Tag: International Commerce

I’m Sure that the Blairites Will Flock to Support Her

The Guardian is reporting that Tory PM Theresa May is wooing Labour party MPs in an attempt to secure support for her Brexit proposals.

The (reflexively anti-Corbyn) Guardian misses the point here.

May’s appeal to Labour is not, “The Good of the Kingdom,” it’s, “You have the opportunity to stop Jeremy Corbyn.

You will notice that the report does not detail who is in discussions with the Conservatives, and I think that this is because it is the representatives of failed New Labour who are in talks, in yet another of their schemes to destroy the party to preserve their position within the party:

Theresa May has drawn up plans for a secret charm offensive aimed at persuading dozens of Labour MPs to back her Brexit deal even if it costs Jeremy Corbyn the chance to be prime minister, the Guardian has learned.

Senior Conservatives say they have already been in private contact with a number of Labour MPs over a period of several months, making the case that the national interest in avoiding a no-deal outcome is more important than forcing a general election by defeating the government on May’s Brexit deal.

Now, with talks in Brussels entering their frantic final phase, the prime minister and her party whips are stepping up efforts to win backing for a compromise deal that one minister described as a “British blancmange”.


Labour MPs will thus be the focus of intense lobbying, in the period between May returning from Brussels with a Brexit deal and the meaningful vote, which is expected to come about a fortnight later.


May appealed directly to Labour backbenchers in her conference speech when she spoke of the “heirs of Hugh Gaitskell and Barbara Castle, Denis Healey and John Smith”, saying they were on the backbenches, not in the shadow cabinet of what she called the “Jeremy Corbyn party”.

This is not an attempt at a better Brexit, it’s an attempt to sabotage Labout, an Blair and his Evil Minions are more than willing to aid and abet this strategy.

Not What You Expect from The Financial Times

But they published an editorial saying that the expansion of the scope of trade deals has not worked:

How will the world trade regime handle a large, increasingly powerful country such as China that apparently plays globalisation by different rules? This is the question that keeps US and European policymakers awake at night. The fever runs highest in the US, where the Trump administration has blamed China for engaging in economic aggression and has declared trade war in response. The US president’s methods may be frowned upon, but the view that something has to be done about China’s trade and industrial practices is widespread among mainstream policy elites.


But US and European policymakers are asking the wrong question. The problem is not with China’s policies as much as it is with the world trading regime. The World Trade Organization — as well as every trade agreement since — has been predicated on the idea that economic practices in different nations would eventually converge. This has not happened, as China’s example amply indicates. More importantly, there is no good reason for national economic models to converge in the first place. World trade rules need to change, regardless of what China does, to accommodate economic diversity.

The trade agreements concluded in the early postwar period left plenty of space for countries to pursue their own paths. The various trade rounds under the old General Agreement on Tariffs and Trade system covered only explicit barriers to manufactured goods at the border, mainly import tariffs and quotas. Services and agriculture were excluded. Developing countries could do almost as they pleased. When an import surge in garments threatened economic dislocation in developed countries in the early 1970s, a special regime was established that enabled these countries to re-impose quantitative restrictions.

The WTO changed all that. Negotiated at a time of neoliberal triumphalism, it reached inside the border to constrain domestic policies in subsidies, health and safety and intellectual property. Any domestic regulation with an adverse impact on imports could now be treated as a trade restriction. Subsequent trade agreements went further, prioritising trade and foreign investment over domestic concerns.

Western policymakers tend to think of today’s global trade rules as neutral and impartial, treating all participants fairly. But trade agreements are political documents, reflecting the interests of dominant coalitions. Multinational corporations, international banks and Big Pharma play a particularly important role in shaping them. It is no surprise that long-term concerns about development, or indeed labour rights and the environment, are given short shrift.

There is little doubt that China violates the spirit, if not the letter, of WTO rules on intellectual property and subsidies. But when the US and Europe complain that China is infringing “global norms and rules”, they forget their own economic history. China’s policies are not so different from those that they too embraced while catching up with technological leaders of the time. For example, US patent rules were notably lax in the late 18th and 19th centuries, and the US textile industry would never have arisen without widespread “theft” of technological secrets from Britain. Similarly, many of Europe’s industries, such as aircraft, steel and cars, were nurtured by government support.


If the WTO has become dysfunctional, it is because our trade rules have over-reached. A fair world trade regime would recognise the value of diversity in economic models. It should seek a modus vivendi among these models, rather than tighter rules.

The author, Dani Rodrick, is an economist who has been dubious of the neoliberal consensus on trade for some, and as such, this is very much in line with what he has written before, but it is not something that I would have expected to appear on the pages of FT.

Yeah, This is Working So Well

In response to new sanctions against new sanctions against Iran, Russia is planning to invest fifty billion dollars in the Iranian energy industry:

Iran has touted $50bn worth of potential Russian investments in its oil and gas sector as it seeks to deepen its relationship with Moscow, amid mounting pressure from the US to curb the country’s energy exports and diplomatically isolate Tehran.


“Russia is ready to invest $50bn in Iran’s oil and gas sectors,” Ali Akbar Velayati, a senior adviser to Iran’s supreme leader, said during a visit to Moscow that included a meeting with President Vladimir Putin. “Military and technical co-operation with Russia is of major importance to Iran.”


Mr Velayati, Ayatollah Ali Khamenei’s top diplomat, also used a media interview during his visit to say that a Russian oil company had already signed a $4bn deal with Iran that “will be implemented soon”, without providing details. He added: “Two other major Russian oil companies, Rosneft and Gazprom, have started talks with Iran’s oil ministry to sign contracts worth up to $10bn.”


The suggestion of deeper co-operation between the two countries’ energy industries comes eight months after Russian companies signed preliminary agreements to invest up to $30bn in Iran’s oil industry, as part of a visit by Mr Putin to Tehran.


But Mr Trump’s decision to rip up that accord and threaten to sanction companies that trade in Iranian oil has led Tehran to work with Moscow. Hardline Iranian politicians have urged Mr Rouhani’s government to expand co-operation with Russia and China to replace European companies unwilling to risk the wrath of Washington.

This is a foreseeable result of bad policy. 

Sanctions after sanctions, particularly without the support of allies, is like pushing on a string.

They are Just Trolling Us

Donald Trump has a plan to ditch the WTO and return to tariffs.

Not a surprise, it was something that he has campaigned on, but it is called the Fair and Reciprocal Tariff Act, or FART act.

Seriously, they aren’t even trying any more:

A report that Donald Trump is looking to walk away from the World Trade Organisation and instead adopt a United States Fair and Reciprocal Tariff Act, or Fart Act, has been greeted with loud amusement on Twitter.

Axios reported that it had received a leaked early draft of a bill ordered by the president, that would see America take the unlikely step of abandoning WTO rules, allowing Trump to raise tariffs without the consent of Congress.

The bill – the existence of which has not been independently confirmed – would be a dramatic shift in trade policy with wide-reaching impacts, but it was the name of the proposed bill that caught people’s attention.

In 2021, I fear that our President will be Pauley Shore.

I am not joking.

The Weasel will be the next President of the United States of America.

Three Stopped Clock Moments in 1 Week

First, notwithstanding the ruling by a George W. Bush appointed judge approving the AT&T — Time Warner merger, Trump and his Evil Minions were correct in opposing that merger.

Judge Richard Leon noted the lack of immediate negative consequences to the consumer, the classic analysis developed by Robert Bork, but that analysis is legally, functional, and historically bankrupt. 

Even a cursory analysis of antitrust law reveals that Congress’s original intent was driven by concerns about the barriers to entry for new competitors and the political power of monopolies than it was consumer welfare.

Second, Trump was right in the core of his dispute with the other G7 members in that he trade deals should not be an eternal and unchanging edifice upon which our world is based.

His proposal for sunset clauses in trade deals, so that countries can reevaluate policies as conditions change, is correct.

To quote Keynes, “When the facts change, I change my mind. What do you do?”

He gets almost everything wrong. But last weekend Donald Trump got something right. To the horror of the other leaders of the rich world, he defended democracy against its detractors. Perhaps predictably, he has been universally condemned for it.

His crime was to insist that the North American Free Trade Agreement (Nafta) should have a sunset clause. In other words, it should not remain valid indefinitely, but expire after five years, allowing its members either to renegotiate it or to walk away. To howls of execration from the world’s media, his insistence has torpedoed efforts to update the treaty.

In Rights of Man, published in 1791, Thomas Paine argued that: “Every age and generation must be as free to act for itself, in all cases, as the ages and generations which preceded it. The vanity and presumption of governing beyond the grave is the most ridiculous and insolent of all tyrannies.” This is widely accepted – in theory if not in practice – as a basic democratic principle.

Finally, of course, is his talks with the DPRK, which has shown more progress than 20 years of refusing to negotiate on an one on one and direct basis and sanctons.

Of course, this is Trump, and he, and his administration, could f%$# up a 2 car funeral, so the probability that this will eventually lead to concrete positive developments is a rather remote.

Not Learning the Lessons of Cuba

What a surprise, our policy of sanctions against Russia does not hurt Putin’s political standing among Russian citizens.

If anything, it improves his political positions, because hardships can be blamed on an aggressively overbearing United States.

Seriously, this sh%$ kept the Castros in power for 60 years (and counting) in Russia, why should we expect anything different this time?

A Good Point on the Qualcomm/Broadcom Mess

It’s has the kibosh put on this because CFIUS determined that it was a threat to US security.

This was not because the Singaporean firm Broadcom was a security risk by its actions or its location, but because it is aggressively leveraged to grow through acquisitions, while Qualcomm invests heavily in technology.

They explicitly said that the Private Equity/Hedge Fund type operations constitute a threat to American technological accomplishments, because it results in disinvestments.

The only conclusion that one can reach then is that the whole Private Equity/Hedge Fund business model is a threat to America:

By the normal standards of U.S. national security, the government’s ruling on Tuesday to delay and potentially derail the acquisition of high-tech company Qualcomm by the Singaporean company Broadcom was startlingly smart and gobsmackingly wonderful.

It was smart because it extended its definition of U.S. security interests to maintaining our advantage in the development of the most advanced forms of technology, in this case, the 5G communications systems that will be critical to both driverless cars and network security in coming decades. The government’s Committee on Foreign Investment in the United States (CFIUS for short) wrote that it feared that if Qualcomm, the nation’s leading developer of 5G technology, were purchased by Broadcom, its research would suffer and a Chinese high-tech company, Huawei, would likely surge past it to become the global leader in security technology.

In the past, CFIUS has blocked several Huawei attempts to purchase U.S. tech companies because they would have involved the transfer of security-related technology to a company that CFIUS has demonstrated has ties to the Chinese military. CFIUS—an interagency committee headed by the Treasury Department, but also consisting of more than a dozen departments and agencies, ranging from Defense to Commerce—is in the business of ruling on potential foreign purchases of U.S. companies that have national security implications. Tuesday’s ruling was groundbreaking in that the issue wasn’t whether Singapore’s Broadcom itself posed a security risk by favoring the Chinese—nothing in the CFIUS letter even hinted at that—but rather, that the purchase might simply reduce Qualcomm’s capacity to conduct high-end research, thereby enabling Huawei and the Chinese to develop advanced technology before we do, which could give them a military advantage.

But why would Qualcomm’s purchase by Broadcom diminish Qualcomm’s commitment to research? This is the gobsmacking part of the CFIUS letter.

Because, in the words of the letter, “Broadcom’s statements indicate that it is looking to take a ‘private-equity’-style direction if it acquires Qualcomm, which means reducing long-term investment, such as R&D, and focusing on short-term profitability.”

Let that sink in for a moment. The staffers of CFIUS—probably the most business- and security-savvy civil servants in the government, headed by those at Treasury—are saying that the private-equity control of companies, which is a dominant feature of current American capitalism, reduces investment and results in profit extraction. CFIUS does not go on to say that the purchase of U.S. companies not only by foreign companies but by U.S. private equity firms, too, also leads to reduced investments and the kind of profit extraction that has enriched the 1 percent at the expense of other Americans; that’s not CFIUS’s mission. But having baldly stated that private equity leads to profit extraction, that’s the inescapable conclusion that any reader of CFIUS’s letter must reach.

The CFIUS letter goes on to specify the way in which Broadcom follows the private equity model of purchasing companies by taking on debt, and paying off that debt by reducing expenditures and funneling revenue into profits. “Broadcom has lined up $106 billion of debt financing to support the Qualcomm acquisition,” CFIUS writes, “which would be the largest corporate acquisition loan on record. This debt load could increase pressure for short-term profitability, potentially to the detriment of longer-term investments. The volume of recent acquisitions by Broadcom has increased the company’s profits and market capitalization, but these acquisitions have been followed by reductions in R&D investment.”

This is not something I would expect from the Trump administration.

I can only conclude that the higher ups only read the recommendations, and not the explanation.

The way I would, and have, put this, is that, “There is nothing that cannot be ruined by an application of modern American Financial techniques.”

It’s About Ireland, and Luxembourg, and ………

The EU is moving to tax gross revenue on digital sales based on where the purchaser is located.

If it sounds extreme, it’s not. It’s a sales tax, much like the VAT, which is universal throughout the European Union.

The above article presents this as something unprecedented, but it is not, and the proximate cause is because any number of countries in the EU, most notoriously Ireland and Luxembourg, compete economically by being tax havens.

This is a simple and elegant solution, and it is in no way protectionist or discriminatory.

Free trade should not be synonymous with tax evasion.

Good Point

Over at Beat the Press, Dean Baker uses issues with Mexican truck drivers to make a very good point on how free trade works generally:


It [The New York Times article] suggests that there is not much at stake in this battle since the Mexican drivers are not allowed to carry goods back from their destination. The prospect of returning with an empty truck would make it uneconomical for most trips even if the Mexican drivers were paid far less than their U.S. counterparts.

This discussion misses the point. If the restrictions on Mexican drivers transporting goods in the United States were eased, then it is virtually inevitable that the NYT and other major news outlets would soon be running pieces on the fact that it is wasteful to prohibit them from picking up goods in the U.S. and instead come back with empty trucks. The likely result would be that this restriction would be removed as well.


So long as pharma, finance, insurance, real-estate, and media get their vigorish, it’s f%$# the American working man.

One Can Only Hope

Could someone explain to me why banks becoming utilities is a bad thing?

The head of Ecobank in the UK, Edward George is filled with dread at the prospect.

The idea of this happening fills me with hope:


Well, one of the big challenges facing banks is that they’re in danger of becoming utilities. The big problem about utilities and why a lot of people don’t want to invest in them is that they have no real growth potential. With a utility, you start providing service over a certain network and you’re kind of stuck there. Where’s the value at? And the problem for the banks would be if the banks become somehow passive repositories of cash but all of the value-add is taken by the Fintechs: selling the service, paying interest here, making a margin here, left, right and centre, etc… So the idea has to be that there must be a value share, and that is the way to go forward.

Innovators out there, the banks themselves, have to come up with services whereby both sides can gain from it. It may just be that for example the bank benefits from having the hard currency coming to the bank account. Fair enough. Then the fintech can make their margin elsewhere. It might be that the fintech and the bank agree to split the fees 50 per cent. There can be many other things, but what they can’t be is just the finTech saying “Oh, yeah, I’ll use those bank accounts, but I’m going to take all of the value myself”, and vice versa. You can’t have the bank just saying “I’m not going to work with you,” because we need to work with the fintechs.

Basically, he is afraid that banks will lose their ability to make up the rules of the game so that they can profit by cheating the rubes.

I’m hoping that his concerns prove true.

H/t Naked Capitalism.

Canada is Trying to Save the American Labor Movement

The Canadian government is meeting with some of the country’s biggest labor groups to discuss Nafta as talks on the deal are set to resume.

Labor Minister Patricia Hajdu will meet union leaders Friday in a round-table discussion near Toronto to get input on the North American Free Trade Agreement. It’s the latest sign that labor has the Trudeau government’s ear in talks that could hinge, in part, on Canada’s push to raise working standards in both the U.S. and Mexico.

“That’s an indication of how much we value our labor movement, and we want to make sure as we go into negotiations that the rights of Canadian workers are protected,” Hajdu said in an interview with Bloomberg. “We’ll do everything in our power to make sure of that.”

Nafta talks resume Monday with a partial round in Washington, without political leaders at the table. Canada wants the U.S. to undo so-called “right to work” provisions in some states, while also calling on Mexico to raise labor standards. One of Canada’s top union leaders, Jerry Dias, has met often with the Canadian negotiating team and regularly predicts Nafta talks will fail.

Trudeau has been pushing to add “progressive” elements like labor, gender and the environment into all trade negotiations — a move derided by political opponents as “virtue signaling” that could make it tougher to get a deal. That strategy was a driving factor in the surprise false start this week of trade talks with China, a country that typically shuns the bells and whistles Canada wants in any trade deal.

Those added elements are among Nafta’s sticking points. Canada wants its two North American partners to ratify eight core conventions, including the right to organize, laid out by the International Labour Organization to make Nafta work. “We did put forward a very ambitious proposal on labor,” chief negotiator Steve Verheul told lawmakers this week. While Canada has adopted all eight and Mexico has nearly done so, the U.S. has adopted only two, Verheul said. “The U.S. is resisting that proposal.”

Canada’s call to claw back U.S. “right-to-work” laws, which ban unions from requiring workers to pay dues, is another obstacle. “The U.S. is also resisting that,” Verheul said.

As Yves Smith pithily observes, “Sounds like the Canadians are doing better by labor than our own Democrats.”

The history of the modern Democratic Party does not show meaningful support for organized labor.

When Republicans pass so-called “right-to-work ” laws, Democrats never repeal them, and the Obama administration dropped its support for the Employee Free Choice Act (Card Check) before the last states were called in 2008.

The positions pushed by Trudeau benefit workers in all three of the signatories of NAFTA, so I expect Democrats, or at least the current Democratic Party establishment to vociferously oppose labor justice, because they have sold their souls to big donors.

Another Stopped Clock Moment from Trump

It appears that the Trump administration wants to effectively gut the Investor State Dispute Settlement (ISDS), which would be a very good thing:

U.S. ISDS PROPOSAL WOULD CUT TWO KEY PROTECTIONS: Expect USTR to put at least one of those “poison pills” forward at talks this week. The final U.S. proposal on investor-state dispute settlement comes not only with an “opt-in” provisions that effectively makes the whole process voluntary, but also rolls back two key investor protections private companies have been able to use under the mechanism in past U.S. agreements. U.S. business and agriculture groups have already signaled that a radical departure from the current U.S. approach to investor protections would be forcefully opposed by them.

I don’t expect this to actually happen.

Even if Trump wants to do this, and I think that it is likely posturing, I would expect resistance from Congressional Republicans and the non “Alt-Right” personnel in his administration to make this outcome highly unlikely.

OK, This Explains a the Furor………

As a part of the Brexit, the UK is renegotiating export deals with the US.

One of the sticking point is chlorine washed chicken.

In the EU and the UK, cleanliness is required at every step of the process, while in the US, the carcasses are washed with a solution of water and chlorine because the chickens are raised in in extreme conditions, and the chlorine washing is required to make ensure that the chickens are safe to eat:

The disturbing prospect of chlorine-washed chickens from the US going on sale in British shops in a post-Brexit trade deal last week sparked an explosive row at the heart of Government.

But beyond the politics lies the story of why American poultry needs such drastic chemical treatment – and of the horrendous conditions at the farms where they are bred and reared.

Now whistleblower farmers have revealed the full horror of the suffering to The Mail on Sunday, including how:

  • Tens of thousands of super-sized ‘Frankenstein’ birds are crammed in vast warehouses.
  • The chickens, which weigh up to 9lb, often buckle under their weight and must live without natural sunlight.
  • Chickens frequently die before they reach maturity and many are left covered in their own faeces, turning warehouses into vile breeding grounds for disease.

Unlike in the UK and Europe, there are no minimum space requirements for breeding chickens in the US. America also does not have any rules governing lighting levels in the sheds and, crucially, its farms have no maximum allowed level of ammonia, which indicates how much urine and faecal matter is present. This means there is no limit on how much can fester inside the sheds.

There is no legal requirement to wash US chickens in chlorine or other disinfectants, but 97 per cent of its birds are cleaned in this way after slaughter.


Another reason poultry in the US is chlorinated is that farmers are not required to vaccinate against diseases such as Salmonella. Britain and the EU have widespread vaccination programmes.


Leah Garces, of the Global Animal Partnership, an animal welfare group, added: ‘The fact we have to wash our food in chlorine to make it safe indicates that we are not doing farming right in the first place. It indicates how unhealthy we are raising our birds.’

While UK chicken farmers are not wholly free from criticism from animal welfare campaigners, there are strict regulations that must be followed. In the UK and Europe, poultry farmers must not keep more than 17 chickens per square metre in their sheds. There are also rules governing available natural light, temperature and the maximum levels of ammonia.


Shraddha Kaul, of the British Poultry Council, said: ‘We strongly reject any move to import chlorine-washed chickens as part of a makeweight in trade negotiations with the US.

‘Chlorine is used as a catch-all. It is an approach which means it doesn’t matter how badly you treat your chicken, you can just clean it away at the end of the process.’

This reflects a very big difference in philosophy, the Europeans bake in sanitation throughout the process, while in the US, you hose the chickens down with disinfectant when they hit the slaughter house.

Of course, lousy chicken and a race to the bottom is the par for the course in free trade deals, so limeys need to eat their mutant steroid and antibiotic fetid chicken, and they need to like it.

This is a Feature, Not a Bug

Over at Bloomberg, we have a bit of history which describes how US Chipmakers dealt with the toxicity of their manufacturing processes by moving overseas, where they could harm brown people and no one would care:

Results in epidemiology often are equivocal, and money can cloud science (see: tobacco companies vs. cancer researchers). Clear-cut cases are rare. Yet just such a case showed up one day in 1984 in the office of Harris Pastides, a recently appointed associate professor of epidemiology at the University of Massachusetts at Amherst.


SIA, representing International Business Machines Corp., Intel Corp., and about a dozen other top technology companies, established a task force, and its experts flew to Windsor Locks, Conn., to meet Pastides at a hotel near Bradley International Airport. It was Super Bowl Sunday, January 1987. “That was a day I remember being at a tribunal,” Pastides says. The atmosphere “bordered on hostility. I remember being shellshocked.” Soon after the meeting the panel formally concluded that the study contained “significant deficiencies,” according to internal SIA records. Nevertheless, facing public pressure, SIA’s member companies agreed to fund more research.


Pastides felt vindicated. More than that, he considered the entire episode one of the greatest successes in public-health history, as do others. Despite industry skepticism, three scientific studies led to changes that helped generations of women. “That’s almost a fairy tale in public health,” Pastides says.

Two decades later, the ending to the story looks like a different kind of tale. As semiconductor production shifted to less expensive countries, the industry’s promised fixes do not appear to have made the same journey, at least not in full. Confidential data reviewed by Bloomberg Businessweek show that thousands of women and their unborn children continued to face potential exposure to the same toxins until at least 2015. Some are probably still being exposed today. Separate evidence shows the same reproductive-health effects also persisted across the decades.

The risks are exacerbated by secrecy—the industry may be using toxins that still haven’t been disclosed. This is the price paid by generations of women making the devices at the heart of the global economy.


Yet in virtually every study published since the 1990s, Kim read one form or other of the same phrase: The global semiconductor industry had phased out EGEs in the mid-1990s, signaling the end of reproductive-health concerns. The statements made sense. Not only had IBM and other companies publicly announced that the use of EGEs had been discontinued, but the chemicals also had become classified as Category 1 reproductive toxins under international standards, and European regulators had placed them on a list of the most highly toxic chemicals known to science, designating them Substances of Very High Concern.

Still, something nagged at Kim. In focus groups, young South Korean women working in chip plants told Kim’s colleagues it was not uncommon to go months, or even a year, without menstruating. (Some saw these potentially ominous changes to their reproductive systems as blessings, not warnings. It was just easier not to have periods.) As in the U.S., women dominated production jobs in South Korea’s microelectronics industry, which employs more than 120,000 of them, mostly of childbearing age; they’re often recruited right out of high school. Kim and a colleague decided they needed to conduct a new reproductive-health study. They faced a challenge, however, that Pastides and the other U.S. researchers hadn’t, at least on the front end: a lack of industry cooperation.

In 2013 they persuaded a member of South Korea’s parliament to pry loose national health-insurance data. They got five years of physician-reimbursement records through 2012 for women of childbearing age working at plants owned by the country’s three largest microelectronics companies: Samsung, SK Hynix, and LG. Samsung and SK Hynix accounted for the vast majority of women in the study, as the two have long been among the world’s largest chipmakers. The data covered an average of 38,000 women per year. From that number, the researchers looked at the records of those who had gone to doctors for miscarriages.

The results were both undeniable and shocking to Kim, just as they had been for Pastides almost three decades earlier. She found significantly elevated miscarriage rates and a rate for those in their 30s almost as high as in the U.S. factories. And the findings were conservative, because many women don’t go to the doctor for miscarriages, and because production workers couldn’t be separated in the study from those who worked in offices. “This was not the result I had expected,” Kim says.

As an aside here, this is another argument for single payer in some form, it creates a demographic database that is both available and universal that can be used to find problems like these.


After the outcry in the U.S. in the 1990s, chemical companies said they’d changed the formulations for the photoresists and other products they supplied to chipmakers, including those in Asia. But testing data obtained by Bloomberg Businessweek show that changes weren’t made quickly or, in some cases, completely.


Kim, the epidemiologist, says the secrecy of these settlements is a reason there was so little discussion for so long of the risks in chipmaking. “It was not published in academic papers,” she says. “Just some hidden settlements between the companies and some victims.”

Even today, the chipmakers themselves sometimes don’t know what they’re bringing into their facilities and exposing their workers to. That’s what SK Hynix discovered in 2015 after hiring a team of university scientists to assess the toxic risks in two of its plants.

Some of their results were made public in Korean, but many of the findings remain confidential. An extract of the research reviewed by Bloomberg Businessweek shows scientists found that the plants used about 430 different chemical products each. These included more than 130 deemed to be dangerous enough that employees exposed to them must undergo special health checks; those chemicals are called CMR agents—shorthand for carcinogens, mutagens, and reproductive toxins. In addition to benzene and EGEs, they’ve historically included arsenic, hydrofluoric acid, and trichloroethylene.

The ability to directly or indirectly poison unsuspecting employees is one of the goals of globalization.  It’s all about labor and regulatory arbitrage, which is why promises of labor, safety, and environmental protections that we hear about whenever they want to push through a trade deal are empty.

Allowing the 1% to f%$# the rest of us is the goal of modern trade deals, so it’s no surprise that this is their actual effect.

The Germans are Getting Nervous

The Germans don’t want a Brexit, but if it happens, they want to be sure that it is painful for the British, and they also want to be sure that it won’t upset the existing political consensus.

I think that the disaster for Theresa May, particularly in context of the German dogma for austerity, has shaken the German establishment, which is why Wolfgang Schäuble is now talking about how all will be forgiven if Britain decides to forgo leaving the EU:

German Finance Minister Wolfgang Schaeuble said that the U.K. would be welcomed back to the European Union if the British decided they no longer wanted to quit the bloc.

French President Emmanuel Macron also said the “door is open” for a return, but warned that it would be much harder to achieve once negotiations have started.

In his first public comments on the matter since the U.K. election, Schaeuble said that “it’s up to the British government to take their own decisions” on Brexit. He said he had discussed the surprise election outcome with Chancellor of the Exchequer Philip Hammond the day after the vote, and concluded that “we have to leave them some days” to decide on the way forward.

Asked if the government might reverse its decision to quit the EU, he said it “would not be helpful” to speculate whether that will happen or not. “The British government has said we will stay with the Brexit,” Schaeuble said in the interview during Bloomberg’s G-20 Germany Day. “We take the decision as a matter of respect. But if they wanted to change their decision, of course, they would find open doors.”

I think that they are afraid that if Brexit happens, and Labour ends up in charge, it won’t be a complete clusterf%$#, and could lead to other countries to pulling back from the EU.

Preach It, Brother!

In the Guardian, Thomas Frank makes a very good point, that “The Democrats’ Davos ideology won’t win back the midwest.”

The current neoliberal consensus is that globalization benefits the deserving, and that if you lose, it’s because you’re stupid, and never studied in school:

The tragedy of the 2016 election is connected closely, at least for me, to the larger tragedy of the industrial midwest. It was in the ruined industrial city of Cleveland that the Republican Party came together in convention last July, and it was the deindustrialized, addiction-harrowed precincts of Ohio, Pennsylvania, Michigan, and Wisconsin that switched sides in November and delivered Donald Trump to the Oval Office.


And what I am here to say is that the midwest is not an exotic place. It isn’t a benighted region of unknowable people and mysterious urges. It isn’t backward or hopelessly superstitious or hostile to learning. It is solid, familiar, ordinary America, and Democrats can have no excuse for not seeing the wave of heartland rage that swamped them last November.

Another thing that is inexcusable from Democrats: surprise at the economic disasters that have befallen the midwestern cities and states that they used to represent.

The wreckage that you see every day as you tour this part of the country is the utterly predictable fruit of the Democratic party’s neoliberal turn. Every time our liberal leaders signed off on some lousy trade deal, figuring that working-class people had “nowhere else to go,” they were making what happened last November a little more likely.

Every time our liberal leaders deregulated banks and then turned around and told working-class people that their misfortunes were all attributable to their poor education, that the only answer for them was a lot of student loans and the right sort of college degree … every time they did this they made the disaster a little more inevitable.


Of course it isn’t working out that way. So far, liberal organs seem far less interested in courting such voters than they do in scolding them, insulting them for their coarse taste and the hate for humanity they supposedly cherish in their ignorant hearts.

Ignorance is not the issue, however. Many midwesterners I met share an outlook that is profoundly bleak. They believe that the life has gone out of this region; indeed, they fear that a civilization based on making things is no longer sustainable.


I have no doubt that people in this part of America would respond enthusiastically to a populist message that addressed their unhappy situation – just look, for example, at the soaring popularity of Bernie Sanders.

As things have unfolded thus far, however, our system seems designed to keep such an alternative off the table. The choice we are offered instead is between Trumpian fake populism and a high-minded politics of personal virtue. Between a nomenklatura of New Economy winners and a party of traditional business types, willing to say anything to get elected and (once that is done) to use the state to reward people like themselves. The public’s frustration with this state of affairs, at least as I heard it on my midwestern trip, is well-nigh overwhelming.


But when “the resistance” comes into power in Washington, it will face this question: this time around, will Democrats serve the 80% of us that this modern economy has left behind? Will they stand up to the money power? Or will we be invited once again to feast on inspiring speeches while the tasteful gentlemen from JP Morgan foreclose on the world?

The argument of the privileged (center) left is that this is inevitable, and people who are harmed by this are to blame for this harm.

It is a pernicious attitude, one that stems from their inability to recognize their own unearned privilege.

This destructive sanctimony needs to be purged from the Democratic Party.  Let the Republicans have them.

Quote of the Day

The politics of compensation is always subject to a problem that economists call “time inconsistency.” Before a new policy – say, a trade agreement – is adopted, beneficiaries have an incentive to promise compensation. Once the policy is in place, they have little interest in following through, either because reversal is costly all around or because the underlying balance of power shifts toward them.

Dani Rodrik

It is a point that I have made many times: Promises to help people hurt by free trade deals are never fulfilled, because along with a loss of jobs and money, there is a loss of political power, and political losers almost never get the spoils.

Quote of the Day

And so, contrary to Hayek’s expectations, financial globalisation has proved that it is market fundamentalism, and not the regulatory state that is leading the world into an era of authoritarianism and totalitarianism – in the US, Eastern Europe, India and China.

Ann Pettifor

This is not surprising the relentless concentration of power by monopolists has always had this effect. 

As an aside, Hayek in fact loved authoritarianism and totalitarianism, as shown by his full-throated support of the brutal Pinochet regime in Chile, and his only slightly more muted defense of the Apartheid regime in South Africa.