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16. July 2007

Americans uneasy over job security

WASHINGTON: The US stock market is at an all-time high, unemployment is near record lows, yet poll after poll shows American workers uneasy over job security and worried that they are losing out in a global economy.

The disconnect between the seemingly rosy economic data and the dour mood has caught the attention of some influential politicians who are concerned the middle class has soured on globalisation, tingeing the debate on hot-button issues ranging from immigration to trade.

On the same day in June that Republican senators scuttled a US immigration bill, many Democrats were applauding the demise of the fast-track trade authority that the Bush administration desperately wanted.

Rep Barney Frank, who chairs the House of Representatives Financial Services Committee, sees a link. "Both of those died because of problems that were extrinsic," the Massachusetts Democrat said, adding that many workers harboured "deep anger" over stagnant wages and widening income inequality, and were quick to pin the blame on illegal immigrants, China or regional trade deals like Nafta.

"The globalisation issue is one that is menacing to many," House Speaker Nancy Pelosi said.

"We want it to be promising to more."

Manufacturing job losses and recalls of potentially harmful Chinese-made goods have hardened negative attitudes. A recent survey from the Financial Services Forum found that 49 per cent of Americans had a favorable view of globalisation, down from 54pc a year earlier.

When economics and politics meet, it is not always a perfect fit, so the flat wages that stoke worker anxiety actually come as a bit of relief to economists who fret over an overheating job market and inflation.

That makes policy decisions all the more tricky, and even many Democrats are shying away from hard anti-trade stances like import tariffs for fear of shutting off profitable trade.

Emboldened by last November's congressional sweep and optimistic about their chances in the next election, Pelosi and other Democrats are pushing for a stronger safety net to support those hurt by competition from low-wage countries.

A study released last month by economists Matthew Slaughter, Grant Aldonas and Robert Lawrence said that the average American family stands to gain as much as $15,000 per year from global trade that boosts productivity and opens new markets for US goods and services.

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