No Jobs But Crappy Jobs: The Next Big Political Issue?

 

(AP Photo/The Brownsville Herald, Brad Doherty)

Wal-Mart employee Nidia Flores arranges shirts, Thursday, August 7, 2014, in Brownsville, Texas.

For decades, the increasing precariousness of work has been a source of mass frustration for tens of millions of Americans. But the issue has been largely below the political radar.

Politicians ritually invoke good jobs at good wages, yet presidents have been unwilling to name, much less remedy, the deep economic forces that are turning payroll jobs into what I've termed "The Task Rabbit Economy"—a collection of ad hoc gigs with no benefits, no job security, no career paths, and no employer reciprocity for worker diligence.

But there are signs that maybe this issue is starting to break through.

One manifestation of job insecurity is extremes of inequality as corporations, banks, and hedge funds capture more than their share of the economy's productive output at the expense of workers. The Occupy movement gave that super-elite a name: the One Percent.

Thomas Piketty's renowned book, Capital in the Twenty-First Century, documented the intensification of inequality. A fairly technical piece of statistical work became a bestseller because it articulated unspoken frustrations.

After six years of prodding from a labor movement for which President Barack Obama delivered precious little, the president at last began issuing executive orders requiring government contractors to be minimally decent employers.

Obama nominated a leading academic expert on the precarious economy, David Weil, to be the top Labor Department official in charge of wage and hour enforcement. Thanks to the hardball of Senate Majority Leader Harry Reid, Weil miraculously managed to get confirmed, and is starting to use his office to crack down on such abuses of disguising permanent jobs as temp gigs.

Local organizing to dramatically raise the minimum wage reaped some local victories with wages set as high as $15 an hour in places like Seattle, and is beginning to resemble a mass movement.

Now the New York Times has weighed in, with a superb series on precarious work.

The Times addressed the fact that it's becoming normal for workers not to know their schedules more than a few days in advance. The lead piece shamed Starbucks, which prides itself on being a good employer, to enforce its own nominal policy of giving employees decent notice of the hours they are expected to work.

The Times' Sunday article addressed the increasing number of workers in the so called "sharing economy"—the Task Rabbits and people who offer cut-rate rides via Uber and Lyft, and dozens more web chore-matching services. The dirty little secret of the vaunted flexibility is that you can't make a living at it, or have enough predictability in your life to raise a family.

The shift in labor markets, from an economy where regular payroll employment is the norm, to one where more of us are performing odd jobs, or have regular jobs with indeterminate schedules, ought to be the top domestic political issue. There should be an emergent political consciousness that regular people are getting screwed solely so that greater profits can go to corporations, executive, and private equity speculators.

Are we on the cusp of a breakthrough, where this issue bursts into public consciousness and cannot be ignored, the way the civil rights movement finally broke through in the late 1950s?

The mass frustration is surely there. What's missing is a mainstream national leader who will make this cause a prime election issue.

Why do politicians address these widely felt injustices mainly at the level of platitude? Because the remedies would require a transformation of who runs the economy, and of how we regulate labor markets.

Three decades ago, corporations in retailing and other service industries faced essentially the same variation in the need for staffing over days or weeks. But they didn't expect their employees to bear all of the cost. Unemployment insurance covered far more of the cost of genuinely seasonal work such as construction.

Though the Times series cites use of new computer technology that makes it easier for employers to monitor fluctuating demand for services and to reduce ever more employees to on-call status, this shift is mainly not about new technology; it's about a power shift.

As I wrote in a profile of one of the nation's most effective unions, Local 6 of the Hotel and Restaurant Employees in New York, the hotel industry, which has fluctuating customer demand, would just love to reduce most workers to on-call status—come in if we need you. But as the union points out, its people have lives. Most of them have kids. So, thanks to the union's power, most of its members are paid for a standard workweek and the burden is on management, not on individual employees, to figure out how to maximize productivity consistent with common decency.

Here's another idea. How about a $20-dollar-an-hour minimum wage for any worker who's on-call status. That would make management think twice.

How about a full employment economy, so that more people have real jobs and fewer have to freelance as task rabbits and Uber drivers?

How about serious criminal penalties for employers who steal wages by pretending that regular employees are contract workers and permanent workers are temps?

The candidate who ran on that platform would have the grateful support of tens of millions of forgotten Americans, and the contempt of Wall Street. Which would you rather have?

Can you imagine, say, Hillary Clinton making these issues the centerpiece of her campaign? I sure hope so. If not, the Democrats need somebody else.

 

Comments

The author seems to identify a basic problem of employers trying to minimize costs; while employees are trying to maximize benefits. The author understands that the only party who should get to negotiate is the employee. Given the problem of employers, how to we get to that utopian state where all industries are nationalized, and the benefits will be generously granted by our benevolent leadership? Until we get to complete government control, greedy corporations will continue to try to maximize value to their equally greedy stockholders, and workers will not get everything they want. This central control has worked so well in the past, it is amazing why it is taking us so long to attain this enlightenment. Best wishes.

Better government control than Money Grubbing Corporations. Although I don't think that was the point of the article. But if your response is any indication, you probably didn't figure that out. TRICKLE DOWN FOREVER!

In non-union industries, which is almost all of them, the "negotiations" that happen are about like you negotiating with a man who holds a gun to your head. Time to level up the playing field. We did it once before for white male 99%ers; we can do it again for us all.

You have skewed your argument all to one side, the side of the 1%ers. Employers only care about minimizing costs because that's how they maximize profits! Employees are trying to increase their standard of living by being offered full and meaningful employment that is much more consistent and steady so they can have a life with their families. Better wages are a big part of that package too. The best solution to this string of problems has always been the checks and balances offered by solidarity: Labor and Trade Unions! Complete government control is not what is needed or wanted, but having Labor granted the same status and protections under the law as Capital has. Laws granting fairer treatment of laborers have been weakened and/or eliminated since the National Labor Relations Act of 1934 was passed. Have you already forgotten what the governors and legislatures of Wisconsin, Indiana, and Ohio (just to name three states) have done recently to remove rights from workers in just the past few years? Labor knows it can't get everything it wants from Capital, but Labor knows that if we don't have a financially secure working class our economy will stay "in the tank."

This is not a big election issue because both parties, along with the national media, obsess about the numbers, and the fact that economists (also known as experts) have declared the recession to be over. Fact is, neither party is all that worried about the economic benefits, or lack thereof, of these jobs, given their inaction on the issue. I blame Democrats as well as Republicans, since, during the first two years of the Obama administration, they were in control of both chambers of Congress, yet they did squat on jobs. This won't be an issue because neither side can defend their positions on this.

Here’s another idea: supplement labor income with non-labor income. Thus, we could pay dividends nationwide, as Alaska does, with revenue from common wealth. In my latest book, "With Liberty and Dividends For All: How To Save Our Middle Class When Jobs Don't Pay Enough," I show how this could be done. (www.dividendsforall.org). Such dividends wouldn’t be welfare or redistribution. Rather, they’d be legitimate property income and could win support across the political spectrum.

It’s time to face the fact that, thanks to globalization, automation and the decline of labor unions, there won’t be enough good-paying jobs to sustain a large middle class in the future. But where is the politician — or even the economist — brave enough to say that and propose a credible supplement to labor income for the middle class?

Good issue, wrong approach, partly because the stats collected are of less and less utility in a modern economy. Bad measurements, bad policy.

Unions are government creations, intended to reduce competition by co-opting workers, stifling dissent and imposing conformity for employers (who generally had monopoly pricing power and could pass on the costs without affecting demand). A mediocre solution in a 1920's economy, unions are dinosaurs wandering around after the comet strike of (semi) individual economic freedom. Outside government, there are few price controls left. Just how many more years of union failure are required to see the obvious? The only union left is the government itself.

Minimum wage laws are a Jim Crow relic intended to keep poor southern blacks from competing against entrenched union power in the north. Lincoln used the slavery issue to transform a weakly bound voluntary republic into a hierarchical command/control union, entrenching corruption and poverty in one blow, while consolidating power in DC.
Not a good thing. Just ask the folks in Ferguson.

The unseen (by the employee) payroll taxes of OASDI, HI, FICA... are the cruelest burden, since they create a false perception between employee/employer of cost and value. Workers see "take home" pay of 5 bucks an hour. Employers see costs of 20 bucks an hour. Expecting twenty bucks from a five dollar mule is a ticket to conflict anywhere in the world. The solution to the problem, simplicity, honesty, transparency:

End withholding. Forever. Friedman created it to pay for Vietnam. Mistake.
End all employer withholding. Forever. It is hard to vote responsibly when the costs are hidden from the voter and carried by employers. Place the costs and all the benefits in one place, directly on voters/employees. This makes the individual worker into the customer, not a bartering chip for special interests like insurance, government programs, unions, or any other non-value adding middlemen....

Then let the discussion begin on whether centralized systems or individual systems better serve the customer, since it is now legal to be a customer. And let customers decide. Make freedom legal.

End withholding forever. And replace it with what? Like it or not, government does supply services we all require. Protection by police (Ferguson not withstanding) and the armed forces, fire protection, clean water, schools, passable streets, the list goes on and on. These. Things. Are. Not. Free. Without withholding of taxes, where do we find the money to exist? Your idea would lead to anarchy. The wealthy would have all the money they need to survive, while the rest of us would be killing each other in the streets for the few crumbs of food available. You have noble thoughts here, but the reality is, your solution is not workable.

Withholding was instituted in 1976 to pay for the Vietnam War because social security taxes were insufficient. I don't recall killing in the streets for crumbs being a big part of the bicentennial celebration. I did not offer a solution. I am suggesting that a big part of the current system is obfuscation: spreading costs and benefits to deliberately create a politically complicated mess. If you saw the total cost of FICA and had to write a check for it year end, would you? It really is just another federal tax, with no correlation to benefits.

Yes, you did not offer a solution. Problem is, your suggestion makes mo sense without a solution. No matter what the reason for the establishment of withholding, the fact is, the revenue generated from withholding would have to be replaced. So where is the money?

You are too young to understand. In the 1970's you paid your entire tax bill on April 15. There was no such thing as "take home pay". You took it all home. There was no withholding, the payment of taxes in advance. There were no w-4's, no exemptions, and no withholding and no refunds. Because everyone paid when they filed.

The services you mention have all been traditionally supplied by businesses to customers. They have slowly been taken over by gubmint and replaced with taxes and subsidies. There are water districts, fire districts, education, street repair programs, even distributed armed forces in Switzerland, all paid as customers, not as tax slaves.

Linking costs to benefits and providers to customers in as transparent a manner as possible helps make innovation possible. You seem to be defining anarchy as NOT paying a premium to a bureaucracy, which simply subs out all the work of government to the favored few, after they skim their cut. Lets cut out the middleman.

First of all, I do remember 1960. Secondly, you keep missing the point. All the things you mention as "gubmint" services are necessary, and like it or not, paid for with tax revenue. If we end withholding, new revenue must be found to pay for their services. Where does it come from? Yes, it would be nice to have Corporate America pay the taxes they really owe, but that's not happening any time soon. So how do we pay for all these services?

You pay directly as a customer, not a tax slave and then lobby for services. Gloucester MA, you pay as you throw for trash. Recycling is paid by revenue generation. Delaware generally does not snow plow for free. You contract for the service. LA residential roads, sewers, power, water, gas, telecomm are all paid for by property developers and included in home purchase cost. St Louis neighborhoods still own and maintain their streets directly, property lines generally go to the center of the road. There are many hundreds of water, fire, sewer districts across the country, billed for both usage and network upkeep. Switzerland has no DoD, they require military training and then send you home with a gun. The entire country is a volunteer army, so here is no standing army to eat the budget. Education was paid for directly, parent to teacher, for over a hundred years. As was health care paid patient to doctor. Government is the ultimate elite middleman, skimming as much as practical, providing as little as possible.

Be a customer, pay for what you use. No invention required, we've done this before.

Consistently equating withholding as taxes is disingenuous at best. Withholding is estimated advance payments, which may or may not be required, refunded, or sufficient.

Corporate america does pay the taxes they owe. They are called quarterly payments. There are a sea of lawyers, accountants, and auditors whose sole job is exactly that. Run a business and miss one and find out what happens.

You need to be logged in to comment.
(If there's one thing we know about comment trolls, it's that they're lazy)

Connect
, after login or registration your account will be connected.
Advertisement