Thought they were one and the same? Well they are not. For example we have seen trade agreements, such as NAFTA, show that the two are not the same. In America corporations see noticeable gains, but workers continue to be left out of the equation. Over the past few decades US workers have seen stagnating wages, a shrinking middle class, and globalization.
Let us start off with stagnating wages. According to the Economic Policy Institute (EPI), 2014 continued a 35-year trend of broad-based wage stagnation . More specifically “ever since 1979, the vast majority of American workers have seen their hourly wages stagnate or decline.” The American worker is long overdue for a minimum wage increase and we are beginning to see it occur in various states across the nation. One state being Oregon , another being New York , and others appear positioned to follow.
Now let us attack the unfortunate issue of a hard hit middle class. Various socio-economic factors certainly play a role, but “since 2000, the middle class has been shrinking for a decidedly more alarming reason: Incomes have fallen.” One of the main reasons this is so unsustainable is that costs continue to rise. In modern times one key metric is the cost of college tuition. It plays a significant role in whether an individual earns a middle class livelihood. With college tuition costs skyrocketing, this does not bode well for Americans to enter what is left of the middle class.
Finally, let us address globalization. Trade deals like NAFTA and now the TPP, are catalysts for corporations to globalize their organization and enhance their bottom line. By closing and relocating manufacturing to other areas of the world, corporations are able to accrue more profit because their costs of doing business decline. Sure some of this offshoring of American jobs would be executed by corporations with or without deals like NAFTA or the TPP, but these deals only help them expedite the process. Millions of Americans are thereby left unemployed or underemployed in trade skill jobs. It is then very likely that they cannot find other opportunities nearby, and are forced to switch careers entirely. If we want to put this group of hard working Americans back to work there are certainly plausible options out there. If you’d like to hear about my ideas for how we could get these people back to work, let me know in the comments and I’d be happy to write a piece on my vision for it.