How Can We Protect American Workers

March 11, 2017

Trump’s power, and his policies on jobs, immigrants, religious and ethnic hatreds and the Alt-wrong are all related.

Scholars of intolerance tell us that threat breeds hate. I suspect that all we can say about why immigrants and Muslims are really good people only makes those who feel threatened feel more threatened, because instead of talking about their needs we’re praising someone else.

So I want to talk about the needs of Americans who feel threatened economically and what can be done regarding their economic losses, recognizing that the disfunction in American politics is partly due to the desperation of workers who’ve lost once good jobs.

Protecting American workers is crucial both because people suffer when they can’t find good jobs, and because desperate or threatened people take dangerous risks at the polls and elsewhere. We must protect workers both for their sakes and for ours; it’s much the same thing.

It’s our job because government fiscal, tax, programmatic and other policy decisions daily determine how many jobs there are. Some people can make their own opportunities, but, to be fair, most good, decent, hard-working people can’t.

What can we do about it? Sometimes it helps just to set out the options. Here are the choices I can see:

FDR created unemployment compensation and Nixon proposed a negative income tax – safety-net approaches based on direct income transfers. Many object, including those who benefit from handouts, tax loopholes, deductions, farm price supports, subsidies etc. – the tax code and the budget are replete with them. But direct financial transfers are one possibility.

A second approach is to pay for jobs indirectly through trade policies. All three presidential candidates talked about that. I understand the fear of foreign competition even though there are reasons to look for other solutions for American workers: limiting foreign imports hides the cost in the price of things we buy, and isolates the American economy from developments elsewhere. It also might not work; actual hiring decisions would rest on other people’s decisions. But we can’t overcome the fear if we can’t commit to other steps, and all the talk about the risk to Social Security fans that fear.

A third approach, the conservative free market approach, is not really a solution for the working person at all – it simply puts the monkey on workers’ backs to find jobs or starve.

A fourth approach is to create new jobs by government action – fiscal stimulus, infrastructure development, and investment in science and education, all of which call for construction, maintenance and technical jobs. That’s what Obama called for but Congress drastically whittled his effort down.

Why can’t government be employer of last resort? That would automatically support a minimum wage, create better communities, and make life better for all of us. It’s not the free lunch some people worry about; it’s a job. What’s so terrible about giving people what Tom Paxton called “a job of work to do”? There’s plenty to do if we were willing to invest in our people, our workers, our infrastructure, and our environment. Sometimes spending a little can make the community more attractive and the economy zing while providing a decent income to people who need a job.

Some countries use all of those methods and have quite robust economies.

Those are the alternatives I can see: the free marketeers’ defining it away as the workers’ problem, the safety net approach of income transfers, paying indirectly through trade policies or subsidies for the appearance of helping workers, or creating jobs through fiscal stimulus or hiring people to do needed work. My preference is to put people to work – that way protecting others is good for us all. One way or the other, standing up for each other is essential.

— This commentary was broadcast on WAMC Northeast Report, March 7, 2017.

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Amtrak Subsidy

August 25, 2015

I’d like to talk about an issue that has been below the surface of the news but reflects a constant disagreement in our politics. Economic conservatives would displace almost everything in favor of the marketplace. But when you decide what to pay for, what are you including or excluding from the transaction?

Perhaps you’ve been following the arguments about subsidizing Amtrak, for example.[1] The details are more complex but I want to set out the basic issue. Passenger trains and commuter rails and busses tend to be subsidized by government. If they depended on the marketplace alone, they would fail. When any of us decide whether to take Amtrak or a city bus, or the subway in New York City or Washington, we are thinking of the personal costs and benefits. I’ve calculated, for example, that when I go to New York City, unless my wife is going down with me, it is cheaper to take Amtrak than to travel alone by car.

But if Amtrak failed, the trip to New York City would impose much greater burdens on me than just the cost. Given that this corridor is one of the busiest passenger rail corridors in the country, that would put a lot of people on the highway. It could make the trip slower, the likelihood of accidents on a more crowded highway greater, and, of course, unlike an Amtrak trip, I couldn’t read or work on the road.

Notice, though, that those burdens of extra traffic on the highway don’t just affect me. They affect everyone on the road. And my Amtrak bill does not reflect those benefits of mass transit. There isn’t any calculation on any bill that identifies the costs to me and to all of us if Amtrak were allowed to fail.

And of course I haven’t listed all the costs. The pollution costs of taking the car are much more than the pollution attributed to train travel. Highways take a great deal of land that we could have enjoyed for other purposes – their land use is much less efficient. They are expensive to police, expensive to clear for winter travel, and expensive because of the damage from salt splashed on the underbodies of our cars and washed into our rivers and streams.

Nor do those calculations take into account the impact on global warming. It isn’t possible to be precise about the cost for global warming. But it will be large and should be accounted for. Many things can’t be put into numbers. What’s love or freedom or life itself worth in dollars? As a common ad says, “priceless.”

So to see if subsidizing Amtrak is justified, we have to add all those shared benefits to ourselves and each other that can’t be part of the ticket price. Social benefits have to be paid for by the whole society. None of us alone can buy the benefits of less climate change or less congested highways.

So yes, I believe in subsidizing mass transit and helping it grow. I think it is valuable for those who don’t take it too. More generally, the marketplace doesn’t handle every problem well.

— This commentary was broadcast on WAMC Northeast Report, July 25, 2015.

[1] See http://www.cbo.gov/budget-options/2013/44782 for the Congressional Budget Office discussion. Individual routes raise additional considerations but even those decisions impact the entire system.


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