Extending the validity of Ruy Mauro Marini’s work to the elucidation of the exploitation of the working class in what is to this moment the epicenter of the exercise of power—the United States of America (US)—is not common in Latin American Social Sciences. But that is what Adrián Sotelo offers in this book, supported by the growing inequality and oligarchization observed in the US, as well as the powerful precarization of the workforce in the northern country. With analytic diligence and clarity in his explanations, the author addresses the central role of the super-exploitation of the workforce, not only in the imperialist dynamics deployed by Washington and its lumpenbourgeoisies in the capitalist periphery but recovering this dimension as a critical part in the current labor dynamics of the US, specifically since the implementation of the North American Free Trade Agreement (NAFTA or TLCAN).2 The signing of this agreement formalized a downward standardization of salaries, embedded in a context of generalized precarization (gig economy3) in the US, with the consent of big capital based both in the US and Mexico. As pointed out by researchers from the Economic Policy Institute—Jeff Faux in particular (Faux 2017)—not only did NAFTA make 700,000 jobs disappear, but it empowered businesspeople in the negotiation of salaries. It also plummeted—virtually froze—the capacity of negotiation and caused the subsequent collapse of membership in US unions. More than just a ‘trade agreement’, NAFTA contains hundreds of pages of a vast framework of rules and procedures designed to offer investors in large corporations, and bankers—on both sides of the border and beyond—rules of the game loaded to their advantage, “giving privileged access to the US market of goods produced in Mexico, where salaries are meager and regulations weak. This FTA also contains subtle protection mechanisms for managers, investors, and corporations, including secret courts for labor and environmental disputes. Employers on both sides of the border have
The present book provokes great interest thanks to a themed and careful exploration of the period in which Donald Trump’s presidency come into force in the US, a power that since the end of World War II—and more intensely after the attacks of September 11, 2001 (9/11)—shows signs of becoming a domestic and international regime of exception via a growing and cruel military and commercial unilateralism. Of ocurse, the attack against the US labor force did not start with Trump. As US Senator Elizabeth Warren points out, it has been for decades that “armies of lawyers and lobbyists who represent a handful of giant corporations have pressed […] to pursue policies that maximize corporate profits” (Warren 2017: 2). But she cannot help but to warn that:
…[i]nstead of strengthening the rights of working people, the Trump administration has pushed in the opposite direction. Since taking office, President Trump has signed several laws that directly undermine the wages, benefits, health and safety of American workers. The President and the Republican Congress have rolled back rules designed to make sure federal contractors don’t cheat their workers out of hard-earned wages. They’ve delayed safety standards that keep workers from being exposed to lethal carcinogenic materials. They’ve given shady financial advisers a few extra months to cheat hardworking Americans out of billions in retirement savings. The list goes on.
WARREN 2017: 3
Although continuity and structural characteristics amongst this administration and its predecessors exist, we can now observe asinine gestures and mannerisms, similar to Mussolini’s, that reflect at every turn a liking for inflicting damage and pain upon the weakest inside and outside of the capitalist system that has been sinking into a crisis of accumulation since the 1960s/1970s.
Just as Senator Warren suggests, the super-exploitation of the workforce under what can be characterized as National Trumpism is not to be under-estimated. Like National Socialism, it holds great political-electoral and psychopathological power that can be seen in Trump’s actions and words with a racist, classist, hateful tone and a unified dehumanization of ‘the others.’ In
In the present book’s crucial fourth chapter, Sotelo formulates a novel hypothesis that has not been previously included in the academic literature and, as he claims, “was not contemplated even by Marini,” namely, a fourth modality in the super-exploitation of the workforce that would be being built through the imposition of labor precarity and its updating through the precarization process of all of the elements that constitute the world of labor, such as salaries, functions, categories, subcategories, employee benefits, labor costs, unionization, collective labor agreements, flexibility and deregulation.6
Sotelo’s approach coincides with Marini in that “the super-exploitation of the workforce is settling itself inside the systems of production and labor (organization) of imperialist countries structurally and systematically, although subordinated to the logic and laws that rule the production of relative surplus value and its institutional correlates like the State, scientific-technical development, imperialism and autonomy of their capital cycles that they maintain as a hegemonic category. Thus, under this understanding and method, and in line with Marini, we consider that the dilemma of the universalization of super-exploitation of the workforce in contemporary capitalism is solved regarding both its reach and limitations”.7
To the vast anti-worker offensive described by US Senator Warren, one must add the use of “Right to Work” type laws, frequently used in the United States
Jerry Dias, leader of Canada’s largest private sector labor union, said he was “very pleased with the position the Canadian government is taking on labor standards,” and added “Canada’s got two problems: The low wage rates in Mexico and the right-to-work [laws in] several states of the United States” (Slate, 2017).
Thanks to the warning by Mayra Rodríguez Valladares (2018) of MRV Associates about the data offered by the US Federal Reserve the Report on the Economic Well-Being of US Households in 2017 (Board of Governors 2018), we have a more direct approach to the realities that support Sotelo’s novel proposal. The data are significant. In a synthesis of the general and crucial features of the economic structuring of US society in which the expansion of a precariat is experienced, the report prepared for the Board of Governors of the US Federal Reserve shows that the impact of super-exploitation of the workforce on the families of the bottom half of the US, i.e., the ‘precariat society’ (gig society), is a sociological as well as economic reality. In the words of Rodríguez Valladares8 published in The Hill:
Data are powerful storytellers. The data tell a story of two Americas barely cohabiting within the same borders. One America is comprised of the people who are benefiting from a growing US gross domestic product and having the lowest unemployment rate in 14 years … 74 percent of adults responded that they were ‘ok financially’ and living comfortably. This is 10 percentage points higher than five years ago. The majority of survey respondents stated that they are ‘satisfied with the wages and benefits from their current job and are optimistic about their future job opportunities.’ Additionally, 95 percent of Americans have a bank account and hence are in a position to try to obtain credit if they needed it.
Yet, the data also tell a worrisome story about a vast swath of Americans being left behind in this country’s second-largest economic expansion in its history. The plight of those Americans left behind should worry not only those affected, but all of us whether we are legislators, central bankers, regulators or ordinary residents. Their plight, especially if it worsens, will affect what legislative actions and policies will be needed to improve living standards for all. Rodríguez Valladares adds, “…leaving these people behind will impact our competitiveness in decades to come” (Rodríguez Valladares 2018).
Indeed, the report allows us to see how the outlook of the world of labor has changed just in the last five years where 30 percent of American adults are now in the gig economy (precariat). This may seem great in terms of allowing Americans more control of their leisure time. The reality is that most people in the gig economy have to work much harder to have enough money to live, and they have to be able to cope with the risk and emotional strain of not having a stable, earnings stream. Forty percent of adult Americans, or 100 million people, cannot cobble together $400 in cash for a medical emergency without selling a possession or going into debt. While the figure may appear better than five years ago, when it was 50 percent, the US population has also grown since 2013 (Board of Directors 2018: 64). Worse yet, 20 percent of adults cannot pay all of their current month’s bills in full, which means that they also get hit with penalty fees and risk being cut off from any credit. Sadly, 25 percent of American adults skipped necessary medical care because they could not afford it.
A large number of Hispanic- and African-Americans fall into this population in the process of precarization. In the words of Rodríguez Valladares, “[w]hen you break out African- and Hispanic-American responses, only 66 percent state that they were doing ‘ok financially’ as opposed to 75 percent for respondents as a whole (Valladares 2018).”
Those percentages demonstrate that there is a rise in poverty for the most held back sectors of the former society of opulence and we see how in all categories considered needed to achieve a dignified life, Hispanic- and African-Americans require much more effort than those of a Caucasian origin, although, as the report adds, “…40 percent of Americans who are struggling are about to face even more hardships this year and in the foreseeable future since we are in a rising-interest-rate environment. Any variable-rate loan or credit card debt that they have already, or will take on, will be more expensive” (Valladares 2018).
The data from this report that deals with the configuration process of two US societies are very relevant because they come from the center of big capital itself. However, the levels of precarization and inequality are far deeper.
When it became known in Mexico that Robert Lighthizer—Trump’s trade representative, with an eye on the midterm legislative elections in the US and his fundamental “reelection project”—accepted on a tactical level the proposal from Democratic legislators to include the topic of labor related to “standards that can be met” within NAFTA’s renegotiation, Mexican employers and their neoliberal Mexican government were quick to reject this.9 This was because what would be at stake is the primary source of the vast wealth accumulated by the 1% of the population here and there through the super-exploitation of the workforce of Mexican workers, a condition of labor flexibilization, agreed to and formalized by the transnational companies and both oligarchies. NAFTA also facilitates the appropriation of natural resources and primary enterprises and public services of the country, including energy, security and ‘national’ defense. Was is not John D. Negroponte who said, NAFTA is “the cornerstone” that can align Mexican security and foreign policy with the principles of American foreign policy?
Democratic Representative Sander M. Levin was responsible for reminding people about the central issue by observing that the compensation of Mexican autoworkers is a meager 19 percent of that of their unionized US counterparts. Even after more than two decades of NAFTA, this is one of the least asymmetric items! In the mid-1970s, average wages in Mexico were 31 percent of those in the US. This was just before the great offensive by financial capital (Wall Street, the Fed and the Treasury Department through the IMF-WB-IDB) was faced with the capitalist accumulation crisis that has been intensifying since then: real class warfare under the signature of “globalization” and “neoliberalism,” where the super-exploitation of labor is a fundamental part of the “imperialization” of the periphery. And Mexico in the role of a tenacious ‘model’ has been plundered relentlessly since 1982 when—according to a 2016 study by the
The downward standardization of Mexican salaries, in the context of NAFTA, was endorsed by the upper echelons of the Mexican government and the unions that under Salinas stripped the voice from the workforce in the negotiation of the treaty, a condition that continues to this day, with accumulated effects in the US as well, given the practically non-existent growth in salary in that country.
Luis Videgaray, Secretary of Foreign Affairs during the agonizing and bloody Peña Nieto government sought to extend the catastrophe six more years by keeping his party in power. With a nostalgic echo to the ears of the northern neighbor, just in the good old days, the government and private sector comprised a single negotiating team based in the “globalization,” meaning the potentiation of the negotiating capacities of the great transnational companies, from their center and their periphery. It is a stratagem for the super-exploitation of the workforce that combines wage caps dictated by the private sectors from inside and out with growing productivity but in a context for “North America” of a persistent downward salary standardization/stagnation with an elevated electoral risk for the Republicans and Trump. It is not surprising that in a recent interview Lighthizer asked himself: “Do I believe that Mexican labor laws have had a negative effect on the United States? … Yes, I think so.”10
He immediately added “the position of the US President Donald Trump and that of the Democrats on labor standards ‘are not that far off.’” It is clear that the commercial representative is talking about precarization and the brutal wage ruin in Mexico and not about the truly progressive laws that exist on paper, torn to shreds every day by the upper echelons of the government, corporations and union cronyism. This is also in the center of the interest of not just the bankers and investors in NAFTA, but also of US politicians. Ever since a free trade agreement with Mexico had begun to be contemplated, the Democratic leadership considered the absence of class instruments that would allow an increase in the income of Mexican workers as NAFTA’s primary obstacle. Now, for Trump, extreme inequality in the US is a matter of political demagogy, although he does not seem to be fully aware of what this entails, because he
According to a study by Facundo Alvaredo, Lucas Chancel, Thomas Piketty, Emmanuel Sáez and Gabriel Zucman (2016) and data from Global Wealth/Credit Suisse, at the base of the processes that carried Donald Trump to the White House is a structural issue observed decades ago, but which shows its face in this study that exhibits that, between 2015 and 2016, the wealthiest 1% of the US channeled in its favor the wealth of 90% of US households, equivalent to $4 trillion or an average of $3 million per household. The wealthiest 10% captured an average windfall of $1.3 million per household.
Almost half of that extracted by the 1% came from the middle and lower class. The authors of the study estimate that the plutocracy took $17,000 per household/average from 90% of the population. The loss of wealth by the middle class rose to $35,000 per household/average. This amounted to 50 million households being batted with an estimated loss of wealth of $1,760,000,000,000 and for the poorest 50%, real household income did not increase in 40 years!
US Democratic candidate Bernie Sanders was the only politician of the three countries of NAFTA that dared to say:
In the United States, Jeff Bezos—founder of Amazon, and currently the world’s wealthiest person—has a net worth of more than $100 billion. He owns at least four mansions, together worth many tens of millions of dollars. As if that weren’t enough, he is spending $42 million on the construction of a clock inside a mountain in Texas that will supposedly run for 10,000 years. But, in Amazon warehouses across the country, his employees often work long, grueling hours and earn wages so low they rely on Medicaid, food stamps and public housing paid for by US taxpayers.
SANDERS 2018
I quote him here also because he labeled his political campaign as ‘socialist’, something unheard of at that scale in the history of the US as well as in either of the other signatory nations of NAFTA. And, for Marini, the socialist revolution was the path to take. This was not to be for the US Democratic Party’s leadership that devoted considerable resources, efforts and borderline (if not openly illegal) electoral manipulation, to stop the solid electoral progress of Bernie Sanders. Sanders was the only major politician in the three NAFTA nations that dared to challenge the powerful fossil fuel industry and the internal combustion engine automotive industry, with a massive mobilization like the one when confronting fascism during World War II. This time the danger is global warming and climate change, that threaten as never before in recorded history, global biota, humanity included.1
John Saxe-Fernández
This “Agreement” on the part of the US signifies a treaty level accord of the sort first established by Franklin D. Roosevelt that can be placed into effect with a simple legislative majority in both houses instead of requiring a two-thirds majority in the Senate as in the case of treaties.
Cambridge Dictionary defines ‘gig economy’ as: “a way of working that is based on people having temporary jobs or doing separate pieces of work, each paid separately, rather than working for an employer. Workers eke out a living in the gig economy, doing odd jobs whenever they can.” https://dictionary.cambridge.org/us/dictionary/english/gig-economy.
North American Free Trade Agreement. https://www.nafta-sec-alena.org/Home/Texts-of-the-Agreement/North-American-Free-Trade-Agreement. More detail on the impact of NAFTA over the American working class can be found in Jeff Faux (2013). Also, see Faux (2006) or in Spanish, Faux (2008).
See robertreich.org.
From this book: Sotelo, Chapter 4.
Also from this book: Sotelo, Chapter 3.
Mayra Rodríguez Valladares is Managing Principal of MRV Associates, which provides financial consulting, research and training on financial regulation issues. She has 25 years of financial regulatory experience from her time at the Federal Reserve Bank of New York, JP Morgan and BT Alex. Brown.
For more on this topic see Process Magazine #2125, July 22, 2017.
The Baja Post “US will seek to negotiate ‘compliant’ labor standards in NAFTA”, June 26, 2017, in https://www.thebajapost.com/2017/06/26/u-s-will-seek-to-negotiate-compliant-labor-standards-in-nafta/.
John Saxe-Fernández is a researcher at the Programa el Mundo en el Siglo XXI (The World in the 21st Century Program) of the Center for Interdisciplinary Research in Sciences and Humanities at the Universidad Nacional Autónoma de México, he is Full Professor on the Faculty of Political and Social Sciences. He teaches the “Geopolitics and Geoeconomics of Capital” seminar and is a member of the Postgraduate Faculty in Latin American Studies and Political Science. Among his recent books are: Crisis e Imperialismo (Crisis and Imperialism), CEIICH/UNAM, 2012 and La Compra-Venta de México (The Mexico Purchase), Plaza & Janés, 2002 (New electronic edition, CEIICH/UNAM, 2016). He is the coordinator of La Explotación de Combustibles fósiles no Convencionales en Estados Unidos: Lecciones para América Latina; Hacia una Sociología Política del Colapso Climático Antropogénico (The Explotación of Non-Conventional Fossil Fuels in the United States: Lessons for Latin America); and Towards a Political Sociology of Anthropogenic Climate Collapse, 2018/2019.