souls still were wondering why the Republicans hijacked a Supreme Court nomination away from the previous administration, they can wonder no longer. The Republicans—and, especially, the donor class that insulates the Republicans from the electoral consequences of their political malpractice—saw that maneuver pay off handsomely.”

Epic Systems involves three consolidated cases, each involving employment contracts cutting off employees’ rights to sue their employer in a court of law. In at least one of these cases, the employees were required to sign away these rights as a condition of starting their job. In another, existing workers were told to sign away their rights if they wanted to keep working, Millhiser noted.

Each contract contained two provisions, a “forced arbitration” provision, which requires legal disputes between the employer and the employee to be resolved by a private arbitrator and not by a real court; and a provision prohibiting employees from bringing class actions against the employer.

Gorsuch presents Epic Systems as a simple application of a legal text. “The parties before us contracted for arbitration,” he writes. “They proceeded to specify the rules that would govern their arbitrations, indicating their intention to use individualized rather than class or collective action procedures. And this much the Arbitration Act seems to protect pretty absolutely.”

It’s the sort of statement someone might write if they’d never read the Federal Arbitration Act — the law at the heart of this case — and had only read the Supreme Court’s decisions expanding that act’s scope, Millhiser noted.

Broadly speaking, the Federal Arbitration Act requires courts to honor arbitration agreements, and to ignore legal doctrines that disfavor arbitration as a method of resolving disputes. Yet the Act also exempts “workers engaged in foreign or interstate commerce.”

Nevertheless, in a 5-4 decision in Circuit City v. Adams (2001), the Supreme Court held that the Act applies to most workers engaged in foreign or interstate commerce. If Gorsuch were concerned with the text of the Arbitration Act, he might have called for additional briefing on whether Circuit City should be overruled. Instead, Gorsuch compounded the Court’s error in Circuit City — all while insisting that an anti-worker outcome is required by the law’s text.

Similarly, the Federal Arbitration Act says nothing about class actions. And it certainly does not contain any language suggesting that courts must give the same special treatment to contracts banning class actions that it gives to contracts mandating arbitration.

Justice Ruth Bader Ginsberg read her dissent from the bench, which is not the usual way things are done on the Court, Pierce noted. She pointed out the Arbitration Act cited by Gorsuch was passed in 1925, before organized labor had come to its full power and before federal labor laws had been proposed, let alone enacted. She also looked at the political landscape of the country and concluded, rightly, that Gorsuch’s reasoning applied to a land that exists only in his imagination.

“Once again, the Court ignores the reality that sparked the NLRA’s passage: Forced to face their employers without company, employees ordinarily are no match for the enterprise that hires them. Employees gain strength, however, if they can deal with their employers in numbers. That is the very reason why the NLRA secures against employer interference employees’ right to act in concert for their ‘mutual aid or protection.’ … Employees’ rights to band together to meet their employers’ superior strength would be worth precious little if employers could condition employment on workers signing away those rights,” Ginsberg said for the minority.

SPEAKER RYAN DIVES IN TO SAVE NAFTA FOR BIG BUSINESS. Against all odds, the North American Free Trade Agreement (NAFTA) renegotiations launched by the Trump administration in August 2017 were heading towards an outcome that could have generated support from Democrats in Congress, unions, and public interest groups that have been critical of globalization. NAFTA’s job outsourcing incentives and investor-state dispute settlement (ISDS) regime were on their way out. The timeline to finish talks for a vote to occur this year was looming in June, due to the requirements of Fast Track negotiating authority, Lori Wallach, director of Public Citizen’s Global Trade Watch, wrote at Prospect.org (5/17). The corporate lobby was apoplectic. 

Many issues remained under discussion. Dairy market access, intellectual property rules, labor standards, and even the de minimis value for a shipment to trigger NAFTA’s customs rules were unresolved. But to the horror of legions of lobbyists, US negotiators were making progress on major changes to NAFTA that labor wanted and corporate American opposed.

That was enough for Speaker Paul Ryan and the House Republican leadership. Ryan abruptly announced on May 10 an arbitrary deadline for a final deal—May 17—that he knew could not be met. 

The May 17 deadline Ryan set did not reflect the timelines established under the problematic Fast Track process that applies to the negotiations. But thanks to quirks in that system, Ryan has the power to deny his president a vote on a renegotiated NAFTA during this Congress. What a convenient calling card for a retiring GOP speaker to secure another year of NAFTA’s job outsourcing protections for corporate America, Wallach noted. 

“That once again Ryan and the Republican congressional leadership would stick it to working Americans to protect their big corporate donors is not news. Ryan’s lifetime rating on voting in the interests of working families is only 26%,” she noted. “His artificial May 17 deadline for a new NAFTA is all about preserving NAFTA as it is.”

Robert Lighthizer, the US trade representative, who progressive Sen. Sherrod Brown (D-Ohio) dubbed “the best appointee in the Trump administration,” has opposed NAFTA since 1993. Lighthizer is a conservative with deep ties to Republican policymakers, but he also has a long commitment to American manufacturing, is furious about the almost one million jobs that the US government has certified as lost to NAFTA including hundreds from his hometown of Ashtabula, Ohio, and has worked with unions and Democrats in Congress for decades. And, he knows NAFTA inside and out, Wallach noted.

Lighthizer pushed for elimination of investor-state dispute settlement (ISDS), which makes it less risky and cheaper for corporations to outsource jobs. ISDS empowers multinational corporations to sue governments before a panel of three corporate lawyers. These lawyers can award the corporations unlimited sums to be paid by taxpayers, including for the loss of expected future profits over claims that domestic laws violate their NAFTA rights. The decisions are not subject to outside appeal. The system operates like free risk insurance subsidizing outsourcing. Already under NAFTA nearly $400 million has been paid to corporations after attacks on environmental and health policies. In a sign of panic that NAFTA countries were poised to agree, corporations launched a big dollar MSNBC and Fox ad campaign in defense of ISDS.

Significant progress has been made to establish a higher “rule of origin” so that no longer could products with one-third of their value coming from China or other non-NAFTA countries get NAFTA’s duty-free access. For autos, which represent a huge share of NAFTA trade, Lighthizer is demanding 75% of value come from the US, Mexico, or Canada. And, 45% of a good must be produced by workers making $16 per hour. The wage standard is aimed at ensuring that US workers produce a share of the increased North American content, while creating incentives for Mexico to raise wages. The Mexican government’s strategy has been to attract investment with low wages, since Mexican manufacturing wages are now on par with coastal China.

Any revised NAFTA that merits support must include strong labor and environmental standards with swift and certain enforcement to raise wages and stop the outsourcing of pollution, Wallach noted. Otherwise, companies will continue to move US jobs to Mexico to pay workers $2-an-hour poverty wages and dump toxins and then import those products back for sale here.

TRUMP ADMINISTRATION FINDS A SHAM ELECTION IT DOESN’T LIKE. The Trump administration condemned Venezuelan officials for hosing a “sham” presidential election over the weekend, which socialist President Nicolás Maduro won easily after critics claimed the vote was rigged in his favor.

Maduro’s re-election — he first was elected president in April 2013 — came amid extremely low voter turnout and allegations of political intimidation.

“Venezuela’s election was a sham — neither free nor fair. The illegitimate result of this fake process is a further blow to the proud democratic tradition of Venezuela,” Vice President Mike Pence stated (5/21).

But the White House stance on the Venezuelan election is somewhat contradictory, Melanie Schmitz noted at ThinkProgress (5/21): In the past, Trump himself has called to congratulate other world leaders, themselves the winners of similar sham elections.

In March, Trump called Russian President Vladimir Putin to congratulate the authoritarian leader on being reelected to a fourth term. That election was also seen as a “sham,” with incidents of ballot stuffing and polling irregularities peppering the vote. Putin also faced virtually zero opponents, with his one real challenger, Aleksei Navalny, accusing the Russian president of rigging the election.

Trump’s own national security advisers had reportedly warned him specifically ahead of the call, according to the Washington Post, handing him briefing materials with a bold note that read, “DO NOT CONGRATULATE.” As the outlet noted, it appeared Trump had either ignored that advice or had not read the memo at all.

Of course, Trump’s own election campaign is at the center of a massive election interference scandal involving Russia, which is being investigated by Special Counsel Robert Mueller.

Trump defended his phone call to Putin in a series of tweets, writing, “I called President Putin of Russia to congratulate him on his election victory (in past, Obama called him also). The Fake News Media is crazed because they wanted me to excoriate him. They are wrong! Getting along with Russia (and others) is a good thing, not a bad thing.”

Trump also tweeted that the only way to “solve problems with North Korea, Syria, Ukraine, ISIS, Iran and even the coming Arms Race” was “PEACE THROUGH STRENGTH!”

In the past, the president has threatened to decimate North Korea with “fire and fury like that world has never seen.”

In April, Trump once again ignored the advice of experts, calling Egyptian President Abdel-Fattah al-Sissi to offer “sincere congratulations” on the authoritarian leader’s re-election win, in what many have also called a sham election. The Egyptian leader faced no real challengers and walked away with 97% of the vote.

As Human Rights Watch notes, al-Sissi has one of the worst human rights records of any world leader, and has overseen the systematic oppression of Egyptian citizens, press, and political dissidents through “torture, arbitrary arrests, and enforced disappearances.”

WHITE HOUSE GOES ALL IN COMPARING MIGRANTS TO ANIMALS. Four days after President Trump called undocumented immigrants “animals,” the White House released a statement indicating administration officials have no regrets about it — in fact, quite the opposite.

Over the span of 10 paragraphs, the statement — entitled “WHAT YOU NEED TO KNOW ABOUT THE VIOLENT ANIMALS OF MS-13” — refers to MS-13 members as “animals” 10 times.

In the 16 months since his inauguration, Trump has repeatedly used MS-13 gang members to stoke xenophobia about immigrants in general, Aaron Rupar noted at ThinkProgress (5/21).

As is the case with the new White House statement, Trump often cherry-picks brutal crimes that MS-13 members have committed. But in reality, undocumented immigrants are less likely to commit crimes than American citizens.

Beyond crime stats, however, Rupar noted the White House’s effort to dehumanize particular groups of immigrants bears a disturbing similarly to the language used throughout history to justify violence against groups of people. As Nour Kteily, a professor who studies the psychology of dehumanization and its consequences at Northwestern, told Vox, dehumanizing language like Trump’s “animals” characterization of MS-13 “justifies or even mandates violence.”

BREAKTHROUGH SOLAR PANEL HARVESTS POWER FROM RAINDROPS — DAY OR NIGHT. Scientists have figured out how to create “hybrid” solar cells that generate power not just from sunlight but also from raindrops. This means we may soon see all-weather solar panels that work when it is cloudy and even at night, if it’s raining, Joe Romm wrote at ThinkProgress (5/21).

Use of solar panels has soared in recent years, as panel prices have dropped so fast that solar keeps crushing its own record for the cheapest power “ever, anywhere, by any technology” — even without a subsidy. But scientists and engineers around the world keep innovating, looking for ways to  make solar panels more efficient and less expensive. Much of this innovation is now coming from China, the world leader in both manufacturing and deployment of solar energy.

For instance, China has developed “double-sided” solar panels that can generate power from light that hits their underside. That can enable a 10% boost in output, especially if you put the panels on a roof or other area that is painted white to help reflect the suns rays. Bloomberg New Energy Finance projects these panels could capture a remarkable 40% share of the market by 2025.

In another remarkable advance, researchers at China’s Soochow University have demonstrated a solar cell that can generate electricity from falling rain. A recent article in the American Chemical Society’s nanotechnology journal Nano describes the innovation in an article titled “Integrating a Silicon Solar Cell with a Triboelectric Nanogenerator via a Mutual Electrode for Harvesting Energy from Sunlight and Raindrops.”

It could be a while before the technology makes its way into a commercial product for widespread use, though. We are still 3 to 5 years from a prototype according to Sun. He told the Guardian, “the output power efficiency needs to be further improved before practical application.”

But if the technology takes off, we may actually have solar panels that work rain or shine.

EU MAY FORBID COMPLIANCE WITH TRUMP SANCTIONS ON IRAN. The French energy giant Total says it will pull out of a billion-dollar project in Iran without a waiver on US economic sanctions, but the European Union is moving to implement provisions of a law that prohibits EU companies and courts from complying with those sanctions.

As part of its withdrawal from the 2015 multilateral nuclear agreement with Iran, the Trump regime is reimposing the sanctions used to spur Tehran to negotiate the agreement in the first place. The impact is uncertain, but it is already being felt:

“Total will not continue the (South Pars 11) project and will have to unwind all related operations before 4 November 2018, unless Total is granted a specific project waiver by US authorities with the support of the French and European authorities,” the French oil and gas company said in a statement.

Denmark’s Maersk, which operates oil tankers globally, said it would fulfill commitments in Iran already on its books but would not enter into any new contracts.

Another Danish oil tanker operator, Torm, has said it would stop taking new orders in Iran.

The EU seeks to keep Iran in the 2015 agreement that dropped sanctions in exchange for  curtailment of Iran’s nuclear development program. Patrick Wintour and Daniel Boffey at *The Guardian* reported that European Commission President  Jean-Claude Juncker says he will deploy a plan the EU last used to protect businesses working in Cuba before the US lifted sanctions on that nation:

“We will begin the ‘blocking statute’ process, which aims to neutralise the extraterritorial effects of US sanctions in the EU. We must do it and we will do it tomorrow [Friday] morning at 10.30,” he said at the end of a summit in the Bulgarian capital, Sofia.

The “blocking statute” is a 1996 regulation that prohibits EU companies and courts from complying with foreign sanctions laws and stipulates that no foreign court judgments based on these laws have any effect in the EU.

The European council president, Donald Tusk, added at a meeting of EU leaders: “We agreed unanimously that the EU will stay in the agreement as long as Iran remains fully committed to it. Additionally the commission was given a green light to be ready to act whenever European interests are affected.”

REPUBS AIM AT BLACK PEOPLE WITH MEDICAID WORK REQUIREMENTS IN KENTUCKY, OHIO, MICHIGAN. Republicans are pushing a Medicaid work requirement in Michigan, Ohio and Kentucky that exempts mostly white, rural counties, Laura Clawson noted at (5/14). The claim is that the exemptions are for places with high unemployment rates where people simply can’t find work—but cities with high unemployment rates often don’t get the same treatment, because they’re surrounded by (and within county lines of) wealthy suburbs that pull the county’s overall unemployment down. The end effect is that, in what a health law scholar described to as “a version of racial redlining,” work requirements apply to poor black people but not poor white people. The numbers are striking:

The waiver in Kentucky, the first state to win federal approval for a Medicaid work requirement, will have the effect of exempting eight southeastern counties where the white residents are over 90%. The work requirements will be imposed first in Northern Kentucky, which includes Jefferson, the county with the highest concentration of black residents in the state.

A Washington Post analysis found that while African Americans make up about 23% of Medicaid enrollees in Michigan, they would make up just 1.2% of the people eligible for an exemption. Meanwhile, 5% of Michigan Medicaid enrollees are white, but white residents would make up 85% of the population eligible for an exemption.

The numbers in Ohio are similar—26 counties would get exemptions, and they’re 94% white on average. John Corlett, a former Medicaid director for Ohio, points out that these patterns aren’t accidental, either, thanks to a “past history of institutionalized segregation.” And the stakes are high for the most vulnerable:

“The communities most at risk under this scenario are African American, and those communities already have significantly higher rates of infant mortality, lower life expectancy, and a number of other serious health disparities,” he told TPM.

Kentucky’s law is already approved by the federal Department of Health and Human Services—and facing a court challenge. Ohio’s approval is on the way, and Michigan is moving toward passing its law at the state level and going to HHS for approval. This is a gross move to not just stigmatize but actively endanger people’s health because they’re poor … or, specifically, poor and black, Clawson noted.

FEDS LOSE TRACK OF 1,475 MIGRANT CHILDREN, SOME TO TRAFFICKERS. Federal officials lost track of nearly 1,500 migrant children last year after a government agency placed the minors in the homes of adult sponsors in communities across the country, according to testimony before a Senate subcommittee (5/17).

The US Health and Human Services Department has a limited budget to track the welfare of vulnerable unaccompanied minors, and realized that 1,475 children could not be found after making follow-up calls to check on their safety, an agency official said.

Federal officials came under fire two years ago after rolling back child protection policies meant for minors fleeing violence in Central America. In a follow-up hearing (5/17), senators said that the agencies had failed to take full responsibility for their care and had delayed crucial reforms needed to keep them from falling into the hands of human traffickers.

“You are the worst foster parents in the world. You don’t even know where they are,” said Sen. Heidi Heitkamp (D-ND). “We are failing. I don’t think there is any doubt about it. And when we fail kids that makes me angry.”

Since the dramatic surge of border crossings in 2013, the federal government has placed more than 180,000 unaccompanied minors with parents or other adult sponsors who are expected to care for the children and help them attend school while they seek legal status in immigration court.

An AP investigation found in 2016 that more than two dozen unaccompanied children had been sent to homes where they were sexually assaulted, starved or forced to work for little or no pay. At the time, many adult sponsors didn’t undergo thorough background checks, government officials rarely visited homes and in some cases had no idea that sponsors had taken in several unrelated children, a possible sign of human trafficking.

Since then, the Health and Human Services Department has boosted outreach to at-risk children deemed to need extra protection, and last year offered post-placement services to about one-third of unaccompanied minors, according to the Senate Permanent Subcommittee on Investigations.

But advocates say it is hard to know how many minors may be in dangerous conditions, in part because some disappear before social workers can follow up with them and never show up in court.

From The Progressive Populist, June 15, 2018

Populist.com