During the 1980s recession, as steel mills closed and auto plants began downsizing around the country, neoconservative economists insisted that the jobs lost to deindustrialization would soon be replaced by new jobs. In Youngstown then, we knew better. And as we wrote seven years ago in Steeltown U.S.A., Youngstown’s story in the late 70s and early 80s has not only persisted here, where unemployment is among the highest in the state and the poverty rate hovers around 30%, but has become America’s story today.
Youngstown learned then how real economic shifts could be exacerbated by ideology: the idea that businesses and investments matter more than ordinary human beings and the notion that we should just get used to economic patterns that create long-term hardship for those with the least power and resources. Youngstown learned more than 30 years ago how damaging such ideas can be. Once again, the rest of America is learning that lesson today.
The gap between the Wall Street recovery and the continuing jobs recession was highlighted by Friday’s jobs summit. Communities around the country understand that we are in another jobless recovery that leaves hundreds of thousands of American families vulnerable. While markets have stabilized for the moment and investors are feeling more confident, the economy isn’t improving for most Americans.
So is the current situation just like the earlier recession? No. It is worse. As Peter Edelman and Barbara Ehrenreich note in Sunday’s Washington Post, the current economic crisis reveals the glaring problems left behind by the welfare reform of the 1990s, a policy change that reflected the long-standing assumption that poverty is a “voluntary condition” and that every able-bodied adult should simply find a job – “even when there are obviously no jobs available.” When we removed the safety net because of conservative and neoliberal worries about “fostering dependency,” we created the economic conditions that left 17.1 million Americans living in extreme poverty in 2008 – and no doubt even more today. As we learned last year, we’re willing to bail out corporations but not working people.
The current recession is also worse because it isn’t just a matter of jobs. It’s a matter of ideology. Blaming the victim and normalizing long-term economic struggle were part of the discourse at the jobs summit, during which Jan Hatzius, chief domestic economist at Goldman Sachs, acknowledged that unemployment will likely remain high for a long time. She suggested that we may just have to get used to it. Why? Because those who have been unemployed for a long time are losing their skills and their work habits. No doubt, long-term unemployment affects people, but the idea that unemployment will last a long time because workers won’t be prepared to return to work represents the most absurd, cruel version of blaming the victim.
On the other hand, Hatzius is not wrong that we’re in for long-term unemployment and underemployment– problems which are far worse than the official unemployment rate suggests. No doubt, business takes the cautious path during economic downturns, often by adding hours to workers’ schedules rather than by hiring additional workers. But as we learned in Youngstown, the reality is that those jobs may never come back as businesses, especially manufacturers, continue to disinvest in the United States.
At the same time, as we have argued before, we’re also witnessing long-term shifts in the nature of the jobs available. Promises about a new “creative worker” economy or green jobs that will someday provide some former steelworkers and autoworkers with new versions of manufacturing jobs fall short when we remember the latest predictions of the Bureau of Labor Statistics: that the job categories predicted to grow most over the next few decades involve primarily low-wage, low-education service positions. Many of these jobs pay less than $21,000 a year. That means that poverty is going to be a long-term problem for American workers.
What we need, in other words, is not a single jobs summit. We need long-range policy planning aimed at creating a better system of supports for the working poor and unemployed. We need to recognize that as much as education matters, it won’t necessarily overcome long-term employment trends and growing income inequality. We need economic policies that focus on the poor and working class and that treat them with respect, rather than blame.
Too often, economic theory has provided a distraction from the real struggles of real people. Jan Hatzuis and her colleagues might do well to stop worrying about the work habits of the unemployed and start learning about what it’s like to lose a job after you spent years doing everything right, about the indignities associated with applying for government aid as you struggle to survive job loss, about how limitations of K-12 education, urban transportation, limited access to fair banking, overcrowded housing, persistent hunger, and lack of health care make finding a steady job that pays enough to support a family incredibly difficult. A little moral education might help as well.
We need to stop thinking about the current crisis as a temporary recession, and we certainly have to stop talking about the economic crisis as part of an inevitable shift we can’t do anything about. We have to recognize and act on the situation as what it is: a moral crisis.
The Obama administration must take the problem as a moral imperative, acknowledge that the private sector simply won’t solve the problem on its own, and like Franklin Delano Roosevelt, create a jobs-centered stimulus that is environmentally sound, improves the national infrastructure, and provides an economic foundation for working Americans and rebuilding the American economy.
The economy isn’t a game, with winners and losers who deserve what they get, because the players don’t occupy a fair playing field and the rules are biased. Inequality has long been and is becoming more deeply engrained in the American system. We cannot continue to view long-term high unemployment rates, minimal public supports for the poor, and a permanent and increasing gap between rich and poor as normal much less acceptable. We can do better. “Yes, we can.” And we must.
John Russo and Sherry Linkon