By BOB DAVIS / Staff Reporter of THE WALL STREET JOURNAL
NEW YORK -- Democratic presidential candidate Bill Bradley plans to call for "earnings insurance" for workers laid off because of new trade deals, as a way to ease labor opposition to globalization.
The proposal forms the core of Mr. Bradley's plan to sustain U.S. economic performance, which he will unveil in a speech Wednesday at Columbia University. Mr. Bradley also plans to endorse a new global round of trade negotiations and China's admission into the World Trade Organization. In addition, he is expected to call for a program of "Infostamps," patterned after food stamps to help the poor buy computers and software so they can better participate in the high-tech economy.
Mr. Bradley's ideas are bound to have resonance within the Democratic Party, whether or not he wins the presidential nomination. He has long been a leading Democratic thinker on global issues, and worked in the Senate to expand trade and help ease Latin America's debt crisis of the 1980s. But Mr. Bradley's plan is silent on his signature issue from his Senate days: tax reform. A draft of his speech deals with that issue by declaring that "a politically inspired bidding war for tax cuts must be resisted at all costs" -- a swipe at Republican presidential candidates.
'Titanic Tuesday'
Mr. Bradley also is looking ahead to next Tuesday's vote in Washington state that isn't used to select delegates. He is betting that a win there would generate enough momentum to carry him through the March 7 "Titanic Tuesday" battle, when 16 states choose delegates. Mr. Bradley's trade pronouncements are sure to attract attention in the state, whose economy is tied up in international trade, but which has become a symbol of resistance to globalization because of protests at a WTO conference in Seattle late last year.
Portrait of Bill Bradley
At its core, the Bradley plan appeals to the notion that liberalized trade could help produce what he calls "broadly shared prosperity." His proposals are aimed at making trade deals more palatable to American workers and populists abroad. "The process of globalization is uniquely advantageous to the U.S.," Mr. Bradley said. He also said that global trade helps "the poorest countries in the world get a foothold on the ladder of success."
But liberalized trade is opposed by labor unions in the U.S. and populists abroad who see trade as a rigged game benefiting the rich. To help address those fears, his earnings-insurance program would subsidize workers laid off as a result of new trade deals, and who subsequently take jobs at lower salaries. The government would reimburse half their lost wages for three years.
For example, Mr. Bradley cites a factory worker earning $45,000 a year who loses his job when his factory closes due to import competition. Should that worker take a job at $25,000 a year, the government would reimburse for three years half his foregone salary, or $10,000 annually. The new program would supplement current trade-adjustment assistance, a program that provides displaced workers with extended unemployment payments during their job search and some retraining money.
Breaking Down the Opposition
Earnings insurance was proposed years ago by Brookings Institution economist Robert Litan and was recommended to the Bradley camp by Fred Bergsten, director of the Institute for International Economics. Mr. Bergsten said the Bradley campaign had envisioned offering such a program to all laid-off workers, but the estimated $10 billion annual cost was prohibitive. Instead, Mr. Bradley decided to focus the program only on workers affected by new trade deals, which he believes would reduce the cost to about $200 million a year after a new trade deal is negotiated.
"The issue is to try and remove the opposition building against free trade," Mr. Bradley said.
Economic studies show that workers laid off because of trade frequently can only find lower-wage jobs. Consequently they collect unemployment insurance for long periods of time, while they try to find better-paying work; earnings insurance is designed to give them additional incentive to take jobs quickly.
Mr. Bradley is releasing his economic proposals as part of a go-for-broke strategy of overtaking Vice President Al Gore, who is leading in the polls by wide margins. Along with high-toned policy pronouncements, Mr. Bradley is blasting Mr. Gore as lacking the character necessary to occupy the Oval Office.
'Old Politics'
In a speech at Adelphi University on Long Island Tuesday, he accused Mr. Gore of practicing "the old politics, the politics of distortion and attack and polls and consultants." The Gore campaign responded by setting up a "Bradley information bureau" on the Gore campaign's Web site to refute the challenger's assertions.
As part of his economic plan, Mr. Bradley calls for a new round of global trade liberalization after what he terms the "fiasco" of the Seattle meeting, which failed to launch new negotiations. He also strongly backs the inclusion of China within the WTO, which will likely come to a vote in Congress this spring.
Mr. Bradley was revising the speech late Tuesday. His idea for Infostamps wasn't in the draft version of the speech, although he said he would include it in the final version. The candidate didn't provide an estimate of the budgetary cost of Infostamps.
Write to Bob Davis at bob.davis@wsj.com1
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