Issue: Economy, Labor & Trade -- Reducing global inequality and economic precarity through equitable trade, labor, and investment rules

Reducing global inequality and economic precarity through equitable trade, labor, and investment rules is a key principle of progressive foreign policy.

New Foreign Affairs Essay Offers Bold Blueprint for U.S. Foreign Policy Reform

In a provocative new essay published by Foreign Affairs, Nancy Okail, President and CEO of the Center for International Policy, and Matt Duss, the organization’s Executive Vice President, present a sweeping critique of the entrenched U.S. foreign policy orthodoxy and lay out a bold blueprint for reform. The essay, “America Is Cursed by a Foreign Policy of Nostalgia,” challenges decades of militarism and neoliberal economic policies that have prioritized corporate and elite interests over the well-being of most Americans and people worldwide.

With the 2024 election confirming the collapse of Washington’s traditional foreign policy consensus, Okail and Duss argue that neither “America First” unilateralism nor liberal internationalism can address the urgent needs of a world grappling with climate change, economic inequality, and political instability. Instead, they call for a transformative foreign policy rooted in shared global challenges, equitable economic reform, and principled international cooperation.

“The United States must choose between advancing a genuinely equitable global order or clinging to an undemocratic and unsustainable quest for global primacy,” said Okail. “Our current trajectory not only fails to meet the needs of working Americans but also alienates nations and peoples worldwide that are calling for a more just and inclusive international system.”

Key recommendations in the essay include:

  • Ending Failed Militarism: Shifting from prioritizing global military hegemony at any cost to a foreign policy that prioritizes human security, accountability, conflict prevention, and consistent application of international laws and norms.
  • Breaking from Neoliberal Economics: Ensuring prosperity is more widely shared among US communities, while reducing global inequality and economic precarity through equitable trade, labor, and investment rules, including by reforming global institutions like the World Bank and International Monetary Fund to support low- and middle-income countries, enabling sustainable development and debt relief.
  • Redefining Relations with China: Moving beyond Great Power Competition and zero-sum strategic thinking to focus on collaborative solutions for climate change, public health, technological innovation, and a more inclusive global economic and political system.

“Decades of militarized foreign policy and economic systems designed to benefit corporations and the wealthy have left working-class Americans—and communities around the world—paying the price,” added Duss. “The 2024 election put a decisive stamp on what has long been clear: the Washington foreign policy consensus is not only intellectually bankrupt but also increasingly alienating to the American people. It’s time for a new approach that breaks from the false choice between ‘America First’ unilateralism and ‘America is Back’ nostalgia, focusing instead on the needs of everyday people and a future built on common good, human rights, and shared prosperity.”

This essay is a call to action for policymakers, thought leaders, and citizens who recognize that the challenges of the 21st century require a fundamentally new approach to U.S. leadership.

The full essay is available in Foreign Affairs and can be read here.

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The Center for International Policy (CIP) is a woman-led, progressive, independent nonprofit center for research, education, and advocacy working to advance a more peaceful, just, and sustainable U.S. approach to foreign policy.

CIP Welcomes Introduction of Migration Stability Resolution

In response to the introduction today of the Migration Stability Resolution by Rep. Greg Casar (D-TX) and his colleagues, the Center for International Policy issued the following statement from Vice President for Government Affairs Dylan Williams:

“For too long, the U.S. approach to migration has focused on barricading our borders rather than addressing the realities compelling people to leave their homes — including crises exacerbated by U.S. policies. We applaud Congressman Casar and his colleagues for taking this critical step to review and move toward better U.S. policies to address the conditions giving rise to increased migration and displacement.”

For more on the introduction of the Migration Stability Resolution, read this press release.

For more discussion of the challenges and priorities in migration policy, check out this discussion from CIP’s 2024 Conference.

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Q&A: Will New Taxes & Restrictions Stifle Cuban Businesses?

This week, as Cuba implements new laws and regulations that impose new taxes, restrictions and requirements on the private sector, CIP senior non-resident fellow María José Espinosa Carillo offers her analysis of their implications on businesses in Cuba and for the country’s economy. In a Q&A with Latin America Advisor (a daily publication of The Dialogue), she explains:

“The stated aim of the new regulations is increased order over the private sector in Cuba, but they risk undermining private-sector growth—a necessary component of the country’s economic future. The mixed nature of the reforms—some offering protection for workers while others curtail entrepreneurial freedom—signals the Cuban government’s ongoing reluctance to fully embrace private enterprise as a driver of the country’s growth. Shifting regulations create uncertainty and distrust among entrepreneurs and potential investors, hindering investment and economic progress. The Cuban people are suffering an unprecedented multidimensional crisis. Over a million people have migrated since 2022, creating a massive brain drain–the effects of which we will see for decades to come.

Meanwhile, civil society organizations, entrepreneurs and community leaders are at the forefront of promoting community initiatives that generate employment and create social benefits such as social services for elderly and vulnerable populations. With an entrepreneurial solidarity spirit, they are building partnerships among themselves, as well as with state institutions, when possible.

We hope to see a more coherent regulatory framework that balances inequality stopgaps with the need for non-state sector growth and innovation. Increasing transparency, reducing barriers and fostering partnerships between state and non-state actors would help build confidence and stimulate investment, which the country so desperately needs. Further, the state must recognize the non-state sector and other civil society groups as legitimate actors. The government should send a clear message of support and encouragement to young entrepreneurs, who are currently looking anywhere but the island to build their futures. Lobbing confusing laws and repeatedly shifting regulations is no way to empower them.”

Read the original article here.

Labor unions going global for workers rights

Wouter van de Klippe is a freelance journalist and Public Policy graduate based in Europe. He’s particularly interested in organized labor, economic, social, and environmental justice, and social welfare states.
 

Boiling in Amazon’s warehouses

The city boiled as the unrelenting sun cooked Manesar in India’s northern state of Haryana. Temperatures soared to 50 degrees Celsius (122 degrees Fahrenheit) in some areas of India on May 16th this year as a deadly heat wave swept the region.

At 4:30pm, a manager inside of Amazon’s Manesar warehouse called a meeting. The meeting was, according to the manager, intended to motivate the workers to push their efforts and increase productivity despite the heat. To accomplish this, a worker testified in The Independent, the manager asked the warehouse workers to make a pledge: workers “will not take any breaks, we will not stop to drink water or go to the bathroom until we meet our targets.”

The inhumane pledge came as the same worker reported shifts of organizing products for 10 hours a day with only two breaks of 30 minutes to rest. While the facility has been outfitted with fans and coolers, she said that their impact is “negligible”, “walk just 10 steps away and you can barely feel any difference. The areas where we work are typically between 30-35C on any given day.”

Amazon has since said that the pledge was an “unfortunate and isolated incident”, but the case has catalyzed a renewed discussion of the brutal labor conditions in Amazon warehouses.

These conditions were brought to the attention of India’s National Human Rights Commission (NHRC) by the Amazon India Workers Association (AIWA), established in 2022 and supported by UNI Global Union, a global union federation for service sector workers. AIWA is one of over 80 organizations across the globe fighting to improve the often brutal conditions faced by Amazon under the banner of the Make Amazon Pay campaign.

AIWA, with the help of UNI, was able to document and raise awareness of the conditions experienced by Amazon warehouse workers, ultimately resulting in the NHRC taking action at what the commission stated could potentially “raise a serious issue of the human rights of workers.”

Now, UNI Global union is campaigning to demand that Amazon provide safe working conditions – especially in light of the climate crisis. Amazon’s warehouses in India are not alone in unsafe temperatures – the Teamsters union in the US is mobilizing for better protections in the Northeast, and back in 2022 workers reported scorching temperatures during the 2022 California heatwave.

These campaigns and others like are one example of a burgeoning wave of global labor solidarity that is rising as unions seek out new strategies to confront global capital.

Especially in the United States, unions are experiencing a renaissance of public attention and support. Less well-known is that union victories in the United States could have the consequence of pushing union victories around the world.
 
 

Less well-known is that union victories in the United States could have the consequence of pushing union victories around the world.

On the last Friday of the groundbreaking United Auto Workers (UAW) walkout that led to a historic victory, Tesla servicing workers went on strike in Sweden. It was the first attempt ever to get Tesla to sign a collective bargaining agreement and the action benefited from the momentum of the UAW actions to organize auto workers.

Unions that are pushing the envelope of labor organizing in the United States could spearhead efforts around the world, especially when it comes to global efforts at US-based multinationals such as Amazon.

For Nick Rudikoff, UNI’s campaign director and coordinator of the Make Amazon Pay campaign, “only a global labor movement can transform Amazon into a responsible employer.”

“You have such a multisectoral company that transcends sectors and geographies, it’s the largest logistics and commerce company in the world.”

The Make Amazon Pay campaign was launched four years ago and has coordinated growing days of strike action each year – most notably during Amazon’s (in)famous Black Friday sales.

Last year’s Black Friday strike mobilized workers in over 30 countries and, according to Rudikoff, received more press coverage than the sales themselves. “The fact that the Make Amazon Pay strikes and actions received so much support shows just how much solidarity there is for workers wanting a union.”

A representative from AIWA told me that coordinating with UNI Global and the Make Amazon Pay campaign “shows that the poor working conditions at Amazon are similar everywhere across the world. We are fighting for the right cause, not only in India. We are fighting everywhere across the world, and we are learning from each other.”

New campaigns seeking to organize workers the world over within multinationals are one of the many ways that unions have responded to globalization and increasingly spread supply chains.
 

Globalization and International Framework Agreements

Labor unions have had to be nimble in response to contemporary capitalism. Historically, the labor union’s bread and butter way to improve working conditions has been to represent workers by negotiating collective bargaining agreements. When employers are unwilling to come to the bargaining table and negotiate these agreements, unions demonstrate their power through organizing strikes and collective actions.

Globalization and outsourcing put pressure on the ability of workers to do this – first, by companies threatening to move operations abroad in response to pressure from workers; second, by companies increasingly moving operations to countries with less-robust unions and fewer legal protections for workers and organizing.

In a report written by Astrid Kaag, policy advisor for the largest Dutch trade union confederation FNV, Kaag notes that “the most important tool we have, the collective labor agreement, means little in such situations.”
 
 

The heart of Union action has always been at the shop-floor between workers in a shared space.

The heart of Union action has always been at the shop-floor between workers in a shared space. As the threads of global capitalism weave increasingly international distances, the process of building worker power and manifesting it at the local level has come under threat.

To adapt, and strengthen international worker solidarity, unions developed a new tool to fight for improvements in working conditions called “Global Framework Agreements” (GFA). Essentially, these are agreements made between unions (most often global union confederations) and multinational companies that set a baseline of working conditions for the companies’ employees and suppliers.

One of the most impactful GFAs that have been signed to date was in response to one of the greatest worker tragedies in recent memory – the Rena Plaza disaster.
 

“The International Accord”

In April of 2013, an eight story commercial building containing several garment factories in Dhaka Bangladesh called the Rena Plaza collapsed, killing 1,138 garment workers. Companies that sourced clothing from the building included C&A (Belgium), Carrefour (France), El Corte Inglés (Spain), Benetton (Italy), and J.C. Penny (U.S).

The disaster catalyzed a response from workers, trade unions, and NGO’s that resulted in the creation of a legally binding framework agreement – first called the Bangladesh Accord and more recently transforming into the “International Accord for Health and Safety in the Garment and Textile Industry”, or more commonly just “The International Accord .”

The International Accord was signed and negotiated by IndustriALL Global Union and UNI Global union, alongside several NGOs. According to the accord’s dedicated website, it has resulted in over 2 million workers across Bangladesh being trained in workplace safety, over 56,000 factory inspections, and over 1,000 resolved complaints.

The accord’s first legal test came when in 2016 UNI Global and IndustriALL won a lawsuit against brands that had failed to live up to the requirements stipulated in the accord. In 2018, the two global union confederations won the court case and the brands were forced to pay over $2 million to remedy the accord violations at their suppliers.

Despite this victory, there are real limits for what workers can secure relying on GFAs. A study recently showed that while GFAs have indeed resulted in significant material improvements in some cases, they are largely dependent on the goodwill of management at a company’s headquarters.

Other studies have been less sanguine about the impacts of GFAs. In a report by the German foundation the Friedrich Ebert Stiftung, it was shown that in many cases in the United States, the agreements were essentially ignored – either intentionally, or due to the fact that local managers didn’t even know of their existence. Between 1998 and 2018, the International Labour Organization estimates that over 300 GFAs were signed – and yet, many of these global agreements have failed to secure the workers rights that they call for.
 
 

despite the International Accord being lauded as a major victory, workers trying to organize in Bangladesh are consistently repressed, and in some cases, murdered.

At worst, GFAs can serve as opportunities for multinational companies to boast their corporate social responsibility while continuing the longstanding abuse of workers. This is especially the case when GFAs are not legally binding and do not contain dedicated ways to assess, monitor, and intervene on violations of the agreements by independent bodies.

In Bangladesh, although The Accord has led to changes in factories and successful legal battles for unions, worker abuses are still common in the country and garment workers are still paid very low wages. Many companies have yet to sign The Accord, especially those from the United States such as Walmart, Amazon, and Target. In fact, these corporations created their own, non-legally binding organization called ‘Nirapon’ which NGOs have described as being self-regulating and entirely opaque.

A key part of these agreements is to make companies agree to remain neutral when workers decide to unionize. Yet, despite the International Accord being lauded as a major victory, workers trying to organize in Bangladesh are consistently repressed, and in some cases, murdered. For example, Shahidul Islam, a prominent union organizer for the Bangladesh Garment and Industrial Workers Federation, was murdered on the 25th of April, 2023, after attempting to resolve a dispute over wages at a factory in Gazipur.

Not only has globalization put significant pressure on the ability of unions to organize. Political hostility to workers and unions have resulted in working conditions degrading in many places across the world.
 

Labor is under pressure the world over

The world’s largest trade union confederation, the International Trade Union Confederation (ITUC), releases an annual report that describes the status of labor rights all over the world and provides ratings for each countries’ respect for workers rights.

This year’s results were bleak.

The ITUC’s 2024 report found that globally, workers were denied the right to strike in 9 out of 10 countries. In 49% of countries, trade union members were either arbitrarily arrested or detained. Only two countries’ ratings improved year on year (Brazil and Romania), whereas 13 countries saw their ratings fall.

An outlier can be found in the United States, where the Biden administration’s impressive support for organized labor has undoubtedly strengthened the movement in the country after decades of anti-union political leadership. Consider UAW’s successful amd ambitious campaign to organize non-union autoworkers. Surveys show that the US public is currently more supportive of labor unions than at any time in the past 60 years.

Alongside Biden’s formal political support has come new legitimacy within public discourse – although reactionaries have sought to disguise their intentions under a veneer of worker-friendly rhetoric.
 
 

reactionaries have sought to disguise their intentions under a veneer of worker-friendly rhetoric

Consider that the notoriously anti-union Republican party is attempting to rebrand itself as being pro-worker by, for example, inviting Teamster’s union president Sean O’Brien to the Republican National Convention.

Many of Europe’s far-right populists are similarly, and deceitfully, claiming an allegiance to the continent’s working class as well. The far-right Finnish Finn’s party has allegedly referred to itself as the “worker’s party without socialism”. Marine le Pen’s Rassemblement National is consistently attempting to present itself as the party of France’s working class.

In practice, these parties consistently implement policies hostile to organized labor. In the United States, the Republican party is blocking pro-union legislation and plans on rolling back labor protections for the working class when in power. In Finland, the Finns helped the center-conservative party slash worker and union protections.

Unions the world over are countering the far-right’s pseudo-allegiance to the working class by coming together.
 

Unions for Democracy

IndustriALL’s Walton Pantland wrote in 2019 that now, more than ever, there is a need for international union solidarity. He argues that the increasingly global and interconnected nature of contemporary capitalism requires new forms of worker movements.

“Labor is on the back foot. Jobs are becoming more precarious. Fewer workers have good pensions. Inequality is growing. The balance of power between capital and labor has tilted heavily in favor of capital.”

This year, the ITUC has been organizing a campaign “For Democracy” and warns that there are concerning anti-democratic movements in every continent that would have devastating consequences for workers’ rights.

For the ITUC, this gradual erosion of democracy presents an existential risk to the trade union movement. According to the ITUC’s For Democracy campaign, unions are forges for democracy. “Generations of trade unionists have fought and died, been tried and executed to advance democratic rights. Today, hundreds of trade unionists sit in jail, under house arrest or on trial as they continue to defend it.”

Wooing the labor vote has been a central part of the 2024 US presidential election and the outcome will have serious consequences on organized labor around the world. The stronger the labor movement becomes in the United States, the more pressure and momentum can be developed internationally. Just this year, Amazon workers in Coventry nearly succeeded in a vote for union recognition.

Amazon workers on strike in Coventry nearly won union recognition in a vote earlier this year. Image provided by UNI Global Union.
 
Labor organizers in the United States must take advantage of the current momentum and fight for legislative changes that will support organizing in the long-term. For example, campaigns must be centered around garnering support for the Protecting the Right to Organize (PRO) act which would empower worker organizing through new legal protections.

There are also legislative victories that can be fought at the global level. Take actions like the EU’s Corporate Sustainability Due Diligence Directive (CSDDD) which requires companies based in the EU to make sure that there are no labor and environmental abuses in their supply chains. Yes, the act has significant shortcomings and has been made significantly weaker through lobbying, but it is a good starting point that unions can organize around to fight for legal due diligence requirements at the global scale.

Another battleground could be union campaigns pressuring legislators to ensure that trade agreements contain clauses to protect the right for workers to unionize and requirements for participating in collective bargaining agreements.

The global fight for workers rights is a struggle contested on a cornucopia of battlegrounds – from legislation and presidential politics to local actions.

The Make Amazon Pay campaign represents one the many different ways that unions are fighting the world over to secure workers’ rights.

When asked on whether unions should be focusing at the global level, the local level, via old union confederations or new unions such as the Amazon Labor Union in the U.S., Rudikoff replies “every worker organizing drive at Amazon inspires dozens more – in other cities, in other states, and in other countries.”

“As a progressive movement we’re all in this together.”

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The Democrats’ Pro-Worker Agenda Can Go Global

As a candidate, Vice President Kamala Harris is signalling her rejection of a corporatist neoliberalism in favor of progressive, worker-first policies at home. Such a policy would build on the existing pro-labor success of the Biden administration, but it also presents an opportunity to move towards a more pro-worker foreign policy, without getting caught in great power competition.

Writes Matt Duss:

The United States can build a more equitable global order, or it can frantically try to maintain global primacy, but it can’t do both. The Harris-Walz team has an important task and a big opportunity to diminish this contradiction and complete this transformation. Just as the neoliberal era proved that giving carte blanche to big corporations—whether they’re car companies or weapons manufacturers—is not a means for achieving broad economic progress or security, the past 20 years of the “war on terror” showed that a heavily militarized foreign policy feeds global insecurity and shreds the fabric of international norms.

As outlined by Trump and Vance, the Republican vision is essentially zero-sum: The United States and its workers only win by others losing, and vice versa. The Harris-Walz team can offer a vision of contrasting solidarity, which doesn’t seek to build political consensus by vilifying the foreign enemy of the moment but rather seeks ways to uplifts workers and their communities in every country.

Read the full piece at Foreign Policy.

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To defeat oligarchy, Ukraine needs strong labor protections. The US can help.

Vladyslav Starodubtsev is a Ukrainian social-democratic, human rights, and social activist and historian of Central and Eastern Europe and Ukrainian left-wing movements.

Every Ukrainian government since independence in 1991 has shared the goal of implementing austerity. In pursuit of an economy organized by neo-Thatcherite principles, each successive government has sought to limit the social and labor rights of Ukrainians. From the Russian invasion in 2014, this has meant prioritizing the oligarchy’s sectoral interests and anti-social business practices over promoting social cohesion and national unity.

Ukrainian labor was already under attack before the 2022 invasion. A 2020 report by the US State Department on the state of human rights, including labor rights in Ukraine, mentioned acts of violence against trade unionists as well as pressure against workers who were acting against corruption in their workplace. In addition, State reported discrimination in the workplace; lack of worker safety and undermining the safety regulations; dangerous work conditions; and delays in payment of wages (essentially a “theft” of wages).

Still, only since Russia’s February 2022 full-scale invasion of Ukraine has the full extent of the consequences of such policies become clear. One can see overworked nurses toiling in hospitals that lack capacities and equipment, facing a huge number of wounded while understaffed and underpaid, for often no more than 130-150 dollars a month – well below the $175 monthly minimum wage (and earning at most a maximum of 300 dollars/month). Construction workers labor without proper safety standards, working under constant threat of rocket and drone strikes. At the same time, the government has implemented tax cuts for businesses, and further benefited employers at the expense of workers by easing the process of firing an employee. All of this came at the moment when stability for most people became non-existent.

Ukraine’s labor standards were already worsening before February 2022, but instead of easing the burdens on workers and capital equally in the face of the war, labor standards have instead been actively degraded by new laws.

Capital Gains

In March 2022 the least balanced labor law in Ukraine since independence, Law 2136, came into effect. It allowed employers to fire workers without the consent of trade unions and during sick leave. It became possible to increase the work week to 60 hours, and the inviolability of the right to pay was abolished. Employers were able to dismiss employees due to disagreements regarding the continuation of work under new working conditions without waiting for 2 months.The biggest imbalance was caused by the procedure for suspending employment contracts, which employers abused, putting employees on the edge of survival with impunity

Law 2136 also canceled holidays during wartime. This could be justified under some circumstances, but in effect, labor bore the brunt of the hardships, while employers were largely unaffected. Before the full-scale invasion, if work could not continue due to objective factors, workers were able to receive compensation while finding a new job, allowing them to find a better job without compromising their dignity by immediately accepting worse employment.

Under the new law, employers could stop employment contracts without firing an employee and without paying them. This meant that people could no longer register as unemployed while finding work and therefore could not get unemployment benefits. This has not always worked out to the employers’ benefit, though it often does. Since Law 2136’s introduction, in some cases courts sided with employees if an employer did not specify a reason for stopping work.

Law 2136 also introduced the possibility of moving workers onto 1-hour working days, with proportional lowering of wages. If employees disagree, they could be fired without any compensation. Employers were only required to provide 2 days of notice before implementing such decisions, thus depriving them of the possibility to save money or find alternative employment.

With Law 2136, Ukraine enabled employers to avoid paying maternity leave, compensation for pregnant workers, and other benefits.

In July 2022, the Law on Simplifying the Regulation of Labor Relations (Law 2434) was adopted. It introduced parts of the Civil Codex into the labor Codex, providing further opportunities to undermine the labor Codex by allowing looser contracts between employees and employers. The main “innovation” of this law was the introduction of the possibility of firing workers easily.

In August 2022, the Ukrainian government introduced Law 2421, one of the worst-regulated laws on zero-hour contracts in the world. Precarious work, which elsewhere increasingly trends towards greater regulation, is instead becoming even more precarious in Ukraine. Law 2421 establishes zero-hour contracts without any additional security for workers agreeing to such a precarious arrangement. Employers can enter into collective labor agreements with no obligation to provide employees with work, but can offer it as they need. Payment is made only for completed work. After receiving an offer from an employer, an employee must accept it within the terms established by the contract and start work; in case of refusal, they may face disciplinary action. If the duration of work is less than 32 hours per month, the monthly salary is paid for 32 working hours. In effect, the law practically cancels the requirements for a minimum wage.

The new law introduces the possibility of calling an employee at any time and forcing disciplinary action if an employee doesn’t respond. It introduces the possibility of paying less than a minimum wage for work, as well as the possibility of overtime work without compensation. This law undermines the right to private life and poses severe threats to the mental health and well-being of employees.

In its latest statement, the second biggest trade union of Ukraine directly calls the new labor Codex (planned to be accepted in 2024) that the government is now working on, “enslavement.” The statement reads; “Enslavement of employees is foreseen, and employers are given the right to apply overtime hours almost without restrictions (at their discretion).”

Labor Struggles

Even after this attack on labor rights, Ukrainian labor security formally could be seen as at least comparatively average. But in reality, this could not be further from the truth, as the law has power to protect workers only when it is enforced. Undermining workers’ rights illegally is now an incredibly widespread and normalized practice, one aided by the government’s introduction of a moratorium on labor inspections.

The International Labor Organization has concluded, drawing on the examples of Tajikistan and Kyrgyzstan, that any moratorium on labor inspections “would substantially undermine the inherent functioning of the labor inspection system” and that to adhere to the norms of labor regulations, “the Government [should] take prompt measures to ensure that labor inspectors are empowered to make visits to workplaces liable to inspection without previous notice and to undertake labor inspections as often and as thoroughly as is necessary to ensure the effective application of the legal provisions.” 

In 2023 labor inspections were reintroduced under the pressure of the EU, but with severe limitations that effectively undermine inspections.

These new labor standards were not in any way communicated with the population, and did not receive adequate debate or discussion before adoption. Most people are not well educated on labor law, and the country lacks a strong pool of labor lawyers who can educate and empower workers to find weaknesses in the law and defend their rights.

While it has become somewhat difficult to criticize Ukraine’s government during wartime, the same criticisms have long been made by Ukrainian trade unions, preceding the war: the country is in dire need of a good system of inspections and labor security to enforce standards of labor law.

Furthermore, there has been a constant effort to nationalize trade union property, pursuing the legal argument that trade union property in the USSR was the property of the state and thus, after more than 30 years of independence, it should be inherited by the Ukrainian state, which is viewed as the successor to the Ukrainian SSR, not by trade unions. This argument is used as both an instrument of intimidation to achieve trade union loyalty and as a tool to undermine trade unions’ means for realizing their role in civil society.

In 2022, the government introduced a number of reforms that severely and disproportionately weakened Ukrainian labor rights. Meanwhile, capital has seen its privileges expand, damaging the social contract between workers and businesses by fully siding with business. Tripartism between the state, capital, and labor is practically no more.

None of these reforms helped the economy. They also weakened the human potential, well-being, and physical and mental state of employees, as well as artificially creating highly precarious conditions.

The lack of jobs and extremely low, and usually not-enforceable, minimum wage, which sometimes was ignored outright – even some state enterprises have jobs with less than the $175 monthly minimum wage, with some employees earning only $150 – worsens the situation on the labor market, since fewer qualified workers want to work in Ukraine at a time when the Ukrainian labor market faces serious shortages.

New labor laws have weakened trade unions, thus limiting the voice of civil society and weakening social dialogue between different social groups. This lack of communication also has an economic effect, since cooperation between labor and capital is weak, as is motivation. This lowers productivity and flexibility.

A huge number of workers are working in the shadows. Tax police ignore the problem, and the government tries to normalize this state of affairs. These anti-labor reforms also strengthen the shadow sector, as official employment no longer provides sufficient guarantees. Meanwhile, the government does little to force business out of “the shadow economy.”

Mobilization efforts are hampered by inequality and the refusal of the government to make capital to pay their fair, equal share, together with labor. New labor laws, while rhetorically trying to “move away” from the Soviet legacy, have retained the mindset towards labor inherited from the USSR: a denial of the value and dignity of employees.

Solidarity and the US

How can the US help Ukrainians to limit the harms of oligarchy and regressive reforms, while providing social security for workers ?

In light of such reforms, which are made only for pursuing very narrow sectoral interests instead of the common good, one should understand Ukrainian society and group interests as diverse and complex. We still, unfortunately, retain the strong influence of the old Soviet elite, which became the Ukrainian oligarchy, and we suffer from Thatcherite-like reforms that created a new group of powerful and unchecked influences on politics and the economy. At the same time, Ukraine has a robust civil society, the largest part of which is made up of trade-unions. There are a great number of problems that need to be tackled to ensure basic fairness and justice, which is even more important in the context of full-scale war. Society should feel connected, united, strong, and not undermined and divided by social, political and economic conditions.

Biden’s foreign policy towards Ukraine can be understood in a number of ways. Despite modest beginnings, there have been steady improvements. I expect that this tendency will continue if Biden wins another term. This is the case especially with labor rights, where we hope to see the US taking a greater role in protecting Ukrainian labor.

In 2022, the American Federation of Teachers sent a letter to Secretary Blinken, asking him to look into the Ukrainians government’s actions to undermine the Ukrainian trade union movement and limit worker’s rights. The letter states: “Overall, these new laws, if signed by President Zelensky, will eliminate most collective bargaining rights, reduce worker protections, and allow the state to confiscate property owned by unions and currently used to shelter war refugees.”

The letter was made after a call for solidarity by Ukrainian trade unions against attacks on workers’ rights when they couldn’t be defended, as people were fully concentrated on winning the war.

The AFL-CIO also provided strong backing for Ukrainian trade unions and made sure that Ukrainian trade union voices were heard. It raised awareness in the US government and motivated the adoption of policies to act on Ukrainian society’s demands.

In 2023, Julie Su, the US acting Secretary of Labor, organized a meeting with Ukrainian medical workers to highlight the issues that they are facing, during which Ukrainians discussed the horrible labor conditions in the country.

Some US grants came with conditions that targeted the strengthening of labor, and USAID actively finances trade union events and organizations focused on the promotion of labor rights, such as Labor Initiatives.

The US constantly provides support for the Ukrainian government’s social spending. To make sure that this money would be spent beneficially to the majority of Ukrainians, the US set limitations to the categories on which money could be spent. This is despite the Ukrainian government’s Ministry of Social Policies (which also deals with labor related questions) policy to introduce as many social cuts as possible. This policy was described explicitly: “destroy all social.” The mentioned motivation was to promote the “self-sufficiency” of internally displaced people and others facing extreme pressure so they wouldn’t “get used” to government help. This plan was extensively criticized by Ukrainian social policy researchers.

Active sabotage by some officials and downplaying of the role of the trade unions undermines the majority of Ukrainian society, which in turn produces corruption, unchecked power, lack of stability, and poverty for the majority of Ukrainians. The question of winning the war thus becomes a question of organizing an equal share of responsibility, feeling of community, and common solidarity, which is incompatible with the pursuit of the sectoral economic interests of a powerful few at the cost of the rest of Ukrainian society.

What should be done?

While US policymakers have made efforts to help Ukrainian labor, these efforts are often undermined. For example, medical workers had praised a US grant of $1.25 billion for wages to state-employed workers, but voiced concern with real allocations, especially after Ukraine’s cabinet authorized wage cuts for these same workers. This is just one example where US help has been allocated to help labor, but is subsequently misspent by government schemes or solely allocated for higher management, which already enjoys relatively high wages by Ukrainian standards.

To answer that problem, the US needs to change its priority from securing Ukrainian labor through the help of the government to a multiplicity approach that recognizes the conflicting interests of different parts of Ukrainian society. This might mean helping the national government in one regard while helping the trade unions and local government in others, sometimes, even at the expense of national government interests.

I call that approach poly-archic: recognizing different groups, their positions and roles in society, and the goals that they can achieve. In that sense, the Ukrainian government has a strong pro-oligarchic bias but has a talent for organization of military production and guiding construction efforts. It should be supported in achieving those goals, and trade unions and labor should be supported for the goals of fighting poverty, better social cohesion, tripartism and, importantly, for the effort to battle corruption and oligarchic influence in the political sense: limiting possibilities for unchecked government actions, promotion of group interests; and rigorously controlling government actions towards labor.

Diversifying funds and other means of help towards different agents in Ukrainian society could be a great benefit. Such diversification will strengthen democracy and human rights, promote deliberation, stabilize Ukrainian society, make it more resilient, and indirectly strengthen the Ukrainian war effort. All of this while making the Ukrainian government more transparent and effective.

This is important not only in Ukraine but also in the US. It can create dialogue and cooperation between US trade unions and the US government, combining the skills and knowledge of both to provide strong common support for Ukrainian labor.

With that said, Ukrainian labor will need  substantial international support  to help contain trade union inefficiencies and corruption where those exist. This is a cheap investment, from a financial standpoint, that can boost anti-corruption, democratic, and anti-poverty efforts dramatically.

Conditions for financial aid in terms of labor security could also be stronger. Together with empowering trade unions, it could be enough to help Ukrainians pressure their government when it engages in wrongdoings. Minimum demands would need to include a fair minimum wage, security from firing, promoting social-oriented practices of business, and the introduction of pro-active labor inspection.

Implementing new, even modest, measures towards empowering labor and civil society as a whole will improve democracy and political participation, social cohesion and Ukraine’s economic growth. Ukraine’s victory will be that much closer if Ukrainian labor has a strong voice.

To tackle global kleptocracy, US must also look inward and clean house

Casey Wetherbee is a freelance journalist based in Buenos Aires, Argentina. He holds an M.A. in security studies from Georgetown University and previously worked as a corporate investigator specializing in international asset tracing investigations. You can follow him on Twitter/X at @caseywetherbee.

On June 3, 2021, the Biden Administration established the fight against corruption as a core national security interest, and later that year released the first U.S. Strategy on Countering Corruption. The strategy, coupled with an implementation plan released in September 2023, includes such pillars as curbing illicit finance, holding corrupt actors accountable, and strengthening multilateralism. In December 2023, the White House announced several accomplishments across these pillars, including financial sanctions and enforcement actions against corrupt actors, enhanced reporting requirements for beneficial ownership, and partnerships with multilateral and civil society organizations abroad.

While it is commendable to tackle corruption abroad, it is at least as much of a problem closer to home. Scholars and progressive policy makers alike have decried the emergence of an oligarchy that wields considerable political power in the United States, fomenting grotesque inequality and swaying foreign policy. Since the 1980s, corporate interests have unduly, yet often fully legally, exercised tremendous power in politics and public affairs. A series of Supreme Court decisions have also severely narrowed the ability of prosecutors to go after cases of corruption and bribery, weakening US credibility. This domestic context, coupled with the globalized nature of kleptocratic networks, requires policy makers to propose legislation that mitigates the ability of oligarchs, both within and outside the United States, from exercising outsized influence on US political affairs.

An ideological pursuit of deregulation, begun by the Carter administration and accelerated during the Reagan administration in the 1980s, spurred the rise of American oligarchy. The lobbying profession boomed and expanded, even as a general pro-business atmosphere made its work less necessary. As Sarah Chayes described in On Corruption in America, successive administrations appointed business leaders to top regulatory positions, allowing them to influence the policies that would (or would not) constrain their own industries. At the same time “soft money” began to enter politics in the late 1970s; since 1980, there has been a demonstrable correlative relationship between campaign contributions and political outcomes, and it is impossible to know how much of these funds are from foreign sources. These factors have resulted in a system by which kleptocrats can effectively pay to capture resources from the state, sustained by the “revolving door” between the public and private sectors and an electoral feedback loop fed by more and more money.

US credibility in terms of anti-corruption policy is hindered by a weak enforcement regime against corruption and bribery domestically. Several federal lawsuits have followed a pattern by which a public official commits an act that is clearly corrupt or fraudulent, such as the “Bridgegate” scandal; they are convicted for using their office for personal gain; the Supreme Court overturns the conviction, citing the vagueness of the laws as written. Indeed, gaps in federal corruption law require that prosecutors rely on federal mail and wire fraud statutes in order to target acts of corruption and bribery by public officials, despite those statutes not having been designed with that purpose. For example, the 2017 corruption trial of New Jersey Democrat Bob Menendez, which centered around lavish gifts he received from a Florida ophthalmologist later found guilty of Medicare fraud, resulted in a hung jury and all charges being dropped. This result largely drew from the Court’s 2016 decision in McDonnell v. Virginia, which had earlier been used to overturn the high-profile corruption cases of New York politicians Sheldon Silver and Dean Skelos.

In September 2023, the DOJ charged Menendez — then-Chairman of the Senate Foreign Relations Committee — in a bribery scheme involving cash, luxury vehicles, and gold bars provided on behalf of the Egyptian and Qatari governments. Even given the abundance of evidence of Menendez’s shady dealings, the burden of proof for federal prosecutors is considerable given the recent restrictions of terms such as “official act” and “honest services fraud” that will be used to prosecute him.

According to legal scholar Zephyr Teachout, these recent Supreme Court decisions “enshrined bribery into our politics.” Although they are certainly discouraging, they are not cause for despair. In 1987, McNally v. United States overturned the conviction of a Kentucky public official over an insurance kickback scheme. In response to this implicit direction by the Supreme Court to clarify the criminal statute, Congress added 18 U.S.C. § 1346, defining honest services fraud. Given the Court’s unwillingness to interpret the existing law broadly, the onus again lies with Congress to draft new statutes that align corruption law with the public’s general understanding of what is corrupt. This could include incorporating state-level definitions of official misconduct, which are often quite robust, into the text of the statute to alleviate federalism concerns. Policy makers at the state level should review and strengthen, if necessary, regulations regarding bribery and conflicts of interest.

Anti-corruption laws are useless if there is no political will or incentive to enforce them, and corrupt officials can sabotage the functions of their own institutions in order to serve kleptocratic interests. During the Trump administration, environmental enforcement actions by the EPA plummeted under the scandal-ridden leadership of Scott Pruitt, who appointed former lobbyists to high-level positions.

In order to counter the infiltration of oligarchic interests within US institutions, progressive policy makers should embrace legislation that promotes public integrity: tightening conflicts of interest by targeting stock ownership, closing loopholes by which corporate interests sabotage public interest actions, and regulating lobbying activities, which should include a ban on American lobbyists accepting money from foreign entities. From a national security standpoint, it is also important to include provisions regarding Defense officials and contractor transparency.

The Biden administration has made some strides reining in American oligarchy. This includes enabling the IRS to crack down on tax evasion, requiring real estate professionals to report suspicious activity, and mandating beneficial ownership reports to FinCEN as of January 2024 (although on March 1 the Alabama District Court ruled this provision unconstitutional and is pending appeal). Many of these recent actions target kleptocrats’ use of shell companies and trusts to launder money, a tactic that large multinational corporations also use to evade taxes. Shell companies, non-profit entities, and other facilitators of dark money in US elections must be priority targets for progressive policy makers, both by closing loopholes that Citizens United created and addressing the gap in FEC enforcement. Like with anti-corruption statutes, policy makers must also address campaign finance transparency at the local and state levels. These transparency measures must both eliminate mechanisms by which foreign kleptocrats contribute to US elections and shine a light on sources of dark money.

Ultimately, addressing the culture of individualism and greed that has afflicted US institutions for the last several decades will require profound normative changes. These legislative proposals, however, are an important starting point toward ending the power of kleptocracy within the United States, which will in turn allow it to more honestly help other democracies fight back against kleptocratic threats and corruption.

 

 

The Global South is fighting for a voice in global tax rules

Wouter van de Klippe is a freelance journalist and Public Policy graduate based in Europe. He’s particularly interested in organised labour, economic, social, and environmental justice, and social welfare states.

Since 1954, a “rich countries club” of the Global North have set the rules of the global tax system through the Organisation for Economic Co-operation and Development (OECD). Now, countries of the Global South are successfully fighting for more equal say.

On the 22nd of November, 2023, the Africa Group of the United Nations spearheaded an effort to take global tax rule setting away from the OECD and towards the UN. The UN has global representation, more transparent voting mechanisms, and more impactful accountability measures in case countries violate rules.

What died and let the OECD set tax policy?

Just after the second World War, the newly formed United Nations attempted to start setting global taxation rules determined by all member states. This effort collapsed, rather unspectacularly, in the summer of 1954 with the discontinuation of the fiscal committee of the UN.This left the OECD as the only multilateral organization setting global tax rules. The OECD only included a small number of rich states and its approach towards taxation represented these interests.

The OECD sets tax rules by providing frameworks that countries adopt within taxation agreements with other states. For example, the OECD publishes and updates a “model taxation guideline” that countries typically use when drafting their own taxation agreements. These guidelines provide advice on how to prevent companies from being taxed twice for the same profits, set rules on how to tax profits when companies sell to their own subsidiaries abroad, and more.

Under the OECD’s leadership, this tax system is one where tax evasion is rampant, double-taxation agreements benefit the richest of the world, and it took until  2021 to form an agreement on a global minimum corporate tax rate of 15% to prevent multinationals from fleeing taxes and plundering public funds.

Consider the oil giant Shell. In 2022, Shell announced that it made an astounding $39.9 billion in profits. These profits were distributed all over the world across various tax havens, meaning that it paid a 0% effective tax rate in the Bahamas (on $570 million profits), 3% in Singapore (on $937 million profits), and 7% in the Netherlands (on $2.2 billion profits). Miraculously, Shell was able to squeeze these millions of dollars of profit out of the Bahamas despite it having no ‘real’ economic activity in the country whatsoever.

This is on the verge of a major transformation being led by the Global South.

Tax and Amend

After a drawn-out fight where the US, the UK, and the countries of the EU bitterly resisted the convention, countries representing the vast majority of the world’s population voted on November 22nd, 2023, in favor of the new UN-led convention. In the end, 125 countries voted in favor with 48 votes against.

Ahead of the vote, Dr. Chila Milambo, permanent representative of Zambia at the UN, said that the convention “is not merely a political document, but a beacon of hope for developing countries that have long sought a voice in shaping international tax norms.”

According to the Tax Justice Network, the countries that voted against the resolution are responsible for 75% of global tax evasion and only represent around 15% of the global population. All told, an estimated $480 billion in tax revenue is lost each year as a result of evasion – money that could otherwise be spent on public schooling, transportation, health systems, and much needed programs for the just transition.

While the total amount of money lost to tax evasion is significantly smaller in lower-income countries, the total share of public budgets that they lose is much higher. On average, lower-income countries lose about $47 billion each year – representing almost half of their annual budgets for public health.

The scale of tax abuse is so great under the current system that currently, African countries lose more through tax abuses than the total amount of foreign development aid per year.

The OECD itself recognized that it was failing to prevent tax abuse so in 2016 it created a special framework that now includes over 140 countries with the goal to establish new tax rules. This is called the OECD/G20 inclusive framework and was heralded by some as a much needed step towards global inclusivity in taxation.

Critics have argued that it hasn’t meaningfully challenged the skewed nature of global rule setting. The Tax Justice Network argues that the OECD’s lack of transparency, bias towards OECD member states. The fact that its key members are the same countries responsible for tax abuses mean that it is unsuitable to be the body determining how global tax rules are set.

The fight for a seat at the table

For decades, the dominant narrative of tax evasion was that poor administrative infrastructures facilitated corruption within low-income nations, squarely placing the blame on the countries suffering the most from the evasion. Through years of lobbying, campaigning, and organizing, Global South-led coalitions of civil society organizations and political leaders fought for recognition that tax abuses were inherent to the current system, and that meaningful change was needed. The reality was clear – a tax system that was built by the richest countries of the world would never provide justice to the Global South.

In 2015, the G77 group of developing countries tabled an earlier motion to legislate taxes at the UN in a meeting at Addis Ababa. Then, amidst heavy lobbying by countries of the OECD, the resolution tabled at the summit in Addis Ababa was rejected.

At the time, the slogan supporting the change was “if you’re not at the table, you’re on the menu”. If the talks at Addis Ababa represented a failed effort to establish more equitable tax rules, the passing of the resolution at the UN last year, nearly a decade later, shows the resolve and durability of solidarity movements of the Global South.

The proposed UN tax convention represents yet another instance of powerful Global South solidarity, such as what we have seen in the Global South’s rallying support for South Africa’s genocide case against Israel, and the near-unanimous Global South support for the COVID vaccine patent waiver at the peak of the pandemic.

A just and solidaire foreign policy is out there – in this case at least, it’s just not the Global North leading it.

While debate still needs to take place on what exactly the tax convention will consist of, it represents a success in forcing a more inclusive and democratic future for setting the rules of taxation. The Global South has shown that international solidarity can force meaningful changes in a regime built against their interests. With the UN becoming the leading institution for tax reform, the majority of the world’s population will finally have representation at the taxation rule table.

Full view of the UNGA hall

Lawmakers, Progressive Leaders Urge Reorientation of Foreign Policy as a 2024 Imperative

On February 6, Members of Congress and progressive movement leaders gathered at a conference hosted by the Center for International Policy (CIP), demanding changes to US foreign policy decisions as a necessity in a consequential year that will determine the trajectory of the US both at home and globally.

In a keynote address seen by over 60,000 people, Senator Bernie Sanders (I-VT) argued that the concentration of wealth and power foments war, violence and mass insecurity for everyday people globally, benefiting billionaires at the expense of whole families, nations, peoples and regions and declared that, “For many decades we have seen a ‘bipartisan consensus’ on foreign policy—a consensus which, sadly, has almost always been wrong.”

Pointing to the distorting influence of moneyed forces ranging from AIPAC, super PACs, big defense contractors, fossil fuel companies, pharmaceutical companies, oligarchs supporting Putin, Trump and other autocrats, and other multi-billionaires and multinational corporations; as well as the growth of right-wing extremism, tax havens and economic inequality, Senator Sanders declared, “It’s hard to overstate just how fundamentally this broken global financial system undermines faith in democracy and saps our ability to deal with the pressing crises we face today.”

“​​We live in a world where a small number of multi-billionaires and multinational corporations exert enormous economic and political power over virtually every country on earth,” added Sanders. “That reality has a huge impact on all aspects of our foreign policy and whether or not we will be able to effectively address the major crises we face.”

In a “Congress and Progressive Foreign Policy” session, Members of Congress discussed their personal pathways to foreign policy and outlined key challenges and opportunities for a “people-centered national security” that delivers for people in the US and the Global South, recognizes the interdependence of domestic and foreign policy on issues like migration and climate change, and allows the outside world to interact with the US in positive ways like refugee resettlement rather than negative, militarized interactions.

“Nowadays, most people are interacting with the United States through drones, through weapons that are made in the US that are in the hands of dictators, police or their military, or they’re interacting with us in regards to sanctions that are making it hard for them to have necessary medication and food. And that creates a national security problem for us,” said Representative Ilhan Omar (D-MN).

“We’ve spent more on border security since 2013 than was in the immigration reform bill of 2013. And we’ve seen no improvement in anything because we haven’t fundamentally shifted the system. So we have to think about, how do we invest in other countries? Our foreign policy is directly tied to this,” added Representative Pramila Jayapal (D-WA).

“What I would like to see is a people-centered security, where the United States can actually engage with people of a nation, and help empower them, help them pursue freedom and dignity on their terms, not necessarily our terms,” concluded Representative Jason Crow (D-CO).

In “Prioritizing a Progressive Foreign Policy Agenda,” regional experts discussed strategies for the US to reorient its relations to better serve the people and address the realities and needs on the ground. Speaking to the pitfalls of Great Power Competition and the Cold War as frameworks for US-China relations, China expert Ali Wyne declared, “Diplomacy is not something that you do out of kindness to competitors. It’s something that you do to advance your own national interest.” “We can’t support a progressive movement in Ukraine if they’re dead,” emphasized Terrell Jermaine Starr. Speaking on Latin America, María José Espinosa Carillo stressed, “We have deep connections with the region, not only through our borders, but also through funding and economic ties. But what’s more important, there is a renewed vision of the region.”

In “The Political Necessity of a New Foreign Policy,” movement leaders from MoveOn, Center for American Progress, AFL-CIO and Win Without War explored the intersection of domestic and foreign affairs, offering their analysis of policy tradeoffs and highlighting how they see these issues moving the progressive base.

“That [progressive foreign policy] actually is not just a morally and ethical position, but it is an electorally salient one, one that is a winning position in elections,” declared MoveOn executive director Rahna Epting. “With Biden, he campaigned in 2020 promising to end endless wars, and that helped him win. That was one of the reasons I believe helped him win in that election cycle. And now we see Donald Trump poised to exploit the current situation in Israel Gaza and how that’s going to show up in November.” 

Center for American Progress president and CEO Patrick Gaspard described the threat of antidemocratic forces at home and abroad, and said, “We’re now in a place of the world where you win votes by arguing that you build a moat around yourselves and pull up the drawbridge, our progressive transnationalism, internationalism is not actually ascendant. We should recognize that and we should fight fiercely.”

This fight for democracy at home and abroad takes place not just at the ballot box but in workplaces too. Cathy Feingold, International Director for the AFL-CIO, argued we must recast our priorities in favor of “ worker-centered security,” explaining, “It sends a very specific message to people in this country and around the world who are working day in and day out and want to make sure that they can live with dignity. I have found that workers here and workers around the world are interconnected.”

Win Without War executive director Sara Haghdoosti added, “We talk about foreign policy like there are not people in this country who have family connections, and deep commitment to what happens around the world. And it’s just not okay. That’s not how people work.”

View all the key moments from the conference on YouTube here and read opening remarks from CIP president and CEO Nancy Okail here.