Category Archives: The Working Class and the Economy

The Value of Admitting that Raising the Minimum Wage Could Cost Jobs

A few weeks ago I watched Bill Moyers interview conservative economist Arthur Brooks as he mouthed the Republican talking point that the problem with the minimum wage is that “it hurts the people it’s supposed to help” because it eliminates jobs. Moyers politely countered that “some studies” show that minimum wages do not kill jobs. A few days later the PBS News Hour rehearsed an almost identical dialogue between an advocate of living wages and an opponent – a battle of studies about potential job loss. You have undoubtedly heard similar talking-point contests dozens, if not hundreds, of times.

The problem with this debate is that it goes nowhere and educates no one about the relationship between declining real wages for 3/4ths of those employed and the very slow and low economic growth that leaves us with an official unemployment rate above 6%.   By itself an increase in the federal minimum wage to $10.10 an hour by 2016 and then adjusted for inflation each year thereafter, as proposed by President Obama, is insufficient to address these problems. But as the leading edge of a broader program to increase worker spending power in order to get the economy growing more fully, it could be the kind of signature issue that rallies the Democratic base of young people, women, and people of color while also attracting a significantly larger portion of the much-prized white working class (defined as whites without bachelor’s degrees).

For the minimum wage to be a leading edge of such an economic program, however, progressive Democrats have to admit that a large enough and quick enough increase in the federal minimum wage does, in fact, threaten the loss of some low-wage jobs. They have to abandon their “studies show” approach to defending a minimum wage increase, and instead develop a larger narrative about how our gross and still increasing inequality of income and wealth is the principal reason our economy is growing so slowly and, therefore, producing so few jobs.

What’s more, it does not take much political courage to exploit this opportunity because increasing the minimum wage is so damned popular. This is clear from the public reaction to the Congressional Budget Office (CBO) report that concluded, as USA Today headlined, that a “Minimum wage hike could cost 500,000 jobs.” Weeks after this news was widely proclaimed, and typically seen as declaring the Republicans the winner in the “job-killer” talking-points debate, a Pew Center survey found that nearly three-quarters of the public supported a $10.10 minimum wage as proposed by the President.

The strongest argument for a substantial increase in the minimum wage is the one President Obama articulated recently, the simple moral imperative that: “Nobody who works full time should ever have to raise a family in poverty.” The public, including even a slight majority of Republicans, apparently accepts this imperative even if it might cost a substantial number of jobs.

What the CBO report actually said was that somewhere between zero and 1 million jobs might be lost, settling on the 500,000 figure as an educated guess – and thus granting that Democrats could be right in insisting that no jobs might actually be lost. At the same time, the CBO estimated that at least 16.5 million workers would get higher wages directly (because they make less than $10.10 now) while additional millions making a bit more than $10.10 now might also get raises from a “spillover effect” –including, in the CBO’s words, “a few higher-wage workers [who] would owe their jobs and increased earnings to the heightened demand for goods and services that would result from the minimum-wage increase.” Thus, the CBO thinks there is a trade-off: of the 17 million workers directly affected, 97% would definitely benefit while 3% might lose their jobs.

Equally important, the CBO compared President Obama’s earlier $9-an-hour proposal with the current $10.10 one, and found that many fewer people would benefit from it (7.6 million) but fewer jobs would be put at risk (only 100,000). Thus, by reducing the amount of increase, the trade-off is also reduced: 98.7% would definitely benefit and only 1.3% might lose their jobs, but less than half the number of workers would be affected.

This is the single most important thing about the federal minimum wage: the higher the wage floor, the more people who benefit but the more jobs that are put at risk. For most public policies (or private ones for that matter) something that benefits 97% but harms 3% would be considered an excellent risk-reward ratio. But the loss of a job (even a low-wage one) in our society is such a punishing harm that it makes most people hesitate to “throw anybody under the bus.” Though majority public opinion supports the $10.10 minimum wage anyway, the threat of job loss undoubtedly reduces their ardor and thus the saliency of the issue in elections. The Pew survey cited above, for example, found a large gap between support for the increase and the degree to which that support would affect people’s votes.

If, as Democrats currently do, you want to insist that increases in the minimum wage won’t cost any jobs, you have to keep the increase relatively low. On the other hand, if you grant that jobs may be lost and you are not indifferent to that, then the logical response would be to search for a way to replace the 500,000 jobs that might be put at risk.

Such a way is easily found in another highly popular Democrat proposal: government investment in infrastructure — roads, bridges, water and sewer systems, public transportation, weatherization and other energy efficiency, and green technology. All these are included in President Obama’s current budget proposal before Congress, though at very small levels. The President proposes an increase of just $75 billion a year for the next four years, while the House Congressional Progressive Caucus (all Democrats) wants $130 billion a year over ten years, and the American Society of Civil Engineers estimates that we need $225 billion a year over the next 16 years. Using Council of Economic Advisers’ estimates, Obama’s minimalist plan would create 975,000 jobs, while a fully developed program that would meet our infrastructure needs would provide 2.8 million mostly decently paid construction jobs.

I may be comparing apples and oranges among these various plans, but you get my point. The President’s minimalist plan would create more than enough well-paying jobs to replace any low-wage jobs that might be lost due to increasing the minimum wage to $10.10 an hour. If we actually invested amounts like the American Society of Civil Engineers thinks we need, we should be able to offset any jobs lost to an even higher minimum wage – say $15 an hour. Over time, low-wage jobs would be replaced with higher wage ones, greatly increasing worker spending power, reducing inequality, increasing economic growth, and creating even more jobs.

Such an ambitious infrastructure program would have to be paid for, and the President has proposed to pay for his minimal program through a variety of small tax increases based on eliminating loopholes for corporations and individuals. But here our great inequality of wealth and income becomes a distinct advantage, as one of our most plentiful national resources is rich people with much more money than they need. As I have pointed out before, there are any number of ways to increase taxes on the top 1% or 2% without significantly reducing their living standards and life prospects. $220 billion is chump change for a group that each year earns $2 trillion more than they used to when labor unions forced productivity sharing on profitable companies.

You may say this is all pie in the sky, but I offer it as a winning political program for Democrats – one that simply ramps up and connects several existing Dem proposals. A minimum wage that could really make a difference in people’s lives would disproportionately benefit the Democratic base of young people, women, and people of color – giving them a reason to vote. An infrastructure program at a scale we actually need in the 21st century would disproportionately benefit white working-class men, a key part of the Republican base, while also providing opportunities for renewed affirmative action hiring requirements in the building trades. A large tax increase on our oligarchs would satisfy many people’s sense of justice while providing the money to get the economy growing again at a pace that can provide jobs and wages that make everybody’s lives better.

This is a program that could give working-class people of all colors and genders a reason to vote and a reason to vote for Democrats. Republicans are currently blocking small increases in the minimum wage, minimalist investments in infrastructure, and tax increases on the rich of any kind. Why not propose something big enough to make a difference – replacing low-wage jobs with well-paying ones – and then win elections that might allow you to actually do it?

Jack Metzgar
Chicago Working-Class Studies

The Pipeline and the Unions

The controversy over the Keystone XL (KXL) pipeline has sharply divided the labor and climate movements. The KXL would provide a new direct route for the northern leg of the existing Keystone pipeline bringing Alberta tar sands oil to refineries in the US Midwest and the Gulf Coast of Texas. The new pipe would be 36 inches in diameter, increasing Keystone’s capacity to more than one million barrels per day. It offers the promise of good jobs, virtually unlimited fuel, and – some claim – climate disaster.

Terry O’Sullivan, president of the Laborers International Union (ILUNA), has been lobbying hard for Keystone and is frustrated that “a pipeline that could put thousands of Americans to work and help ensure our nation’s energy security remains stalled” because President Obama has postponed making a decision until after the mid-term elections. O’Sullivan regards those who oppose the pipeline as job killers. He has been joined in his pro-KXL campaign by other construction trades unions, including the Ironworkers, IBEW, and Operating Engineers, some of which have project agreements with the pipeline’s builder, TransCanada. In February 2013, the AFL-CIO issued a “Statement on Energy and Jobs” that called for “expansion of our pipeline infrastructure,” though without naming Keystone.

One of the pipeline’s many opponents is James Hansen, the NASA scientist who famously wrote that building it would be “game over for the climate.” He calls the Alberta tar sands oil that would be pumped across the US via Keystone “one of the dirtiest, most carbon intensive fuels on the planet.” Canada’s deposits contain twice the amount of carbon dioxide already emitted by global oil use over time, and exploiting them would raise greenhouse gas emissions to disastrous levels. Hansen’s data and his example helped galvanize the anti-pipeline movement that took to the streets of Washington, DC in 2011, where Hansen and a 1000 other activists were arrested at White House protests. Several labor unions also oppose the pipeline, including the Amalgamated Transit Union (ATU) and National Nurses United.

Opponents point to potential problems beyond the climate effects of extracting and burning this fuel. Unprecedented quantities of toxic crude will be transported across the Ogallala aquifer, the Sandhills wetlands, an active seismic zone, and farmland whose owners can be dispossessed through “eminent domain.” TransCanada claims this would be the world’s safest pipeline (despite a devastating 2010 spill from their pipes in Kalamazoo, Michigan), to which Nebraska farmer Randy Thompson responds: “What was the safest ship that was ever built?” At the local level, a coalition of ranchers, farmers, and tribal communities in Nebraska and South Dakota – including the Cowboy Indian Alliance — is now stalling the pipeline through court challenges and creative direct action.

Supporters of the pipeline are concerned primarily about jobs, though they also claim that it will help ensure US energy independence — oddly, since the point of transporting Canadian oil to the Gulf is primarily to refine and ship it to global markets beyond the US. Access to the much closer coast of British Columbia is blocked by the resistance of First Nations communities and BC residents, despite Canadian Prime Minister Harper’s approval of the Northern Gateway pipeline. KXL opponents point out that a far greater contribution to US energy independence would be created by a wholesale and rapid transition to a low-carbon economy fueled by renewable energy.

Unions, of course, have a responsibility to protect their dues-paying members’ jobs, and to generate more jobs where they can. Around one million construction workers are out of work, and the pipeline is “shovel-ready.” Job-creation estimates for KXL vary wildly from the US Chamber of Commerce’s 250,000 to Cornell University Global Labor Institute’s 500 to 1,000. TransCanada claims 20,000. Whatever the number, most KXL jobs would be temporary, during the two-year construction phase. And again, the pipeline’s employment potential is dwarfed by the numbers that could be put to work – including laborers, pipefitters, electricians, and operating engineers — through a massive investment in renewable energy (wind, solar, and geothermal) and in upgrading the nation’s infrastructure (water systems, public transit, and the electric grid).

This is the program around which current labor-climate partnerships can unite, according to Joe Uehlein of the Labor Network for Sustainability, whose slogan is “Making a living on a living planet.” Uehlein was a member of ILUNA at a time when it featured a bumper sticker that read, “Hungry and out of work? Eat an environmentalist.” He has since worked as director of the AFL-CIO’s Industrial Unions Department and was its representative to the UN commission on global warming. He knows the history of organized labor’s tangled relationship to environmental struggles and cites several productive partnerships. “The UAW was by far the largest contributor to the first Earth Day,” and UAW president Walter Reuther was an enthusiastic endorser of the Clean Air Act. The BlueGreen Alliance of unions and environmental groups, founded in 2006 out of a partnership between the Sierra Club and United Steelworkers, works to promote jobs and investment in the green economy. Uehlein’s network promotes a “just transition,” with protections and training for workers in declining sectors of the economy.

You can demonstrate solidarity on issues of climate and jobs by joining the upcoming Peoples Climate March on September 21 in New York, in advance of a UN meeting to hash out an inter-government agreement for dramatic reductions in global warming pollution. Participants announced to date include the ATU, along with locals and regional branches of the Machinists, SEIU, IBEW, CWA, TWU, Teamsters, Nurses, UAW, AFT, AFSCME, Heat and Frost Insulators, and the Canadian Labor Congress.   More will no doubt sign on as the date approaches. The support of so many unions in what organizers predict will be the world’s largest mass demonstrations on climate issues is encouraging.

As Jeremy Brecher puts it, explaining the unanimous vote of the Connecticut State Council of Machinists to support the March, “Addressing the climate crisis is an opportunity to reduce unemployment, grow our unions, improve our community’s health and restore balance to our environment.” These union brothers and sisters, marching alongside hundreds of environmental groups, can help us to be as clear about what we are for as what we are against. A “just transition” to the low-carbon economy, with green jobs at living wages, need to be front and center in the climate rally and the campaigns that follow.

Nick Coles

Climate Change and Income Inequality

People committed to struggles for peace and justice always have our work cut out for us.  The forces arrayed against us are powerful and determined, and the range of issues and crises demanding action is daunting.  Given our limited time and energy, where and how do we apply them for the common good?  What guides us in deciding?  Life experience and the values we uphold, no doubt, but also our analysis of the present situation.  For me, the two broad concerns that have become most pressing, at least since the economic collapse of 2008, are income inequality and climate change.

These are, of course, twin products of industrial capitalism and its class system.  The rising oceans, killer heat waves, floods, species extinctions, and crop failures we are witnessing on the climate front – like the poverty wages, attacks on labor, bank fraud, malnutrition, and “austerity” in public services on the class front – are inter-related signs of a system in crisis.  Yet the two issues – climate change and income inequality – are rarely linked in a common analysis.

For instance, a recent study by the UK Government Office of Science predicts that, given increasing global population, “by 2030 the world will need to produce 50 percent more food and energy, together with 30 percent more fresh water, whilst mitigating and adapting to climate change.”  Author John Beddington adds, “This threatens to create a ‘perfect storm’ of global events,” without specifying what those events might be or how they will be exacerbated by unequal distribution of the necessary resources.

The just-published fifth assessment of the UN’s Intergovernmental Panel on Climate Change (IPCC) goes a bit further, according to The Guardian’s report:

The volume of scientific literature on the effects of climate change has doubled since the last report, and the findings make an increasingly detailed picture of how climate change – in tandem with existing fault lines such as poverty and inequality – poses a much more direct threat to life and livelihood. (my italics)

One study that does make the link explicit comes from the NSF-funded Socio-Environmental Synthesis Center in a report titled “Human and Nature Dynamics (HANDY): Modeling Inequality and Use of Resources in the Collapse or Sustainability of Societies.”  When Nafeez Ahmed wrote about this report in his Earth Insight blog for The Guardian, he touched a nerve regarding our “convergent catastrophes,” and generated a storm of commentary.  The study, Ahmed writes, “highlight[s] the prospect that global industrial civilization could collapse in coming decades due to unsustainable resource exploitation and increasingly unequal wealth distribution.”

The HANDY report begins with a review of past collapses of societies – such as the Roman Empire, Han dynasty, and Mayan civilization – to demonstrate that societal collapse is “a process recurrent in history, and global in its distribution.”  Collapse typically entails loss of political authority, breakdown of economic systems, and inability to sustain the population.   Not all societies collapse, of course, but in those cited the cycle of “boom and bust” seems to take about 300 – 500 years.

Noting “widespread concerns that current trends in population and resource use are unsustainable,” the authors apply their analysis of such collapses to the question “whether modern civilization is similarly susceptible.”  Explanations for particular cases of collapse vary by time and place and include drought, foreign invasion, earthquakes, technological change, famine, and popular uprising.  But across states and cultures that have collapsed over the past 5000 years, the authors find two common features: “the stretching of resources due to the strain placed on the ecological carrying capacity, and the division of society into Elites (rich) and Commoners (poor).”

Using the HANDY theoretical model, the authors analyze interactions between population and natural resources as these tend towards equilibrium or towards collapse, across three scenarios: 1. Egalitarian society without Elites, which can achieve a “soft landing” to equilibrium;2. Equitable society, with Workers and non-Workers (students, retirees, disabled people), which oscillates a bit but can still achieve a negotiated sustainable equilibrium; 3. Unequal society with Elites and Commoners — “most closely reflecting the reality of our world today” – in which,

Given economic stratification, collapse is very difficult to avoid and requires major policy changes, including major reductions in inequality and population growth rates.  . . .  However, collapse can be avoided and population can reach equilibrium if the per capita rate of depletion of nature is reduced to a sustainable level, and if resources are distributed in a reasonably equitable fashion.

Good luck with that, you might be thinking – but it is the goal!

The HANDY analysis is mathematical and complex, but two significant points emerge clearly.  One is that technological innovation does not reverse the trend towards collapse:  “Technological change can raise the efficiency of resource use, but it also tends to raise both per capita resource consumption and the scale of resource extraction, so that, absent policy effects, the increases in consumption often compensate for the increased efficiency of resource use.”  For example, greater fuel economies for cars can have the “rebound” effect of encouraging people to drive more and faster, in newer cars.  Current “policy effects,” despite occasional “green” tweaking, all tend towards encouraging consumption as a stimulus to economic growth.

The other point addresses the conundrum: do the leaders of the fossil fuel industries, and the politicians who do their legislative bidding, not know that their activities will make the Earth uninhabitable, for themselves as well as the rest of us?  Well, “it is important to note that the Elites – due to their wealth – do not suffer the detrimental effects of the environmental collapse until much later than the Commoners.  This buffer of wealth allows the Elites to continue ‘business as usual’ despite the impending catastrophe.”   This mechanism, the authors believe, may explain the obliviousness of the elites in the face of the impending Roman and Mayan collapses.  But they got theirs in the end.

Although I’ve been concerned here with scenarios of collapse, I am an optimist, still hopeful that the arc of human history does indeed bend towards justice.  I am also a realist, and I sense that the arc is going to need a mighty shove from those of us who still believe we can shape our history.  The fundamental problem we face, as the HANDY study makes clear, is that a sustainable equilibrium of population and resources is incompatible with business as usual under industrial capitalism.  And the difference in the current cycle of boom and bust is that the society threatened with collapse is not Roman or Mayan or even American, but global.  It’s all of us.

Perhaps I ‘ve gone a long way round to affirm the obvious: that issues of economic and social justice are interrelated with issues of environmental justice and climate change, and that we need to keep making those links visible in our activism.   But I find it helpful to have an analysis that explains the linking mechanism and points a way forward, while laying out very clearly the consequences of inaction.

Nick Coles

Better Jobs Drive Better Business

Good jobs are hard to find.  Hard jobs – entailing bone-tiring work, low wages, and limited or no advancement opportunities — are all too plentiful.  And in our country that’s been a big and growing problem dating back at least three decades.

HouseholdIncomeSince the early 1980s, job growth — and especially job quality – wilted in the face of intersecting economic, political, and demographic forces.  As usual, the short end of the stick is found in the hands of the working class and lower middle-income households.  Earnings stagnated for these groups as poverty jumped and un- and underemployment took and continues to extract heavy tolls.

These aren’t just statistics for me.  They are also my family story.  My father and two siblings worked for most of their lives in manufacturing.  I made it to college by working a few summers in a local plant.  I took away both a withdrawal card from the Machinists Union and many lessons about work and life.  But my career trajectory changed, and I went to work for a series of state and federal elected officials. This was an “up close and personal” viewpoint on how government – at the state, federal, and local levels – can expand opportunities for good jobs and stronger, more resilient communities.  But lately, I’ve grown pessimistic about the prospects for political or policy changes that might make a real difference.  Gridlock and paralysis spread – perhaps an expected result of a “conservative” governance apparatus.  Politics can be a noble calling and sometimes produces courageous heroes.  But recently, we’ve seen too much ignobility and too little spine.

That’s part of why I left the public sector.  Now I work in the nonprofit and philanthropic sector, as a program officer in a foundation. Much of my work and that of my colleagues at The Hitachi Foundation focuses on how foundations can use their tools and resources to address challenges and expand opportunities for low wealth individuals, families, and communities.

Most philanthropy targets social, educational, or support services, while others promote policy changes.  A third category aims at organizing or direct action at the worker, community, city, or even national level.  Each has its merits, and the sector makes almost $50 billion in grants annually. But only a fraction of that, about $14 billion, is targeted to the “economically disadvantaged.”  If you divided that into equal shares and only consider the 46 million people living in poverty in the U.S., it would only deliver $303 per person each year.  That’s not much of a supplement.

So philanthropy in general and our foundation in particular must focus our efforts.  The Hitachi Foundation is working on the role that good businesses can play in creating many more good jobs and improving opportunities for lower-wage workers to gain earnings and advance.  Many philanthropists, like many in working-class studies, are skeptical of the business world.  But our experience suggests that business leaders are not monolithic in their viewpoints.  If we provide evidence that “good jobs” can generate growth, profits, and happy customers, many more businesses can be spurred to take action that will benefit lower-wage and frontline workers.

Over the past five years, we’ve amassed compelling evidence that some businesses create social value even as they pursue a profitable and sustainable bottom-line.  Before we did the research, we expected that specific HR and training practices would be the generator behind significant gains in earning and career acceleration for frontline workers.  That was true in part.  But we were surprised to see that workers and employers made the largest gains when companies innovated in the products or services they offered, in the methods for producing or delivering good and services, and in HR practices and training programs.  In retrospect, of course, these strategies are interrelated. With new products or services and/or innovation in methods for producing them, there’s a premium on engaging and retaining workers with skills and experience.  And on top of that, the talent and skills grown by workers who are already in the business are often the best and most valuable fit.  All that can yield a larger overall pie that can be shared with workers.  Mutual Gain Bargaining has a history of pursuing similar ends in the context of a labor agreement.  Whether a plant is organized or not, gains aren’t always shared.  But where they are not, the workers’ incentives are poorly aligned with business goals.  Good workers with skills will be more inclined to look for other options and leave when they find them.

In the Good Companies @ Work program, we’ve collected stories of just under 100 firms that attribute their success to their frontline workers. These companies outperform their peers while providing quality jobs and pathways to the middle-class.  For example, Marlin Steel made a dramatic transition from old technology, a product in declining demand, and outmoded methods to become an innovative leader.  This Baltimore firm made baskets for bagel bakeries and stores.  But demand declined sharply according to the company because the rise of low-carb diets. Marlin quite literally “reinvented” their business and that made it possible to shift from making bagel baskets to supplying Boeing.  Today, Marlin has a more flexible approach to manufacturing a different set of products.  In part, they use some advanced technologies such as robotics and laser cutters.  The company did not make a wholesale change in their workforce.  Their core group of workers was with the company before, during, and now after the transition.  The company and the workers did invest in training, and that expanded their ability to manufacture higher quality products with less time from the initial order through design and manufacturing and on to delivery.  Another innovation at the company directly ties  wages of production floor workers to skills.  The more machines and processes they are capable of operating, the higher their hourly rate.  The firm also has a production bonus system that shares profits with workers, who can earn as much as 40% above their hourly earnings by meeting weekly team goals.

Good companies are more likely to generate good jobs.  But we’re not naïve.  Many – maybe even most – corporate or business directors are driven by short-term profit maximization.  But many are not. They bring their personal values beyond the plant gate or office door.  And those values help interest them in offering opportunities to improve wages and working conditions.  But values and motivation take business owners only so far.  We find good evidence that for many businesses, doing the right thing for and with frontline workers is not just consistent with the imperative for businesses to survive and thrive.  In many cases, it is essential to staying profitable and positioning the company for the future.

We will continue and deepen our efforts to help businesses make that connection in the years ahead.  And we’ll share what we’re learning, because we see communication as key to altering the dominant paradigm that profit margins require companies to put the maximum squeeze on labor costs.

Why focus on business to expand opportunity for low wealth, lower-wage people?  Because we believe that it works.  We’ve seen sustainable, profitable models in action. Equally important, business has more resources to create more and better jobs than either philanthropy or government.

Our goals include supporting and fomenting changes inside the plant gate, or with patient care teams, or in other settings. If we can do so that will create progress that is not dependent on the next grant or election cycle.  Neither the public sector nor the foundation world has a good track record for sustained focus and effort.  Causes rise and fall with the next crisis or new opportunity.  But strategies that yield real benefits to the bottom line and the front line, generating economic gains for companies and workers, have the potential to stick, expand, and spread.

Mark Popovich

Mark Popovich is a senior program officer at The Hitachi Foundation.  Following two decades focused on public policy as a staffer, researcher and advocate, he’s spent the last fourteen years working at the intersection of philanthropy and business.

Inequality After Occupy

When the media became aware of the protest centered at Wall Street during the fall of 2011, a predictable line of questioning immediately appeared – whatever in the world are they protesting? “The cause . . . was virtually impossible to decipher,” intoned the New York Times, joining the bulk of the mainstream coverage of the protest in its early weeks, which together professed confusion at the sight of the rag-tag group of occupiers.

Of course, to crib Liza Featherstone, covering the protests for another NY daily, the opposite was closer to the truth: everyone who came near Zuccotti Park knew exactly why the protesters were there.  Given the scale of the economic crisis, Main Street’s bailout of Wall Street, and ongoing oligarchy, the “only surprise [was that it took] so long for the citizenry to take to these particular streets.” The graphic polarization of their chant, “We Are the 99%” made it all the more clear:  it’s the (unequal) economy, stupid.

In the years since the destruction of the occupations, this critique of inequality – one, broad part of what Occupy was all about – has only broadened and deepened in the US.  Occupy should claim credit for getting it on the map, while political iterations old and new have been keeping it there.  Today, the fight against inequality is taking greater institutional shape, and seemingly exerting more leverage, in places inspired by Occupy but moving beyond its initial tactics.

Studying Occupy Wall Street in New York from its inception and through 2012, my colleagues and I traced the “enduring impact” of OWS through various measures, including the ongoing movement participation of core participants and the proliferation of “Occupy after Occupy” efforts – what journalist Nathan Schneider described as a “productively subdivided movement of movements.”

Joining most observers, we noted that Occupy’s impact was most easily traced in the extent to which it had shifted the discourse in the United States.  “Income inequality” was suddenly in the headlines.  We included a graph that showed how frequently the phrase was invoked by the media pre-, during, and post-Occupy.  We found that news mentions of “income inequality” rose dramatically with the outset of Occupy, and in the aftermath remained substantially higher through the end of 2012 (up about a third from pre-Occupy levels).

I ran the numbers again this week, and I have to admit I was surprised by the results.

LexisNexis Academic Database, all news (English), United States

LexisNexis Academic Database, all news (English), United States

As we’d seen before, in the year after Occupy’s peak, the numbers stayed higher – 30-50% of the pre-Occupy discussion.  But beginning in the fall of 2013, the numbers reached Occupy levels again, and this time rising to over 2000 mentions of the phrase “income inequality” in December 2013 – over 50% more than Occupy’s peak.

Of course, I shouldn’t have been surprised to see this rise. The occupations have gone away, but neither the crisis nor the resistance has disappeared.  Low-wage and precarious workers are at the forefront of the fights today, and they are keeping inequality in the spotlight.  This past fall and winter we’ve seen fast food strikes and the “Fight for $15”; other minimum wage fights around the country; Walmart workers demanding $25,000; university adjuncts organizing and striking.  Workers, unionists and Occupy veterans, through both traditional labor and “alt-labor” organizations are elevating the fights around income inequality and pushing for concrete change.  Tailing these developments, figures from President Obama and the Gap are now simultaneously pushing for (highly inadequate) wage increases.

Media attention to inequality reflects recent electoral shifts as well.  Mayors who ran left were decisively elected in New York, Seattle, and Boston.  (Occupations existed all over the country, but it would be interesting to probe the relationship between those Occupations and new electoral outcomes. Certainly, these three cities were home to sustained and popular occupations in fall 2011.) Labor’s candidates and initiatives did well overall, in the 2013 local election cycle; and in Seattle, Occupy activist and socialist Kshama Sawant was elected to the City Council.  While many of the core Occupy activists eschewed electoral politics, we nevertheless see the outlines of their critique emerge in race after race.

As important as Occupy’s inspiration has been as the carrot encouraging these new movements and electoral shifts, the ongoing crisis that working people are experiencing and the desperate straits that unions and other progressives find themselves in provide the stick. . Labor, in particular, has been working hard to shift course for many years.  Occupy’s eruption was a major shot in the arm, but many of the campaigns we see today have their roots pre-Occupy.

However, the energy and audacity in today’s movements are fueled in part by the experience of Occupy (and the organizers who started the occupations and emerged from them). Direct action and prefigurative practices inform many of the efforts that contribute to today’s groundswell, such as the strikes and walkouts.  But unions are also exploring worker cooperatives, community groups and activists are forestalling foreclosures through occupations, and activists are tying collective student debt refusal to the demand for free higher education.

The Occupy activists we spoke with two years ago continuously echoed each other, saying that the movement needs to “take the long view” and remember that change doesn’t happen overnight.  I haven’t spoken with enough of those activists today to know their assessment of the fights they see and are participating in today.  They are not out there, all day, all week, occupying Wall Street – and it wasn’t enough when they were. The scale of necessary social transformation remains daunting, and questions of both strategy and power loom large. But all day, and all week, more people are talking about inequality and directly fighting against it.  And workplace by workplace, franchise by franchise, ordinance by ordinance, council member by council member, co-op by co-op, the struggle continues.

Penny Lewis

Penny Lewis is an Assistant Professor at the Murphy Institute for Worker Education and Labor Studies, School of Professional Studies, CUNY.  She is also the author  of Hardhats, Hippies and Hawks, The Vietnam Antiwar Movement as Myth and Memory.

 

Paying Attention to the Precariat

As I wrote in October 2012, the precariat – the growing class of insecure workers whose wages and working conditions do not provide economic stability – ought to be getting more attention in American political discourse. I have urged mainstream journalists covering labor issues to use the term, which is increasingly being used in Europe.  Several reporters have told me that they don’t use precariat because readers would not understand it.  Writers think it’s clearer to refer to this group as the underclass or chronically unemployed. Of course, proletariat is verboten for mainstream journalists.

But last week, New York Times columnist David Brooks broke the pattern. In “The American Precariat,” Brooks tries to explain why Americans, who used to be willing to move in order to improve their economic position, are increasingly likely to stay put, even when that means passing up potential jobs.  According to Brooks, some people are trapped by homes that are underwater and workers have little incentive to move, since labor markets are pretty much the same everywhere, a change from the past, when different regions offered distinct opportunities.

But Brooks also suggests that the major reason Americans are staying in place both geographically and economically is a “lack of self-confidence.” Few workers today are willing to risk “the temporary expense and hardship [of moving] because you have faith that over the long run you will slingshot forward.” Brooks also sees evidence that Americans lack self-confidence in declining fertility rates and in more people staying in the jobs they have rather than voluntarily leaving to look for something better.  He also cites evidence from opinion polls showing that an all time low of only 46 percent of Americans report that they expect their economic condition to improve.  “American exceptionalism,” he writes, “is basically gone.”

All of this leads Brooks to the idea of the precariat, “a concept that has been floating around Europe” for which he cites British scholar Guy Standing. Brooks sees Americans embracing an “uncharacteristic” fatalism, something we’d expect to see in Europe, but not here.

More conservative commentators and think tanks should pay attention to the American precariat. Clearly, the growing number of individuals who lack employment security, job security, income security, skill security, occupational security, and labor market security are threat to conservative benefactors. Among other things, the precariat is long past believing conservative promises, like trickle-down economics or the idea that having five jobs by the time they’re 35 gives young workers flexibility and opportunity.

But like Brooks, most conservatives would rather talk about how individuals lack self-confidence than address the real economic challenges facing many Americans today.  Rather than offering substantive policies, some conservatives suggest that moving vouchers would help poor people pursue opportunities (an approach that would also reduce the kind of the concentration of insecure workers that led to Occupy Wall Street). Their analysis ignores how Wall Street and global corporations have changed work practices and benefit structures, stigmatized the unemployed, and championed the loss of public assistance. Moving vouchers and appeals to self-confidence won’t prevent the precariat’s growing resentment toward the 1% and their apparatchiks.

Like journalists, the academic community has been slow to join the discussion of precarity. A few institutions have hosted Guy Standing as a visiting scholar, and some scholars have organized panels on the topic at disciplinary conferences. But two upcoming conferences suggest growing interest among academics. At Georgetown University, the Lannan Symposium Living in a Precarious World will feature writers, scholars, workers, and activists discussing questions such as “How does the struggle to get by shape our lives, our relationships, and our social institutions? How do we challenge the rise of precarity, and what, if anything, does it offer as the basis for resistance?”  Yale University will host a conference in April on the Conditions of Precarity: Life Work, and Culture, focused on how the humanities can provide “the space to describe current phenomena of precarity, situate what is new in the context of a long tradition of human experience and critically engage with this tradition.”  Both events take an interdisciplinary approach, linking the humanities with political and economic analysis. The Georgetown conference also goes beyond academic talk about precarity.  Its opening panel will include adjunct faculty, low-wage workers, and activists organizing in both the formal and informal economy.

Interdisciplinary analysis of precarity should be expanded beyond elite universities, but academics must do more than talk about precarity.  They should also study and collaborate with community and labor groups like the Excluded Worker Movement that is organizing the precariat, including millions of farmworkers, domestic workers, tipped workers, guest workers, and day laborers. It collaborates with other organizations on campaigns to win immediate improvements in the conditions facing excluded workers; to strengthen and expand the labor movement; and to develop a new framework to transform and expand workers rights to organize in the 21st century. Journalists should be covering these efforts, and academics should be studying them and joining them.

In a world in which we are all increasingly expendable and insecure, we need to join forces. The precariat will not be fooled into blaming themselves for lacking self-confidence. If David Brooks does not believe this, he should notice the empty desks in his newsroom.  Better yet, go talk with the many displaced reporters who cannot find work as journalists and have become part of the precariat.

John Russo

Benefits Street, or the Road to Poverty

I got wet last Thursday, very wet.  I was standing on a picket line at my university outside the central administration protesting yet another below inflation wage offer. A one per cent pay raise will mean that my colleagues and I have lost between 10 and 15 per cent of the value of our salary through inflation since the financial crisis hit in 2008. Meanwhile the top pay in the university sector has been rising steadily.  My own Vice Chancellor has been awarded a 1.8% raise this year, but that borders on the hair-shirt compared to her peers where double digit increments are not uncommon.

While comparative pay rates in higher education are obviously important to those of us who work in the sector, the question of pay both at the top and bottom of society more generally has come to the fore in the UK over the last few months. What matters about this debate is how it is rolled up in a whole series of other factors central to the contemporary working-class experience – the link between work, welfare, wealth, and poverty.

In their recent report, The Joseph Rowntree Foundation (JRF) highlighted the fact that for the first time on record the majority of those in poverty were in working families, not registered as unemployed or retirees. This trend began to increase in 2003, and the increase in poverty within these working families halted the more general progressive trends to reduce poverty over all. As a result there are more people in poverty in working families than in workless and retired families combined, and that undermines government ministers’ claims that work itself is some kind of silver bullet cure-all for the poor. The problem isn’t simply a lack of work; it’s also about low pay. In 2012, there were around 4.6 million low-paid jobs in the UK, and 39 per cent of these workers were under 30. This means roughly one in six workers in the UK economy lives in poverty.

Low wages contribute to poverty, but so does the structure of contemporary employment, and the JRF report highlights the growth of insecure work and underemployment.  In 2012, an estimated 250,000 people were employed on zero-hours contracts (where workers are not guaranteed a fixed number of hours).  This figure has varied over the years, with a low of 110,000 people on such contracts in 2004.  Drill down into these figures and we find that the average hours worked has declined from 28 hours per week in 2000 to 21 hours in 2012.  Of course, these are averages, with the actual hours worked oscillating one week to another. In addition, 620,000 people who desired permanent contracts are on temporary ones.  They want and need permanent status rather than ‘choosing’ the flexibly of temporary work as a convenient economic lifestyle. These features of the labour market — low pay, in-work poverty, zero-hours, and temporary contracts — are all working-class issues.  All corrode the elements of settled living that gave some semblance of stability to working-class communities in the past.

Some social scientists in the UK have interpreted these features as evidence of what Guy Standing has labelled the ‘precariat’ (see John’s Russo’s blog about the book here). More recently, UK sociologists Mike Savage and Fiona Devine have developed a widened class schema with a group at the bottom that they also call the ‘precariat.’ In both instances, what unites this new group of disparate people is their common experience of various forms of labor market instability. Their existence has a powerful disciplinary role on others in more secure work. Knowledge that firms might outsource roles to contractors, or off-shore it altogether, leads individual workers and their collective representatives to temper demands for higher wages and better conditions of service.

These findings start to puncture some big holes in the popular political and press accounts of the causes and consequences of the recession. Worklessness (people without work regardless of whether or not they are officially unemployed and drawing benefits) is not the great cause of poverty politicians would have us believe, and intergenerational worklessness – where two or more generations of family members are out of work – is a more marginal issue still. When asked about welfare, most survey respondents think that benefit fraud is a massive problem accounting for large chunks of the welfare bill.  In fact, it represents less than 1% of the total. Surveys also show that most people believe that unemployment benefit makes up the largest share of the benefits budget, when in fact pensions are the greatest cost. The real problem is with the real level of wages and how employment is structured.

Unfortunately, the political and press rhetoric around welfare in the UK is if anything ramping up, with a pernicious demonization of those on benefits. The UK based Channel 4, for example, has come in for a great deal of criticism for its TV documentary Benefits Street, which is based on what the producers describe as one of the most welfare dependant addresses in the UK. They have been attacked by residents of the street, including one couple who had been extensively filmed and who alleged that their in-work status meant they didn’t fit the dependence narrative of the series and were subsequently left out of the program. Listening to a recent BBC radio piece reflecting on Benefits Street, I was struck by the different ways of talking about the people there. While politicians and journalists used the phrases ‘welfare cheats’ and ‘benefit dependent,’ the residents themselves used the term ‘poverty’ to describe conditions in their area.

This rhetorical distinction perhaps holds the key for a more informed and progressive debate about the lives of working people, one where we shift the vernacular from ‘welfare queens’ and ‘benefits cheats’ on to the terrain of poverty. Reading Jack Metzgar’spiece a couple of weeks ago about SNAP recipients in the US, I am struck by the similarity in debates about the ‘deserving’ and especially the ‘undeserving’ poor. On both sides of the Atlantic, politicians’ reluctance to talk about poverty, its causes and amelioration, creates a vacuum that more reactionary commentators are happy to fill. As the lead character in the HBO show The Newsroom laments, in the past, “We waged wars on poverty, not poor people.” Fifty years after Lyndon Johnson launched the War on Poverty, we need to shift the vernacular more than ever.  There’s an idea worth getting wet for!

Tim Strangleman