At City Club 01.07.05: Sherrod Brown for "Fair" Trade - and Gov in '06?!

Submitted by Norm Roulet on Sat, 01/08/2005 - 17:11.

Congressman Sherrod Brown was the speaker at the first Cleveland City Club Friday Forum of 2005, on January 7, where he presented insight from his recently published book on American free trade policy, Myths of Free Trade: Why American Trade Policy Has Failed, and shared personal perspectives on life in Washington, Ohio, and around the world. Appreciative attendees enjoyed the company of an insightful speaker, empowering statesman, and refreshing intellectual – and we may well have been the first to learn Brown is seriously considering a run for Ohio Governor in 2006. Where else but the City Club may we the people of Cleveland get up close and personal to explore the most important issues in the world, with the most insightful people in the world.

Sitting 20 feet from our Congressman of District 13, in Northeast Ohio, hearing him speak eloquently about his worldly pursuit of truth about free trade and answer any question posed from attendees - from "aren't Democrats in Washington a bunch of 98 pound weakling"? to "would you consider running for Governor of Ohio"? - I truly valued the City Club slogan of "A Free Exchange of Thought", and left the session thinking more insightfully about free trade, and the prospect of "Brown for Governor". Here's a recap of the discussion, also broadcast on TV and radio and available by tape.

Brown started his talk by discussing observations on America's free trade policy, highlighting his book Myths of Free Trade, the profits from sales of which go to Results and Cleveland Jobs With Justice. He made the free trade issue personal and human, as seems his style.

He offered a brief background on free trade policy, explaining that before 1990 global trade policy was a below the public radar issue in congress, with limited media interest, handled by commissions and of greatest interest to multinational corporations and their lobbyists. Then came Fast Track, and NAFTA (North American Free Trade Agreement), and PNTR (Preferred Nation Trade Relations). Then followed mounting trade deficits, and the WalMarting of America, and publicity of labor abuse by companies like Nike and the TV pop-star Kathy Lee Gifford, and the complete realignment of the American and world economy, which started to disturb congressman in the late 1990s. The media and public really became aroused about world trade issues in 1999 with the "Battle of Seattle", when 10,000s of global citizens protested at the World Trade Organization summit there. Once visible in TVland, USA, Brown says, the majority of Americans grew to oppose American Free Trade policies, to the extent they saw realities. Brown then explained the realities of Free Trade he has seen.

He recounted a visit to workers at a Mexican GM plant near the border of America - an area he says is the most toxic in the Western Hemisphere. He described the workers' homes as a fraction of the size of the stage on which he stood, built of packing material from the factories in the area, surrounded by waste. The factory, he recalled, was like a modern American automotive factory except it had no parking lot, as none of the employees make enough money to buy cars - pay there is not sufficient to produce consumers, even as the jobs there displace consumers in America, making this free trade a negative impact on our and the global economies. He described seeing the same problems in Asia, where workers making shoes can't even afford those, and Central America - he spoke of "coffee widows" in Nicaragua whose husbands no longer can make a living producing coffee because World Bank policy has forced massive expansion of coffee growing in Viet Nam (no #2 in world), driving down all global prices, making the industry unprofitable for farmers in developing nations.

He then spoke of meat processing plants here in America that once offered well paying, safe jobs to Americans, but that have eliminated union representation and now pay immigrant workers low wages to process 2.5 times more carcasses per hour, resulting in poorer health and quality standards and making this one of the most dangerous jobs in the world. As a side-note, he mentioned that the processing plants have higher quality standards for meat being shipped to Europe, highlighting how industry has prioritized consumption here, over quality, concluding unregulated production is worse for workers and consumers.

Brown mentioned a conversation with an important Chinese national activist, now living in America, who explained the vanguards of the Chinese Communist Party movement are major American corporate CEOs. Brown explained when congress was considering PNTR for China, despite their human rights issues, the airport in Washington DC was clogged with corporate aircraft and the halls of congress congested with corporate CEOs, knocking on every legislator's door, lobbying for ratification. Brown said they pitched wanting access to billions of Chinese consumers when in fact they wanted access to billions of $1/day Chinese laborers, who have little chance of ever becoming consumers of much beyond simple food and shelter.

Brown acknowledged most corporate elites and mainstream media outlets serving the elites in America are supportive of "Free Trade". But common citizens poll against this, and legendary Nobel Lauriat economist Paul Samuelson has come out to say free trade is in ways a net loser for America. From The American Prospect:

Samuelson argues that, far from representing an unmitigated boon, free trade may in some circumstances prove a net loser. Among countless globalists who stand duly corrected, not the least chastened are two of Samuelson's own former students: Jagdish Bhagwati and Gregory Mankiw. Noted for their ardent embrace of globalism, the pair are identified by name as purveyors of "polemical untruth" in Samuelson's opening paragraphs.

Samuelson's insight is that if a low-wage country like China suddenly makes a major productivity leap in an industry formerly led by the United States, the result can be a net negative for the American people. Although American consumers may benefit via low-low prices at Wal-Mart, their gains may be more than outweighed by large losses sustained by laid-off American workers.

This conclusion, coming as it does from the pope of economic orthodoxy, is already (even before its official publication) causing a sensation in the economics profession.

Brown continued by referencing some trade deficit data, like the $120 billion deficit with China this year, and that over the past few years America has lost 1 in 5 manufacturing jobs. This leads up to a battle now in congress that is near and dear to Brown's heart... the Central American Free Trade Agreement (CAFTA)... which Bush has signed and Brown encourages the public to be vocal against. For this and all Brown's candor, he receives a warm round of applause and opens the floor to Q&A.

Q. Democrats are now viewed politically as 98 pound weaklings - what do you think of that?

A. The House and Senate are very different in how they work these days. They used to be more bi-partisan but now are very partisan. Ultimately, Brown believes, Democrats represent majority of citizens in America and so must reach out to the people and activate them to have more of a voice in public policy and law making.

Q. Clinton was for free trade so how can this be viewed as a party issue - that Democrat was wrong.

A. Clinton did start out for NAFTA but by the end of his administration he became more aware of problems with free trade, and started to work toward "fair trade". But Bush has pushed trade policy in reverse toward free trade at expense of human rights and economic progress. Brown believes trade needs to be viewed as a "People Issue" considering quality of life of all people involved, including those harmed by environmental impacts... from unsafe worker conditions to toxic waste at the Mexico-America border. He points out that now, in considering CAFTA, 90% of Democrat legislators are against, but 70% of the majority Republicans are for. To influence this issue, Brown believes small business owners need to speak up about their concerns, but acknowledges most of them are probably Republicans, and they don't have the resources to lobby anyways. Longer term, it is necessary for individuals and small businesses to align to gain a voice in trade issues controlled by high price lobbyists and multinational corporations.

Q. Are you considering a run for Governor of Ohio?

A. Brown replied he loves his current office and that if Kerry had won he'd be writing the national Healthcare reform bill - but Kerry didn't win, so he isn't. Brown also said he loves Ohio and while he hates the idea of having to work with the state legislators, who seem preoccupied with fighting same sex marriage and promoting concealed weapons instead of saving our state economy, he wants to turn this state around, so he is considering running for Gov. - a conclusion Crains also took from this forum - see ... reporting that Brown is "thinking about" running for governor. He said he is concerned about the direction of the state, in particular the loss of manufacturing jobs, the rising costs of tuition at the state's public universities, the mismanagement of Medicaid, and the corruption of public officials. But, reflecting on his job as a legislator, he added, "I can't think of a job I like more than this one."

Q. The Wall Street Journal likes free trade - doesn't that mean something?

A. Brown is not a fan of the Wall Street Journal, which is the largest media supporter of free trade and is not in synch with the American public reality.

Q. Does America do too much using subsidies to further our national business interests - e.g. for importing oil?

A. By acting as the "Undeniable Superpower" we spend more than our fair share policing the world, which adds to spending, and much of our policing is to protect interests of American corporations abroad, which could be viewed as subsidies. We also allow American corporations to headquarter in tax exempt countries to avoid paying US corporate taxes, which is a policy favoring the largest corporations, so our tax policy is problematic.

Q. Oil consumption in America has exploded and is increasing so what percent of free trade and the deficit is reflected in that one commodity and is there anything that can be done about that?

A. Big problem - latest energy bill is designed for more conservation and efficiency but Brown doesn't see us making real progress here.

Q. How do we overcome need in developing countries for jobs, even if pay is poor?

A. Brown says that is the hardest question to reconcile. He believes workers in developing nations could be paid more, giving them a higher quality of life, and costs to consumers elsewhere would still be low: e.g. raise from $0.25 to $0.50 per pair of jeans sewed in China, which retail for $25 in America. He points to other economic development methods for developing those economies, like microloans (2005 is the UN International Year of Microcredit) to small businesses. While people may believe developing countries need American trade to survive, Brown points to the history of economic activity around the world, which our policies disrupt, and that once disrupted it is very difficult for those economies to normalize. Brown is not opposed to doing business abroad but feels our policies need to promote the fair and good business practices that make America a great country, like fair trade, fair wages, workplace safety, environmental responsibility and respect for human rights in general. Current free trade policies do not take these issues into account and ultimately make the world worse, and poorer - minimize consumers - with fair trade policies we would create more consumers for a sum gain.

Brown receives warm applause and goes off to mingle and sign books.

I left reflecting on free trade and Brown's prospects for Governor. I agreed with Brown on his beliefs about the environment, fair trade, personal empowerment, and social responsibility to all people and the planet, but I distrust politicians and was interested in other opinions. At a meeting with a friend that followed, I asked his opinion on Brown. He said he does not agree with Brown's beliefs on free trade - my friend sees the issue as growth of the overall global economy by developing unique value at each link in the chain - the loss of manufacturing jobs in America is a reasonable response to lower cost labor elsewhere, and American jobs must realign to higher value purposes. Low wages in developing countries will raise as supply of cheap labor tightens - all supply and demand, shifted to a universal level of absolute macroeconomics. As an economist, I ultimately recognize these absolutes, over time, for those left alive, to the extent the world remains reasonably livable. The loss of life and ecology in the mean time suggests to me a more compassionate hand in policy-making.

Thus, I consider, is Brown the hand to steer good policy, and should he do that in Ohio, as Governor, or in DC, as Congressman and perhaps eventually President. For the next few years I wish him well in DC and hope he serves Ohio well - ramping up to 2006 we'll see how other politics play out. I did some googling to see how the 2006 Governor's race is shaping up and this is already fascinating. So far, for the Democrats, the most likely contenders seem to be Brown and Jerry Springer. For the Republicans, Blackwell has announced and Petro and Montgomery are also expected to run. As the 2006 election will be won on the Internet, I visited each potential candidate's election website and Jerry Springer has my vote - he understands the power of the WWW. Blackwell is eCampaigning the most aggressively, but he doesn't use the power of IT well. With a few years to learn, we'll see which candidates realize that the WWW is where they must meet their citizens, and where their citizens will decide who to elect to represent them in government.

For today, I vote for the City Club as "The Free Exchange of Thought", in person. Coming up in the next few weeks, at the City Club:

Fixing Ohio School Finance: A Report from the Governor's Blue Ribbon Task Force on Financing Student Success
Senator Jeff Jacobson, Representative Claudette Woodard and Paul Marshall

Dr. Myles Brand
President, National Collegiate Athletic Association

David E. Gilbert
President and CEO, Greater Cleveland Sports Commission

Delos M. Cosgrove, M.D.
CEO, The Cleveland Clinic

Dialogues on Leadership - New Leaders Only
Terry Stewart
President and CEO, Rock and Roll Hall of Fame and Museum

Plain Dealer visions on Gov race, and past problems

Through 2006 there will be lots of press on area elections, already ramping up  with Sandy Theis' 01/09/05 front page Forum article "Race for the Governor's Mansion", considering lessons to be learned from past governors and their political battles. No big news, but interesting perspectives, and a fun gameboard graphic on page H6... you'll need to buy the paper to get that, but here's the article:

Race for the governor's mansion

If they're smart, this round's players will take a lesson from Ohio history
Sunday, January 09,
Sandy Theis

Plain Dealer Columnist

As Ohio prepares to elect its 67th governor next year, a peek into the
past helps to understand the political rules of the game.

Former Gov. Jim Rhodes had three famous rules: Don't drink on the job.
Don't put your hand in the till. And don't [take liberties with] the


In the 1930s, Martin Davey - Ohio's 53rd governor - fell into disfavor
for breaking rule No. 2. He bought himself a limo with Ohio National
Guard money, justifying the purchase by invoking his role as
commander-in-chief of the state militia. In 1938, the voters gave him
the order to move out.

Fifty years later, Democrat Jerry Springer's 1982 primary campaign
fizzled when voters failed to forgive him for ignoring the premise of
rule No. 3. The "help" he hired was a Kentucky hooker whom he paid by

Violations of the no-drinking rule have been rare in a state known for
its Prohibition candidates and governors who prefer to serve only Ohio
wine at the Mansion.

Rhodes' rules are just the obvious ones, though. Political
professionals say the fine print extends well beyond no drinking, no
stealing and no cavorting.

They tell you that money matters, and the more of it the better.
Attacks must be answered quickly and forcefully. A good organization is
imperative. Any talk of taxes is best avoided.

They'll also warn that even the finest campaign can be derailed by the unexpected.

George Voinovich began the 1990 race as the decided underdog. Having
just lost a misguided 1988 U.S. Senate contest in a landslide, he found
campaign donors and other skeptics reluctant to give him a second

Early polling showed his opponent, Attorney General Tony Celebrezze, with a sizable lead.

Celebrezze had a solid record that he'd recently enhanced by
negotiating a landmark deal that required the federal government to pay
for the cleanup of a nuclear weapons complex, but left the state in
charge of monitoring the feds' compliance.

Environmentalists loved Celebrezze, while the best thing anyone could
say about Voinovich's record on the environment was, "What record?"

But with a plaid shirt, a canoe and one of the best campaign
commercials of the season, Voinovich nullified Celebrezze's greatest
achievement with an ad that declared the big-city mayor to be "the real
environmentalist in the race for governor."

By the time Celebrezze responded, it was too late. Of course, the race
wasn't all about the environment, but Voinovich won it in a landslide
to become Ohio's 65th governor.

Many candidates have been punished by their own words, perhaps none
more so than Ohio's 62nd governor, Democrat Jack Gilligan. Fans of Ohio
State University howled in protest when the Notre Dame graduate
dismissed a buckeye as "a hairless nut of no commercial value."

And in a live radio broadcast from the Ohio State Fair, Gilligan
verbally stepped in it during an interview about the day's
sheepshearing event.

"Gonna shear sheep?" the interviewer asked.

"Nope," Gilligan replied. "I shear taxpayers, not sheep." The
taxpayers, who'd been feeling a chill ever since Gilligan pushed for
(and a hostile legislature approved) Ohio's first personal income tax,
promptly hired their previous shepherd, Rhodes.

During that campaign, Rhodes used the new tax, which allowed the state
to make dramatic improvements to education, mental health and the
environment, as his personal bludgeon. He accused the "Gilligan
gougers" of having "taxed everything in Ohio that walks, crawls or

Rhodes figured the tactic would work, because he'd used it successfully
in 1962 to defeat Democratic Gov. Mike DiSalle - the man Rhodes branded
"Tax-Hike Mike." DiSalle had pushed through taxes on corporations,
gasoline and liquor.

Democrats know the danger of taxes, though many have been unable to
resist them. Some have tried morphing into tax cutters. In 1998, Lee
Fisher proposed a statewide, 15-percent cut of the most hated tax of
all: the residential property tax.

Republican Bob Taft beat him anyway, which brings us to the present day.

Even before the 2006 governor's race has officially begun, it's turning into a debate over taxing and spending.

Three Republicans covet their party's nomination next year, and each has plans to save the state from its ballooning budgets.

Secretary of State Ken Blackwell, the most conservative of the
contenders, has the most ambitious (critics call it draconian) plan. He
wants a state constitutional amendment that would make it harder for
Ohio to continue spending at its current rate.

Attorney General Jim Petro has proposed saving money by consolidating
the 23 Cabinet agencies into nine and - through attrition and time -
reducing the state's workforce by 20 percent.

Auditor Betty Montgomery offers a work-harder-and-smarter approach tied
to her duties. She wants more authority to ferret out waste, fraud and
abuse - especially at nursing homes and other Medicaid providers.

Even Taft is considering a scaled- down version of the Blackwell plan - an announcement that has Democrats sneering.

"Isn't it ironic," said House Minority Leader Chris Redfern of Catawba
Island, "that a Republican governor, in a state controlled by
Republicans for more than a decade, is telling us that finally - after
all these years - it's time to get serious about cutting down on
government spending?"

No Democrat has announced plans to run, but a half-dozen are taking a
close look at the race. They include U.S. Rep. Sherrod Brown of Lorain,
Columbus Mayor Michael Coleman, state Sen. Eric Fingerhut of Shaker
Heights, former Attorney General Lee Fisher, Akron Mayor Don
Plusquellic and even former Cincinnati mayor, tabloid TV host Jerry
Springer and U.S. Rep. Ted Strickland of Lucasville.

The 2004 election offered clues about the tactics the Democrats will likely use in the upcoming governor's race.

In House races and countywide contests that saw Democrats knock off
incumbent Republicans, TV commercials had a common theme: The
Statehouse fund-raising scandals show the downside of one-party rule.

In some House races, images of a scowling Richard Nixon appeared with
those of a smiling Larry Householder, the ex-speaker of the House who
is the subject of investigations by the FBI and IRS.

Democrats took control of the Franklin County Board of Commissioners
with TV ads that portrayed local Republicans as monkeys: See No Evil,
Hear No Evil and Speak No Evil.

The rare victories offer some hope to demoralized Democrats that the
scandals will mushroom into the kind of monumental event that sweeps
Republicans out of office.

That's happened before, too.

In 1970, Republicans held all six elected statewide executive offices.
By year's end, Democrats had captured four of them and sent Gilligan to
the Governor's Mansion.

The scandal centered on Crofters Inc., a politically connected
loan-finding firm. Crofters had persuaded the state treasurer to make
questionable loans to some companies that later went belly- up.

The suspicion - never proven - was that Crofters' campaign donations to
Republicans (some of them paid in $100 bills) greased the skids for
loans that would not otherwise have been approved.

Fuming over their lost money, voters tossed out the party that didn't mind the store.

Republican consultant Chan Cochran, a long-time Rhodes adviser, is
watching the latest contest but says its too early to predict winners
and losers.

He did, however, offer a reminder of a less-famous Rhodes' rule: "Don't
give people a reason to be mad at you all the time. His first analysis
of every situation was, 'How can I use this to make a friend?' "

So far, there's no evidence that anyone is following that one.

Theis is chief of The Plain Dealer's Columbus bureau.

Contact her at:

stheis [at] plaind [dot] com, 800-228-8272