White House Chronicle

News Analysis With a Sense of Humor

It Isn’t Your Father’s Workplace Anymore

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One thing we think we know about the Republicans is that they take a dim view of waste, fraud and abuse. So how come the U.S. House of Representatives, in Republican hands, has voted 56 times to repeal or cripple the Affordable Care Act, better known as Obamacare?

They’ve put forth this extraordinary effort despite an explicit veto threat from President Obama. Their repeated effort reminds one of Onan in the Bible, which politely says he spilled his seed on the ground.

It’s a waste of the legislative calendar and the talents of the House members. It’s a fraud because it gives the impression that the House is doing the people’s business when it is holding a protracted political rally. It’s an abuse of those who need health care because it introduces uncertainty into the system for providers, from the insurers to the home-care visitors.

It’s symptomatic of the political hooliganism which has taken over our politics, where there is little to choose between the protagonists.

Republican groups think that Obama is the doer of all evil in the nation – especially to the economy — and the world. Daily their Democratic counterparts gush vitriol against all the potential Republican presidential candidates, only pausing for an aside about the wickedness of Fox News.

Their common accusation is middle-class job woes. They’re on to something about jobs, but not the way the debate on jobs is being framed.

The political view of jobs is more jobs of the kind that we once thought of as normal and inevitable. But nature of work is changing rapidly, and it cries out for analysis.

The model of the corporation that employs a worker at reasonable wages which rise every year, toward a defined benefit pension, is over. Today’s businesses are moving toward a model of employment at will; the job equivalent of the just-in-time supply chain.

While more of us are becoming, in fact, self-employed, the structure of law and practice hasn’t been modified to accommodate the worker who may never know reliable, full-time employment.

The middle-class job market is being commoditized, as the pay-per-hour labor market includes everything from construction to network administration. Sports Illustrated — synonymous with great photography — has just fired all six of its staff photographers. Don’t worry the great plays will still be recorded and the Swimsuit Issue will still titillate, but the pictures will be taken by freelancers and amateurs.

Two forces are changing the nature of work. First, the reality that has devastated manufacturing: U.S. workers are in competition with the global labor pool, and business will always take low-cost option. If unemployment goes up in China, that will be felt in the U.S. workplace. Second is the march of technology; its disruptive impact is the new normal — accelerated change is here to stay.

All is not gloom. The trick is to let the old go – particularly difficult for Democrats — and to let the new in. There will be new entrepreneurs; more small, nimble businesses; and whole new directions of endeavor, from gastro-tourism to cottage-industry manufacturing, utilizing 3-D printing. Individuals will be free in a new way.

Government needs to think about this and devise a new infrastructure that recognizes that the nature of work is changing. The emerging new economy should have simplified taxes and Social Security payments for the self-employed; portable, affordable health care; and universal catastrophe insurance, so that those who are not under an employer umbrella can benefit from the equivalent of workers’ compensation. The self-employed, rightly, fear the day they can’t work.

Rugged individualism has a new face. The political class needs to look and see the new workplace. — For the Hearst-New York Times Syndicate

Cheerio, Your Job Has Been Computerized

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Some thoughts about work. It is under attack from a giant labor pool of maybe 200 million eager and qualified people in Asia and elsewhere, who will do it for less than it costs in the United States.
 
It also is under attack everywhere from computerization. Stated bluntly: if jobs are not going to Asia, they may be going to the cloud. The service sector, once the saving grace of the post-industrial world of work, is being computerized: no more people needed. 
 
The somber back story at the recent National Federation of Retailers annual convention and expo at the Javits Center in New York City, as recorded in The Washington Post, was not about new shopping centers, point-of-sale displays, the minimum wage or offshore call centers for warranties: it was about Amazon. Online retailing is eating up traditional retailing — and retailers have seen the future, and it is bleak.
 
Two University of Oxford researchers, Carl Benedikt Frey and Michael A. Osborne, recently calculated that 47 percent of American jobs are under threat from computerization. The only major publication that dwelt on this extraordinary study was The Economist.
 
Even those spoiled children of society, university professors, are feeling the cold winds from the computer vortex. Online learning is shaking up the quietude in the ivory towers. While they have to do something to improve the productivity of their academic staffs, this is not the way.
 
Against this threatening employment sky rages the debate over the minimum wage. But it is a debate that is too narrow; too much about the short-term interests of the employers of minimum-wage earners and too little, if at all, about the endangered workplace. The spurious argument is that any increase in the minimum wage will drive employers to install more computer substitution of workers. 
 
They are hell-bent on that anyway. Look around: checkout counters are being automated; book manufacture is threatened by e-readers; telephones are answered by other telephones, guided by the unseen hand of computers. Soon even those vilified call-center jobs in India, will be under threat. Here, your doctor will not want as many support staff, as records go the Web.
 
The minimum wage should be raised. It will not stop the rush to substitute humans with computer-driven gadgets. When a machine can be finely tuned to cook and serve hamburgers, a machine will be cooking and serving hamburgers. All those untruths about jobs in fast-food chains being only entry level will fade away. 
 
Meanwhile, go into any fast food outlet and count the people who are middle-aged: They are not there because it is a way in. It is a way of hanging on – especially for African Americans and Hispanics. The same is true for hotel room cleaning, chicken-plucking in processing plants, cleaning toilets in commercial buildings, warehouse working and those toiling in the night kitchens of bakeries. Entry into what? Hell?
 
I once earned the minimum wage in New York City. At the hiring hall, I can tell you, there were only those exiting the job world not entering it.
 
You will not get rich driving a non-union truck, either. Delivery people do it because they have no other skill and almost none of them are candidates for retraining, another shibboleth. Wherever there is menial work that is not unionized, there is economic misery.
 
Recently, I attended a conference in Europe — where the jobs problem is as bad as here, and possibly more intransigent — and speakers were talking openly about a decline in the standard of living. We, in the United States, are not immune. Those who have enjoyed middle-class comfort may have to face a devaluation in their quality of life: less and crowded housing, less travel, a smaller, older car or no car, more hourly work and less security, no medical procedures for ailments that some computer may deem elective. Grimmer daily lives that are more 19th century than 21st century.
 
The debate over the minimum wage ought to be a national discussion of the future of work. A rising tide does not lift all the boats anymore. — For the Hearst-New York Times Syndicate


Denigrating the Unemployed; at Christmas, Yet

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In order to execute an abomination, it helps to create myths about the victims: the Jews aim for world domination, all gypsies are thieves, all blacks abuse government assistance programs.
 
It's a national abomination that 1.3 million Americans lost their extended unemployment benefits over Christmas. Bring forth the myth: Extending benefits only causes the unemployed to prolong their search for work, or not to look for work at all. End the benefits and they'll find work.
 
This suggests that suddenly unemployment will fall nationally from 7 percent to who knows? Myths are great for ratiocination. Want to bet that ending extended unemployment benefits won't move the unemployment number at all?
 
Being unemployed isn't a vacation. It's not a glorious excuse to watch television at home and snigger at working stiffs who get a paycheck, have savings, take vacations, hope for promotions, and whose children will be able to afford to go to college.
 
Unemployment means cold economic fear — fear of not being able to provide for yourself and your loved ones; fear that your marriage will crumble; fear that your children will have the humiliation of not having the clothes, the electronic gadgets, the sports equipment, the vacations, the meals out and the college education, without which one is doomed to second-rateness.
 
What happens when a breadwinner loses a job? Fear for the future becomes a constant companion: it erodes the good times of family life and confiscates future plans. The specter of hunger and homelessness pushes out laughter and dreams. Worry moves in and begins to dominate a household; an unwelcome but palpable presence.
 
People who are sick to their stomachs with economic worry don't laugh much. Joblessness silences the normal joys of life.
 
Unemployment is not something I've read about. As a young man, I suffered its debilitating privations both in London and in New York. I was even evicted from an apartment in New York because I couldn't pay the rent. Where will I go? How will I eat? What will become of me. These survival fears are multiplied a hundredfold when there are dependent children.
 
The jobless, although they may be so through no fault of their own, blame themselves and sink into self-flagellating despair. The desire to work where there is no work is a hunger to belong, a hunger to be useful, a hunger to provide for loved ones, and a hunger for the simple dignity of going to work.
 
Going to work is a beautiful thing. Not going to work is an ugly thing – ugly in all the horrors that can descend on a person or a family.
 
Unemployment insurance is not the solution, but it's a help; it's not a substitution, just a help – a desperately important shelter in a storm. It's not, as one conservative commentator suggested, about paying people not to work. It's about paying people to live, until they find work in an economy that is changing the very nature of work.
 
In his masterpiece “The Sun Also Rises,” Ernest Hemingway wrote:
 
“How did you go bankrupt?” Bill asked.

“Two ways,” Mike said. “Gradually, then suddenly.”
 
If Congress follows Senate Majority leader Harry Reid's plan to pass a three-month unemployment benefits extension when it reconvenes on January 6, then a ghastly Christmas nightmare will be somewhat alleviated for 1.3 million Americans, who gradually or suddenly fell out of work – and some into bankruptcy – and will still have to pound the pavements, looking for those elusive jobs that will bring hope and dignity back into their shattered lives.
 
No unemployment checks for our fellow Americans is an abomination, originating with congressional indifference, buttressed by conservative mythology. — For the Hearst-New York Times Syndicate

How Computers Are Trashing the Old Ways of Work

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I saw the future outside my apartment building this week — and it was a brown van. To be exact, it was a United Parcel Service van and the operator was struggling with a huge load of parcels on a hand truck.
 
You can’t tell too much from a parcel, but the shape gives the contents away to some extent: a small, rolled carpet; a large, flat-screen television; about a dozen boxes that could contain a variety of goods — goodies for fun and essentials to keep things going. Talk about Frankie Laines’1949 hit “Mule Train.”
 
Every day the UPS delivery man is at our building, sometimes with more, sometimes with less. Sometimes he brings clothes for my wife, and recently he brought a book for me. What the trusty fellow in the brown van doesn’t unload, his compatriots from FedEx and the United States Postal Service do.
 
A sea of goods flow into this building each day; goods that have never seen a retail store, never been offered for sale in a mall or high street shop, but goods that people want anyway. Welcome to online shopping and the future disruption it'll bring.
 
What's missing with this shopping is the shop, whether it's a big box store in the mall or a ma-and-pa operation on the high street.
 
It's part of one of the great historical revolution brought about by the Internet. All the data show that online shopping grows every day.
 
Eventually, in the way that the malls undermined the neighborhood shop and the chains killed off those wonderful downtown department stores, a different one for each city (Garfinkel's in Washington, D.C., Jordan Marsh in Boston and I. Magnin in San Francisco), the Internet may bury the malls.
 
Make no mistake, the Internet is a hellishly efficient and cruel exterminator of jobs, as well as a ruthless agent of social change.
 
As so often, the political class is still convinced that job growth can be achieved by economic and regulatory policy shifts. It's easier to blame presidents Barack Obama and George W. Bush, depending on your ideological persuasion, even though the evidence of massive change is everywhere, than to face a new reality.
 
It's nigh impossible to speak to anyone on the phone at a bank, an insurance company or a utility without going through 20 minutes of computer-assisted torture in the form of voice prompts — “Press star 2 to get your balance.”
 
Academia has been surprisingly slow to study and quantify the job-threatening nature of the new order. MIT, Oxford and Harvard have spoken up, and now you can expect more pessimism from on high as academics get the wind up about their own employment.
 
In the ivory towers, those citadels of refined arrogance, there is deep disquiet. The cause: MOOCS, or massive open online courses. These are attracting students by the hundreds of thousands; some for credit, some just for the joy of watching the most articulate professors in action. They are creating a star system that favors the telegenic over everything else and could, in time, change the nature of higher education so profoundly that many lesser university will close up shop. One study, by researchers at Oxford, has estimated 47 percent of our jobs may disappear.
 
History tells us that new ways of doing things lead to new areas of endeavor; agrarian people became urban manufacturers, manual labor gave way to service-sector work. The computerization of work is an equal-opportunity un-employer. Is new work possible?
Factories in China and Germany are as subject to computer predation as those in the United States. We may yet see a global economic collapse driven by too much productivity; computer productivity.
 
This column was written on a computer and distributed by computer. The contents were generated by a human being, but that may change. Stay online. — For the Hearst-New York Times Syndicate
 
 
 
 

 

Is There a Jobs Catastrophe in the Making?

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Disruption is in the air: disruption in Congress, disruption in the workplace, disruption in the well-being of the middle class. History may well term this the Age of Disruption.
 
This need not be all bad.
 
Disruption is only a problem if it is poorly managed, or if forces beyond control devastate existing order. Take the Russian Revolution or the recent tsunamis in Asia. Nowadays, we tend to think of disruption as being uniquely in the province of technology – and it is this disruption that harbors the most future shock.
 
The most serious disruption now getting underway is the disappearance of jobs; not the replacement of old jobs, but the utter disappearance of jobs. Jobs that once were are going into the ether or, call it what you will, to the cloud. Gone for good.
 
For the first time since the Industrial Revolution was ushered in by the substitution of human and animal labor by shaft horsepower derived from a waterwheel or a steam engine, technology is subtracting jobs rather than adding them. This is a disruption that hurts.
 
From Oxford University comes one of the most disquieting studies on the future yet to appear. Two researchers, Carl Benedikt Frey and Michael A. Osborne, predict that 47 percent of American jobs are at risk in the coming years from computerization.
 
Their conclusions are stupefying: nearly half the jobs in the United States could disappear in a few short years. Worse, according to the Oxford University researchers these jobs will affect the great middle reaches of employment, from the white-collar jobs down to unskilled workers.
 
Their study “The Future of Employment: How Susceptible Are Jobs to Computerization?” should have every parent and every policy wonk asking: What should be done? What can we do to save half of the population from not being able to find a job at any level, of being driven to compete for minimum-wage employment?
 
Until now, each leap forward in technology and its corresponding increase in productivity has had two effects:

1. The economic benefits have been shared with the workers. That has ended.

2. New prosperity from automation always led to new demand for more goods and services. This maybe ending. Depressed wages do not lead to new purchases.

In turn, this history has led to a pervasive economic myth that the relationship between automation – even automation using advanced computers – will always lead to more jobs and more prosperity.
 
Yet the market for labor is changing dramatically, and that lockstep has lasted pretty well since the first loom in England substituted shaft horsepower for human labor in the 18th century.
 
That happy union may be broken. The Oxford researchers, in a National Public Radio interview, suggested that the only safe jobs might be those that require a high degree of education and interpersonal skills like the law, teaching and management consulting.
 
My own daily reminder of the world of jobs that is changing is my Kindle. It reproves me. Its value is that I am never without a new book, and it is more portable than any but small pocket books.
 
But I used to publish books and every time I open the electronic book, I think of the long chain of people who were involved in making a book years ago: typesetters, printers, binders, warehouse staff, book wholesalers, and finally the clerks who took your money — all worthwhile jobs with dignity.
 
Books and book stores are not worse hit than many other things, but they are suffering. When did you last speak to a person at your bank, airline, insurance company or utility?
 
A nation that does all of its business online may be efficient in the short term until online leads to the breadline.
 
Disruption is the new normal and we need to understand it. New industries need to be sought. An example of a newish industry that has flourished in recent decades is tourism. A century ago, a few rich people traveled. Now tourism is the world's largest employer.
 
Old remedies for new problems won't do it. The jobs deficit won't be fixed by what we seem to have on the table: lower corporate taxes and less unionism. Less general wealth is the wrong kind of disruption and we are heading that way. — For the Hearst-New York Times Syndicate

Stand Up to NIMBY — and Create Jobs

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In Britain, they call it “DADA.” It means Decide. Announce. Defend. Abandon.

In America we call it “NIMBY” — “not in my back yard.”

It applies to all kinds of infrastructure construction, from airports to roads. But it is electric and gas utilities that feel the brunt of local opposition.

These localized forces of “no” have caused the buildup of a substantial backlog of infrastructure projects, not only for sexy green-energy technologies but also for the traditional needs of energy production and distribution — pipelines, power lines, replacement of aging equipment and the construction of new facilities to meet new loads and move the energy infrastructure into the 21st century.

It also includes old-fashioned technology — meters, switches, transformers — to get new green electricity to the consumer.

A new study, from a group advocating upgrading energy facilities, says the pent-up need for utilities to start these projects is so great that if the impediments can be dealt with, 250,000 jobs can be created almost immediately, without action from Congress or a raid on the federal treasury.

The group, Build America Now, is headed by a veteran utility consultant Steven Mitnick, who has advised the governor of New York, headed his own electric transmission company, and was a senior strategist in the electric and gas practice of McKinsey & Co., the consulting firm.

According to Mitnick, the backlog buildup in the utility sector could be a bonanza for the Obama administration. He calculates that if the Gulliver of energy projects can be freed from the Lilliputian ties of local regulatory opposition, unemployment would be reduced by two-tenths of 1 percent. Not inconsiderable.

Mitnick told me the beauty of pushing these utility projects is that they would be financed by the utilities and “they really are shovel-ready.” Whereas Obama’s much-discussed green jobs will one day pay off, Mitnick believes these more traditional jobs — which he calls “backbone” jobs — are in the starter’s gate.

The study provides lists of utilities and gas companies and their projects that stretch across the energy field. In essence, Mitnick is saying that there are jobs in energy here and now and that they deserve a political shove, especially at the state level.

Here are some examples:

•In Minnesota, five transmission lines have been proposed, creating 7,800 jobs.

•In New Jersey, Spectra Energy has proposed to build a gas pipeline, creating 700 new jobs.

•In Texas, Panda Energy is building a power plant using natural gas, creating 500 jobs.

•In Colorado, Xcel Energy is retiring some coal-fired plants, installing pollution-control equipment in others and building new natural gas plants, creating 1,254 jobs.

The biggest job growth by far is associated with shale gas in the states of New York, Pennsylvania and West Virginia: a whopping 165,000 jobs.

When I asked Mitnick why these projects and others have been allowed to back up, he calculated that naysayers, the NIMBY folk, had swarmed state regulators for years, forcing the companies into defensive inaction.

But the midterm elections may have changed all that.

“Governors and state legislators were elected to put job-creation and economic development as priority No. 1,” Mitnick said. Therefore, in the new climate, opponents of growth can be reasoned with or sidestepped when jobs are at stake.

“The governors simply need to get the word out to state regulators that the world has changed and regulators need to make job-creation and economic growth part of the equation,” Mitnick said.

So it is back to the future, according to Mitnick, who taught economics at Georgetown University early in his career.

“Throughout the 20th century, utilities and energy companies were engines of growth because they could efficiently finance infrastructure growth,” he said.

Will an explosion of energy infrastructure jobs push up utility bills? Not much, Mitnick said, because most of an energy bill is for fuel and taxes. Besides, there would be an efficiency premium for the consumer, he added.

The idea here is not that it is green vs. brown, but now vs. later.