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Workforce ‘ally-shoring’ brings benefits across borders

After a swing and a miss with the Summit of the Americas, President Biden and Mexican President Andrés Manuel López Obrador’s recent meeting at the White House was a critical opportunity to reset U.S.-Mexico relations. The Biden administration should jump on one of the topics the Mexican president raised — tapping Mexican labor markets to meet persistent worker shortages in critical occupations among U.S. employers.    

In a new report published by the U.S.-Mexico Foundation, we argue that a skilled and mobile workforce, as part of a U.S.-Mexico “ally-shoring” framework, can help address chronic vacancies in the U.S., along with the biggest inter-related problems of both countries: supply chain disruption and dependencies, spiking inflation and the need for more good-paying jobs for more people. 

As previously written, ally-shoring describes how countries can rework critical supply chains and source essential materials, goods and services among and between trusted democratic partners and allies. Addressing workforce dynamics and needs as part of an ally-shoring strategy enables mutual economic and employment benefits, supporting the availability of labor and skills to meet critical supply chains’ manufacturing and production requirements.

Ally-shoring makes sense with democratic neighbors like Mexico, with which we don’t so much “trade” as operate a tightly integrated co-production system. Fifty percent of “trade” between the U.S., Canada and Mexico is in intermediate goods, components of finished products like parts of an electric car, or the processing and packaging of agricultural goods that may cross a border several times. 

When reshoring is not viable, relocating critical U.S. supply chains in Mexico (versus China, for example) keeps technology and innovation closer to home. It also requires a readily available and skilled workforce.

Timing, as they say, is everything. Labor market dynamics in the U.S. and Mexico are working in favor of deepening bilateral engagement on workforce issues, creating an opening for business leaders and policymakers to devise a workforce ally-shoring strategy that brings value to both sides of the border.

U.S. labor shortages have been fueled by structural changes in U.S. labor market dynamics and accelerated by the impact of the pandemic. Before the pandemic, U.S. employers were already dealing with an aging workforce and critical skill shortages in key occupations, ranging from manufacturing production workers to truck drivers. The pandemic exacerbated these trends by knocking millions out of the labor force while catalyzing voluntary job quits as workers opted for retirement, remote work or wholly different occupations. These structural shifts in the labor market and supply chain bottlenecks are leading to rising pressure on wages and helping to super-charge inflation. 

But Mexico faces growing downward pressure on wages and a looming youth demographic bulge entering a labor market already thin with work opportunities. Mexico has an increasing cohort of underemployed workers looking for job opportunities. In the U.S., many job opportunities remain unfilled. Mexico also has skilled agricultural workers that boost businesses and are most productive for both U.S. and Mexican employers when they can work on both sides of the border. These complementary labor market dynamics support the concept of a more highly integrated North American co-production system. 

Reading the global tea leaves, particularly after Russia’s naked aggression in Ukraine, China is seeing that democratic countries are accelerating efforts to reduce the economic and political leverage of authoritarians like themselves. Secretary of the Treasury Janet Yellen’s promotion of “friend-shoring” in South Korea only reinforces that message.

But China is also responding, moving to recreate Chinese production capacity worldwide, including in Mexico. For example, Chinese foreign direct investment (FDI) has grown steadily over the last 15 years. It looks to be growing faster in the wake of the growing alarms and interest among Western governments and businesses in shifting some critical supply chains out of China.  

Some leaders in Latin America and elsewhere might welcome the Chinese as they expand production and businesses in their countries — appreciating more jobs for local workers. But the ally-shoring opportunity with the U.S. is a much more robust economic enabler without the dependency-building and potential authoritarian coercion from doing business with China. 

The size and scope of current and potential U.S. investment and co-production expansion in Mexico still dwarf Chinese investment. U.S. FDI in Mexico totaled $7.6 billion in the most recent year, compared with China’s growing but still very small FDI of $18.4 million. Chinese FDI is very concentrated in the Northern Mexico provinces of Chihuahua and Nuevo Leon — manufacturing export centers.

Meanwhile, trade between the U.S. and Mexico (again much in intermediate goods) is already massive and growing, doubling in the last 15 years to $30 billion. Exports from the U.S. to Mexico have also doubled from $10-$20 billion over the same timeframe. While Mexico’s trade with China has undoubtedly increased in recent years, it is still barely more than a quarter of the trade value with the U.S.

The U.S.-Mexico economic relationship surpasses today anything the Chinese can offer, but that may not always be the case. We should not miss the opportunity to devise and implement the longer-term strategies that bring economic stability and security to the U.S. and Mexico; or let Mexico, or any other neighboring country become a back door for authoritarian influence in our backyard. Ally-shoring allows us to address both under a framework of mutual benefit.

John Austin directs the Michigan Economic Center and is a nonresident senior fellow with the Brookings Institution and the Chicago Council on Global Affairs. Elaine Dezenski is senior director and head of the Center on Economic and Financial Power at the Foundation for Defense of Democracies.

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Progressives urge inclusion of uninsured in insulin proposal

House progressives are calling on leadership to include people without health insurance in any legislation that limits out-of-pocket costs for insulin. 

Senate Democrats are pushing to include a $35 cap on out-of-pocket insulin costs as part of a larger reconciliation bill, though it’s still unclear if such a provision would be allowed under the arcane Senate rules for passing the legislation.

In a letter to bipartisan House and Senate leaders, members of the Congressional Progressive Caucus and Tri-Caucus (comprised of the Black, Hispanic and Asian Pacific American Caucuses) said any cost savings should also apply to the uninsured. 

“Failure to do so will deepen health disparities and increase long-term healthcare costs,” the lawmakers wrote. 

The lawmakers said a universal cap on insulin costs could be accomplished either by using existing Medicaid payment structures to reimburse pharmacies or by establishing a fund in the Department of Health and Human Services that reimburses insurance providers and pharmacies.

“Inclusion of uninsured people in insulin pricing legislation will help prevent new racial health disparities resulting from this legislation, curb future deaths of Americans due to insulin rationing, and decrease the likelihood of diabetes complications,” they wrote.

Democrats have in the past pointed to the $35 insulin cap in particular as one of the most tangible benefits for consumers in their economic package. The push to include the provisions in the party-line package comes as a bipartisan insulin bill seems unlikely to get the 10 Republican votes it would need to pass the Senate.

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New San Francisco DA revokes 30 drug case plea deals made by recalled predecessor

San Francisco District Attorney Brooke Jenkins (D) announced on Wednesday that she has revoked 30 plea offers for drug cases made by her predecessor, who was recalled from office.

Former District Attorney Chesa Boudin (D) was ousted in a recall election in June, a rebuke of the progressive policies that he pushed like ending cash bail and offering defendants the opportunity to enter a rehabilitation program instead of prison. 

Jenkins’s office said in a news release that one of the plea offers that she took back was for a case in which a defendant had six open cases for dealing fentanyl and was arrested with more than 100 grams of the drug. 

The release says the individual was referred to the city’s Community Justice Center, a collaborative court program that focuses on rehabilitation instead of punishment, more than five times despite not completing the center’s requirements. They were offered a single misdemeanor to settle all six cases. 

The district attorney’s office will now seek a felony charge that includes jail time.

“Since 2020, nearly 1,500 people have died of drug overdose in part because dealers have been allowed to operate with impunity,” Jenkins said in the release.

“The lethality of fentanyl presents a different challenge, and we must immediately change course, so we can save lives and hold people accountable for the havoc they are wreaking in our communities like the Tenderloin and South of Market.” 

San Francisco Mayor London Breed (D) appointed Jenkins, a more moderate public prosecutor, to the role to complete Boudin’s term last month. 

Wednesday’s release says the office’s new policy will prevent drug dealers arrested with more than five grams of drugs from being referred to the center. 

Jenkins ordered a review of open narcotics sale cases, which found that over half of the more than 150 open cases involved the sale of fentanyl. 

The release states that Boudin’s office did not obtain any convictions for dealing fentanyl in all of 2021, while former District Attorney George Gascon (D) oversaw at least 90 in 2018. The San Francisco Standard reported that fentanyl killed nearly 500 people in the city last year.

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Energy Department awarding $26 million to fund renewable energy grid projects

The Department of Energy (DOE) is allocating $26 million to 10 projects to demonstrate the U.S. power grid can reliably run on renewable energy sources such as wind and solar.  

Funding for the Solar and Wind Grid Services and Reliability Demonstration Program will come from President Biden’s Bipartisan Infrastructure Law and will go toward projects focused on showing how the nation’s electricity grid can reliably operate with a mix of solar, wind, energy storage and other renewable energy resources.  

Projects will also test tools and plant functions that allow a grid to stay online during disturbances and to restart it if it goes down, according to a release.  

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Each demonstration project will provide data to “underscore how President Biden’s goal of 100 % clean electricity by 2030 can be achieved while supporting grid reliability.”   

“Americans do not have to choose between a clean grid and a reliable one as we move forward towards our goals of a net-zero economy by 2050,” Secretary of Energy Jennifer M. Granholm said in a statement.  

“Thanks to funding from President Biden’s Bipartisan Infrastructure Law, DOE is proving that transitioning to solar, wind, and other renewable energy sources can keep the lights on without service interruptions, while creating good paying jobs,” she added. 

The projects will require testing at a plant of at least 10 megawatts in size and will aim to show how a clean energy grid can prevent blackouts by rapidly identifying and responding to faults.  

The DOE is encouraging academic institutions, private companies, nonprofits, tribal nations and state and local governments to apply for funding.  

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Looming change in worker classification rules will cost small businesses big bucks

A lot of attention has been paid to the tax increases that are part of the Democratic-backed Inflation Reduction Act that’s making its way through Congress. And while these increases are concerning to both businesses and taxpayers, there’s another rule coming from the Biden administration that will have an even bigger impact on costs for millions of small businesses: a looming change in worker classification rules.

The new rules will result in changing the status of countless “independent contractors” to employees. So why is that such a big deal?

Small businesses rely on independent contractors to perform ad-hoc and infrequent tasks that usually do not require the attention of full-time employees. Often called “1099 workers” (thanks to the tax form that needs to be filed with the IRS to report payments over $600), these freelancers (or “gig workers”) are stand-alone entrepreneurs who oftentimes serve multiple customers.

They’re truck drivers, software developers, project managers, construction workers, content producers, health care professionals, counsellors and trainers. They belong to professional organizations that support freelancers. Along with millions of others, they get projects and side gigs through platforms such as Fiverr, Craigslist, UpWork and Freelancer.com. Most of these entrepreneurs operate independently as small business owners themselves and earn their entire livelihoods this way. Others enjoy the extra income these freelancing opportunities provide.

But the Biden administration feels that these independent contractors need more protections. And so the Department of Labor (DOL) is taking action.

“The department now plans to engage in rule-making on determining employee or independent contractor status under the Fair Labor Standards Act,” Jessica Looman, the acting administrator for the Department of Labor’s Wage and Hour Division, wrote recently on the DOL’s blog. “We remain committed to ensuring that employees are recognized correctly when they are, in fact, employees so that they receive the protections the FLSA provides.”

The DOL’s new rules will throw away the multiple requirements that have long been used to determine whether a freelancer is truly independent or should be classified as an employee and replace these requirements with a more simplified “ABC Test.” These new rules focus on just three factors:

A: The worker is free from the control and direction of the hirer in connection with the performance of the work;

B: The worker performs work that is outside of the usual course of the hiring entity’s business and

C: The worker is customarily engaged in an independently established trade, occupation or business.

For small businesses, the biggest challenge will be meeting the “B” rule. That’s because, in essence, that specific test basically says a small business owner cannot use a 1099 worker to perform tasks that generate revenue for his business. The work must be “outside of the usual course” of what his company does. So, if he’s going to charge his clients for the services performed by the outside developers and tax experts he uses, then he can’t treat these outsiders as independent contractors.

Instead, he must classify these workers as employees. And that’s a big problem for small businesses. Why? Because it’s a big tax increase. Not only will small business owners have to withhold payroll taxes for these workers, but they’ll also need to pay the employer’s portion of both Social Security and Medicare taxes as well as any related state and local taxes. As employees, they also may be qualified to participate in the company’s benefit plans, which could incur further health insurance and retirement costs.

Sure, these workers will also have protections under the Fair Labor Standards Act. They’ll also have the freedom to unionize (which many opponents are saying is the main driver behind the Biden administration’s actions). But do independent contractors and freelancers really want to be employees? Many contractors prefer to be their own boss and have no desire to be on a payroll. They like their independence. They serve multiple customers. They make their own choices, from billing to the clients they work for and the hours they work.

“We told the Labor Dept. that we want these attacks on our small businesses to stop,” says Karon Warren, co-leader of Fight For Freelancers USA. “There are 59 million independent contractors in this country. We’re a third of the U.S. workforce, and the majority of us are happy. Lawmakers and regulators need to stop their outrageous attempts to misclassify us as employees.”

“The bill could end my ability to be my own boss, set my own hours and otherwise live the American worker’s dream,” wrote Judi Ketteler on NBCNews.com. “According to the ABC test, businesses need to treat someone like me as an employee — with all the rights and benefits that entails — even if I’m writing only a single story for them. Ditto for all types of creatives who support themselves through gigs, like actors, artists and musicians. How many companies will continue to use our services under these circumstances? It’s simply not feasible.”

Ketteler was referring to the PRO Act, a workers’ rights bill (fashioned on California’s controversial AB5 legislation) that failed to pass the Senate back in 2021. Despite this failure, the DOL is continuing to move forward outside of the legislative process using pieces of that legislation, particularly the ABC Test. The department held two public forums on the issue in June, and most experts are expecting finalized worker classification rules by the end of the year.

It’s inevitable that freelancer organizations and other business groups will challenge the ruling in court. There are already many legal challenges. And it’s important to note that the ruling is coming from the DOL and does not impact how the IRS – a separate agency – defines independent contractors for tax filing purposes. So, confusion and chaos are also inevitable.

In the meantime, countless small business owners will be stuck in the middle. Amid inflation, supply chain problems, labor shortages and a continued economic slowdown, these changes could not be coming at a worse time.

Gene Marks is founder of The Marks Group, a small-business consulting firm. He frequently appears on CNBC, Fox Business and MSNBC.

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Manchin says Electoral Count Act reform would target ‘bad actors’ trying to overturn elections

Sen. Joe Manchin (D-W.Va.) on Wednesday touted a bipartisan bill he introduced with Sen. Susan Collins (R-Maine) to reform the Electoral Count Act that he said would fix a law “bad actors” have manipulated for their benefit.

The act was passed in 1887 as an answer to the disputed 1876 election between Rutherford B. Hayes and Samuel Tilden — which included competing slates of electors from multiple states — and close elections in 1880 and 1884. Both Republicans and Democrats have used provisions in the act, including during four of the last six presidential elections for what Collins said were “frivolous objections.”

Now, lawmakers hope that by reforming the act, they can help prevent another Jan. 6 from happening. 

“As we saw on January 6, 2021, a lot of the ‘fixes’ established by the original Electoral Count Act are not merely outdated but actually serve as the very mechanisms that bad actors have zeroed in on as a way to potentially invalidate presidential election results,” Manchin said during a Senate Rules Committee hearing on the bill. 

“The time to reform the ECA is way past due. Way past due,” Manchin added. “The time for Congress to act is now.”

Collins called the 135-year-old act “archaic and ambiguous” with reforms necessary to clarify the vice president serves in a “solely ministerial” role over the counting of Electoral College votes and does not have unilateral power to throw out or change electors. 

The House select committee investigating Jan. 6 has laid out evidence that former President Trump and his allies sought to put pressure on former Vice President Mike Pence to overturn the 2020 election results to be in Trump’s favor. A mob of pro-Trump supporters stormed the Capitol that day in an effort to disrupt Congress’s official count of Electoral College votes, which is overseen by the vice president in what has typically been a largely a ceremonial role. 

Pence ultimately did not succumb to the pressure, telling Trump that he did not believe he had the sole power to overturn election results.

In addition to clarifying the vice president’s role, the act would also increase the threshold necessary for members of Congress to object to a state’s electors to one-fifth of each chamber — or 87 representatives and 20 senators — rather than one lawmaker each in the Senate and House. 

After the 2020 election, 138 representatives and six senators objected to electors from Arizona, and 121 representatives and seven senators objected to the count in Pennsylvania.

“That dark day, enemies of our democracy sought to exploit the provisions of this antiquated law to subvert the results of a free and fair election,” Committee Chair Amy Klobuchar (D-Minn.) said. “It’s our job to ensure this never happens again, no matter who’s in charge or what happens.”

The reforms would also ensure Congress has only a single, conclusive slate of electors from each state through an expedited judicial review for presidential and vice presidential candidates as well as requiring Congress to defer to those slates according to state or federal court judgments.

Former President Carter and former White House chief of staff James Baker have both also called for reform to the Electoral Count Act and offered support to Collins and Manchin.

The bill includes 14 cosponsors: Sens. Mitt Romney (R-Utah), Kyrsten Sinema (D-Ariz.), Rob Portman (R-Ohio), Jeanne Shaheen (D-N.H.), Lisa Murkowski (R-Alaska), Thom Tillis (R-N.C.), Mark Warner (D-Va.), Shelley Moore Capito (R-W.Va.), Chris Murphy (D-Conn.), Todd Young (R-Ind.), Ben Cardin (D-Md.), Ben Sasse (R-Neb.), Chris Coons (D-Del.) and Lindsey Graham (R-S.C.). 

Klobuchar and the committee’s vice chairman Roy Blunt (R-Mo.) advised the group as they were putting together the legislation, and with Blunt’s support, the bill would have enough votes to surpass the 60-vote threshold in the Senate. 

But the legislation may also be at odds with some members of the House Jan. 6 select committee like Reps. Liz Cheney (R-Wyo.) and Zoe Lofgren (D-Calif.) who have suggested they will unveil their own recommendations “soon.”

Both Collins and Manchin said they expect to pass their legislation before the end of the year, ahead of the 2024 presidential election cycle — and before the House GOP has potential to take the House and stall legislation.

Manchin said he would be the first to acknowledge the bill is “not perfect” and may not address all problems with the original Electoral Count Act but that the reforms would be a “tremendous improvement” over the current law.

“We were all there on January 6. That happened. That was for real. It was not a visit by friends from back home. And we have a duly responsibility to make sure it never happens again,” Manchin told the committee. “The Electoral Count Reform and Presidential Improvement Act of 2022 is something that our country desperately needs, and the correction needs to happen now.”

Source: TEST FEED1

American innovation is losing ground — here’s how we can once again lead the charge

As Democrats focus on pronouns and vilifying police, America is losing ground to China and other countries in global competitiveness. 

It’s time for the Biden administration to work with Republicans to promote innovation and advance policies to help our businesses compete on the international stage.

One critical step is to promote incentives for research and development (R&D).

The U.S. established the R&D tax credit in 1981 and for the next two decades remained at the top of the global leader board in terms of R&D incentives. According to a study by DST Advisory Group, the U.S. ranks 24th compared to other developed countries. China is particularly aggressive. Its R&D tax subsidy is now nearly three times more generous than ours.

R&D propels innovation and innovation drives the creation of good paying jobs. The average salary for workers in the R&D field is substantially higher than other vocations. For example, in the biotechnology industry, a field heavily dependent on R&D incentives, wages are nearly two times the national average.

World leadership in R&D is also critical to a strong national defense, a superior education system, world-class health care and a favorable balance of international trade — key components for peak economic performance.

But the U.S. has lost its footing at a time when we cannot let others gain ground.

What’s the solution? Let’s start with an easy step.

Until last year, thanks to the Republican’s Tax Cuts and Jobs Act, U.S. tax law allowed companies to fully write off (expense) qualified R&D costs in the year incurred. This represented a key incentive to locate R&D in the U.S. But beginning in 2022, tax law will require that companies deduct their U.S. R&D costs across five years.

This is a disincentive to R&D investment. Economically it’s like giving our international competitors a head start. My colleague on the House Ways and Means Committee, Ron Estes from Kansas, has introduced legislation which would allow companies to continue to write off their R&D expenses. Congress should enact this commonsense reform immediately.

But we shouldn’t be complacent with the U.S.’s current tax credit, which lags the competition. Currently the U.S. provides a credit of up to 20 percent of incremental R&D costs. Doubling the R&D credit would provide a huge boost off the starting block. Another Ways and Mean member, Jackie Walorski from Indiana, recently introduced a bill that would do just that. Enactment of this bill would represent a major step toward America catching up to the competition.

Promoting startup companies is another way to compete in the innovation race. Helping entrepreneurs take their unique product or service idea from concept to reality is what the American dream is all about. That’s why I introduced the American Innovation Act, which would quadruple the amount of start-up costs small business owners can deduct from their federal income taxes, raising the limit from $5,000 to $20,000.

Finally, let’s incentivize companies to move the results of R&D — intellectual property — back to the United States. Universities, manufacturers, other American businesses, life sciences companies and hospitals could all benefit by having researchers in closer physical proximity. Here, too, my colleague on the Ways and Means Committee, Darin LaHood from Illinois, introduced legislation to make it easier to bring intellectual property and associated R&D activities back to the U.S. This would greatly strengthen the innovation ecosystem and help the U.S. win back its leadership role.  

Yes, the race is on. For at least the last decade, other countries have stepped up their investments in innovation and either caught up or surpassed us. Republicans are offering a second wind that will get America back to leading the race. Republicans are fighting to foster American innovation by allowing American companies to benefit when they invest, improving the generosity of the R&D credit, returning R&D to the United States and making America the most innovation-friendly economy in the world.

Vern Buchanan represents the 16th District of Florida.

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After Kansas, four more states set to vote on future of abortion

Six weeks after the Supreme Court ruled to overturn the constitutional right to abortion, the procedure is on the ballot in pockets of the country, and voters are now casting their vote. Voters in Kansas went first on Tuesday night — ultimately striking down an abortion ban — and now four more states will have their turn in the coming months.  

Abortion-related ballot measures have been cropping up across the country in the wake of the Supreme Court ruling in June to overturn Roe v. Wade — a nearly 50-year precedent that affirmed abortion as a constitutional right. 

At least a dozen states initially reacted by enacting trigger laws, which are abortion bans and restrictions designed to take effect immediately or with quick state action following the downfall of Roe. 

Some states are having to turn to voters in order to determine the future of reproductive rights. It began with Kansas, one of five states to have an abortion-related measure included on its primary ballot. The Kansas No State Constitutional Right to Abortion and Legislative Power to Regulate Abortion Amendment asked voters to weigh in on a proposed state constitutional amendment that says the right to an abortion is not protected by the state constitution.  

Kansas voters resoundingly rejected that measure, with nearly 60 percent of voters indicating “no.” 

Kansas was viewed as a bellwether of how Americans feel in the aftermath of the high court’s decision, and despite being a historically conservative stronghold, Kansas voters rejected eliminating abortion access. 

Now, four other states will pose similar measures to voters that address the future of abortion: 

1. California 

The state on its Nov. 8 ballot will feature Proposition 1, which aims to amend California’s constitution to include the right to an abortion. The measure provides that the state cannot “deny or interfere with an individual’s reproductive freedom in their most intimate decisions,” including decisions to have an abortion or to choose or refuse contraceptives. 

Gov. Gavin Newsom (D) has been doubling down on his efforts to make California an abortion sanctuary, including signing a law the shields California abortion providers and volunteers from lawsuits in other states. The state has also allotted more than $200 million in new spending to expand abortion in the state. 

2. Kentucky 

Also on Nov. 8, voters in Kentucky will be able to vote on whether their state’s constitution should be amended to lay out that nothing in the state constitution creates a right to abortion or requires government funding of abortions.  

Kentucky hopes to join four other states that currently have constitutional amendments declaring that their constitutions do not secure or protect a right to abortion or require the funding for the procedure. 

The state has completely banned abortion, thanks to a trigger law that took effect quickly after the Supreme Court overturned Roe. The law makes limited exceptions like to prevent death or serious injury of the mother. 

3. Montana 

Voters in Montana will get to weigh in on a state statute known as the Medical Care Requirements for Born-Alive Infants Measure on Nov. 8. It states that infants born alive at any stage of development should be considered legal persons; require medical care to be provided to infants born alive after an induced labor, C-section, attempted abortion or another method; and establish a $50,000 fine and/or 20 years in prison as the maximum penalty for violating the law. 

Currently, abortion is legal in Montana up until 20 weeks of pregnancy and as long as the state constitution is not amended. Though the state has tried to enact several restrictive abortion laws, including one that would have stopped advanced practice registered nurses from being able to perform early abortion services. A judge blocked the law from taking effect. 

4. Vermont 

Vermont is taking a similar approach to California by including Proposal 5 on its Nov. 8 ballot. It represents the Right to Personal Reproductive Autonomy Amendment which supports amending the Vermont constitution to add language protecting the right to personal reproductive autonomy and prohibiting the government from infringing — unless justified by a compelling state interest.  

Abortion is currently legal in Vermont, and in 2019 the state enacted comprehensive abortion rights legislation. It protected abortion as a fundamental right throughout pregnancy and prevented any public entity to regulate, deny or interfere with an individual’s right to choose or refuse contraception or sterilization, to give birth or to obtain an abortion. 

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Congress should be preparing for more job displacement, not less

On July 1, the long-standing Trade Adjustment Assistance (TAA) program expired, marking a symbolic reversal of over a half-century of government support for workers whose jobs are impacted by trade. Unless Congress acts, communities will no longer have access to dedicated funding to help residents recover after mass layoffs. 

While the TAA program’s reach has been modest in recent years, its quiet decline sends a troubling message. Rather than modernizing in the face of new challenges, the government is reneging on its pledge to help workers adapt to a changing economy.  

For 60 years, TAA has served as both an acknowledgment and a reminder that government policies can sometimes, even by design, cause suffering for some workers. When the program was initiated in 1962 as part of global agreements to reduce barriers to trade, the country stood on the precipice of a new era in globalization. Policymakers accurately foresaw that the changes that were coming would not be good for everyone and incorporated TAA in the negotiations as a response. While the TAA program never came close to fully compensating the losers from globalization, at a minimum it provided temporary relief and support to the five million workers it served.  

Last month’s termination represents a marked departure from that commitment. Before the July expiration, the program had been successfully reauthorized at least eight times, spanning both Democratic and Republican administrations. This bipartisan support reflected a shared national sentiment that workers shouldn’t be left alone to weather economic shocks. Indeed, over 2 million U.S. manufacturing jobs were lost between 2001-2019 due to Chinese import competition alone. Of course, this figure does not account for the jobs that have been gained due to trade, but it is informative because communities hit the hardest by these job losses have seen larger increases in drug and alcohol abuse, single parenthood and childhood and adult poverty, among other adverse outcomes.    

While underutilized, the program included many evidence-backed services critical to successful employment transitions — for instance, subsidies for transportation to training or job interviews, relocation assistance and income support for the time taken to do job training. A rigorous 2018 study comparing the labor market outcomes of workers receiving TAA funding with those deemed ineligible found that workers that received TAA had approximately $50,000 more in cumulative earnings after 10 years. 

Indeed, our active labor market programs are rarely ambitious enough. Even before the expiration, the TAA program was systematically weakened. With increasingly restrictive eligibility requirements and a lack of funding available to the state agencies responsible for administering the program, the number of workers deemed eligible steadily declined, even as globalization accelerated. In addition, the program was too often targeted toward traditional classroom-based models and too rarely deployed to support promising models of adult learning, like work-based experiences. 

Unfortunately, TAA is more the norm than the outlier for U.S. human capital policy. For instance, the U.S. ranks among the bottom of the Organization for Economic Cooperation and Development’s economies in public spending to support and stimulate employment. For older workers, the situation is even more dire.

It is ironic that the end of one of America’s main programs to assist dislocated workers comes at a moment of massive global disruption. Rapid technological change is affecting many industries and occupations, with even more automation-induced displacement on the horizon. Trade flows are being disrupted by COVID-19 supply chain shocks and a strong U.S. dollar. In sum, job loss due to structural change is not disappearing, it is accelerating, and workers without college degrees are those most likely to face the headwinds.   

Most recently, Democrats tried to extend TAA through the CHIPS Act, but the bill passed without the extension due to Republican opposition. This leaves only a few legislative paths to passage before the midterm elections. The decision to allow the program to expire would be not just shortsighted, it is symbolically treacherous. Instead of abandoning workers when their employment is disrupted due to factors beyond their control, we should be increasing investments to help them weather these changes. 

Instead, Congress’s inaction sends a message of indifference to wide swaths of our society. That message is ultimately not just bad for our economy, but bad for our democracy too. 

Rachel Lipson is the director of Harvard’s Project on Workforce. Gregory Wright is a fellow at the Brookings Institution where he leads the Workforce of the Future initiative. 

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McConnell says 'good luck' to senators looking for excuse to oppose Finland, Sweden NATO bids

Senate Minority Leader Mitch McConnell (R-Ky.) on Wednesday spoke in support of Finland’s and Sweden’s bids to join NATO in advance of a Senate vote later in the day expected to have broad, but not unanimous, support.

“Their accession will make NATO stronger and America more secure,” McConnell said. 

“If any senator is looking for a defensible excuse to vote ‘no,’ I wish them good luck,” he continued. “This is a slam dunk for national security that deserves unanimous bipartisan support.”

The two European countries’ bids to join the military alliance are expected to have widespread, bipartisan support in the Senate.

Sen. Josh Hawley (R-Mo.) on Monday said he would vote against their accession, arguing in an op-ed that the United States should focus on the more pressing threat from China rather than expand its alliance with European countries.

A symbolic resolution supporting Finland’s and Sweden’s NATO membership was opposed by just 18 House Republicans in a vote last month.

The two Nordic nations announced their desire to join NATO in May following Russia’s invasion of Ukraine, as domestic sentiment shifted drastically in favor of joining the alliance.

All 30 member states of the alliance must now approve the two countries’ bids for the effort to be successful. Twenty-two countries have already ratified their accession, while the Czech Republic, Greece, Hungary, Portugal, Slovakia, Spain, Turkey and the United States have not yet formally signed off.

The only country to speak out against the additions was Turkey, which has since backed their ascension after negotiations over security guarantees.

McConnell on Wednesday reiterated his endorsement of Finland’s and Sweden’s NATO bids, noting that Finland already meets the alliance’s target for countries to spend 2 percent of their gross domestic product on defense, while Sweden was making “significant” investments in modernizing its military.

“There’s just no question that admitting these robust democratic countries with modern economies and capable interoperable militaries will only strengthen the most successful military alliance in human history,” McConnell said during his floor speech.

Source: TEST FEED1