An Elegy for Tim Ryan and the Rustbelt’s Working Class Heroes
As a former resident of Youngstown, Ohio, I had whole-heartedly wished my fellow Youngstowner Rep. Tim Ryan the best of luck and success in his bid for a U.S. Senate seat.
He, more than any other national elected official, best captured the hopes, aspirations, and frustrations of those blue collar workers in the formerly industrial region known as the Rustbelt.
Having said that…
Ryan also represented the stubborn failures of the constituents of those areas, long beset by runaway factories and offshoring corporations, to rally behind anything coherent or pragmatic beyond a wistful nostalgia for the 1950s, when American manufacturing dominated in a world devastated by World War II, and when forty percent of our workforce was buoyed by union representation and benefits.
Too many of his constituents bought into the myth that it was trade agreements, and trade agreements only, beginning with “neoliberal corporatist” President Bill Clinton and “his” NAFTA, that began the wholesale plunder of the American middle class.
First, the NAFTA was submitted to Congress for approval in December 1992 by President Bush, and not Clinton, who immediately criticized the agreement — an outgrowth of the US-Canada trade agreement negotiated under President Reagan — for its lack of enforceable, verifiable standards on workers rights, environmental protections, and workplace safety.
As president, he tried to work with Congress to enact these measures, but to no avail. In the end, he signed NAFTA along with two side agreements that contained standards but which were not enforceable.
But those that do blame Clinton for outsourcing jobs don’t know the entire history. The jobs started leaving in the 1970s, after Nixon withdrew from the Bretton Woods agreement in 1971.
FDR famously told British Prime Minister Winston Churchill, the U.S.’s ally in World War II, that the US would not enter World War II in order to preserve the British Empire. To that end, he helped convene the Bretton Woods Conference to formulate an economic plan for a postwar world revolving around open trade and capital controls to replace older systems of colonialist and imperialist trade blocs and spheres of influence.
For a quarter-century, the Bretton Woods regime of a fixed exchange rate system served as an anchor for international financial stability and cooperation, and capital controls prevented the recolonization of poorer undeveloped nations by restricting the international flow of private capital, until it was discontinued by President Nixon in favor of the current system of floating exchange rates and unfettered flow of private capital by multinational corporations and the neoliberal investor class.
Under Bretton Woods, there were capital controls that restricted investment into foreign economies. This was in order to avoid undermining established foreign exchange rates, because participating countries’ currencies had been pegged to the dollar under Bretton Woods. As a result, investors had to invest in their own country’s economy.
Last year, in a New Republic column 1 commemorating the 50th anniversary of Nixon’s hugely consequential action, Bruce Bartlett, a Reagan administration economist, wrote about the impact of the withdrawal of the Bretton Woods agreement and its system of capital controls:
“One of the keys to maintaining this system was capital controls. Major nations did not permit the free flow of capital internationally because it could easily destabilize exchange rates. Businesses and individuals had to get permission to import or export capital, and access to foreign exchange by domestic investors or domestic currency by foreign investors was controlled by the central bank. As a consequence, investors were denied the opportunity to seek higher returns in other countries and were forced to invest domestically.”Bartlett described the moves as Nixon’s attempt to combat inflation without resorting to the politically hazardous move of raising taxes or interest rates, and to apply some short-term grease to the economy in order to boost his re-election prospects.
His passage on ending capital controls included this point, which I think is crucial to understanding the impact:
“Once businesses were free to invest abroad by the abolition of capital controls, which followed from the elimination of fixed exchange rates, workers lost enormous leverage. Globalization destroyed the private sector labor unions and allowed businesses to exploit workers throughout the world, creating a race to the bottom in terms of wages."The fact is, before NAFTA was even a glimmer in the eye of President Reagan and President Bush – let alone President Clinton – the private sector was already engaged in a policy of active disinvestment in domestic manufacturing, which hollowed out our industrial sector:
- Leveraged buyouts of manufacturers created huge amounts of corporate debt which resulted in pressure from shareholders to downsize, shift priorities and budget allocations, or otherwise slash expenses in order to maximize revenues and boost stock prices;
- Private equity firms and corporate raiders acquired industrial firms only to raid pension funds, spin-off or outsource profitable divisions, and sell off valuable real estate or other assets for short-term gains;
- Tax laws were enacted to provide firms with incentives to shut down factories and outsource as deductible business expenses, write off “phantom” losses that existed only on paper, take advantage of accelerated depreciation schedules, etc.
- Chrysler acquired 15 percent of Mitsubishi Motors in 1973; it wanted to acquire 35 percent but its plans were blocked by the Japanese government and stymied by its own financial weakness;
- Ford had been the biggest shareholder in Japanese carmaker Mazda from 1979 – when it bought 25 percent and lifted that to a controlling 33.4 percent in 1996 – until it reduced its ownership to three percent in late 2010 to raise cash;
- General Motors bought 34 percent of Isuzu in the 1970s, and in the 1980s entered into joint ventures with Toyota and Suzuki and also began to invest heavily in automation in its manufacturing; and
- General Motors once was the top shareholder in Fuji Heavy Industries, the maker of Suburu cars and trucks, but sold its entire 20 percent stake in 2005 as part of its efforts to raise cash.
I point this out because for too long discussions about international trade have devolved into a left wing populism that consists primarily of Clinton-bashing and other muddying narratives that disadvantage Democrats, when there were more consequential and far-reaching influences that had already enabled the offshoring of jobs and factories to poor sweatshop countries.
This is not intended to be a one-sided partisan history of labor relations:
President Jimmy Carter refused to support a local proposal from my area for a worker-owned takeover of a steelmaking company that announced it would be closing, even though a feasibility study said their rescue plan was sustainable, while around the same time giving his blessing to a Chrysler Motors bailout led by Chairman Lee Iacocca that was able to break labor contracts and undo existing salary, benefits and pension agreements.
President Clinton pushed to bring China into the World Trade Organization and make their favored-nation status permanent, arguing that the PRC represented the largest untapped market. However, since then China has not kept its promises to open up its markets, and has resorted to stealing patents and other technological intellectual property, manipulating its currency to achieve a competitive price advantage for its exports, and dumping steel under cost onto world markets to eliminate competition.
Other factors managed to successfully peel off of white working class voters from the Democratic Party. Republicans captured the South with their racialist Southern Strategy, and their anti-union Right to Work movement decimated labor union ranks, and their ability to organize politically, in the industrial Midwest.
A declining union presence nationwide undermined Democratic electoral prospects around the same time that the Democratic Party found common cause with and welcomed the civil rights, women’s rights and gay rights movements battling discrimination, and with young progressive degreed professionals. However, many working-class whites took a zero-sum approach to these efforts, feeling they would come at their own expense, and their sense of aggrievement and estrangement alienated them from the Democratic Party.
That might be where some Midwesterners’ ambivalence and resentment at their supposed abandonment by Democrats comes from.
I’m from the Midwest — the same town as Tim Ryan — and I don’t feel resentful. And I’m certainly no elite: when I was 18 I would put on my steel-toed shoes, ear protectors, safety glasses, and asbestos gloves and go to work in a factory making doors and side panels for railroad freight cars.
I worked summers in that factory in the Midwest starting in 1974 and through to 1979. The newest overhead press there was built in 1941, and it was not even made in the U.S., but in the former Soviet Union. It, and all the other presses there, pre-dated OSHA safety regulations, and worker injuries were commonplace.
And some of the nearby steel mills were originally pig iron mills from the 1800s that were converted as cheaply as possible. And by the early 1980s, most of those firms already had begun the process of subcontracting out their labor operations to the non-union South, or moving overseas.
When they finally closed a few years later, management blamed greedy unions and burdensome environmental regulations — but not their own short-sightedness and greed, the true cause of their demise.
Because as far back as the 1950s, American steelmakers operating open-hearth furnaces repeatedly and blithely brushed off suggestions to adopt newer technologies such as basic-oxygen steelmaking and the electric arc furnace.
Truth is, we were out-innovated. Just like we were in the 1970s when smaller fuel-efficient Japanese autos challenged our Big Three and their bloated gas-guzzling product – a product that was engineered to be scrapped after 100,000 miles.
This economic anxiety was weaponized when the Obama administration tried to correct the flaws of NAFTA with new trade agreements that featured enforceable, verifiable labor and workforce safety standards and environmental protections across national jurisdictions.
But for many these efforts were ill-timed, out of step, and out of touch in an era of populist politics dominated by Donald Trump and Sen. Bernie Sanders, who both preached, in their own ways, that international trade agreements could only benefit the economic elite.
Critics of trade deals point to the unrealized promises made by proponents of NAFTA. Indeed, NAFTA was flawed in not adequately addressing concerns about labor rights or environmental protection.
I can understand the concerns; if a nation such as ours, with relatively high wages, and relatively strict laws addressing minimum wage, labor rights, environmental protections, and workplace safety, were to lower trade barriers with a poor nation with lax or nonexistent protections – without holding them to the same standards as employers are held to here in the US – we would be undercutting the interests of American workers.
Because in that scenario, we’d have created an incentive for an American firm to simply pull up roots and relocate to a sweatshop country that pays workers peanuts, provides them no legal protections, and allows companies to pollute and operate under dangerous workplace conditions without any accountability.
TPP and TTIP — the Trans Pacific Partnership and the Trans-Atlantic Trade and Investment Partnership — had the potential to address those concerns with enforceable standards for worker rights, workplace safety and environmental protections — standards that typically are not championed by the free trade advocates and have not been enforced in past agreements.
In addition, with these two trade agreements we had an opportunity to form a trade and strategic bloc that upholds worker rights and environmental protections while undercutting China’s influence and putting pressure on them to raise their own standards as a price of doing business.
Through these trade initiatives, President Obama tried to promote opportunities for expanded overseas trade that wean multi-national firms from reliance on cheap labor, lax regulations and China’s now-shrinking expansionist window, and also “globalize” worker and human rights and environmental protections.
So, besides an attempt to expand trade relations with a fast-growing region, and strategically engage nations that might otherwise fall into China’s sphere of influence, TPP also represented an attempt to reform NAFTA and institutionalize worker and human rights and environmental protections by offering favorable trade conditions to nations that uphold these values — which could also reduce the incentives to outsource American jobs to developing nations.
Because by making it more expensive to offshore jobs and factories to poor countries, we can keep those jobs here while we prevent oligarchs from exploiting poor and unorganized workers in developing countries, and also prevent them from pitting poor countries against each other in competition for needed foreign investment and jobs.
Because if enough of our trading partners adopt the type of policies that we uphold in the West — outlawing human trafficking, cracking down on forced and child labor and other human rights violations, raising environmental and labor standards; and allowing labor unions and a free, open and unrestricted Internet — we could effectively reduce the incentives to outsource American jobs to developing nations, and also apply “soft” pressure on repressive governments and strengthen the hands of those liberal forces, reformers, and constituents advocating for human rights, higher wages, and safer working conditions.
But for some, these efforts, accomplished in the aftermath of the worst financial collapse of our lifetimes and against massive resistance and obstruction from Republicans, were deemed insufficient, and dismissed as mere half-measures.
And because of the cynicism and despair that had overtaken so many in this toxic and cynical media environment, some on the Left joined the naysayers on the Right and called for change.
But which ignored the reality: which party pushed for a big infrastructure bill that would create millions of jobs for blue collar workers and trades people?
President Jimmy Carter refused to support a local proposal from my area for a worker-owned takeover of a steelmaking company that announced it would be closing, even though a feasibility study said their rescue plan was sustainable, while around the same time giving his blessing to a Chrysler Motors bailout led by Chairman Lee Iacocca that was able to break labor contracts and undo existing salary, benefits and pension agreements.
President Clinton pushed to bring China into the World Trade Organization and make their favored-nation status permanent, arguing that the PRC represented the largest untapped market. However, since then China has not kept its promises to open up its markets, and has resorted to stealing patents and other technological intellectual property, manipulating its currency to achieve a competitive price advantage for its exports, and dumping steel under cost onto world markets to eliminate competition.
Other factors managed to successfully peel off of white working class voters from the Democratic Party. Republicans captured the South with their racialist Southern Strategy, and their anti-union Right to Work movement decimated labor union ranks, and their ability to organize politically, in the industrial Midwest.
A declining union presence nationwide undermined Democratic electoral prospects around the same time that the Democratic Party found common cause with and welcomed the civil rights, women’s rights and gay rights movements battling discrimination, and with young progressive degreed professionals. However, many working-class whites took a zero-sum approach to these efforts, feeling they would come at their own expense, and their sense of aggrievement and estrangement alienated them from the Democratic Party.
That might be where some Midwesterners’ ambivalence and resentment at their supposed abandonment by Democrats comes from.
I’m from the Midwest — the same town as Tim Ryan — and I don’t feel resentful. And I’m certainly no elite: when I was 18 I would put on my steel-toed shoes, ear protectors, safety glasses, and asbestos gloves and go to work in a factory making doors and side panels for railroad freight cars.
I worked summers in that factory in the Midwest starting in 1974 and through to 1979. The newest overhead press there was built in 1941, and it was not even made in the U.S., but in the former Soviet Union. It, and all the other presses there, pre-dated OSHA safety regulations, and worker injuries were commonplace.
And some of the nearby steel mills were originally pig iron mills from the 1800s that were converted as cheaply as possible. And by the early 1980s, most of those firms already had begun the process of subcontracting out their labor operations to the non-union South, or moving overseas.
When they finally closed a few years later, management blamed greedy unions and burdensome environmental regulations — but not their own short-sightedness and greed, the true cause of their demise.
Because as far back as the 1950s, American steelmakers operating open-hearth furnaces repeatedly and blithely brushed off suggestions to adopt newer technologies such as basic-oxygen steelmaking and the electric arc furnace.
Truth is, we were out-innovated. Just like we were in the 1970s when smaller fuel-efficient Japanese autos challenged our Big Three and their bloated gas-guzzling product – a product that was engineered to be scrapped after 100,000 miles.
This economic anxiety was weaponized when the Obama administration tried to correct the flaws of NAFTA with new trade agreements that featured enforceable, verifiable labor and workforce safety standards and environmental protections across national jurisdictions.
But for many these efforts were ill-timed, out of step, and out of touch in an era of populist politics dominated by Donald Trump and Sen. Bernie Sanders, who both preached, in their own ways, that international trade agreements could only benefit the economic elite.
Critics of trade deals point to the unrealized promises made by proponents of NAFTA. Indeed, NAFTA was flawed in not adequately addressing concerns about labor rights or environmental protection.
I can understand the concerns; if a nation such as ours, with relatively high wages, and relatively strict laws addressing minimum wage, labor rights, environmental protections, and workplace safety, were to lower trade barriers with a poor nation with lax or nonexistent protections – without holding them to the same standards as employers are held to here in the US – we would be undercutting the interests of American workers.
Because in that scenario, we’d have created an incentive for an American firm to simply pull up roots and relocate to a sweatshop country that pays workers peanuts, provides them no legal protections, and allows companies to pollute and operate under dangerous workplace conditions without any accountability.
TPP and TTIP — the Trans Pacific Partnership and the Trans-Atlantic Trade and Investment Partnership — had the potential to address those concerns with enforceable standards for worker rights, workplace safety and environmental protections — standards that typically are not championed by the free trade advocates and have not been enforced in past agreements.
In addition, with these two trade agreements we had an opportunity to form a trade and strategic bloc that upholds worker rights and environmental protections while undercutting China’s influence and putting pressure on them to raise their own standards as a price of doing business.
Through these trade initiatives, President Obama tried to promote opportunities for expanded overseas trade that wean multi-national firms from reliance on cheap labor, lax regulations and China’s now-shrinking expansionist window, and also “globalize” worker and human rights and environmental protections.
So, besides an attempt to expand trade relations with a fast-growing region, and strategically engage nations that might otherwise fall into China’s sphere of influence, TPP also represented an attempt to reform NAFTA and institutionalize worker and human rights and environmental protections by offering favorable trade conditions to nations that uphold these values — which could also reduce the incentives to outsource American jobs to developing nations.
Because by making it more expensive to offshore jobs and factories to poor countries, we can keep those jobs here while we prevent oligarchs from exploiting poor and unorganized workers in developing countries, and also prevent them from pitting poor countries against each other in competition for needed foreign investment and jobs.
Because if enough of our trading partners adopt the type of policies that we uphold in the West — outlawing human trafficking, cracking down on forced and child labor and other human rights violations, raising environmental and labor standards; and allowing labor unions and a free, open and unrestricted Internet — we could effectively reduce the incentives to outsource American jobs to developing nations, and also apply “soft” pressure on repressive governments and strengthen the hands of those liberal forces, reformers, and constituents advocating for human rights, higher wages, and safer working conditions.
But for some, these efforts, accomplished in the aftermath of the worst financial collapse of our lifetimes and against massive resistance and obstruction from Republicans, were deemed insufficient, and dismissed as mere half-measures.
And because of the cynicism and despair that had overtaken so many in this toxic and cynical media environment, some on the Left joined the naysayers on the Right and called for change.
But which ignored the reality: which party pushed for a big infrastructure bill that would create millions of jobs for blue collar workers and trades people?
Which party pushed for free community college, and student debt relief?
Which party worked to provide affordable health care for poor and working class families?
Which party managed to rescue Chrysler and GM, saving millions of jobs at those firms and their supply chains?
Which party enacted a stimulus to prevent the Great Recession from becoming another Great Depression?
And, which administration was able to establish 10 federally-funded “hubs” in an attempt to jump-start advanced manufacturing activity, including one devoted to the promising area of 3D printing, right in Ryan’s hometown?
And so, eight years of gains under a pro-worker Democratic administration came under threat and attack under the Trump Republicans, who rejected trade agreements with our partners in favor of ill-advised trade wars and punishing tariffs, which only served to increase hostilities and isolate us from allies and trading partners, strengthen China, fuel inflation, and drive up our trade deficit.
And now, despite the work by the Biden administration to make historic investments into our aging infrastructure, to provide relief to working class and middle class families, and to position our economy for the exciting opportunities presented by renewable energy and next-generation manufacturing, candidate Ryan chose to present himself not as a liberal or Democrat working alongside the most pro-labor president and Congress in years, but as an outsider, a populist out of step with his own party.
And recall that, in an effort to better position himself with his disaffected Rustbelt constituents, he had also opposed Nancy Pelosi – among the most effective legislators of our lifetimes, and one who was responsible for much of the progressive gains of the past decade – as Speaker of the House.
He spoke of the “exhausted majority” instead of the successful and optimistic majority coalition working to lower education, healthcare, child care, and pharmaceutical costs for working and middle class Americans, and working to reshore manufacturing jobs by standing up to the authoritarian practices of China.
And so, Ryan lost to a man, a faux populist from the hedge fund sector who has shown no solidarity to the working class, and no support for manufacturing jobs, and who has resorted to promoting condescending stereotypes of embattled, downwardly-mobile Appalachian whites when he cynically decided to “go native” and gain credibility with a once-Blue constituency now demoralized by cynicism and resentment over failed promises and economic reversals.
Which party worked to provide affordable health care for poor and working class families?
Which party managed to rescue Chrysler and GM, saving millions of jobs at those firms and their supply chains?
Which party enacted a stimulus to prevent the Great Recession from becoming another Great Depression?
And, which administration was able to establish 10 federally-funded “hubs” in an attempt to jump-start advanced manufacturing activity, including one devoted to the promising area of 3D printing, right in Ryan’s hometown?
And so, eight years of gains under a pro-worker Democratic administration came under threat and attack under the Trump Republicans, who rejected trade agreements with our partners in favor of ill-advised trade wars and punishing tariffs, which only served to increase hostilities and isolate us from allies and trading partners, strengthen China, fuel inflation, and drive up our trade deficit.
And now, despite the work by the Biden administration to make historic investments into our aging infrastructure, to provide relief to working class and middle class families, and to position our economy for the exciting opportunities presented by renewable energy and next-generation manufacturing, candidate Ryan chose to present himself not as a liberal or Democrat working alongside the most pro-labor president and Congress in years, but as an outsider, a populist out of step with his own party.
And recall that, in an effort to better position himself with his disaffected Rustbelt constituents, he had also opposed Nancy Pelosi – among the most effective legislators of our lifetimes, and one who was responsible for much of the progressive gains of the past decade – as Speaker of the House.
He spoke of the “exhausted majority” instead of the successful and optimistic majority coalition working to lower education, healthcare, child care, and pharmaceutical costs for working and middle class Americans, and working to reshore manufacturing jobs by standing up to the authoritarian practices of China.
And so, Ryan lost to a man, a faux populist from the hedge fund sector who has shown no solidarity to the working class, and no support for manufacturing jobs, and who has resorted to promoting condescending stereotypes of embattled, downwardly-mobile Appalachian whites when he cynically decided to “go native” and gain credibility with a once-Blue constituency now demoralized by cynicism and resentment over failed promises and economic reversals.
But the story doesn’t have to end there.
But first we have to overcome the economic anxiety represented by NAFTA and the missed opportunities of expanded trade, and work for a new approach to globalism — and not one that seeks ever-cheaper human labor to exploit, but one that recognizes the dignity of work and upward mobility by championing worker rights, environmental protections and workplace safety.
But first we have to overcome the economic anxiety represented by NAFTA and the missed opportunities of expanded trade, and work for a new approach to globalism — and not one that seeks ever-cheaper human labor to exploit, but one that recognizes the dignity of work and upward mobility by championing worker rights, environmental protections and workplace safety.