The Future of Jobs

April 18, 2017

Automation is changing the workforce. It creates some highly skilled jobs but eliminates many others, from service jobs like taxis to previously professional tasks like document review. Factory jobs are decimated by automation.

The industrial revolution was largely built on repetitive factory production lines, based on physical dexterity, repetition and obedience, not higher education. Automation handles repetitive tasks well. Eliminating them affects people very unequally.

How can we deal with that change? The historic Republican free-market approach, now pushed by Tea Party Republicans who control Congress, is that it’s none of our business.  For them, it’s every man, woman and child for him- or herself. Millions in breaks for big corporations and no security for the workers whose lives and livelihoods are the playthings of  markets, financial institutions and corporate interests. But woe to countries that forget their people, engulfed in power struggles and bloody civil wars with the fate of ordinary, hard-working and decent people as talking points and engines of recruitment.

Some jobs have been divided into a large class of “aids.” In Iran everyone from middle class up had a bagi, their term for servant. It’s a world of dependency, power, and deep social division, a world in which people can be taken advantage of. The market, so sacred to the ideologues, is pushing more and more people to join the service economy as maids, waiters, servants and sometimes as sex workers.  Notice the contrary pressures on the women’s movement, with some vying for the few high-end jobs and others being pressured into demeaning and dangerous activity.

We might share good jobs. Labor unions once looked toward a five-hour day. Or we might create jobs, keeping everyone busy and satisfying more of the community’s needs, from building and repairing bridges, roads, water systems and electric and internet grids, to watching over playgrounds. But actually we’re going the other way. Jobs that can create opportunities are being dropped. The pressures are all on workers to find or create ways to survive. We all feel the taxes but don’t notice the benefits.

I see our separation by wealth, color and origin blinding us to common problems. John Adrian Witt, a Yale historian speaking at Alumni House last week, sees organizational failure, like the 1920s before unions and public service organizations finally jelled, leading toward the New Deal reforms in the 1930s.

The New Deal gave us a powerful administrative state, capable of opposing and controlling corporate greed that demeaned and poisoned workers with dangerous equipment, noxious chemicals and contaminated foods. But that effective administrative state became the Republican target, stated theoretically as “regulation” – regulation everyone can be against unless broken down to the safety and honesty it is designed to protect.

There is also an ideological issue, especially when the unchecked power of the market is pushing the public to turn on each other and itself.

Workers are entitled to security. Graduates of high school, colleges, and universities are entitled to good jobs. Our job should not be to ask workers to justify their lives to the market; it should be to employ people to make a better America, much as the New Deal of Franklin Roosevelt founded the Civilian Conservation Corps, the Works Progress Administration and many others. We can support each other, and make a better America for all of us. The market isn’t the answer; the market is the problem. When it doesn’t do what we need, we need to do what it screwed up.

— This commentary was broadcast on WAMC Northeast Report, April 18, 2017.


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.


Investing in the Environment

February 21, 2017

The White House isn’t explaining government’s environmental options.

The environment is the crux of emerging industry. It doesn’t just enable us to breathe better and protect our children’s lives. It is a growing industry which America could dominate if we tried. It is and will be crucial to housing materials, and protecting existing investments of all kinds. Places and countries that don’t protect their environments will not attract entrepreneurs, workers or investments. Their infrastructure will clog along with people’s lungs.

And as it becomes cheaper solar and wind make other industries possible – sun and wind don’t charge by the hour. Falling behind in environmental infrastructure means disaster, abandoned communities if they don’t first fall into the sea.

As simple a gesture as writing land-planning rules so that new construction has the best orientation to the sun cuts expenses forever. Supporting science, instead of taking scientific findings off government websites, will lead to other helpful steps America could take. Plus everything we do for the environment will depend on putting people to work to get it done.

Yes I know, there are shifts in world temperatures that are not man made. New York was once covered with a huge sheet of ice. Nevertheless, we also know, independently, that carbon and methane are driving global warming. Even if natural processes affect the temperature of our world, mankind is making it much worse. We could take action to bring that down unless we put our heads firmly in the sand. Fighting to minimize climate change is good for the economy. Losing that fight isn’t. It means rescuing people, pulling them away from the coasts, crowding them into smaller less productive areas. More than that, it means that many of the places we live will become uninhabitable. Only the mortuaries will do well.

I once chatted with an engineer about the effects of climate change. I knew that his house is in New York City, only 8 feet above sea level and not far from the coast. So I suggested he move to higher ground. He responded that if the sea rose 8 feet, New York City would be unlivable. The infrastructure of the city wouldn’t work. Roads and streets would be submerged or collapse. It wouldn’t be worth staying even on higher ground. So I suggested moving up here – the Hudson may be at sea level but most of us are much higher than that. His response was chilling but one would be a fool to assume he was wrong. He said that none of us would be safe if 8 million New Yorkers, or more from the metropolitan area or the East Coast, became refugees. Wow. His point is that if large numbers of us become desperate, and remember that most Americans live near the coasts, then all bets are off.

Remember the resistance in Congress to repairing the damage from Sandy. That doesn’t even compare to the costs of a rising sea.

So fighting climate change is good for jobs, protects us from economic collapse, and gives our children and grandchildren something to live for. That’s a heck of a worthwhile investment, and a collective, patriotic goal.

— This commentary was broadcast on WAMC Northeast Report, Feb. 21, 2017.


Labor Economics

February 14, 2017

The White House isn’t explaining what’s happening to jobs. I once taught labor economics, an issue close to my heart. To some extent, labor is like any other commodity and that’s the problem. Jobs go wherever business can find all the things it needs – the land, transportation, materials, markets, reliable legal relations, at the right prices. And it keeps changing.

We talk about the rust belt as if we did something wrong. Actually we had about a century-long run on the best factory jobs in the country – a ribbon through this state after New York’s government built the Erie Canal and made New York City gateway to the west, turning every city along the Hudson, Mohawk, Erie Canal, and then the great Grand Central Railway into a powerhouse. This area long dominated clothing, technology, science, heavy industry and spawned radio and television networks. Each industry provided resources for newer ones.

But New York’s advantages couldn’t be permanent. For bigger plants with newer methods, business looked for virgin land. Other governments built ports, the Interstates and St. Lawrence Canal, while the aging infrastructure of older cities led firms elsewhere. It couldn’t be permanent. Economic fundamentals inevitably dominate jawboning and presidential rhetoric.

Workers get cast aside unceremoniously. One of my law students was also a human resources specialist at GE, missing class whenever GE announced layoffs. They had long since let the weakest workers go. Now she had to fire the best and it hurt. But big corporations aren’t sentimental.

What’s a city or region supposed to do? The market doesn’t automatically find the next big thing and put it where former employees can get jobs like those they lost. The market didn’t build America automatically. Government changed British rules. Government built a banking system with resources to fund business, and smooth their cash flow – if you read or saw Hamilton, that’s what he was about, government providing what companies couldn’t. Government built ports, canals, highways, and had the railroads built. Government provided public health facilities, water, sanitation, disease control – which became crucial for business. Government invested in schools, and President Lincoln laid the foundation for the modern state university system. President Wilson sparked the country’s first broadcasting system for the war effort. Almost everything in your hands today has government fingerprints on it – the research and development in fundamental physics that led to the lasers, transistors and chips that run almost everything today.

Yes, governments make mistakes. You think private industry doesn’t? Most businesses fail. But only government can provide the fundamentals, the things that all the businesses in the country, region or route need. Only governments are motivated to look beyond individual companies and work for the region.

Governments have been investing in new forms of power. If governments in coal producing states had the sense to invest in emerging industries instead of dying ones, the coal miners might face a much better transition to good jobs than anything presidential jawboning can produce. But government cannot do it if it is afraid to fail.

Governments need to be thinking about what the emerging industries are, what resources will support growth. Not individual businesses that any group of investors could build on their own, but the underlying fundamentals that make broad development possible. And we may only know which ideas work when we try them.

If government thinks small, we all shrink.

— This commentary was broadcast on WAMC Northeast Report, February 14, 2017.


Against whom the rebellion?

November 8, 2016

This is my last chance to talk with you before the polls close.

Republicans have argued since the 19th century that the market solves all problems. Democrats by contrast solve economic problems by investing in the people and the infrastructure they need to get their work done – things business can’t partly because of competitive pressures and partly because they can’t reap the benefits of projects that help the general public.

Because getting things done requires both the president and Congress, split government favors the Republicans. Democrats need both branches and both houses of Congress to pass the laws  that make their economic programs possible. Looking back to 1994, there have been only four years in which Republicans did not control at least the Senate.

There is a well-justified need to rebel against the way the economy and the government have been treating you, and the Republicans should bear the brunt of that rebellion.

They insist that investors would use tax breaks to create new jobs in this country. In fact, tax- break beneficiaries can invest the money anywhere. So when Republicans give wealthy businessmen more money, we just get the risk. Their friends get tax breaks; workers get laid off. Their friends close factories; workers look for jobs. Their friends freeze wages; workers look for second and third jobs just to keep going. Their friends downsize for efficiency, leaving workers unemployed, unhappy, and looking for a way to earn a living.

The economy is organized for the guys on top. Dealing with it, making America truly great for all of us, takes more than the Republican nostrum of lowering taxes. Businesses invest where they find markets, workers, infrastructure, and where they’re attracted by the comfort or the cultural life for themselves and those they want to hire. Taxes have little to do with it.

That’s why Obama’s and Hillary’s investment in infrastructure and emerging industries is a better deal to create jobs and opportunities for everybody. There are many reasons to invest in America – unless we let it fall apart, let our infrastructure crumble, and don’t keep it up to date.

Whether Trump understands real estate, where he’s managed to lose lots of other people’s money, Trump clearly doesn’t understand the economy. The old trope about taxes won’t grow the economy. And his promises are cynical because people won’t invest in outdated, high cost, low return industries when there are better opportunities, no matter how much he yells about it.

Which gets back to something else Trump doesn’t understand. Government needs to work on shifting the risk, to make it easier for the vast majority of Americans to find new sources of income, if necessary to move where the jobs are, on more than a hope and prayer of avoiding homelessness. That’s not in the big generalities that so-and-so will fix things. That’s in the details. You work on those; you study those; the job isn’t all in the bluster.

We’ve had enough of Republicans blocking every effort to build the economy, protect its workers and take care of all the people. It’s time for a smart rebellion – not a wild swing with eyes closed.

So do vote if you haven’t already. It matters.

— This commentary was broadcast on WAMC Northeast Report, Nov. 8, 2016.


Democracy and Compromise

September 13, 2016

Since Obama’s election, congressional Republicans and their Tea Party challengers made Obama’s defeat their overriding goal, and when they couldn’t do that, they did everything they could to make him seem like a total failure, an example of politics gone completely awry. To accomplish those goals, they refused to give him any victories – not on infrastructure, not on economic stimulus, not on judicial nominations and they tried to retract his success with the Affordable Care Act under a Democratic Congress.

The Republican decision that nothing could go forward without support of a majority of the Republicans in each house of Congress gave power to a majority of their caucus but a minority of Americans. Had dissenting Republicans been able to vote their conscience, some real negotiation would have been possible. The harsh stance driven by the Tea Party was a form of power play by a determined minority that got its hands on a way to block the congressional majority from even bringing bills to the floor.  It was not a prelude to negotiation and it was not an example of democracy at work.

On the other side of the political spectrum, many Sanders supporters argued that they could take nothing less than Sanders or a third party – even if it made a Trump victory more likely.

In this era of my-way-or-the-highway politics, it needs to be explained why democracy is and should be about compromise.

If a majority can do anything, or a majority of representatives, can do whatever they wish, then one portion of the population can be left with virtually nothing. That may be majority rule. But it has nothing to do with fairness or equality. Democracy gets its moral authority from taking everyone’s interests and needs into account. We routinely talk about the combination of majority rule and minority rights. Merely giving the majority the power to exercise power over everyone else is a definition of tyranny, not democracy. Where bargaining is possible, even small or unpopular groups can get some recognition of their needs. Where bargaining is possible, even permanent minorities can get some modicum of decent treatment. Without bargaining, permanent minorities can be stripped of virtually everything. Bargaining gives some meaning to the ideal of equality. The willingness to work things out has always been one of the things that had made America a leader of the free world.

The Founders of this country tried to force some degree of compromise by the different ways they constructed the Senate and the House of Representatives. Before the Civil War the struggle to reach compromises was all about slavery and freedom, the rare area where compromise ultimately became as impossible as it was immoral. After the war, a spirit of compromise reemerged so that America could deal with conflicts between rural and urban areas and other issues.

Sometimes compromise works better than others. Some of us remember within our own lifetimes when absolutely nothing could be done if it included any benefits for African-Americans, and the use of the filibuster to prevent any breach in the wall of segregation.

Many astute observers of democratic government point out that the system works best and most fairly when the needs of different groups of people overlap – disagreeing on some, agreeing on others. That gives groups an incentive to bargain so that everybody gets a fair shake. Even so-called nonnegotiable demands can sometimes be balanced against other similarly important demands of other groups.

Civil war becomes more likely when democracy becomes a contest over nonnegotiable demands that are beyond any form of bargaining. Democracy does not have to be a zero-sum game, where some win the brass ring and the rest merely polish the brass.

Americans need to relearn the art of compromise. Our democracy and our country will be better for it.

— This commentary was broadcast on WAMC Northeast Report, September 13, 2016.

 


Universalism vs. the What-About-Mes

May 10, 2016

This primary season has made plain Americans’ dissatisfaction with American politics – dissatisfaction because someone else seems to be getting all the goodies and concern. The right wing thinks the poor are the government’s favorites. The left wing sees its wages and taxes mostly benefitting the super wealthy. Both Sanders and Trump mined the political backlash from special interest politics. Trump’s apparent nomination increases the urgency for both parties to respond to this problem.

And for anyone who wants to argue that impoverished or minority Americans are being short changed, one runs a minefield of envy, and the “what-about-mes.” The same weighs down discussion of the advantages of international trade agreements. If we don’t all share, the biggest issue is me. Similarly, for too many people the environment never seems to be about themselves but someone else, people on islands, lowlands, the next generations, but not themselves. That makes all our problems tougher to deal with.

When he wanted to establish a program for the elderly and the injured, the genius of President Franklin Roosevelt was to make it seem universal. Social security insurance applied to all kinds of people and most kinds of jobs.[1] We pay into the system long before we know whether and how much we’ll need. Many get social security who would be excluded by any need based program. But that’s the point. There is no stigma to social security. FDR did it as an insurance program; most of us contribute and collect. Roosevelt wanted to make it simple – you did your social security business at the post office. And when some politicians wanted to tamper with it for ideological reasons, they found that social security was a third rail of politics. FDR had hit that nail on the head.

Now, however, simple, universal programs like medical insurance have become a political football, and the very possibility of the government pursuing the general welfare is under attack from the not-with-my-money crowd. But because it is under attack, because we cannot count on government even to pull us out of a recession that would involve spending tax dollars, no matter how good the investment, the very possibility of economic changes are much more threatening than they should be.

Investment in infrastructure should be an investment in the general welfare, full of benefits for everyone, putting people to work building it, making jobs and businesses easier to reach, and creating benefits for all of us, from clean water and more reliable utilities to better education and internet services. The best way to protect people from unemployment is to provide jobs that provide benefits for the public. Infrastructure can pay dividends, in jobs and services that make everyone better off, and that only government can build.

Unfortunately politicians prefer big showy projects, dramatic new bridges and buildings rather than maintenance, repair and cost effective options. They prefer projects targeted for their contributors, Or they prefer to get on their soapboxes and try to get us to tear down the very government that made this country a great one. The cost of political behavior that breeds distrust of American government is enormous. Good government, self-government was the signal contribution of America to the world and we are allowing our political infrastructure to crumble along with the water, utility, transportation and electrical infrastructure.

It’s not just who we tax; it’s also what we do. Government matters; it does things for the public that no one else will take care of. We need good government, fair government, government for all of us, but government – strong, effective government – and the confidence that comes from doing it right.

— This commentary was broadcast on WAMC Northeast Report, May 10, 2016.

[1] On the original exclusions, see Larry DeWitt, The Decision to Exclude Agricultural and Domestic Workers from the 1935 Social Security Act, Social Security Bulletin, Vol. 70, No. 4, 2010, https://www.ssa.gov/policy/docs/ssb/v70n4/v70n4p49.html, but he is less convincing regarding motivation. For summaries of current exemptions, see Intuit Inc. (U.S.) at https://turbotax.intuit.com/tax-tools/tax-tips/General-Tax-Tips/Who-Is-Exempt-from-Paying-Social-Security-Tax-/INF19965.html or http://www.investopedia.com/ask/answers/013015/who-exempt-paying-social-security-taxes.asp.


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