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

The Need To Redistribute Income Is Real

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If you want to get people riled up, whisper "redistribution."
 
Well, sorry about this, but that is what we need. We need to re-establish what might be called "the comfortable class." Those are the people we used to call the middle class until the politicians, with a helping hand from the media, characterized everyone who worked as middle class.
 
When we had a working class and a middle class, the working class could aspire to join the middle class, and the middle class could aspire to join the upper middle class, which might also be thought of as the managerial or professional class.
 
The professional class is still mostly intact; it includes doctors, dentists, corporate lawyers and some scientists. But the rest of us, unless we are protected by government employment, are standing on the edge of a precipice, and some are already on the way down.
 
There are many problems with our social structure today, not the least of which is that many forms of work have been endangered or have disappeared. Look around you.
 
You do not have to look far to see whole swaths of employment that have disappeared; either moved overseas or have fallen prey to the predations of the computer. I treasure my electronic reading device, but every time I switch it on, a parade of ghosts passes before me: book designers, papermakers, printers, bookbinders, warehousemen, drivers, sales assistants and store cleaners. Well, they are just the book people who the clever device has rendered obsolete.
 
Then there is the whole issue of the future of retail in general, and shopping centers in particular. A young person told me recently that the mall was for hanging out, but shopping should be done on the Web. Retailing has always been poorly paid but, even there, the middle class had a foothold with its managers, marketing specialists and all those aspiring sales assistants.
 
A new book is all the rage in circles that care about such things, and it is causing economists to rethink the inequality that wage-fear has made possible; the fact that the minimum-wage and low-wage structure now prevails in many states and is spreading.
 
The book is "Capital in the Twenty-First Century" by Thomas Piketty. It lays out how money is being concentrated in fewer and fewer hands with more of it belonging not to those who earned it, but to those who inherited it. With sound, but not spectacular investment, the owner of a few billion dollars will almost certainly pass even greater wealth on to his or her heirs in a never-ending column of money, creating the greatest concentration of wealth in history.
 
Yet there is nothing pushing up our earnings.
 
Instead, there are many forces pushing them down — from the inability of the unions to adjust to the times to the constant endeavor by states, such as Texas, to suck high-wage jobs out of other states and beggar the workers. Employers do not want to pay more than necessary and, of course, there is computerization.
 
Lower wages mean less spending, more low-wage jobs, fewer people in the middle class, fewer "comfortable" people.
 
Martin Wolf, the esteemed columnist of the Financial Times, points out that where redistribution is practiced as a continual part of the political process, as in Scandinavia, there is generally universal prosperity and a measurable middle class, enjoying a lot of social services. In Latin America, where you have an oligarchy of the kind forming here, there is little prosperity and consequent human suffering.
 
In history, there have been savage periods of redistribution. Henry VIII seized the abbeys because that was where the wealth was; Oliver Cromwell had the same idea. The French overdid it terribly in 1789, the Russians in 1917. And the British ran taxes up to 90 percent of income after World War II with predictable, devastating results.
 
Societies work best when they are flexible without rigidities; the rise of incalculable billions in the hands of the very few while general incomes are falling creates a cruel and dangerous rigidity. Worse, concentrated wealth overwhelms democracy.
 
Whisper it: "redistribution."  – For the Hearst-New York Times Syndicate
 

Requiem for the American Dream

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There is such a chorus from the punditocracy declaring the American Dream dead that one is scared to lay one's head down at night. A quick Google search reveals that there are at least a dozen books declaring the end to what is the American ethos: a dream in which everyone could graduate to the middle class with a lifetime of dignified employment with a pension, and good educations for their children.
 
Like all declines, there are many threads to the change that is wracking the country. Some of them:
 
  • There has been a dislocation between the growth in productivity and the growth in wages. Hedrick Smith points this out in his excellent and detailed book, “The American Dream and Who Stole It.”
 
  • The years of great national prosperity lasted from the end of World War II until it began to erode savagely toward the end of the last century. Smith dates the rot all the way back to the Carter administration, but most of us were not aware of it until much later.
 
  • If the workers are not sharing in the growth in productivity, we have severely reversed upward social mobility and the enduring belief of an immigrant people that their children would have a better life.
 
The failure of institutions to mobilize against what was patently happening is extraordinary and, in its way, peculiarly American. Our sense of exceptionalism leads us to avoid collective action.
 
Unionism, which has always been a force for incorporating productivity gains into wage packets, has been muted and itself has failed to grasp what is happening. While the world was changing, the unions were lost in old labor-management struggles of an irrelevant past. Management learned they no longer had to sit and take it: They could move to union-free locations like the South, and ultimately Asia. Collectively we watched our own decline in silence.
 
The monied class learned how to buy Congress and turn the watchdog into the enabler of the looter. A powerful new breed of lobbyist — often men and women who had served either in Congress or as congressional aides — threw themselves into the business of making sure that the money people (the corporations and super-rich individuals) got whatever the wanted; subsidies, light regulation, tax breaks and exemptions and, finally, light taxes.
 
As running for office — never easy in the House with its two-year election cycle — became more expensive, elected officials became more vulnerable to campaign contributions. Now it is a giant system of bribery in which neither the bribers nor the bribed feel shame; there are willing buyers and sellers of the U.S. government as farmers buy and sell cattle. This trading money for favors is well documented in Mark Leibovich's book, “This Town.”
 
Everyone who works on Capitol Hill and its lobbies knows what is going on. Money is changing hands for influence, and legislation is being passed favoring big business and big money. You can buy permission to pollute, buy a change in securities laws and buy favorable tax treatment. And you can secure the minimum wage at below poverty levels.
 
It used to be, as one long-term lobbyist explained to me, that if you wanted favors on Capitol Hill you had to assemble a large and transparent coalition of people who would benefit from the change in law that your client wanted. You had to get many interests on board and persuade some newspaper commentators of your high purpose. Now, this veteran said, you just do it with money — in the dark, he might have added.
 
The Chinese did not send an armada of junks to take out jobs; we exported them for short-term gain. We embraced the myth that cheaper goods were better for our people. They are – if we have money to pay for them.
 
The middle class, to use the vernacular of the moment, has been thrown under the bus.
 
The tea party, briefly the hope for middle-class salvation, drank from the horn of myths spread by the monied class. Now, in their folly, they are supporting a destructive shutdown of the government, which will further damage the middle class.
 
Of course it is not just venality that has brought us to our dreamless state: rapid technological change, and the decline in the need for whole classes of work present a serious challenge. But who is taking up the challenge? Not Congress, whose members are mostly millionaires; not the tea party; not the unions.
 
Fancy a double espresso before bed? — For the Hearst-New York Times Syndicate