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Have U.S. Workers Priced Themselves Out of the Job Market? Join the Discussion.



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The following is a recent email conversation between UP board members Karen Watts, Barbara Ehrenreich, Bill Holland, Cryn Johannsen, Trude Diamond, and Tom Bishop. They want this to be a continuous discussion — please add your comments!

Karen Watts: I just saw an interview on the financial news about how the “American worker has priced themselves out” of the global job market. Is this perhaps something we should address? If this is the prevailing attitude in the corporate mind I think we have a problem. I know that for me the $1 per article that Indian and Eastern European writers demand would mean a 24 hour work day…and then I’d still be starving. I imagine many other white collar jobs (which was one of the highlights of this discussion) pay similarly horrible wages when outsourced.
Thoughts?
Cryn Johannsen: I am really glad you sent this out. I think it definitely needs to be addressed. When you think of this argument vis-a-vis student loans, it makes the claim even more problematic, does it not?

Karen: For months Robert Reich, former labor secretary, has been warning that many outsourced jobs are gone for good. He has also stated stated that “American workers have priced themselves out of the job market.”

Trude: Reich’s solution is “permanent new investments in the productivity of Americans” in the form of “Big ones that span many years: early childhood education for every young child, excellent K-12, fully-funded public higher education, more generous aid for kids from middle-class and poor families to attend college, good health care, more basic R&D that’s done here in the U.S., better and more efficient public transit like light rail, a power grid that’s up to the task, and so on.”

http://robertreich.blogspot.com

http://robertreich.org

Trude: That strategy is all well and good for generations beginning with those in elementary schools now, and it will build upon the strategy toward highly functional reading/math/critical-thinking skills education and career-oriented curricula that many schools began to develop several years ago. But what does this attitude mean for the thousands of unemployed and underemployed today here in the United States?

Karen: It would seem that the only hope of landing a job lies in being willing to settle for 3rd world wages. Even if your ego allows you to make such a decision, how are you going to survive? Many of the pat answers we hear so often about living within our means and being willing to accept “any job” simply fall apart when examined closely. For example, live in a small apartment and take the bus to work, sounds like a good solution unless you live in a rural community without multifamily housing or public transit. Get a second job is also a favorite platitude. Never mind that childcare in many communities costs more than many of these entry level jobs pay, and is only available during traditional business hours.

It is true that the economy has changed in new, and sometimes awful and probably permanent, ways. We will have to adapt as a nation. But does Mr. Reich or corporate America really believe that adults can survive on minimum wage jobs? Even should you work a budgeting miracle and learn to live on approximately $16,000 to $17,000 a year, how in the world will you save for the future, support children or pay off the student loans for the education it took to land this dream job?

We need the administration to move beyond pronouncements and good intentions. It is time to dig deep into the complicated problems of creating new jobs for our vast unemployed/underemployed educated class and address the crushing debt they acquired based on the promise that education would lead to a better job and future.

Karen: I got a newsletter this morning from one of my local contacts. In it she advocates again that everyone should be working toward a “credit free” lifestyle. Aside from the business impracticalities of this, she is ignoring the concept of survival credit. I found one blog on it but cannot find any current data–I know that this is a big issue. People are using credit cards to buy the essentials of life like gas and groceries because their wages do not cover their basic living expenses. Perhaps this is a question we should pose as part of this?

Tom Bishop: The American workers have not priced themselves out of the job market, they have been priced out. By companies willing to pay people who went to free universities and live in economies where one can survive on far less than here. This is about how corporate America strangled its own workforce for so long that it finally killed it.

And it will kill the new workforces too.

This is a great year for bashing corporations, and I think it’s already time to start planning for summer (you know how conservatives love summer for getting their message out). Let’s make them defend Wall Street.

I would love to send my thoughts on this “Pricing Out The American Worker” very soon, if that is welcome…

Trude Diamond: Tom’s offer sounds perfect to me. Thanks, Tom, from a formerly 6-figure salaried American communications guru who now makes about $30/hr working freelance for a company based in India. Paybacks really are hell — in this case, the hell is being wreaked on the employees rather than the corporations. Onward!

Bill Holland: These comments are intended to encourage, not discourage the discussion.

For my money the discussion is too “left/right.”  I.e., much too much along traditional ideological lines.  It is an ongoing part of the “blame-game” played far too often.  To suggest that the American worker has “priced” himself out of the market–or its equally accusatory counter-part that the the Capitalists have taken the market away, makes it difficult to examine the emerging global realities that are forcing the issue.

There has been an ongoing restructuring of the global workforce for well over 30 years.  Even when, and as, this economic recession ends, it will not end the underlying shifts in the way goods and services are produced and distributed.  As such, we are in for somewhat of another jobless recovery.  As a result, there are lots of people in harm’s way.  The large question is what can be done about it and how quickly can we do it.

I do not think there is any real chance that the restructuring can be stopped–not sure it should be either.  But just as when farmers were forced off the land in Oklahoma and elsewhere, and just as unions came into existence in response to BIG CAPITAL, there is an opportunity for public policy to play an ameliorating role.

In some quarters, that discussion has already started with former Labor Secretary Robert Reich and in various other places among the American intelligentsia including Jared Bernstein’s friends over at the Economic Policy Institute.  I would like to see others join in.

But I fear we do not get very far when the first question we ask and answer is “who’s the bad guy?”

Karen Watts: I like these ideas. For me (personally) I wish to avoid a left/right kind of debate as I feel this gets people into “automatic” thinking and they just start preaching the party line…for whatever party that happens to be for them. I guess my concern about the Americans overpricing themselves out of the market idea is that it is overly simplistic and not solution focused. Okay, some jobs are not coming back. The job market is global. Now how can we and our elected leaders start coming up with creative solutions. My original idea was that the attitude/platitude of “pricing out” was basically a discussion stopper and not starter.

Tom Bishop: I looked up some figures about India, China, and the US in the CIA factbook (https://www.cia.gov/library/publications/the-world-factbook/). The result:
“Have American workers priced themselves out of the job market?”

Among corporate leaders, cable news personalities, business publication editors, and business school professors, this is considered a fair question. Heads nod and faces crinkle in agreement with the general idea that workers in America have gotten themselves into a terrible situation. They’ve paid for expensive college degrees and bought decent suburban houses near the corporate centers of power. They’ve done everything their parents told them. Despite all this, they have to compete harder than ever to find jobs that will pay the bills.

Business leaders do see a problem with this, of course; they often complain that they can’t find workers in America with the right combination of experience, skill, and willingness to work for a wage that fails to feed their children. Corporate leaders gripe about a shortage of US Visas, and of having to find talent overseas, in countries whose labor forces are larger than the US’ entire population. They are forced to find workers who scramble over each other to win business contracts that pay a sum that might buy a week’s groceries in the US.

Now that’s a work ethic, say America’s business thinkers. Why don’t America’s workers have that?

This is the current wisdom in the business world; American workers are fat, lazy, unskilled, unwilling, and overpaid. If they can’t get ahead, it is obviously their own fault.

Drivel.

The economic destruction that has worked its will upon America’s workers over the past four decades does have a source. That source is not as organized as a true conspiracy should be, but it is organized enough to turn this incredible, preposterous idea into truth. The notion that globalization is an unstoppable force moving under its own power, and that there is nothing that can or should be done, is pretty well embedded into the American psyche.

An alternative to this drivel is rarely voiced.

By now, most Americans understand what globalization is. It is either the reason their stock values keep climbing, or for far more, it is the force that threatens the career they once banked their futures on. Corporate and political leaders agree in a nearly monolithic way that globalization is a good thing, even though the opposite becomes clearer to the working and middle classes every day.

Those who dare to speak ill of globalization or suggest fixes are met by accusations of protectionism, divisiveness, and playing the blame game.

This creates a practical challenge; to deal with globalization’s effect in a way that will benefit America’s embattled workforce and its economy, it is necessary to identify the cause. Yet, it is no accident that identifying the cause is akin to belching in the presence of the Queen.

So here goes: the cause is the myopic short-term focus of America’s corporate leaders.

Businesspeople used to plan for the next five to ten years. Today, most leaders don’t look beyond next quarter. That means they focus on cutting costs rather than developing ideas. They look to the quickest, cheapest and easiest way to meet a bid or finish a project, even if it means more wasted effort later on. They seek solutions overseas, regardless of the cost to quality, staff cohesion, or customer loyalty. Future inefficiencies are ignored in favor of immediate financial gain.

This is the very reason that America’s workers have suffered higher long-term unemployment and a reduction in average household income. Because corporate leaders are no longer dedicated to expanding their workforce or building a stable future, workers have suffered a depressed economy and a loss of bargaining power. And the downward spiral continues.

Why is it necessary to identify the cause of this spiral? The reason is simple: any solution is unlikely to benefit everyone. America’s corporate interests are going to have to pay, in the form of reduced short-term profits and stock values.

The right approach is to include them as a partner in the debate, but a very well-founded assumption is that corporate interests will not be honest dealers. They have benefited from the squeezing of America’s workforce for too long, and are dedicated to it continuing.

The solution to helping America’s workforce get back on its feet will look a heck of a lot like protectionism. The populations of the two most populous countries, India and China, outweigh the US population by eight times. Their workforces outnumber US workers by ten times. Yet, their average GDP per capita is about a tenth of the US’. Nobody needs a calculator to see that the majority of America’s workers will have to sink to unimagined levels of squalor to bring the workers of India and China to parity.

That leaves out billions of workers in emerging nations around the world. Clearly, America’s corporate leaders are not interested in giving up this joyride. We have to make them give it up.

- We have to force legislation from the current administration that ends the freedom of outsourcing.

- We also have to force legislation that enables and encourages the growth of unions at the expense of corporations.

- We have to embrace the insourced laborers who have come here for a better life, but are treated by companies as fodder for industrial and agricultural production, as well as to put downward pressure on wages.

- We have to force legislation that penalizes companies for moving headquarters offshore to avoid taxation.

- We have to force legislation that either raises capital gains taxes or treats them as earned income, to discourage the paying of dividends and encourage reinvestment instead.

- We have to force legislation that repeals the portions of the Fair Credit Reporting Act that allow companies to review credit ratings in hiring practices.

The result of all of these measures will be to embolden America’s workers to demand fair compensation and benefits for the work they do. They must have a foundation on which to demand career stability for themselves and their families. The long-term result is the strengthening of America’s economy, boosting its ability to develop ideas and build badly-needed innovations that will drive industries.

Corporations will not be willing to lose their certain short-term gains in order to reap uncertain long-term growth. That is why their interests are not part of this equation. They own the current conventional wisdom, largely because they created it.

It is time to create a new wisdom that favors the working and middle classes. If that’s playing the blame game, so be it.

Cryn Johannsen: Regardless of how you see it, there are institutional inefficiencies with regard to the way in which capitalism operates. When I think of these arguments vis-a-vis the student lending crisis in this country, it’s frightening to me.

I possess so many degrees from the most prestigious universities in this country (U. of Chicago, Brown, and I was also an exchange scholar at Harvard), and at this point I can’t get a job in this country to save my life! So I am fleeing the country for better opportunities AND pay abroad.

But what about the student loan debtors who can’t do that? Their jobs are being shipped abroad and will never come back. This situation is affecting countless industries. (I consider myself lucky that I can take my skills abroad – many of the people for whom I advocate can’t).

Also, when you think about the fact that the vast of majority of the wealth in this country is controlled by a tiny percentage of people, then you can, in my humble opinion, point fingers at a system and particular individuals. Nevertheless, it’s a matter of looking ahead and insisting that we shift the system, so that it’s more equitable. I couldn’t care less if my argument seems out-dated for academia. I’ve spent plenty of time discussing and writing about the nuances of post-industrial capitalism, and frankly power structures haven’t changed that dramatically. That’s coming from someone who appreciates post-modernism and every day life theories.

Bill Holland: You have hit on several issues that are near and dear.  Your words are kind when you say there are certain “institutional inefficiencies” in how capitalism works as can be seen in the student lending crisis.  That program is a violation of the most fundamental of the rules regarding capitalism–i.e., capital is rewarded or punished based on the risk to which it is exposed.  In the case of student loans, the government takes the risks and the banks get the reward at no risks to them at all.  It may be among the worse of all tricks banks are allowed to play.

Oh yes, it would be nice if there were some explicit agreement that those who sacrifice and attend school have jobs waiting at the other end of their workplace hiatus.  Truth is, there are no jobs reserved with their names on them–never have been and never will be.  Perhaps you are referring to that golden post WW II era when companies allowed universities to do their screening for them by accepting the degree as the credential for entry into their white collar jobs.

Universities (except for places like Reed) accepted the revenue from student generated demand for vocationally relevant education without ever fully accepting the responsibility.   I am afraid that the link between a degree and employment is little more than a marriage of convenience.  As Bernstein has argued, the spoils of globalization go disproportionately to those whose skills often have little to do with their formal education. It is distinctly possible that the most formally educated among us are destined for high unemployment rates.

The collective solution lies in pubic policy–retraining, better controls on global trade, and the realization that the outcomes of capitalism should not be a substitute for reasoned public policy.

For individuals, the solution is different.  The new currency of the realm is something I call “value-creation.”  The least among us has the opportunity to create value for others–be they employers, people we choose to help or goods and services we offer for sale.  And this is just the beginning of the new order of things.

A full expose here is inappropriate.  It is the subject of my next book, “Cracking the Employment Code:  Nine New Rules for Finding White Collar Work.”   Much of it is aimed at those caught in the paradigm shift between education as a ticket for entry and  a refrain from larger and larger numbers of graduating college seniors who wonder ”Now that I have my degree, where is my career?”
Tom Bishop: Bill, your points on this helped a great deal in what I wrote and sent to Karen last evening. It is critical to avoid simplistic politics and focus on solutions as you have. I only disagree on one point: the fault should be identified, since the current economic structure will have to change severely, and the people who will be most upset are powerful enough to have created the structure in the first place.

The original question was whether workers did this to themselves. I find the question itself unacceptable. It shows that the people responsible for what has happened have already created a frame that should never have been considered reasonable. Any debate has to undercut that frame as its first action.

Bill Holland: Tom Bishop–right on!

Barbara Ehrenreich: sounds really good to me, Tom. But by “public health insurance” do you mean Medicaid?

My only big issue with Reich: He has argued for so long that the cure for everything is more education, apparently not noticing the destruction of the educated middle class. Or has he changed his mind on this?

Not that I’m not all for more education, and this weekend’s tea party convention certainly showed the need for it.

Karen Watts: I think Barbara is hitting on the issue that Cryn and I have been talking about in other blogs and venues online. For years we have been hammering into everyone’s heads that education is the path to success. This has led thousands of people to take on debt they will never be able to conquer because when they enter the job market with their newly minted degrees there are no jobs available to them. Education is not a cure-all as we have discussed at length. Young graduates must face the fact that traditional entry level white collar jobs have been outsourced and older graduates realize that a new degree does not negate an “old” face in a society that still worships youth.

I filled out the “contact me” form on Reich’s blog asking him to clarify his ideas on the Dec. blog in question.

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50 Responses to “Have U.S. Workers Priced Themselves Out of the Job Market? Join the Discussion.”

  1. Carlos Soto Says:

    I would not mind reducing my salary to $1 per day, if the cost of living was proportionately lower. These corporations who ship our jobs to 3rd world countries sure as as hell don’t ship their prices either! What is wrong with this society?

  2. George Primov Says:

    Great talk, but I am afraid, in the current harsh economic reality we are pretty much running of options. In my humble opinion, holding the corporations’ feet to the fire and trying to make them feel responsible, is as naive as expecting big government, which traditionally has been the lapdog of the big companies to be responsible. Think of this – how many decades the “wise men and women” in Washington have been relentlessly discussing the “Campaign Finance Reform?” Do you expect a reasonable solution any time soon? Hope we all live long enough to see that and real healthcare. Why? Who is going to foot the bill for the zillions of confusing ads, making our already beyond confused compatriots vote for the “right person?” Can you imagine hopping from exotic place to a more exotic place on your own, $175000/year dime without the help of Big Business?

  3. Dean Says:

    Tom speaks for me. Workers haven’t for the most part priced themselves out of jobs, the new world economy has priced many US workers out of the middle class. And the focus on household income hides a sever decline in compensation per hour worked.

    The question of whether it is too late to fix this situation feeds into the dependencies of the US economy. Can we resolve the situation without somehow impacting Chinese trade in ways that might result in them not supporting our deficit and thus throwing us in a recession to make the current one seem modest? Are we really in a position to pressure them to change their currency valuation policy?

    The US economy has been going in this direction for decades and I don’t know if it is too late to resolve, but nobody in a position to resolve it has much interest in doing so. They just blame workers.

  4. Alan8 Says:

    “Reich’s solution is “permanent new investments in the productivity of Americans” in the form of “Big ones that span many years: early childhood education for every young child, excellent K-12, fully-funded public higher education, more generous aid for kids from middle-class and poor families to attend college, good health care, more basic R&D that’s done here in the U.S., better and more efficient public transit like light rail, a power grid that’s up to the task, and so on.”

    That’s the typical corporate BS, spouted by both Democrats and Republicans.

    After the “basic R&D that’s done here in the U.S.”, corporations will TRANSPORT this R&D to Chinese factories that will do the same job for less. This will solve nothing, while maintaining corporate profits.

    The solution is to pull our of NAFTA and the WTO agreements that enrich corporations (and their wealthy investors), while starving working Americans.

    The Green Party and Ralph Nader have advocated pulling out of these corporate trade agreements. So will the Democrats when they see votes starting to go to the Green Party.

    VOTE GREEN!

  5. paterson dave Says:

    there are still people who believe if a corporation makes money paying chinese wages, that money will be used to improve life for americans. the owners moved the plants from new england to south carolina to avoid paying union wages, and then to mexico, saipan, indonesia, and the chinese child factories when south carolina workers realized they deserved a living wage. wasn’t robert reich one of the architects of nafta? now unlicensed mexican drivers can drive unsafe mexican trucks full of chinese made crap into the u.s. and take more jobs. there will never be a useful health plan unless ‘they’ get the insurance companies out of the pool.

  6. Mary L Says:

    In order to change this situation, you will have to undo years and years of brainswashing of the American people.
    Right now many people I meet seem to be gravitating to the ultra-libertarian tea parties, not to unions or holding big business accountable for their inhumane practices.
    If people can’t seem to ‘get; how they are being used in this economy, how in the world can they be expected to work at solving its problems?.
    For years a great deal of the American working and middle classes have been voting against their own best political and economic interests because they have been buffaloed into believing conservative political values are ‘family values.’
    And now many of them seem to believe those of us who want equitable health care are ’socialists.’ Nevermind that every other first world industrialized nation of any type of political structure gives its citizens health care and America stands alone with frigging South Africa for so-called health care freedom.
    One of the biggest problems with American equity is that it is a myth and always has been. We are a nation of and for who ever holds the most money and guns and always have been.

  7. Francis Says:

    Thanks for just a great discussion.

    A few thoughts:

    Really appreciate avoiding the blame game, re. left/right, as well as digging deep on ownership, power, leverage, and the crux of the situation-argument – yes, let’s identify the framework. It’s not much of a chicken or egg argument, re. owners or workers choosing options overseas. And yet it is the nature of the larger beast.

    Worth mentioning- the contradiction of free trade vis a vis capital and labor, which allows capital to flow freely and monetize at will, while labor is hardly as agile and fluid, nor is it able to travel and maintain job and family security.

    Yes, the long-term view is the ticket. And short-term to blame. Thank you thank you for driving that home.

    And yes the resistance to change is deeply entrenched, but next steps might be to dismantle those giants too. The bigger they come, the harder they fall. 1) Who controls the narrative? 2) Who is represented in representative government? Yes, education is expensive but as the bumper sticker says, not as much as ignorance. A better-informed citizenry needs access to better information that has their interests in mind. Call me an idealist but…

    Ground zero public policy issues would have to address 1) who controls the narrative for the masses – who chooses the story, the issue, the frame, the angle – and that means a hard look at media ownership, and 2) the age-old campaign finance reform, which looks like it will get much worse before it gets better. Too bad. But in my humble opinion those two issues are the one-two punch I’d like to see on the ropes of public discourse before too long.

    Otherwise I believe the whole thing is going down.

  8. Dennis Says:

    This bull about higher education being the key has gone on far enough! If you live in a town or city municipality, where the primary or even sole source for employment are service industry and/or, service retail jobs, getting an education beyond high school can work against you in finding employment. Other then for supervisory and managerial positions these places like the “big box stores”, have little need, use, or want, for college educated people. Especially those thirty or over, or for that matter military veterans.

    This reality is something that’s been ignored by both the political establishment and both the mainstream and right-wing media. Only liberals acknowledge this problem!

  9. Doug Baier Says:

    I agree with many/most of the responses. When we renegotiate our collective bargaining agreement we typically get a “cost-of-living” increase. Does this increase precede or follow the cost-of-living? Put another way; does any pay raise I receive drive the cost-of-living?

    P.S. Now corporations can invest their increased profits in propagandizing their workforce and the society at-large. As robber baron Jay Gould once stated “I can hire one half of the working class to kill the other half.”

  10. Question Authority Says:

    And just who do the uber-capitalists think will be able to buy their products and services if they manage to reduce wages to Third-world levels in the US?

    Alan8 has it right when he says “After the “basic R&D that’s done here in the U.S.”, corporations will TRANSPORT this R&D to Chinese factories that will do the same job for less. This will solve nothing, while maintaining corporate profits.”

    Indeed, they are already doing exactly that. One example: Boeing has outsourced some of the work on the new, cutting-edge 787 composite structures to China. So we have given our greatest competitor one of our brand new advantages in airliner production…for essentially nothing. China is already buiding up their aircraft industry and intends to be the third major player with Boeing and Airbus by 2020. Good work, guys. /snark This happens over and over.

    Those production jobs could have been done in the US, but they aren’t because of the stampede to lowest possible costs.

    The economic “theorists” that came up with globalization should be tried for treason. They have sold the US workforce up the river for a handful of gold, and someday soon, our country will be so weakened economically that it will lose its status in the world – if it doesn’t collapse entirely.

  11. owen paine Says:

    gary becker is to blame
    he called the labor commodity
    human capital

    you ought to start with the forex fiddle
    we are not on a level playing field
    if the yuan is trading at 6plus to the dollar and ought to trade at 3 to the dollar

    we need to use our borders to “correct ” these
    fiddles
    its fair trade
    and we ought to sell licenses to corporations
    to import stuff including over the web services
    licenses sold by uncle on an open market

    i suspect some of you over educated professionals
    need to brush up
    on comparative advantage
    in the context of forex fiddles
    and throw in some notion
    of the “gains from trade”
    on a trans border
    corporate mediated
    trade and finance sphere

    any econ con will tell you after water boarding
    our trade models haven’t a clue what might
    model the role of our multinational corporations
    which in essence operate like mid ocean
    “gains from trade ” scoops

  12. Stacy Says:

    Forget that we’ve priced ourselves out of the market. That is asking the wrong question. What? Some of us are managing to make a living wage, so that makes us responsible for bringing about our own doom in this country? Times are long past for US workers to be able to think only of our own plight. Multinationals are the new world power and unless we are willing to listen to, aid, and support the might of our brothers and sisters who are working for slave or subsistence wages, we are all going down. It’s just a matter of time.

    Worker unity has to be on the same scale as the forces it must stand against. (I never thought I’d sound just like a communist, but there you have it.)

  13. MRK Says:

    Or maybe Capitalism has finally run its course?

    If only one could factor out the greed inherent in the human animal, maybe a shared communal socioeconomic culture would be possible?

    While it may be anti-global and still a bit un-PC, isn’t the point of it all to be comfortable and secure in one’s own environment, to provide for those with less, and to ensure the success of the entire community?

  14. char Says:

    States in the US that have ‘business friendly’ policies, have lower unemployment rates and lower state government debt. The federal government could help the people by increasing its enforcements of immigration laws and reducing the approval of worker visas until such time that American Unemployment rate is lowered to a 5-6% sustainable figure.

  15. Daniel Becker Says:

    Let’s put some dollars behind the meme that labor has priced them self out of the market.

    I personally crunched the numbers using Saez’s data and BEA data.

    $1.4 trillion dollars per year of personal income that used to be in the hands of the 99% is now in the hands of the top 1%. That is $15,300/yr for a family of 4. That is one good health plan and $3K left over for pension.

    That is what has happened to labor. The majority of this is because we changed from an economic model of producing such that we added value to one of consolidating as much existing value as possible. Remember when Sunbeam was sold for it’s brand name? Hey, we even refer to our parties as brands now. Can there be anymore telling evidence of how far we have moved from the ideals and enlightenment that gave us the Constitution to viewing our life and social structure in terms of business now?

    It is called financialization. It what our economy has become and why banking/finance has become as large a part of our GDP as it has. We like to think our big Corps still make things, they don’t. They just collect royalties and rents and commissions, etc. This works if you have enough money already, but it does not work if you only have your labor (cognitive or physcial) to sell in the market place. This was not labor who caused such other than they believed the crap of the politicians they elected.

    Financialization is so large now that our GDP which was 79.6% 1956, in 1980 15.7% of the money involved is now only 1.9% of the money turned over. We’re making money from money in our economy and you do not need labor for that.

    Personally, I argued with my boss (I was 24 at the time) that putting Reagan in and following his policies would only lead to consolidation such that the money would not trickle down. There was no reason that tax cuts would lead to paying labor more, instead I argued they would keep the money in the business to boost the wealth of the business.

    Or have we all forgotten the cheers that when up when Reagan busted the Air Traffic Controllers Union?

    We can not fix this until we understand how much the economic model has changed as to our choice as to how we are going to make money.

  16. David Vincent Says:

    This is not rocket science, folks. If the average industrial enterprise breaks down into a 60 or 70% labor cost component and 30-40% capital component, American enterprises using American labor requiring a wage level that meets an American standard of living are toast where markets are open. As we all know by now, enterprises with third world labor costs win all the marbles, and American enterprises, which were getting their skis waxed by foreign competitors in the American market, understandably moved offshore to get back to that holy grail of business, a level playing field.

    The solution is perfectly obvious and, mechanically speaking, easy to obtain. We are a sovereign nation, we can control everything that happens within our borders and we can limit imports to achieve equilibrium in our foreign trade. That and that alone will produce the number of jobs required to fix our economy and pay living wages to American workers, thereby preserving the middle class. Without it, the water leveling of wages will drive much more of the middle class into poverty and the American economic engine will continue its startling decline. As the end game, think Mexico.

    To take the necessary steps to save America as we know it, some wrenching decisions would have to be made, namely to 1) suffer the inflation that would follow severely limiting imports, 2) bail out of the WTO and other multilateral trade deals that we have entered into for years (and of which we have been the promoter-in-chief,) and 3) take the monetary punishment that would be met out by our chief creditor, the Chinese, when we cut back on their exports and they dump the dollar and quit buying our bonds.

    It is clear than American politicians do not advocate such measures (they would be hounded out of office), American business opposes such measures (the ones that have survived and outsourced are doing just fine, thankyouverymuch,
    and 3) consumers don’t understand all this and they are deep into cheap (the more economic pressure households are in, the more they need to buy the cheap stuff from Walmart, hence growing imports even more, and around we go.)

    Although the remedial course to restoration of America’s economy and worker prospects is clear and workable, (that option, which is very respectable, is beyond the scope of this comment)incredibly enough, there is no constituency for it beyond a few intellectuals. So, barring a lucky intervention by the chaos theory, we can all get ready for a water leveling of our wages with that of the third world, without the benefit of a low standard of living.

    Oh, and it gets worse. We (the world, but especially Americans) are using up all of the natural resources necessary for long term survival of homo sapiens at a forseeable rate, but, in this country at least, we lack any long range planning capability as a nation. We are too lost in our we-beat-the-communists-and-proved-once-and-for-all-that-Ayn Rand-was-right-and-collectivism-is-dead paradigm to vote for the big government that would be necessary to do effective central planning. The Chinese are not so handicapped.

    And for those who continue to have, and in the last election voted for, hope, you will surely come to grief as it becomes clear that the new green industry that the Obama Administration is talking up is, scalewise, just an R & D project. Nor is it likely that, as those industries mature over the long run, they will continue to reside here. (Wind turbines can be made anywhere) As for the main economy–the one that feeds, shelters, and clothes us and provides for our general welfare, Obama is drinking the same Kool-Aid as Bushes 41 & 43, Clinton, and Reagan. The open markets policies and practices of all these administrations (in which we voters were complicit) have led to the status quo. So is Obama, and his talk about opposing “unfair” trade agreements is just blather–pap for our consumption. So is the fantasy talk about promoting exports. All we have to export is low value stuff–what the shipping industry calls “rocks and trees”. Do you know that the biggest American export in America’s biggest trade lane (trans-Pacific) is–drum roll–wastepaper?

    I am cautiously pessimistic.

  17. C. Cryn Johannsen Says:

    What a lively and amazing conversation – thanks to all of you who have shared your thoughts so far.

    I am still hoping that this Administration will take the critical steps to help solve these enormous problems. Unlike David Vincent, I remain cautiously optimistic.

    I say that because I have been on calls with the White House’s policy staffers on higher education. The fact that I have been able to participate in these conversations means something to me – I am advocate for the indentured educated class, and must say that I appreciate the fact that I have spoken directly to those quite close to President Obama. I am impressed with that level of transparency.

    But here’s what remains to be seen (at least in terms of the student lending crisis) – will they ACT and help those in need (i.e., student borrowers)? Or will it will be another debacle like we have seen with health care reform?

  18. Les Holcomb Says:

    We use the words “workers”, “corporations”, and “productivity” quite freely as if they have meaning or explain anything, as if they have value and provide some inherent security or a way back to something that seemed to be working (no pun intended) but really was not, just hype that allowed us to create a monetary value to good will, brand recognition, and sell things and buy things and desire things and redefine things like the half-human creatures in Dr. Seuss and Jonathan Swift’s writings.

    It’s time to explore what these words really mean today and base our strategies on whatever remains or has been genuinely awakened for the first time through the failure of our business model, and what Nancy Pelosi once labeled as “arrogant, incompetent and corrupt.

    A worker? A corporation? a wage? The necessities for a healthy, mostly safe and “satisfying” life? It’s time to examine these. The words “minimum wage” are useless and dead.(Minimum for what?) When one says ” living wage”, that sounds like something that resonates with reality and is hopeful — but is puzzling since we know inside where that is going, and sounds as if we will have to give up our dreams, and lots of other things. But when we write down a list of what think we will have to give up, we find that we already gave them up, gave up on them, or they were commandeered (supposedly for some greater purpose) or were simply stolen.

    Anyway, that’s where I would start so that we would have a clearer picture of what we were talking about.

    There are other words to use with quite different meanings, and when we start to use them, our daily lives begin to redefine and reorder themselves, and things change, in a good way.

    So what’s a worker, really?

    I really hope you just ignore all this and don’t respond, so I can put all of this on the back burner, and just continue trying to do the little that I can as one person out in the market square, with no expectations from others, no thresholds for success (or failure).

    Our biggest problem is that we haven’t really sunk far enough to see that anything that we build, from this point on,in 2010, must fit on foundations that have shrunken to 80% of what they were, and probably have to shrink down to 70% of what they were to be reasonably sustainable for another generation or two. Isn’t the internet wonderful?

  19. Les Holcomb Says:

    What a hoot to hear that “my comment is waiting for moderation”. That’s great. I certainly need more moderation in my life. Thanks guys.

  20. C. Cryn Johannsen Says:

    Les – your remarks mean a lot to me, and they are powerful. So, the “internet is powerful,” and I am glad you posted. It’s not worthless. Thanks for sharing. Please write me here – ccrynjohannsen@gmail.com.

  21. Daniel Becker Says:

    C. Cryn Johannsen:

    I too am not as pessimistic as Mr. Vincent for a couple reasons.

    1. There are nations that did not sacrifice their social collectiveness for Ayn Rand/Milton Friedman ideology. There are small nations that have told the WTO, IMF and World Bank to take a hike.

    2. The solutions Mr. Vincent proposes are correct, but there are ways to get there that do not result in such pain. Could be another discussion. Mostly it starts with a return to a ideology of collectiveness. That naturally happens as one’s life becomes full of more risk and not less as is happening currently. Economics and thus our economy is all about risk; it’s control and reduction. The issue is risk control for who? For a while is was for all.

    In truth, the issue raised in this overall discussion is the awakening of the masses to the fact that they have been in a covertly fought class war. The covertness is the use of “patriotism” and US pride to hide the economic class distinction. It is a distinction that is defined by the means of which one achieves an income. It’s not the first time. Look up “The American Way” a phrase specifically coined to conflate democracy with capitalism by the National Association of Manufacturer’s in part when Kellog’s decided to go to a shorter work week for the over all benefit of the people and their community. The last legacy of which only died in the 80’s at Kellog. I suggest this Time article from Sept 28, 1936:
    http://www.time.com/time/magazine/article/0,9171,756746-1,00.html

    Or, go to the Tax History web site and read the language used to sell ever decreasing tax rates for a decade leading up to the //29 crash. It is virtually exactly as we have heard and followed since Reagan, including Clinton.

    As to Obama acting. I am not convinced. He can not respond as needed until he chooses to follow a different school of economic ideology. I do not see this happening simply because he chose the Chicago School when he formed his campaign team. Part of that team ultimately included past Clinton personnel. My theory was that when that happened, he received the blessing of the DLC.

    No, I think America may have to go through 2 more presidents of 1 term each before we get people who finally understand that people are the power. This of course assumes the Supremes don’t give the Corps the right to vote. :)

  22. Henry bowman Says:

    I suggest a book: the creature from jeckyl island: a second look at the federal reserve. By G Edward Griffin

    You can not address this without looking and talking truthfully about monetary policy. The same folks destroying america are behind the policy that has been the tool to bring about the destruction of the middle class for fun and profit.

    Until monetary policy changes nothing else will get better.

    Watch a film called endgame by Alex jones. He identifys these people by name and exposes thier agenda.

    http://Www.infowars.com. Is also a great place to start.

    Ron Paul is a congressman who has been talking about this for years and has answers on how to address the issues.

    If we follow the suggestions he has and the book has, other things will right themselves.

    You also might want to watch “fall of the republic” by Alex jones as well as “terrorstorm”

    These corporations do have an agenda and it is out there for all to see.

    They will not give up thier power willingly. But once we get educated it will be more difficult for them to carry out their plans.

  23. Peter Says:

    When corporate executive pay are capped by a multiple of its lowest paid worker, they’ll think twice about outsourcing.

    Not sure how to enforce this though, but I’d sure like to try.

  24. Marian Neudel Says:

    High unemployment among highly educated young people has always been recognized as a dangerous political development in the Third World. The only reason nobody worries about it here is that our young people are too well-behaved. We have allowed our children to be intimidated into accepting whatever The Economy offers. And, of course, those of us in the older generation are both intimidated and worn out by trying to sell ourselves when nobody’s buying. As long as nobody is scared of us or our children, nothing will change. I don’t like the Tea Partiers. Their ideology, such as it is, is garbage. But I like the fact that they have managed to scare the Establishment. We need to study their tactics and be prepared to improve on them.

  25. Ralph Swanson Says:

    I haven’t read all of the comments but a sampling leads me to believe almost none of the writers undertands the basic strategy that the olligarchy has used to create the conditions we find ourselves in and that is the setting of imbalanced currency exchange rates. The dollar is way overvalued in relation to other key currencies, the Chinese one in particular. “Third World Wage Rates” is in fact a meaningless term. A $1.00 per hour wage rate in a third world country when recaluclated using the proper (accurate) currency exchange rates might be $7.00 per hour and when calcualted as the true cost within the context of that country’s economy that same wage rate may be $18.00 per hour. It just might be that the worker in the “third world” may be living better than his counterpart in this country. (This is an extreme example and may not be totally realistic but it does make the point.)

    The Bank for International Settlements sets the bands in which the world currencies trade and the US helps run that bank and helps set those rates.
    Our government and the class that runs it have not hesitated to stab us in the back economically
    for the last 50 years.

    Something else to keep in mind: A discouraged demoralized impoverished population is the easiest of all to manage. How are the people put in that docile state of mind? Well, their day-to-day experiences play a big part in that but so does a media that continues a steady drumbeat of bad news and continuing laments of how hopeless it all is.

    As President Roosevelt said, “There are no accidents in politics. If something happens you can bet it was planned that way.” (That is an exact quote.).

  26. Ted Seeber Says:

    The real key in all of this is locality and protectionism. We need to return to subsidiarity as an ideal- not just here but in the third world as well.
    Breeding greed out of the human species hasn’t worked- it’s time to heavily punish greed, and that includes by removing those who put profit above the lives of our citizens from our civilization. Freeze their bank accounts, and send them elsewhere into exile on pain of death- and stop letting the multinational corporations have a retail business license in your city or town.

  27. Karen Mainor Says:

    Glad to see that there are some really intelligent people out there in the “blogosphere” who actually know how our global economy works, and how our nation’s multi-national corporations have mightily contributed to the demise of the middle class. The combination of tax cuts for the top 1%, trade agreements and tax policies that encouraged outsourcing of manufacturing, skilled labor, and now professional jobs, and illegal importation of cheap labor from latin american countries, has all but destroyed the middle class. If we the people do not rest control of our government from the greedy corporate interests (whose ONLY interest is ever increasing profits without regard for the widespread negative consequences to the people who work for them), our nation will experience another great depression, worse than the first one.

  28. KAB Says:

    Some of the responders over the last couple of days have identified a core touch point of this issue: “the American standard of living” which is a sacrosanct value in many circles in this country. That “standard” is promoted relentlessly by commercial interests (the economic generators) and can only be maintained via perpetually increasing spending habits, inexorably including an ever expanding use of credit.

    The plain fact is, in those competitor markets this is not the case — at least not yet to any significant extent — and they therefore have different income expectations and can live to a different “standard of living”. The debate is, does that different income and living standard define the American culture? Are we not the same without it? Is argument against this idea “un-American”?

    Here’s a little thought experiment. What would happen to a national politician who ran on the platform: Cash Only, Refuse All Credit; no regulation, simply national behavior change?

  29. jay allain Says:

    In addition to the provocative query, “Have U.S. Workers Priced Themselves Out of the Job Market?,”
    we could add a supplemental one: “Are U.S. Citizens Really a Bunch of ‘Sunshine Patriots’?”
    In other words, aside from noisy Tea Partiers, the American citizenry – as well as its struggling workers, seem rather morose these days. And what is the link between political apathy and workers’ subservience? Cryn Johannsen’s comment alluded to a key aspect of our plight when she suggested, “(I)t’s a matter of looking ahead and insisting that we shift the system, so that it’s more equitable.” In short, poverty and economic insecurity has beaten us down. Reich himself has acknowledged overwhelming income disparities breed a host of negative social phenomena – and the U.S. today is reeling from an unprecedented gap in incomes. The long-revered egalitarian belief that enormous opportunity would forever undergird the American economy has largely collapsed. Yet Tom Bishop proposes six critical legislative ways workers can push back. But again, this will require a resurgent sense of empowerment, a willingness to take back the country AND the workplace.
    Finally, two pertinent value questions: How can we begin to counter greed and demonstrate how it’s undermining the country’s prospects? And: How can we hope to emerge from our Great Recession, create jobs, and rebuild our communities without slashing our bloated military budget? The somewhat exaggerated attempt to protect the American people, aka, “the war on terrorism,” has become one of the System’s key organizing principles; it is used to stifle dissent and rationalize aggressive foreign policy while quietly helping bankrupt us. We need peace and decent jobs – hope as our reign as last standing superpower ends; that role is played out.

  30. Diane Says:

    From UP board member Tom Lewandowski:

    We finally got our snow day in Indiana so I had time to read the exchange more carefully. I wish I could have joined in this discussion with all of you around a table set up with adult beverages. Anyway, well after the fact, I want to throw in a little bit from my blue collar world just because your discussion made me want to join in.

    As a guy who used to wind transformers for GE, I priced myself out of the market. This is how I and my fellow workers did it back in 1990.
    After surviving a nine year lay-off, my fellow workers and I were forced into team concept manufacturing model at our Fort Wayne, Indiana plant.
    Our previous pay system had been individual incentive. In the individual incentive system we had invented efficiencies that no engineers or technicians ever did so we made money off of both our mechanical and process creativity-intellectual property. We owned it collectively through our hard fought negotiations that, at times, we won by striking.
    In the team system GE forced us to give up our ideas through schemes such as Six Sigma and employee involvement and thereby deconstructed our talents. After GE had picked our brains, they picked our pockets, and then put our jobs on a pick-up truck and moved them to Reynosa and Juarez. When I started at GE Fort Wayne in the early 1970’s there were about 9,000 production workers and now there are none. By not maintaining collective ownership of our intellectual property, we priced ourselves out of the market.
    The education carrot has always troubled workers. The most consistent way we have found to make it work for us is to collectively own our skills and quality. The only workers still holding on are skilled trade unionists with their jointly administered apprenticeship and training programs. Government and private training programs are designed to flood the market with educated individuals but not necessarily skilled or competent workers. Employers buy the minimum quality necessary to complete the job transaction as they push to depress work values. It is not just the employers quest for the smallest payroll costs, it is also employer narcissism.
    The corporate culture club and the wealthy come to the table when they have something to fear. I suspect they are a bit apprehensive when the see such widely shared but unfocused anger. They must be keeping their fingers crossed hoping we won’t rediscover courage and organizing.
    In Solidarity,
    Tom L.

  31. Tom Bishop Says:

    Ralph is right – currency exchange rates were not discussed but they are critically important, are little understood, and are therefore subject to gaming by people who have the knowledge and power to play, like global corps and their subservient governments.

    The Tea Partiers believe the problems come from government only, but they are only half right.

    A real tea party would be more aimed at companies, like the original one. It was a protest against a private trade power aided by government. Tea taxes had actually been recently cut, but the people would not be patronized. So they invaded a private port and destroyed privately traded commodities.

    A tea party in that spirit today would be a run on the banks, a blockade of the port of LA, or a mass abandonment of cable TV. Does it have to come to that? The tea partiers know how to make summer theirs. Do we have to make this a summer of hell for Wall Street and the politicians who worship there?

    Yes.

  32. Colin Says:

    This is simple: When an advanced, industrialized workforce is forced into competition with so-called “Third World” labor markets, the industrialized workforce will inevitably suffer. But this query is meaningless when it comes to the big picture. Rather than focus on competing labor markets, we should realize that the globalized, neoliberal capitalist model that formed in the latter part of the 20th century is bad for all workers of the world. And furthermore, the so-called western, free-market nations have only enjoyed such high standards of living at the expense of imperialism and global poverty. It is only natural that such exploitation must eventually come to an end. Quite simply, as one blogger suggested, capitalism has run its course. We have entered an unprecedented “grand finale” for the capitalist bonanza, which now enjoys record private profits backed by trillion-dollar public protections. In reality, capitalism has been on life-support for decades (saved time and time again by Keynesianism and State-controlled economies). Socialism is the future – and I am talking about true, bottom-up socialism, where democracy rules, rampant inequities are crushed and all workers gain control of the fruits of their labor.

  33. Bill Holland Says:

    I will leave all the talk of socialism versus capitalism to others.

    In reading Tom Lewandowski’s comments I was reminded that John Steinbeck won both a Pulitizer and a Nobel prize for Grapes of Wrath. From time to time, I wondered why. I am now convinced it had everything to do with his comment in Chapter Fourteen.

    “…And in the night one family camps in a ditch and another family pulls in and the tents come out. The two men squat on their hams and the women and children listen. Here is the node, you who hate change and fear revolution. Keep these two squatting men apart; make them hate, fear, suspect each other. Here is the anlage of the thing you fear. This is the zygote. For here ‘I lost my land’ is changed; a cell is split and from its splitting grows the thing you hate–’We lost our land.’ The danger is here, for two men are not as lonely and perplexed as one. And from this first ‘we’ there grows a still more dangerous thing: ‘I have a little food’ plus ‘I have none.’ If from this problem the sum is ‘We have a little food’ the thing is on its way, the movement has direction…”

    Bill Holland

  34. Diane Says:

    Bill, that quote cuts right to the heart of the matter. Since Steinbeck’s time that solidarity is harder to find, but we can find it again if we try.

  35. Susan Says:

    Okay, I’ve just got to get this one off my chest (and it’s not directed at anyone here), but the question itself seems insulting, and displays a psychology that’s deeply problematic, if not perhaps THE problem. “Have US workers priced THEMSELVES out of the job market?” It makes the situation sound as if a majority of workers have decided to stage some sit-down strike because they refuse to work for less that $40. per hour. As alluded to earlier, it’s US workers who have been priced out of the survival market.
    Okay- so I don’t imagine I’ve added much to the conversation, but I feel better. Thanks!

  36. Birks Says:

    I’m intrigued, surprised and astonished that this topic should raise it’s head now when the average guy on “Main Street” has known the answer for the last 10 years. Of course the U.S. workers have price themselves out of the U.S. market place, and it was only a matter of time that the same thing would happen globally.

    With salaries, pensions & benefits going through the roof in the U.S., what is it that is produced by the American worker, that is affordable by anyone? Cars? With such inflated price tags it is no wonder Asian brands, most notably Hyundai is selling better than any American car. The same can be said for cameras, TV’s, computers and just about anything.

    Back in the ‘50’s, “made in Japan” signaled junk. Today, the same can be said for most things manufactured in America.

    Service? What support has not been transferred to India or some other 3rd world country because: “The U.S. has once again priced itself out of the market”. Let’s face reality, we cost too damn much in everything we do and everything we charge. Why does it cost so much to have a plumber or an electrician perform a repair. Because they charge “brain surgeon” prices on a service industry than can not be farmed out to a 3rd world nation..

    Most nations are destroyed from within. What the Romans built lasted for thousands of years. We are about be destroyed by our own greed in a mere 250 years.

  37. Paul Stephens Says:

    This issue is the heart of what is wrong with our economy, and with the arguments in favor of various policies.
    “Free trade” and “the global economy” are ideas originally held by Liberals – advocates of personal freedom, representative government, expanded democracy, etc. But now, it is the corporatists (fascists) who claim to be promoting and defending this false “globalization.”
    No, American workers aren’t “pricing themselves out of the market.” They aren’t pricing anything. They are taking whatever they can get, and even the “Iron Law of Wages” identified by Ricardo promises more than what most American workers can hope for, now. Half or more of us are not even at a healthy, family-raising level of income.
    “Free trade” is the great myth and misconception. You can only have free trade with a sound international currency and standard of value. The dollar provided this for 20 years or more after WWII, and we benefitted from it – becoming not only the richest but the largest creditor nation. But 50 years of trace deficits, plus massive expenditures for wars of conquest and occuption, supporting dictators and multi-national corporate welfare have destroyed all that. We need to stop the “free trade” mythology, balance our current accounts, and get serious about maintaining all kinds of production in the U.S. High carbon taxes and Single Payer Healthcare are two absolutely necessary reforms if we are to maintain our economic viability.

  38. David Vincent Says:

    There is a false air of inevitability in most of these posts about American workers having priced themselves, or having been priced out, of “the market.” American wages need not be competitive with third world wages. Indeed they can not, because they have to cover American real estate values, American educational costs, American retail prices, American taxes, American health care costs, etc., all of which exceed those of the third world by many multiples. The reason why the “new service economy” is an investment in disappointment is that the retail service jobs that replaced lost manufacturing jobs don’t pay a living wage. (See Barbara Ehrenreich’s book, “Nickel and Dimed in America” for a definitive treatment of that subject.)

    What American’s don’t seem to realize (probably because no one will tell them,) is that we don’t have to follow an open markets policy. In fact, as a veteran of many, many government-to-government trade negotiations with Asian countries, I can tell you that our trading partners in Asia DO NOT AND WILL NOT EVER reciprocate (WTO or no WTO.) They deliberately, comprehensively, irrevocably protect their domestic markets and workers. Privately, they think we are stupid, and that our unwavering commitment to an open markets policy is madness, which it is. Our open markets policy benefits them hugely and they will talk it up big time, but they don’t and won’t ever actually follow it. This subject is kind of a deep pool, but the foregoing is factually true.

    Open markets favor those who have a trade surplus (them) and punish those who have trade deficits (us-and our deficits are vast.) Such a policy favors countries with smaller economies that can grow theirs by selling into the economies of their larger trading partners (us) and erodes the larger economies that allow such unreciprocated advantage (us). This is true whether our smaller trading partners have wage levels and standards of living comparable to ours (Japan) or whether they are third world economies that enjoy huge cost advantages due to low wages, government subsidies, and a lack of environmental and labor standards (China.)

    Can someone explain to me why America allows this madness to continue decade after decade? 50% of all the manufactured goods consumed in this country are now made overseas. Do Americans understand how many tens of millions of living wage jobs that has cost us–for no good reason other than consumerism? Every single one of those jobs could be returned here if we only mandated trade equilibrium–if we only did what our trading partners do. Under these circumstances, why aren’t people in the streets with pitchforks and axe handles? This could all change tomorrow if the one person who is uniquely competent to make this judgment, does so, namely, the American voter. The voter is more competent to decide it than any President or Congressional empty suit because the voter is also the American wage earner and the American consumer. So what is most important, having a living wage or buying more cheap stuff at Walmart? What kind of people are we? Do we value things more than people and communities? Do we deserve to fade away in decline?

  39. Bea Says:

    Briefly, I agree with Ehrenreich and others that more education and even, in many cases, retraining is not the solution in the current economic environment. It may have helped in the past, but is now a questionable solution to the unemployment problem. In the present job market – due in part to the surplus of candidates – job ads overwhelming ask for “experience” much more than education or degrees. So one who has been retrained would still hit a brick wall in trying to get a job, because he/she would still be without years of experience.

    I just watched a presentation in BookTV today with Barry Lynn who just published his new “Cornered: The New Monopoly Capitalism and The Economics of Destruction” which is very relevant to this discussion.

    Finally, as some mentioned earlier we may need to unite, not as workers but as the unemployed/underemployed or just as average Americans fighting for survival in our own land.
    We need a leader(s) to step forward for this new movement.

  40. Susan Says:

    @ Bea- I just returned to this site to mention the very same book (Cornered by Barry Lynn)! All great minds! ;-)

  41. melody Says:

    Very thoughtful, honest and articulate conversations… everybody is “right” with their observations.
    There is no “fix” for our economic system. The only thing we can do is opt out of being Consumers and start being Human BEings again.
    That may sound philosophical, but just consider for a minute that the failing of our toxic system is a GOOD thing! Let us all just step aside and become compatible with each other where we live. We meet our neighbors and talk to each other with respect. We have the same common interests. Just drop the spirit-killing negativity and follow your best positive instincts for the REAL “Good Life”! First – Stop BUYING… where we spend our $$$ is our true power right now. Cash Poor allows you to be more Time Rich…artistically creative (fun!). There are so many wasted talents…and lost love in those dreary cubicles. Toxic jobs are the real crimes-not a low income! If we keep drinking the kool-aid we will keep feeling sick – that meant both literally and figuratively. Our country has more than enough land and plenty of empty housing to serve everyone. We have solar technology and other safe and permanent support systems. Hands-on therapies like chiropractic-massage-acupuncture-herbals and natural products should be our first line of defense. We don’t feel good because of our lifestyle…so we have the power to change that…we just embrace it!
    We have everything we need. Now is the perfect time to make this transition and stop waiting! Let the money & intellectual resources that We, The People have be withdrawn from the corporations that serve only the elite. We were on this path in the sixties then we went on a detour. But that experience gave us the knowledge and tools we need to save ourselves Now. The answer is to simply live according to what we know is right. No complaining (except maybe about the weather!) MATTER FOLLOWS THOUGHT. Everything you see around you was created first by THINKING about it. So… Become a creative Lifestyle Artist! Let’s think about a Society where we cut out all the crap and invest in people working together and building human relationships with the people right beside you… not just people typing on a computer in a cubicle. Won’t it be a relief to stop “fighting” and playing the victim? Just imagine the possibilities…what if your dream is to have a happy life with loving relationships? That is within YOUR power. Do you really need the expensive car or house full of “stuff”? Maybe if we relaxed and loved each other more we would not need so much “medical care”.
    Thank goodness we are getting out of this “system”… just step aside freely. TAKE THE LEAP! Don’t we all admire people who do that? We, The People have the numbers to demand anything we want that is not being used…to build a new infrastructure ourselves using basic standards of health and cleanliness and democracy. Why Not? Do we have to ask permission? (Just consult your wise elders. They are waiting patiently to hear from you!) Think about it…IMAGINE THE POSSIBILITIES…

    “The night is far spent, the day is at hand: let us therefore cast off the works of darkness,
    and let us put on the armor of light.” Romans 13:12

  42. Spekkio Says:

    I have to disagree with some of the participants in the discussion – the first being Mr. Holland – who argue this isn’t a partisan issue and shouldn’t be a partisan argument. As Thomas Frank illustrated so well in “The Wrecking Crew: How Conservatives Rule,” the past thirty years have been largely dominated by the Radical Right, who have made the general public believe that government is evil and useless – in large part by making sure that government is ineffective when the Right has been in power. Recent examples include how the Bush (43) Administration neutered the EPA, the Department of Labor, the NLRB, FEMA, and other government functions they didn’t like by putting people in charge who fundamentally disagreed with that function of government in the first place. You may also recall the recess appointment of UN-hater John Bolton to be US Ambassador to the United Nations – talk about diplomacy! (I strongly recommend “The Wrecking Crew” if you have not yet read it.)

    We have been operating under some extreme forms of libertarianism for a good while now – where Adam Smith’s “Invisible Hand” became akin to a deity, Ayn Rand and Friedrich von Hayek became saints, and regulation, taxation, and restraint became sins. This is not mere hyperbole – if you check the news archives when Wall Street nearly melted down towards the end of 2008, you may find photographs of people praying and paying tribute to the “Charging Bull” statue on Wall Street. (For example: http://wonkette.com/403920/jesus-people-pray-that-false-idol-will-save-gods-economy)

    So with all this (government is bad, free market is good, trees are pretty, brush needs to be cleared) as background, should it be a surprise in hindsight that the general public has been screwed? According to this right-wing philosophy, corporations should be able to do whatever they like to make profit, to get in their way would be wrong, ethics don’t apply, and government can’t really do anything anyway because it can’t do anything right. It also logically follows that you would increase government outsourcing and privatization – after all, since government can’t do anything right and is bad, handing over its functions to private enterprise is good. This also explains why mercenaries…er, I’m sorry, private contractors…are acceptable for use in war, reconstruction, espionage, counter-insurgency, etc, etc.

    Stepping over to Ms. Johannsen’s cause (which I support), the student lending crisis, consider the implications of this radical philosophy on education. Again, under this light, are recent developments really that surprising? Giant banks handling most of the student loans? Sure, that makes sense, because that’s something that banks should do, and government would screw it up. Grants? No, those don’t make sense – nobody is going to profit from those – and since government is bad, grants from government are bad. Keeping schools and libraries funded and running smoothly? No, that doesn’t make sense, because those are extensions of government and government is bad and it can’t do anything right. Is it really a surprise that there’s been an explosion of for-profit universities and trade schools in recent years?

    The most recent trend I’ve seen in conservative political thought is that everything they do is about freedom. Apparently, allowing people to suffer is OK, because taking steps (socialism!) to ameliorate suffering might impinge on the “freedom” (often a euphemism for money) of others. We could probably house, clothe, and feed all of our nation’s poor, but (if done responsibly) the money would come from increased taxation on wealthy people, and that impinges on their freedom to spend that money however they like. Freedom means being able to buy another vacation home or fancy car whenever the mood strikes you. And don’t for a second suggest that people have the right to be free from want or free from fear, as FDR put it, because conservatives will tell you that nobody has a right to something that requires that government take property away from someone else. William Shatner’s exchange with Rush Limbaugh on the topic of health care was very illuminating (the good captain hosts an interview program for Biography called “Raw Nerve”) – Limbaugh equates having good health care with having a beach house. Since nobody has a right to a beach house, nobody has a right to health care, either. (Video clip: http://www.biography.com/video.do?name=shatner&bcpid=2226550001&bclid=52251666001&bctid=52239212001)

    I could go on and on but I think you get the idea. In my view, until we can persuade conservatives to abandon their extreme ideas and beliefs (admitting that they were wrong would be a bonus, but I won’t hold my breath) we aren’t going to make a lot of progress.

  43. jay allain Says:

    Fascinating discussion. An undercurrent of our explorations is how do we move from our awful present to a healthier economic future. The Organized System has been adept at atomizing us; and we must create a surge in human solidarity – not in Afghanistan. Part of our economic woes, I believe, can be traced to an inherently wasted and bloated military budget which curiously seems to be a nonstarter in serious discussion. Hmm…
    But Holland’s quote from “Grapes of Wrath” evokes solidarity well… and a vital read is Studs Terkel’s “Hope Dies Last…” The man was a great national resource and his wisdom is vital today.
    Looking backward, remember the Solidarity movement in the Eighties in Poland? A determined movement helped destroy a system deemed impregnable, the USSR. We’ll need something comparable… Finally, I think Reich has been unfairly dismissed herein; the man’s blog is brilliant and he could be forgiven for occasional overexuberance about education, eh? We all need to learn how this system has enslaved us – and how we’re going to extricate ourselves!

  44. C. Cryn Johannsen Says:

    Spekkio – you have posted an insightful and lengthy response to the discussion, and added to it greatly.

    I think you hit a critical point about the radical right. The anti-government rhetoric that comes from folks on that end is eroding the critical concepts of good government. It is dangerous and only serves the interests of a few in the country. It’s a shame. An absolute shame.

    I say to these anti-government politicians, “Fine. If you hate government so much then GET OUT. Because I doubt you’ll be much of a help to your constituents if you think government is so eeeeevil. Indeed, I don’t want people running government who HATE it. You have no business being there.”

    It’s one thing to emphasize state’s rights and “smaller government” (those two things, in my view, represent an “old-school” type of Republican, and I can at least respect that perspective). But it’s quite another thing to go after your colleagues and appeal to part of your base (I emphasize the word “part” by the way) that is, let’s face it, racist and enamored of the concept that the country has gone socialist (er, not “rogue,” mind you, because, uh, that’s a good thing). Ha! How pathetic and false that is!

    To me, this rhetoric is beyond atrocious, not to mention inexcusable.

  45. Barbara Ehrenreich Says:

    The issue is not the size of government, but its functions. The radical right doesn’t complain about the huge Pentagon budget or the routine abuses and misuses of law enforcement (war on drugs, harassment of people of color, penitentiary industry etc.) — they usually just get upset when the government seems to be HELPING someone!

  46. Robin Leslie Says:

    All of these problems stem from neo-liberalism (market fundamentalism, secularism)the latest
    twist of that inveterate twister modernity.
    The only real lasting change is transformation, and that means getting out of modernity, out of economic fundamentalism, out of the ego (’that little mortal absolute’ as Wittgenstein called it)and into a humanity far fuller and richer than modern humanism.
    We will all have to change our way of life, USA included. We don’t OWN anything! Ownership is a
    predatory fiction. Oh, and in case anybody forgets, we don’t own anybody either.
    Enf of Story! Or beginning, if you’ve really changed yourself of course!

  47. jay allain Says:

    Intellectual discussions such as this are most edifying but beg a fundamental question: What are we going to do about it? While new insights are critical, so is avoiding the ‘paralysis of analysis’. As generally progressive members of the intelligentsia, it behooves us to attempt teaching our fellow citizens, too. People are discouraged. As Howard Zinn observed, “The American people aren’t bad – they’re misinformed.” People are inundated with information, but how much of challenges the status quo? The media has largely become apologists for the Organized System. (Is it: “Love is never having to say you’re sorry”?) And currently there are five lobbyists for every member of Congress. Somehow we need a massive and sustained groundswell to put concerted pressure on these shameless vultures. Agitate!

  48. Diane Says:

    Diane did not write this comment. It arrived via email and she posted it. It was written by Melody Record.

    Very thoughtful, honest and articulate conversations… everybody is “right” with their observations.
    There is no “fix” for our economic system. The only thing we can do is opt out of being Consumers and start being Human BEings again.
    That may sound philosophical, but just consider for a minute that the failing of our toxic system is a GOOD thing! Let us all just step aside and become compatible with each other where we live. We meet our neighbors and talk to each other with respect. We have the same common interests. Just drop the spirit-killing negativity and follow your best positive instincts for the REAL “Good Life”! First – Stop BUYING… where we spend our $$$ is our true power right now. Cash Poor allows you to be more Time Rich…artistically creative (fun!). There are so many wasted talents…and lost love in those dreary cubicles. Toxic jobs are the real crimes-not a low income! If we keep drinking the kool-aid we will keep feeling sick – that meant both literally and figuratively. Our country has more than enough land and plenty of empty housing to serve everyone. We have solar technology and other safe and permanent support systems. Hands-on therapies like chiropractic-massage-acupuncture-herbals and natural products should be our first line of defense. We don’t feel good because of our lifestyle…so we have the power to change that…we just embrace it!
    We have everything we need. Now is the perfect time to make this transition and stop waiting! Let the money & intellectual resources that We, The People have be withdrawn from the corporations that serve only the elite. We were on this path in the sixties then we went on a detour. But that experience gave us the knowledge and tools we need to save ourselves Now. The answer is to simply live according to what we know is right. No complaining (except maybe about the weather!) MATTER FOLLOWS THOUGHT. Everything you see around you was created first by THINKING about it. So… Become a creative Lifestyle Artist! Let’s think about a Society where we cut out all the crap and invest in people working together and building human relationships with the people right beside you… not just people typing on a computer in a cubicle. Won’t it be a relief to stop “fighting” and playing the victim? Just imagine the possibilities…what if your dream is to have a happy life with loving relationships? That is within YOUR power. Do you really need the expensive car or house full of “stuff”? Maybe if we relaxed and loved each other more we would not need so much “medical care”.
    Thank goodness we are getting out of this “system”… just step aside freely. TAKE THE LEAP! Don’t we all admire people who do that? We, The People have the numbers to demand anything we want that is not being used…to build a new infrastructure ourselves using basic standards of health and cleanliness and democracy. Why Not? Do we have to ask permission? (Just consult your wise elders. They are waiting patiently to hear from you!) Think about it…IMAGINE THE POSSIBILITIES…

    “The night is far spent, the day is at hand: let us therefore cast off the works of darkness, and let us put on the armor of light.” Romans 13:12

  49. Cindy Piester Says:

    We are losing jobs to technological advances and our willingness to buy into things like self check out that are springing up everywhere. If we as Americans could, collectively, support jobs in our own communities by starting No Self Check Out! campaigns around the country it would help.

    Bernanke: companies can shed workers and rely on technological advances and overseas factories to operate with a lot fewer U.S. employees. “Since 2007, the U.S. has lost 8 million private-sector jobs, and the unemployment rate has risen to more than 10 %, – worse than in any recession since World War II. http://www.consortiumnews.com/2009/111709.html

  50. John H Says:

    I wish I could have gotten into this conversation earlier. I could go on and on. But just one thing that Caught me by surprise was a term I never heard before.

    Robin Leslie used the term “Neo-Liberalism.”

    I have always heard and used the phrase “Neo-Conservative.” I wonder if we are referring to the same thing.

    Politics is NOT straightlined. It is a sphere. At some point, the radical right-wing wackos and the radical left-wing wackos actually agree on issues on the opposite side of the sphere from “mainstream” or “moderate.”

    I was going to go into a diatribe on how the GOP has been hijacked by the Neo-Conservatives (people who are so right-wing, they are actually radical left on issues), but that just takes us off course from the whole unemployment issue. But, I am wondering if Robin and I are talking about the same thing with different terms.

    If we can force the outsourcing model to its endgame, we would resolve the whole problem: Mr. Board-of-Director, why are you paying Joe C.E.O. $30 million a year (and giving him $50 million in bonuses) when you can outsource the C.E.O. position to Jalapeno Ramaswami (an MBA from the University of Elbonia) for just $5000.00 a year? In Jalepeno’s currency, it would be like paying him $5 Million, which would make him one of the richest men in Elbonia. Give him a virtual office in Elbonia, so he does not have to incur the U.S. housing market (or standard of living), and you can put the other $79.95 million into “shareholder value.”

    “Maximizing shareholder value” is another cock-and-bull line used in industry. It equates to “shareflipper price.” An excellent article on what is wrong with U.S. Industry in general is in the Internet article Built to Flip (http://www.fastcompany.com/magazine/32/builttoflip.html) by Jim Collins. The problem goes all the way down to the very people investing in industry, nowadays.

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