Recently, I participated in a new television program called Debates, Debates, in which two teams have an hour to argue an issue of the day. The proposition under debate that day was whether trade sanctions should ever be used to advance human rights. For the opposition, the team captain was Eugene Rotberg, former vice president of the World Bank. Rotberg, cross-examining my debating partner, William Greider, expected to score a nice point on Greider with the following exchange:
Greider: We all have our choke points. I wouldn't trade with a country that used slave labor. . . .
Rotberg: Who's "we" here?
Greider: Americans. This is a political question.
Rotberg: Do you know where the parts to the car that you're driving are made?
Greider: What's that got to do with it?
Rotberg: Do you know that the car parts are made with child labor?
Greider: But, see, you're starting from the position that governments are incapable of addressing these questions, so us poor consumers are supposed to resolve them. I don't agree with that. Look at American history. They didn't get children out of the coal mines until the government made it illegal. They didn't close down the sweatshops until reform movements passed laws.
Quite so. A consumer may be sovereign when it comes to deciding between a Taurus and a Toyota, but the individual buyer is powerless to know, much less influence, the labor practices at, say, a Ford engine plant in Mexico.
Within advanced countries, governments enact wage and hours laws, health and safety regulations, regimes allowing collective bargaining. These and kindred policies all offer relief from economic pressures that would otherwise yield hardship for ordinary workers. They are the fruits of a century of political struggle. But between countries, there are no such rules—as yet. So the default position for traded goods is laissez-faire: The country with the lowest standards enjoys a competitive advantage, and drags down the standards of other countries. This is why the question of whether, and how, to link trading rights to labor rights is so contentious. The domestic forces that don't like these safeguards let international trade do the dirty work of tacitly dismantling them.
The above exchange between Rotberg and Greider offers a much broader insight about the paradoxical relationship between individual freedoms and society's framework of rules. The now ascendant libertarian view depicts rules as nothing but constraints on individual freedoms. But rules can also be empowering. Rules set social standards in realms where the individual as consumer is essentially powerless to achieve constructive social change. And rules protect the individual as producer from acceding to "contracts of desperation" that leave society as a whole worse off.
For example, no matter how dire a household's circumstances, we no longer allow six-year-olds to work for wages. In the short run, child labor might put a bit more bread on a poor family's table, but in the long run it would yield a society with more urchins, less education, and lower breadwinner wages. A custom—child labor—that market society would otherwise lead desperate people to "freely" choose is precluded, by law. A spurious liberty is foreclosed, for the sake of creating a society with more genuine freedom—the freedom enjoyed by a better-educated population that can command higher earnings as adults. There was a time early in this century when the courts held that such laws interfered with the freedom to contract. But a more complex conception of freedom acknowledged that such laws enhanced liberty.
If we look a little harder, we can think of other examples where people are forced into Hobson's choices because the available menu presents no good options. The problem is not bad individual judgment. It is the absence of rules and social remedies that compels individuals to make unbearable choices.
A case in point is the proliferation of guns. If gun-control laws are weak and you live in a violent neighborhood, you are tempted to carry a gun. Pretty soon, nearly everyone is carrying a gun. The NRA actually believes that universal gun toting enhances personal security. But this is only the case when guns are already ubiquitous. A far better "leveler"—one that leads to less total violence and more total security—is to rid the society of private handguns. Who is freer? The citizen free to carry his own weapon, or the citizen free of the worry of being menaced at gunpoint? Game theory understands this as a "collective action" problem, meaning one in which the sum of rational individual choices does not yield a rational collective outcome. We need some external mechanism of reciprocal disarmament, which the lone individual cannot attain unilaterally. The only remedy is a set of collective rules.
Another pertinent case is campaign finance. Do the Democrats unilaterally disarm, and let the Republicans—as natural ally of the rich—raise 10 times the money to contest elections? Or do the Democrats discard half of their historic program and constituency, cozy up to fat-cat financiers, and rent out the Lincoln Bedroom? Neither choice is defensible. The existing rules offer no good choices.
In this issue of The American Prospect, John Donahue analogizes this sort of dilemma to the environmentalist parable of the Tragedy of the Commons. When common standards are weak, there ensues a "race to the bottom"—the phrase is originally Justice Brandeis's—to discard standards altogether. As a society we reap choices that we as individuals really don't want. But in the absence of common standards, the rational pursuit of individual self-interest leaves the collectivity, and hence most individuals, worse off.
A less obvious, though telling, example is family versus career. As real median earnings have fallen, more households require two breadwinners. Parents are constantly torn between sacrificing children and sacrificing living standards. A parent with a sick child must choose between taking time off from work and seeming to the boss like a laggard, or feeling like a rotten mother or father. Faced with these two alternatives, there is no good choice. What we need is not a more discerning engagement with the available choices, but a different menu.
Here, as elsewhere, membership in the elite conveys choices not available to ordinary people. A friend, with two small children at home, has an important job comprised entirely of writing, editing, and telephoning. Her employer is a large corporation. My friend is immensely productive. Her productivity speaks for itself—the work gets done efficiently and well. She recently asked her boss if she could do her job from home three mornings a week—something easily attainable in an age of computer, fax, and modem. The boss responded that he worked a long day, and he expected everyone on his team to put in a long day. As it turns out, he also has small children. But he has a wife with a very part-time job, as well as an au pair.
The very existence of au pairs, as opposed to more social investment in child care and more liberal family leave policies, forces these invidious choices on the nonrich. Here in greater Boston, the papers have been filled with the story of a teenage English au pair, Louise Woodward, who, in a terrible moment of frustration, shook an infant so hard that he went into a coma and eventually died. She is now on trial for murder. This has prompted a heated debate about whether au pairs are adequately screened.
Weighing in with a defense of au pairs was Derrick Jackson, one of the Boston Globe's most liberal columnists. He testified to the wonderful experience that he and his family had had with no fewer than eight au pairs. Jackson bolstered his argument with the point that, statistically, there is far more child abuse by natural parents and ordinary babysitters than by au pairs.
But the real scandal here is not that a trivial fraction of au pairs may abuse children. It's that only a trivial fraction of families can afford au pairs at all, and that society doesn't offer good choices for the rest. No wonder so much abuse occurs among parents.
The sociologist Arlie Hochschild, in an important new book, The Time Bind: When Work Becomes Home and Home Becomes Work, studied the efforts of an unnamed Fortune 500 company to make its workplace more "family-friendly." She picked a company that was renowned for its caring approach to work and family. The company, disguised by Hochschild as "Amerco," offers flextime, pro-rated part-time career ladders, on-site day care, generous family leave policies, and so on.
But Hochschild found, to her dismay, that pitifully few workers took advantage of options that left them more time at home. After conducting extensive interviews of everyone from the chairman to the human resources vice president to ordinary clerks and production workers, Hochschild came to two conclusions. First, despite the company's protestations, workers who got off the fast track paid a severe career price. Second, there has been an awful inversion of what we expect from home and what we expect from work.
Instead of serving as a haven from a hostile world, the home, in time-squeezed America, is a place of split-second juggling acts, marital disputes about who gets leisure time and who minds the children, much stress, and little comfort. The workplace, by contrast, offers social relationships, mentoring, and a feeling of teamwork and accomplishment. One can exaggerate this, of course, but Hochschild's meticulous evidence suggests that the model of the nurturing corporation backfires. Instead of workers taking the company's offer to use the family as a respite from work, they use work as a respite from the family. As Hochschild writes, "The valued realm of work is registering its gains in part by incorporating the best aspects of home. The devalued realm, the home, is meanwhile taking on what were once considered the most alienating aspects of work."
That, in turn, suggests that the work-family conundrum is even more intractable than it seems. Parental leave and part-time career options are fine and necessary, but hardly sufficient. What might be sufficient? Here, we come back to the question of society's rules.
As recently as two decades ago, basic industry and commerce in America were substantially regulated, and domestic oligopolies were substantially insulated from foreign competition. Corporations in industries as diverse and far-flung as banking, trucking, telecommunications, broadcasting, health care, airlines, autos, chemicals, steel, and electric power were all so sufficiently insulated from cutthroat competition that they could offer their employees a stable career environment. Productivity did not suffer; on the contrary, productivity growth in the 1950s and 1960s was more rapid than in the 1970s and 1980s. But it occurred in a stable institutional context, which in turn was the fruit of regulation.
The regulations that afforded this stability were either classic economic regulation of what were thought to be natural monopolies (telephones, trucking, airlines, electric power), or regulation based on safety and soundness concerns (banking, savings and loans, stock brokerage, insurance), or regulation based on professional and public-goods objectives (health care), or regulation that yielded strong unions in basic industry (enforcement of the Wagner Act), or tariff regulation that insulated domestic industry from the pressures of foreign trade.
Most of this has now been discarded, in the pursuit of greater textbook "efficiency." But one of the real, and insufficiently appreciated, benefits of the postwar era of regulation was that it yielded a workplace stable enough to permit the negotiation of durable social compacts. Those social compacts, while they lasted, allowed progressively longer vacations, progressively shorter workweeks, and increasing fringe benefits. The job security afforded by the same social compact emboldened workers to insist on these other amenities. This progress, as Barry Bluestone and Stephen Rose documented in our March-April issue ["Overworked and Underemployed"], has abruptly come to an end. Deregulation, though seldom blamed, is a prime culprit. Had this more stable bargaining environment continued, I have little doubt that these amenities would have been expanded to include measures to reduce the tension between work and family. This is certainly the case in European countries that have resisted the pressure to dismantle a workplace compact.
So the relationship between regulation and a decent society is rather more complex and multifaceted than it first seems. When so many diverse industries were subjected to economic regulation early in this century, more decent working conditions were not the intent, but they became an important side effect. Evidently, it will not work to graft family leave mandates onto a work environment that is so fluid and precarious that workers dare not take advantage of added benefits. In order to allow social progress to resume, we first need to restore a more social conception of work and some new preconditions for a durable social compact. In an information economy of shifting technologies and virtual careers, it is that much harder to negotiate social compacts. But if there were more social safeguards against arbitrary treatment and more social subsidy of the cost of child rearing, more workers would have the confidence to pursue more satisfying trade-offs.
Hochschild calls for a "time movement," demanding relief from the universal time squeeze, in the spirit of the late-nineteenth-century crusade for an eight-hour day. Although a personal turning away from career-crazed materialism could help, this movement will require more than individual commitments to a life of voluntary simplicity; the countervailing economic pressures are simply too intense. It will also require new rights and rules. Extended paid leaves for new parents—of both genders—would be a good place to start. A normal four-day workweek would be another good innovation. Socially sponsored child care and more employee rights against arbitrary dismissal would also help. A revival of the labor movement would be the best remedy of all, since most of the specific gains of the postwar era came via the solidarity and concerted legislative pressure that unionism afforded.
The libertarian story, depicting government and collective regulation as the enemy of individual freedom, offers an impoverished conception of liberty. It has the virtue of simplicity—cast government aside. Our story is necessarily more complex, because it acknowledges the complexity of human society. The libertarian worldview is somewhat contradictory, because it recognizes the need for norms of behavior. Indeed, many professed libertarians pride themselves on being stern parents. But the libertarian view denies that norms of behavior can ever be legitimately set by collective public action.
In a libertarian society, we are free to choose—to sacrifice children or income; time or career; political integrity or political money; weapons or personal security; free trade or decent labor standards. All of these are lousy choices, and not the only ones potentially available.
In reality, regulation remains necessary to prevent races to the bottom, and to preclude invidious choices from being forced upon ordinary people. Regulation is also necessary to create oases from short-term economic pressure, so that durable social compacts can be negotiated. In rebuilding a usable liberal politics, we would do well to rehabilitate the liberating virtue of collective rules.
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