TIME Hillary Clinton

How Barack Obama’s Trade Deal Puts Hillary Clinton in a Bind

Democratic presidential candidate Hillary Rodham Clinton meets with local residents at the Jones St. Java House in LeClaire, Iowa on April 14, 2015.
Charlie Neibergall—AP Democratic presidential candidate Hillary Rodham Clinton meets with local residents at the Jones St. Java House in LeClaire, Iowa on April 14, 2015.

Sen. Marco Rubio is rarely on the same side as President Obama. But the Florida Republican, who is running for president in 2016, recently drafted a letter to the White House in support of Obama’s signature free-trade deal, the Trans-Pacific Partnership, which Congress is expected to vote on this term.

This odd-bedfellows moment backs Hillary Clinton, who announced this week that she is running for President, into a particularly uncomfortable corner — sandwiched between Republicans and centrist Democrats on one side, and the Democrats’ liberal, activist base on the other.

So far, Clinton has kept quiet about whether she supports the deal.

Most Republicans, the Obama administration and a powerful coalition of business interests, some of whom have donated to Clinton’s campaign, would like to see the former Secretary of State champion the Trans-Pacific Partnership. They argue that the sweeping, 12-nation free trade pact, the largest-ever for the United States, would been a boon for the U.S. economy.

“We stand ready to work with you to ensure quick consideration and approval of legislation to renew TPA,” Rubio wrote in the draft letter to Obama, which was obtained by TIME, in reference to the Trade Promotion Authority, the so-called fast track bill designed to facilitate the passage of the trade deal. “We must work together to ensure that goods and services created by U.S. workers are able to enter and effectively compete in overseas markets.” Rubio’s office declined to comment on the letter.

Meantime, an increasingly vociferous coalition of liberal lawmakers, labor leaders and grassroots populists, whose support Clinton will need during the primary campaign, have warned Clinton that they deeply oppose the pact, which they describe as a job-killing sweetheart deal for global corporations.

“People feel a lot of urgency and tension around this moment,” said George Goehl, the executive director the the National People’s Action, a network of progressive, grassroots organizations nationwide, in a press call Thursday morning.

“This is not a theoretical question for [Clinton] to answer,” he added. “It’s real-life right now and people want to know where she stands.”

On Wednesday night, Vermont Sen. Bernie Sanders, a potential Democratic presidential candidate who has been one of the loudest voices in Congress in opposition to the deal, rallied members of the progressive organization, Democracy For America, against the bill during a conference call. “The only way a member pays the price [for supporting TPP] is if the poeple are educated and organized,” he said, adding later that “What we have got to do is rally the American people and educate them and put pressure on vulnerable members.

“Keep the emails coming, put the pressure on,” he urged.

Clinton’s silence about the Trans-Pacific Partnership has sent both supporters and critics into spirals of speculation.

In her most recent memoir, Hard Choices, published last year, Clinton expressed limited support for the deal. “It’s safe to say that the TPP won’t be perfect,” she wrote. “No deal negotiated among a dozen countries ever will be — but its higher standards, if implemented and enforced, should benefit American businesses and workers.”

But during her 2007 run for the White House, she explicitly distanced herself from the last big free trade deal, the North American Free Trade Agreement which her husband signed in 1994, and said she would not pursue any new trade deals for a while.

After supporting NAFTA as first lady and in her 2003 memoir, Living History, Clinton said in an interview with CNN in 2007 that it “was a mistake to the extent that it did not deliver on what we had hoped it would, and that’s why I call for a trade timeout.”

Ohio Sen. Sherrod Brown, a liberal Democrat who has been outspoken about his opposition to the Trans-Pacific Partnership, refused to speculate on Clinton’s position on trade. “I’m not going to go there. Hillary’s got a history. I’m pretty sure she was against fast track, against CAFTA. [She] spoke out in ’08 that we should renegotiate NAFTA,” he said Thursday. “So you make an assumption that Hillary is bad on trade but you would be wrong, I’d think.”

The Senate Finance Committee proposed a fast-track bill on Thursday afternoon that would give Obama the power to submit the trade pact to Congress for a simple up-or-down vote with no amendments. Supporters of the Trans-Pacific Partnership say such legislation is crucial as it assures other countries that Congress won’t significantly change the deal during debate.

Opponents, including Sens. Brown and Elizabeth Warren, have called the fast track undemocratic, in part because it makes it easier for negotiators and lobbyists to insert provisions into the trade deal that Congress would not approve individually.

The populist base has also railed against the non-transparent, and sometimes downright secretive, process surrounding the Trans-Pacific Partnership negotiation process. As of last fall, a network of 566 stakeholders, 85% of whom represented industry and trade groups, were given limited access to the draft trade agreement, according to the Washington Post. Although more stakeholders have since been invited to access the document through a secure website, the details of the agreement, which will include twelve nations in the Asia-Pacific region, have not been made public or provided to the press. Even lawmakers have not been given copies of the draft plan.

In the coming weeks, Clinton will be asked, probably repeatedly, to take a strong position on the Trans-Pacific Partnership. If she opposes it, she risks alienating a slew of powerful, corporate interests. But if she doesn’t, she risks the rage of the populist left. And if she does nothing, she’ll lose points with both sides and be criticized by pundits for ducking a major issue.

“It’s a choice between a corporate vision of a world economy and a vision in which … workers’ rights and sustainable development is allowed by the legal system,” Roger Hickey, the co-director of Campaign for America’s Future, said on a press call Thursday morning. “It’s a big issue.”

TIME Innovation

Five Best Ideas of the Day: April 16

The Aspen Institute is an educational and policy studies organization based in Washington, D.C.

1. Go ahead and start a new career in your fifties. It’s easier than you think.

By Donna Rosato in Money

2. This is what sex-ed would look like if it took place entirely on social media.

By Kate Hakala in Mic

3. Here’s why the FDA doesn’t really know what’s in our food.

By Erin Quinn and Chris Young at the Center for Public Integrity

4. What critical resource helps the sharing economy make billions? People trusting people.

By the editorial board of the Christian Science Monitor

5. Could a continent-wide CDC for Africa stop the next Ebola outbreak?

By Jim Burress at National Public Radio

The Aspen Institute is an educational and policy studies organization based in Washington, D.C.

TIME Ideas hosts the world's leading voices, providing commentary and expertise on the most compelling events in news, society, and culture. We welcome outside contributions. To submit a piece, email ideas@time.com.

MONEY Economy

European Central Bank President Mario Draghi Glitter-Bombed by Protester

The protester rushed the stage at a European Central Bank press conference.

TIME Economy

Low Wage Workers Are Storming the Barricades

Activists Hold Protest In Favor Of Raising Minimum Wage
Alex Wong—Getty Images Activists hold protest In favor of raising minimum wage on April 29, 2014 in Washington, DC.

A few weeks back, when Walmart announced plans to raise its starting pay to $9 per hour, I wrote a column saying this was just the beginning of what would be a growing movement around raising wages in America. Today marks a new high point in this struggle, with tens of thousands of workers set to join walkouts and protests in dozens of cities including New York, Chicago, LA, Oakland, Raleigh, Atlanta, Tampa and Boston, as part of the “Fight for $15” movement to raise the federal minimum wage.

This is big shakes in a country where people don’t take to the streets easily, even when they are toiling full-time for pay so low it forces them to take government subsidies to make ends meet, as is the case with many of the employees from fast food retail outlets like McDonalds and Walmart, as well as the home care aids, child caregivers, launderers, car washers and others who’ll be joining the protests.

It’s always been amazing to me that in a country where 42% of the population makes roughly $15 per hour, that more people weren’t already holding bullhorns, and I don’t mean just low-income workers. There’s something fundamentally off about the fact that corporate profits are at record highs in large part because labor’s share is so low, yet when low-income workers have to then apply for federal benefits, the true cost of those profits gets pushed back not to companies, but onto taxpayers, at a time when state debt levels are at record highs. Talk about an imbalanced economic model.

A higher federal minimum wage is inevitable, given that numerous states have already raised theirs and most economists and even many Right Wing politicos are increasingly in agreement that potential job destruction from a moderate increase in minimum wages is negligible. (See a good New York Times summary of that here.) Indeed, the pressure is now on presidential hopeful Hillary Clinton to come out in favor of a higher wage, given her pronouncement that she wants to be a “champion” for the average Joe.

But how will all this influence the inequality debate that will be front and center in the 2016 elections? And what will any of it really do for overall economic growth?

As much as wage hikes are needed to help people avoid working in poverty, the truth is that they won’t do much to move the needle on inequality, since most of the wealth divide has happened at the top end of the labor spectrum. There’s been a $9 trillion increase in household stock market wealth since 2008, most of which has accrued to the top quarter or so of the population that owns the majority of stocks. C-suite America in particular has benefitted, since executives take home the majority of their pay in stock (and thus have reason to do whatever it takes to manipulate stock price.)

Higher federal minimum wages are a good start, but it’s only one piece of the inequality puzzle. Boosting wages in a bigger way will also requiring changing the corporate model to reflect the fact that companies don’t exist only to enrich shareholders, but also workers and society at large, which is the way capitalism works in many other countries. German style worker councils would help balance things, as would a sliding capital gains tax for long versus short-term stock holdings, limits on corporate share buybacks and fiscal stimulus that boosted demand, and hopefully, wages. (For a fascinating back and forth on that topic between Larry Summers and Ben Bernanke, see Brookings’ website.)

Politicians are going to have to grapple with this in the election cycle, because as the latest round of wage protests makes clear, the issue isn’t going away anytime soon.

Read next: Target, Gap and Other Major Retailers Face Staffing Probe

Listen to the most important stories of the day.

TIME Economy

How April 15 Became Tax Day

Final Day For Filing Taxes
Erik S. Lesser—Getty Images A man deposits his tax return into a mailbox on the final day for filing taxes in 2001 in Atlanta

The April date has been "T-day" for 60 years

Founding Father Benjamin Franklin famously said that the only things certain in this world were death and taxes, but he wasn’t necessarily talking about federal income taxes. The U.S. didn’t institute such a tax until the time of the Civil War, as a temporary measure. The Sixteenth Amendment, ratified in 1913, made it possible for the federal government to tax individuals directly.

But the story of tax day doesn’t end there. In 1954, Congress passed nearly 1,000 pages of revision to the Internal Revenue Code. Though TIME noted back then that the bill didn’t really change the overall structure of the tax code, and that many taxpayers wouldn’t be included in the categories of Americans who would see a decrease in their tax bill due to the change, it did mean one big difference that every single taxpayer would feel: “T-day” would be moved to April 15:

The lawmakers rewrote and in some places tightened many provisions concerning gifts, trusts, partnerships and reorganized or liquidated corporations. They plugged a clutch of minor loopholes that some taxpayers had found profitable. They switched income-tax day from March 15 to April 15, thus giving the taxpayer an extra month to recover from Christmas expenses and sparing him the yearly ordeal of hearing and reading clichés about the ides of March.

But when 1955’s tax day rolled around, it became clear that — even if the extra month did help Americans’ wallets — the new date didn’t mean an end to tired date-based jokes. The Ides of March were no longer financially deadly but April, TIME noted with no hint of irony, is the cruelest month.

Read the full 1954 story, here in the TIME Vault: The New Tax Law

TIME India

This Country Looks Like It Will Grow Faster Than China This Year

A worker at a company processing steel in Khopoli, India, in 2014.
Bloomberg/Getty Images A worker at a company processing steel in Khopoli, India, in 2014.

By almost a full percentage point

India’s economic growth may surpass China’s much sooner than initially expected, with the International Monetary Fund (IMF) forecasting earlier this week that Delhi will take the lead in 2015.

The IMF’s World Economic Outlook, released Tuesday, indicates that India’s growth rate will rise to 7.5% this year, while China’s is expected to drop to 6.8% from 7.4% last year.

India’s growth will “benefit from recent policy reforms” under new Prime Minister Narendra Modi, the report says, with the resulting rise in investment and reduction in oil prices. “Lower oil prices will raise real disposable incomes, particularly among poorer households, and help drive down inflation,” it predicts.

The IMF forecast was substantiated by a Monday report from research firm Capital Economics, which said consumer price inflation dropped unexpectedly in March and raised the possibility of a third unscheduled cut in interest rates this year.

China’s declining growth over the past year has also been well documented, and Bloomberg reported Wednesday that Japan will soon overtake it as the United States’ largest overseas creditor.

With the World Bank also predicting that India’s growth rate will hit 8% by 2017, it looks like the upward economic trajectory anticipated by many when Modi came to power could have begun.

Read next: What I Learned in India About Financial Advice

Listen to the most important stories of the day.

TIME trade

The Trans-Pacific Partnership Will Help Define President Obama’s Legacy

US President Barack Obama speaks while Japan's new conservative Prime Minister Shinzo Abe listens, following their bilateral meeting in the Oval Office at the White House in Washington, DC, on Feb. 22, 2013.
Jewel Samad—AFP/Getty Images US President Barack Obama speaks while Japan's new conservative Prime Minister Shinzo Abe listens, following their bilateral meeting in the Oval Office at the White House in Washington, DC, on Feb. 22, 2013.

The massive TPP trade deal could help boost the global economy and President Obama's legacy—if Congress lets it happen

In the next few days, the Senate will begin debate on one of the most important questions it will answer this decade—whether to grant the President “trade promotion authority” (TPA), also known as “fast track.” This move would give President Obama and his successors the authority to place trade agreements before Congress for a simple up-or-down vote, denying lawmakers the chance to filibuster or add amendments to the deal which change its rules.

Those in favor say that Presidents can’t negotiate growth-boosting trade deals without fast track authority, because other governments won’t make concessions if they know that Congress can later rewrite parts of the agreement. Those who oppose TPA say the devil remains in the details—small changes within a massive trade deal can have huge impacts on individual business sectors, and on the winners and losers in any agreement. They say trade deals are too important for the lives and livelihoods of ordinary Americans to leave their elected representatives with no say in their content.

That debate is now coming to a head because negotiations among a dozen Pacific Rim nations over the Trans-Pacific Partnership (TPP)—an enormous multilateral trade deal involving a dozen Pacific rim countries—are entering the final stages. The talks now include the United States, Japan, Canada, Mexico, Chile, Peru, Australia, New Zealand, Vietnam, Singapore, Malaysia and Brunei. This group represents 40 percent of world trade and 40 percent of global GDP. Without TPA, there will be no TPP, say trade advocates, which would cost America significantly. Too bad, counter trade opponents. If Americans can’t influence the deal’s content through their representatives, America is better off without it.

What’s at stake? TPP proponents say the deal would generate hundreds of billions of dollars of economic gains over the next decade by reducing tariff and non-tariff barriers across the 12 countries it covers. It would enhance security relations among member states, boost labor and economic standards and set rules for global commerce on free-market terms. For some countries, TPP would give their economies a significant boost. Projected GDP growth in Japan and Singapore for 2025 would be nearly a full 2 percent higher with the deal than without. Malaysia’s GDP might be higher by more than 5 percent. The difference for Vietnam might be more than 10 percent.

For the U.S., the political and security impact of the TPP is more important than the economic effects. In 2025, US GDP will be $77 billion higher with TPP than without it—just 0.3 percent. But the White House says it will boost exports by 4.39 percent over 2025 baseline forecasts. If true, that matters, because exports create the kinds of middle class jobs that boost longer-term growth and reduce income inequality. TPP would also give the U.S. a firmer commercial foothold in the world’s most economically dynamic region. And it would do so while growing the economies of U.S. partners and allies, which are anxious to avoid overdependence on fast-expanding China. That’s good for US security interests and makes TPP a central element of the Obama Administration’s long-promised pivot to Asia.

This is a big moment for those who believe in the power of trade to boost economic trajectories. In 2012, China surpassed the United States to become the world’s no. 1 trading nation in total trading volume. Today, there are 124 countries that trade more with protectionist China than with free trade America. That’s why the Trans-Pacific Partnership—whether he can pass it or not—will be a crucial part of Barack Obama’s legacy.

TIME Economy

The Middle Class Is Doing Worse Than You Think

It seems like everyone is concerned about economic inequality these days. A Gallup poll in January showed that more than two-thirds of Americans are dissatisfied with the way income and wealth are distributed, and politicians from both parties are talking about the problems facing the middle class.

But the problem may be even worse than Americans think.

A new report by the Federal Reserve Bank of St. Louis — hardly a liberal bastion — found that economic inequality is actually much worse if you take into account the demographics of the middle class.

Under the traditional economic model, which ranks all American families by their incomes and then analyzes those in the middle, the median income of the middle class increased only slightly, by between 2% and 8%, between 1989 and 2013.

But if you use a different economic model that takes into account demographic and sociological attributes, such as age, educational attainment, race or ethnicity, the median income of the middle class has actually decreased by 16% during that same time period, according to the report, which was released Tuesday.

Senior economic adviser William Emmons and policy analyst Bryan Noeth argue that the method economists typically use to measure the financial health of the middle class fails to reflect important shifts in the population, like whether a middle class family qualifies as middle class in terms of income but not in accumulated wealth, or whether a family is counted among the middle class one year, but not the next.

Instead, they suggest using a method that tracks the group more holistically, by defining a middle class family as one “headed by someone who is at least 40 years old, who is white or Asian with exactly a high school diploma, or by someone who is black or Hispanic with a two- or four-year college degree.”

“In effect, the bar has been rising to remain near the middle of the income and wealth distributions,” Emmons and Noeth write. “The growing importance of college degrees and other advantages more commonly enjoyed by white and Asian families are contributing to significant downward pressure on the relative standing of less-educated and historically disadvantaged minority families.”

TIME portfolio

A Powerful Look Inside Austerity-Hit Greece

This is a humbling, often intense, meditation on the fragility of social cohesion

When the European sovereign debt crisis hit in 2008, media commentary often focused on the fate of the so-called “PIIGS“. Namely, Portugal, Italy, Ireland, Greece and Spain. These were the countries saddled with the largest debt and slowest economic growth, and were the ones — excepting Spain and Italy — that received multi-billion dollar bailouts from the E.U. and International Monetary Fund. These emergency plans, it was said, would keep their economies afloat, but came with a caveat: governments would have to massively reduce spending in an effort to rein in their out-of-control finances.

The move was deeply unpopular. In Greece, austerity measures became associated with public sector layoffs, welfare cuts and later, to the rise of far right and far left political parties. In Ireland, large scale emigration and a collapsed property market dominated the national conversation, while Portugal dealt with mass youth unemployment.

Today, things have changed — at least for some. On paper, Lisbon and Dublin seem to be recovering, with their gradually rising credit ratings. But the situation in Athens often looks like it’s getting worse. Today, it is estimated that close to one million Greeks do not have access to healthcare — which has been linked to a rise in HIV infection, infant mortality and suicide rates — while 40 percent of Greek children live below the poverty line.

It is this Greece that photographer Angelos Tzortzinis set out to capture. Over the course of six years, he has documented the effects of austerity measures in his native country, one he says he no longer recognizes.

The images that have emerged are as powerful as they are shocking. The photographer shows us everything from charged Golden Dawn rallies to women working as prostitutes, and from immigrants seeking shelter to drug addicts in their bedrooms. This is a humbling, often intense, meditation on the fragility of apparent social cohesion and on the very real impact that political and economic policies can have on everyday life.

Angelos Tzortzinis is a photographer based in Athens

Richard Conway is a contributor for TIME LightBox

 

TIME Business

Why Abolishing Tipping Failed in 1950

TIME.com stock photos Money Dollar Bills
Elizabeth Renstrom for TIME

Chesapeake & Ohio Railroad reported customers lacked the courage to kick the habit

The idea of putting an end to tipping has been gaining some traction the United States recently, with some restaurants deciding to ban the practice and restaurant experts also speaking up, especially as momentum builds for increasing the minimum that tipped servers would take home. But this isn’t the first time a business has tried to make that change.

For example, in the late 1940s, the Chesapeake & Ohio Railroad declared that tipping in its dining cars was “unworthy of American labor” and “an imposition on the customer.” But the change didn’t stick. In 1950, the company went back to the old way. It turned out that not tipping was just too darn awkward.

Here what happened, as TIME explained back then:

Waiters, though they got a raise, had proved incapable of purging their features of all hope. And most customers had been plain miserable —uncomfortable if they slipped a clandestine coin under a saucer, more uncomfortable if they didn’t. Said the C. & O. sternly: “Too many persons lack the courage to participate in an experiment that breaks with custom.”

Read more about the minimum-wage debate, here in TIME: The Real Meaning of $9 an Hour

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