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The Economy Sucks, Now What?

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Periodically, the New York Times publishes sobering long-form articles depicting the economy in dark tones that clash with their more upbeat business page reportage. For example, the NYT recently noted a poll indicating the decline of belief in The American Dream – Many Feel that The American Dream is Out of Reach, Poll Shows (December 10, 2014). While the poll showed a trend towards disbelief in attaining the American Dream, I was depressed to learn that 64 percent still believe “… it is possible to start out poor in this country, work hard and become rich.” This means that more Americans believe in the Dream than believe in the Devil.

I am reminded, reading in Hand to Mouth, of Linda Tirado’s jaw-dropping incredulity that a co-worker, who held nothing but dead-end jobs, still expected to “strike it rich” one day. The American Dream, I suppose, retains its tight hold on the psyche of millions, like a prophylactic against utter despair.

Shortly after the American Dream article, the NYT published a multiple-part series focusing on men and the growing trend against work in America – or as the article puts it – the increase in the number of prime-age workingmen who are not in the workforce. Of those between the ages of 25 and 54, 16% do not have jobs and are not looking for them, up from the 60s when only 5% of men were in this category.

The Labor Department keeps a record of what the NYT refers to as “non-workers,” in a backdoor sort of way, by tabulating what they call the “participation rate” in the economy: only those who have jobs or are actively looking for work are counted as “participating.” When women began to enter the labor force in increasing numbers after the 50s, the rate of participation grew, but for over a decade now women’s participation has declined bringing down the rate in general. However, that doesn’t explain the continuing decline in participation of working-age men.

Economists argue over the increase in non-workers: some believe that young adults stay in school longer, others attribute the increase to early retirement, and still others think the explanation lies with the increase in disability benefits under Supplemental Security Income (SSI).

One of the most obvious reasons for the decline in participation is almost never acknowledged in the press – the poor wages of service sector jobs, the only sector of the economy that steadily offers work. In one installment of the NYT series, this issue surfaces accidentally. In the mall where the reporter is interviewing an unemployed union member, the “non-worker” turns and looks with disdain at the fast food jobs advertised and asks how anyone can live on $10 per hour?

In that same article, the interviewees told the NYT reporter that they lost their previous good-paying jobs due to technology. And, as if following the advice of those experts who advise retraining, a few talked about picking up “computer skills.” These ex-workers, unfortunately, seemed to have the most minimal understanding of the role of computers in the current workplace, as if all they needed to know was how to do word processing or layout a spreadsheet.

Techno-wizards and starry-eyed venture capitalists who think new, undreamed-of jobs will be delivered to us by technology share a similarly clueless view of the future workplace, but from the opposite perspective. They confuse the backend, the programming and the maintenance (engineering) with the minimal role of the operators of new technology who simply follow the commands on the monitor. The former requires extensive training that may offer skilled (and high-paying) employment, while the latter simply requires following a machine command and is compensated poorly.

In the last installment of this NYT series, Lawrence Summer, the former Treasury secretary, is quoted as saying that he no longer believes that automation will create new jobs. He elaborated:

This isn’t some hypothetical future possibility. This is something that’s emerging before us right now. The answer is surely not to try to stop technical change, but the answer is not to just suppose that everything’s going to be O.K. because the magic of the market will assure that’s true.

It is time to put to rest the canard that technology creates more jobs than it eliminates. In the late 50s, when automation first made inroads into Detroit’s diversified workforce and decimated high-paying union jobs, it precipitated an alarm regarding the future employment of the displaced workers. The so-called urban riots (really insurrections) of the 60s, while ignited by issues of institutional racism, were at bottom stoked by economic resentments. The manufacturing jobs, mostly union organized, that opened the prospect of Black middle class status, disappeared and were replaced, not with equally good-paying technology jobs, but with poorly paid service sector jobs.

If service sector employment had not exploded, the job killing effects of automation would have occurred as predicted in the 50s. Of course, new technologies give rise to new jobs, and often these cannot be envisioned, much less calculated or planned for. Highly skilled occupations, though, absorb a tiny fraction of the workforce, and though they may spin off other jobs, these are usually ancillary, no-future jobs. Nothing in the past indicates that new technologies have produced the bounty of jobs the techno-wizards predicted.

JOBS GUARANTEE

If we cannot expect the expansion of technology, now threatening the careers of semi-professionals, to provide the millions of jobs it eliminates, then what? How are we to sustain ourselves with no job and no income? Some advocate that the government be “the employer of last resort” and guarantee a job for all those who want one – this is commonly referred to as the Jobs Guarantee (JG). Often the reference here is to FDR’s job programs, like the Works Progress Administration (WPA) and the Civilian Conservation Corps (CCC).

There seem to be two arguments for this sort of program – one from actual need and the other from precedence. No one can deny that there is a vital need today to rehabilitate the country’s infrastructure. In fact, individual states are already setting aside taxes to rebuild bridges, because the federal government has been unable to mandate funds for much of anything aside from the military. And besides rehabilitation of what’s crumbling, new infrastructure is long overdue: electrical grids and high-speed rail, to name only two of the most obvious. And the argument from precedence – the FDR experience – provides a political basis for advocating for a massive federal jobs program.

Our social priorities are askew and real work, useful social projects, could help to reorder our goals and create a society that works for all of us. But does a Job Guarantee meet these challenges of our times? The premise of JG is to create millions of jobs, not only in heavy construction to rebuild our crumbling schools, highways and railways, but also to staff those new schools, to fill the hospitals with more health care professionals (the population is aging, after all) and, beyond these obvious needs, to enrich our culture by providing jobs in the arts so that we have more symphonies and theaters, just as in the 30s.

The mind boggles at the task the government would need to undertake. Admittedly, the government did do all this in response to the Great Depression, but that hardly convinces, on two counts: firstly, the population of the jobless then and scope of their employment doesn’t compare to the complexity of today’s needs. And secondly, all the jobs created then were temporary jobs. The federal government undertook a new role with the understanding that it was responding to an emergency; it was simply reviving the economy with every prospect that it would discontinue its rushed treatment of an acute economic malady. Our depressed economic circumstance bespeaks a chronic condition.

Today we need millions of jobs. Depending on how you count the unemployed, the underemployed and the “non-employed,” we have at least 12 million seeking jobs and upwards to at least twice that amount. This does not include the tens of millions of working poor, those who work but remain in poverty. Is it fair for the government to provide jobs while so many people are barely scraping by? Or is the intent of the JG to pay substandard wages?

The stupendous calamity we face is not a jobs issue, it is a lack of income issue.

ABUNDANCE IS NOT ACCUMULATION

It is true that besides the obvious bounty, the profits sucked up by its owners, technology does benefit society by creating unprecedented material abundance. This abundance, while generated by greater productivity, has to be hidden in plain view from the proletariat. This is the great capitalist scam: the owners of technology convince the workers that the machines, dead labor so to speak, not their living labor, produce wealth. The bosses have largely convinced us that we must service the machines (at low wages), not the other way round.

We entered into a society of abundance many decades ago, but capitalists must invest seemingly forever to secure wealth, the fruit of that abundance, for themselves. Their greed has modeled a putative life for most of us. So, pursuing, if not happiness, then cultural enrichment on both an individual and social level, has been successfully avoided for the insipid goal, or more appropriately, the addiction of material enrichment.

An abundant society is not defined by the size of your television, or the elegance of your espresso maker, but by the quality of life that ensues when basic needs – food, shelter, health and conviviality – are satisfied. When the time that we devote to directly supplying those (real) needs reverts back to us, when our days are filled with the things we want to do and that immediately sustain us, and not the tasks of the paymaster, then we can begin to truly live.

A line of thinking like this is easily dismissed as fanciful, as utopian, in the sense of unattainable. But, to mention only one area, the accelerated pace of our current drive to despoil the environment in quest for oil and natural gas is praised as eminently practical. Where is the folly here? Is imagining a world free of exploitation more harebrained than the headlong pollution of our aquifers?

And anyway, a society of abundance won’t resemble a Land of Cockaigne – grilled geese won’t fly directly into one’s mouth and robust Bordeaux won’t spout from fountains. An abundant society means that the basic components of communal life are attainable for everybody on this planet; it doesn’t mean that breakfast is served in bed for all. An abundant society primarily defines a change in consciousness – an appreciation of quality over quantity. Or to take another aspect, an abundant society means moving away from the reign of scarcity to a profound sense of conservation and an end to the egregious waste that pervades our existence. A recent study in the UK determined that up to 40% of food products are discarded without being used. I recall that fifteen years ago when the energy cartels were screwing California consumers with outrageous electric rates, people conserved energy to such a degree that the state’s private utility companies feared financial losses. Waste means profits in our present system.

A GUARANTEED INCOME FOR ALL

It is necessary to persist in speaking about an abundant society and counter the popular confusions just mentioned, because there is no other way to reverse the perspective of power – a perspective that demands sacrifice and scarcity to keep us all subservient. It is this perspective that JG succumbs to in its focus on jobs instead of income. A guaranteed income, that is, creating a livelihood on a foundation of security for all, follows directly from recovering the social abundance denied to us.

What sort of society could evolve if everybody received an income to meet his or her basic needs of food, shelter and health? No one would be wholly dependent on either private or public jobs, and not on charities either. Interestingly, such a society might resemble the DIY economies that sprang up in the nineteenth century when the private sector was rapacious, employment precarious and before the state’s welfare role in the economy was in place. To stabilize their lives people began to search for ways to create their own economic institutions. In newly industrializing countries like Great Britain and the United States, cooperative ventures were established to provide various social insurances (widows’ benefits, for instance), local food shops and even work places. Accompanying these grassroots efforts, the 19th Century saw an effervescence of communal experiments. The most impressive was Robert Owen’s mill in New Lanark, with up to 2,500 inhabitants living in the communal enclave built at the mill site. In America, literally hundreds of alternative communities were established – this period has come down to us, somewhat unfortunately, as the Age of American Utopianism, when it would be more appropriate to call it the Age of Social Innovations, or the Age of Communal Empowerment.

No matter the terms used, these social experiments occurred during a period before the consolidation of corporate capitalism and its control of the state and technology, when the potential for social relations was still somewhat fluid and the mass of people believed that they could devise a society that more clearly met their needs. The capitalists and their state henchmen, of course, could not tolerate these experiments, which they saw as open rebellion to the structures of oppression that they assiduously began to implement. For them, ideas to create a more just society signaled an ideological class warfare that had to be suppressed – legalistically if possible, by violence if necessary.

Again, we find ourselves living in tumultuous times. In the 19th century, people assessed the negative aspects of the growing industrial society and sought a way of living that provided them with security and respect. For a brief period, and only after decades of persistent worker rebellions, a Grand Bargain mollified dissent – in exchange for obedience, consumerism was unleashed upon the masses. Today, the realization is widespread that the Grand Bargain (aka The American Dream) is a hoax and, I believe, that as a result we have entered into a period of proliferating social experimentation, a sort of practical utopianism has captured the imagination of many.

I think that basic economic security provided by a guaranteed income will support the multiplicity and elaboration of these social ventures. With a their basic needs met, those who participate in “social labs,” as the network of community economic, social and cultural experiments could be called, will be able to devote more time to their development. I find this prospect most exciting and the least appreciated for its libratory potential. We are not talking here about simply releasing the so-called “entrepreneurial spirit” and creating new jobs, though both will certainly happen, but more significantly, BI will support creative collective endeavors of all sorts. For example, in the area of food production and distribution, in opposition to corporate control of this vital resource, every community in America has witnessed not only the growth of local farmers’ markets, but also the largest increase in retail food co-operatives in decades. The same forces are at work in other areas like alternative energy (one aspect of creating new infrastructure), local currencies, and a blossoming of cultural expression in the arts and theater. Neighborhood conviviality, no longer a fond wish, shows traces of flourishing across the land.

A basic income guaranteed to all, while empowering social experimentation (by providing an economic foundation for individuals to devote more time to expand its scope), will grant the working poor the biggest boon of all – better paying jobs. The beloved marketplace that the employers used as a weapon would now betray them as the workers bargain from a position of strength. The bosses, facing the prospect of loosing subservient hands if not properly compensated, might very well opt for even more automation. The famous hamburger machine, with its job killing potential, portends a future that demands income be separated from labor.

FINANCING BASIC INCOME

One final issue needs to be addressed regarding Basic Income. Inevitably, the question of how to pay for such a program arises. Most advocates answer with various tax measures to equitably distribute incomes, and given the grossly exaggerated inequities in wealth, this seems like an appropriate response. However, it seems to me that depending on traditional taxation, that is, on the state’s role as welfare provider, is a dubious proposition and replicates the errant reasoning of the JG advocates.

A more appropriate funding source would be one that adopts, in some fashion, the Alaska Permanent Fund that invests the revenue collected from oil and gas extraction and allocates yearly payments (earnings of the invested monies) to the citizens. Or in other words the commons, as a natural resource, partially finances the livelihoods of the citizens, as it had in rural societies centuries ago. Natural resources, it must be noted, extend beyond oil or gas to include the oceans and even the broadcast bands. In fact, the air itself is a resource and pollution taxes (or fees) have been in effect for decades. The point here is to establish a protocol for everyone benefitting from the wealth of the natural world, before the rich can abscond with it, and to remove the state as far as possible from directly funding the distribution of revenues.

CONCLUSION

The purpose of Basic Income, as I see it, is not simply to provide an income, but to recognize a fundamental social need that capitalism aborted – a viable livelihood: a value, and an economic consequence, that was integral to the functioning of the commons. This is more than an economic right; the recognition of a common sharing/control begets an organizational form of management that forms the basis for (radical) democratic practices that are thoroughly and consistently embedded in everyday life. Here we have the basis for dignity for all.

Bernard Marszalek, editor of The Right to be Lazy (AK PRESS) can be reached at info@righttobelazy.com . He was a member of a worker cooperative for seventeen years.

 

 

Bernard Marszalek, editor of The Right to be Lazy (AK PRESS) can be reached at info@righttobelazy.com. He was a member of a worker cooperative for seventeen years. Links at http://righttobelazy.com/blog/

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