Jeff Faux

Jeff Faux was the founder, and is now Distinguished Fellow, of the Economic Policy Institute.

Recent Articles

Time for a New Deal with Mexico

M exican President-elect Vicente Fox, fresh from a historic victory that ended 71 years of one-party rule in his country, dropped in on U.S. lameduck President Bill Clinton just before Labor Day. He was brimming with ideas for further integrating their economies, including a proposal to open the border to more Mexicans seeking work in the United States. The Clinton White House, which seven years ago sold NAFTA to Congress on the grounds that it would keep Mexican workers out, was unenthusiastic. Fox also visited Ottawa, where he proposed a single continental currency: the U.S. dollar. The Canadian response was frigid. "We're happy to maintain our own currency," sniffed Prime Minister Jean Chrétien. Despite the rebuffs, Fox has opened up a discussion that will not easily be shut down--nor should it be. A former president of Coca Cola Mexico, Fox is a free-trader faced with the reality that NAFTA did not deliver on its promise to raise the...

The Next Recession

A decade of prosperity has convinced a fair portion of the punditry that the new hi-tech service economy has lifted us into an economic orbit beyond boom and bust, where recessions are history. Unfortunately, there is little evidence that the laws of economic gravity no longer apply. Indeed, sensible people should now be preparing for the possibility that Alan Greenspan's effort to slow down the economy will overshoot and that we will soon face rising unemployment and a sinking stock market. To begin with, the length of the current expansion is less a product of some epochal transformation of the American economy than it is of the convergence of temporary economic trends and political events whose influence may have run its course. During its first five years, the current upturn was at best ordinary. After having fallen in 1991, the GDP rose at an average of a little above 3 percent annually through 1996, about the same as the previous two expansions and considerably less than earlier...

Solidarity Ever?

Has the new economy overtaken unions? 

Works Discussed in this Essay Stanley Aronowitz From the Ashes of the Old: American Labor and America's Future (Houghton Mifflin Company, 1998). Morton Bahr From the Telegraph to the Internet (National Press Books, 1998). Century Foundation Task Force Report on the Future of the American Labor Movement, 1999. John Sweeney was elected president of the AFL-CIO in October 1995. Frustrated by labor's shrinking share of the workforce, and shocked by the Democratic Party's loss of the House of Representatives the previous November, Sweeney and his allies staged the only successful revolt against a sitting labor federation president in this century. Given organized labor's historic role in supporting the liberal advances of the New Deal and Great Society, progressive precincts of American politics cheered the prospect of a reenergized AFL-CIO. During the first few months of the new regime, Sweeney and his team criss-crossed union halls all over the country preaching a gospel of aggressive...

Is The American Economic Model the Answer?

The financial elites that favor the "American" model -- deregulation, weak unions, and a minimalist welfare state -- ask the wrong question: how to compete against countries with lower wages and living standards.

N ot too many years ago, the conventional wisdom was that Europe and Japan did it all right, and the United States did it all wrong. And everything that could be learned, we could learn from them, and indeed, they had nothing to learn from us. Now, the new conventional wisdom is just the opposite; we're doing everything right, and Europe and Japan are doing everything wrong. Neither of those positions is correct. -- Secretary of Labor Robert Reich, Detroit Jobs Conference, March 14, 1994. T he economic elites of most advanced nations now believe that the United States offers the best model for competing in the new global economy. As commonly formulated, the argument holds that, compared with Europe, the United States has: Created more jobs. Thus, according to a recent commentary in the Washington Post: The record is unmistakably clear. Since 1970 the U.S. economy has generated 41 million new jobs. . . . By contrast, the European Union -- the new name for the European Community -- has...

Three Things We Learned

There is no silver lining to the cloud of horror that descended on America last week. And the avalanche of pain, terror, and death we have witnessed may be just the beginning. But life, as always, slowly picks up and moves on. Despite the nagging sense that it is unseemly to begin thinking about the economic consequences, the country is once again back in the market. Investors are selling the stocks of insurance companies and airlines, buying those of military contractors and companies that will benefit from the new security-conscious society. Economists are calculating the gains and losses and guessing about the odds of a recession. Many are engaged in burying the dead and tending to the survivors, or facing the awesome responsibility of satisfying the national demand for action that serves justice rather than multiplying evil. Those of us who are going back to business have an obligation, as we do, to reflect on what we have seen. The attacks of last Tuesday revealed some truths...

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