Jeff Faux

Jeff Faux is a distinguished fellow at the Economic Policy Institute, which he founded. His latest book, The Servant Economy (Wiley), was published in June 2012.

Recent Articles

Debate Club

The High Cost of Rubinomics By Jeff Faux If a Democratic president gets to replace Federal Reserve Chairman Alan Greenspan when the latter's term is up in 2006, Bob Rubin is the odds-on favorite. He has the financial credentials: Goldman-Sachs, U.S. Treasury, Citigroup. He raises money for Democrats. And he is credited with the one accomplishment of the Clinton era that all Democrats are proud of: eight years of peacetime economic growth that, by 2000, had produced something pretty close to full employment. As Rubin tells the story in his new memoirs, he persuaded Clinton early on to make financial-market "confidence" the administration's chief economic priority. Key to the strategy was Greenspan, who was supposedly concerned that spiraling federal deficits would ignite inflation, forcing him to raise interest rates and thus choke off growth. Cut the deficit, argued Rubin, and Greenspan will let the economy live. Clinton was an easy sell. He not only reduced the deficit but also went...

Robert Rubin's Contested Legacy

In an Uncertain World: Tough Choices From Wall Street to Washington By Robert Rubin and Jacob Weisberg, Random House, 448 pages, $35.00 If a Democratic president gets to replace Federal Reserve Chairman Alan Greenspan when the latter's term is up in 2006, Bob Rubin is the odds-on favorite. He has the financial credentials: Goldman-Sachs, U.S. Treasury, CitiGroup. He raises money for Democrats. And he is credited with the one accomplishment of the Clinton era that all Democrats are proud of: eight years of peacetime economic growth that, by 2000, had produced something pretty close to full employment. As Rubin tells the story in his new memoirs, he persuaded Clinton early on to make financial-market "confidence" the administration's chief economic priority. Key to the strategy was Greenspan, who was supposedly concerned that spiraling federal deficits would ignite inflation, forcing him to raise interest rates and thus choke off growth. Cut the deficit, argued Rubin, and Greenspan will...

How NAFTA Failed Mexico

During the 1993 battle over the North American Free Trade Agreement, the proposal's promoters' most politically effective argument was that NAFTA would keep Mexicans out of the United States. As political writer Elizabeth Drew later observed, "Anti-immigration was a sub-theme used, usually sotto voce, by the treaty's supporters." The voce was not always sotto. "We don't want a huge flow of illegal immigrants into the United States from Mexico," said former President Gerald Ford, speaking at one of then-President Bill Clinton's pro-NAFTA rallies. "If you defeat NAFTA, you have to share the responsibility for increased immigration into the United States, where they want jobs that are presently being held by Americans." Leaving aside the xenophobia, Ford's argument made economic sense: If NAFTA were to create more jobs in Mexico, fewer Mexican workers would leave. When people can earn a decent living in their own country, they would generally rather stay put. Thus although workers in the...

No Grasp

As they emerge from the wrecked political shelter of their "yes, but" support for the war in Iraq, Democrats are consoling themselves with the prospect of a post-Saddam Hussein return to normalcy -- in America. "Remember 1992," they whisper. "After we get this war behind us, the next election will be about the economy again, stupid." But the "war" will not be over by November 2004. Having successfully morphed the threat posed by al-Qaeda into the threat posed by rogue leaders -- and having morphed both into an open-ended commitment to global American empire -- George W. Bush has created a permanent wartime presidency. As he demonstrated in last year's election, fear of another terrorist attack now trumps domestic pain. In the first two years of this administration's watch, unemployment rose by 2 million, investors lost trillions in a scandal-ridden stock market and the health-care system in many parts of the country was in free fall. Yet Democrats lost both the House and the Senate...

A Tale of Two Cities

T wo political movements representing distinct visions of the global economy will hold their annual conventions the last week of January. The World Economic Forum -- an organization of some 1,000 multinational corporations -- will meet in Davos, a picture book ski resort in the Swiss Alps. The forum was organized 30 years ago to provide a discreet hideaway where businessmen-without-borders could socialize and strategize with one another and selected heads of state. Over the years, Davos has become less an exclusive retreat to do business and more a quasi-public conference on how to make the world safe for multinational capital. This year, more than 500 government officials, media pundits, leaders of churches and nongovernmental organizations (NGOs) such as the Red Cross, and "leading thinkers" will share cocktails and ideas with the captains of global capitalism. Meanwhile, some 7,000 miles away, a much larger group of environmental, labor and other social activists will gather in...

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