What Should We Do With Our Surplus People?

Journal Roblimo's Journal: What Should We Do With Our Surplus People? 20

Journal by Roblimo on Friday January 29, 2010 @09:32PM

We seem to have collectively decided that at least 15% of our working-age population is no longer necessary to keep our country's businesses running, and every year we have a larger number of surplus people as we shift more jobs overseas or automate them out of existence. We basically have two choices: we can either remove some of the connection between work and income or we can build tariff barriers that eliminate at least some competition for American workers from people in other, lower-cost countries. Or we can come up with some combination of these two solutions.

Let's assume we don't want citizens' armies of former workers who have nothing to lose roaming our countryside, looking for food and shelter and killing anyone who gets in their way. If you are a prosperous or rich American, this would not be good for you, because you and your family would become possible kidnap, carjacking or home invasion victims. You can hide behind the walls of gated communities, but then you will need to worry about your hired guards, especially if you pay them the same low wages most security personnel receive today. And what if some of the redress-righters who want to kidnap you or steal from you are relatives of your guards? When this situation arises, your guards are more likely to help loot your house than protect it from looters.

It is, therefore, a good idea for America's more prosperous citizens to help those who have little. Forget morality for a moment and think of enlightened self-interest. Almost every communist revolution and pre-communist revolt against an imperial or dictatorial government was preceded by period during which the rich got richer at the expense of everyone else. In other words, maybe pre-communist Cuba was a paradise for the wealthy families whose offspring fled to Florida to get away from Castro's revolutionaries, but before the revolution life was miserable for most Cubans; no decent medical care, barely enough food to eat, high illiteracy rate due to a lack of public schools, low pay at best, no work at worst. In other words, a dog-eat-dog state, with no protection of the poor from the depredations of the rich, and no social safety net.

Class warfare? You bet! And it typically ends with bodies of the formerly rich or prosperous hanging from lamp posts or their heads piling up next to guillotines while rampaging mobs loot the stores and ransack mansions. Smart American rich people (think Warren Buffett) realize that too much greed by too many people will inevitably cause society to break down, so the rich and prosperous need to allow a certain amount of wealth-sharing through taxation, and must support at least some level of "entitlements" in order to save their own skins. Dumb American rich people (think of the Olin, Walton, and Hilton heirs) seem to believe they can get away with living on the backs of working people because they chose the right parentage and have no obligation to share any of their unearned wealth with anyone else.

If we want more employment, let's hire a lot of people

The two biggest federal depression-era employment programs were the WPA and the CCC. I know the current anti-government people love to say no government handout program ever ends, but both the WPA and the CCC went away as soon as they were no longer needed. It took WWII -- and a level of government spending that eclipsed the WPA, CCC, and all other government entitlement programs before or since, to end the need for these two agencies. Hopefully we won't need a similar war to pull our country out of our current depression, but to make sure of that we need to start figuring out how to help our surplus people before the unemployment problem becomes as acute as it was in 1934 or 1935.

Remember that the WPA and CCC were both "workfare," not "welfare" programs. They included construction projects and public art projects, folklore research (John and Alan Lomax were partially funded by the WPA), and many other useful projects both blue-collar and white-collar.

Were the WPA and CCC "successful?" Not from the standpoint of the 30s far right wing, but a large majority of Americans both rich and poor supported these programs because they staved off misery for an awful lot of Americans, and removed much of the very real threat of a socialist or communist revolt supported by the Soviet Union, which at the time openly talked about spreading communism to the whole world.

There was plenty of right-wing squawking in the 1930s about the government getting too large and not following the Constitution, but that noise was tempered by knowledge that millions of angry workers out of work permanently or even for more than a few years represented a far greater danger to the Republic than a liberal interpretation of the Constitution's Commerce Clause.

The Player Piano Alternative

Kurt Vonnegut's 1952 novel, Player Piano, takes place in a future where most American workers have been displaced by machines, live on scant welfare payments, and want to be useful rather than live on the dole -- except that there is hardly any demand for physical workers in an automated world. Replace automation with "Chinese workers" and include many white-collar workers whose jobs have moved to India, and you still have Vonnegut's Player Piano, along with its original automation component. You not only have massive and growing unemployment, but structural unemployment that is unlikely to abate even if the economy "recovers" from its current malaise.

What do we do about this problem? Warehouse our surplus workers and feed them just enough dole money and free TV to keep most of them sitting on their couches drinking beer instead of plotting home invasions? Do we decide to put strong tariffs in place that make imports artificially more expensive than American-produced goods and services -- and deal with the inevitable smuggling and other problems this solution would create as by-products?

I'll admit that I am personally attracted to the idea of protectionist-level tariffs for a large "basket" of items that we should make here in the U.S. instead of obtaining overseas if only because we are so dependent on them. Food? Yup. Energy? Why not? Support American oil, nuclear power, solar and wind generation, etc., by levying a large per-Joule tax on all imported energy sources. Computers and electronic components? If, as so many companies in this industry claim, "intellectual property" is what matters, producing the physical products here would not lead to huge price increases. Ditto with pharmaceuticals. One day I bought a popular over-the-counter cold remedy and noticed that it was manufactured and packaged in Costa Rica. This is a product where the actual production cost is only a small fraction of the retail price. Making it here in the U.S. would not drive its maker into bankruptcy, especially if all that company's competitors also manufactured here because of tariffs or because of laws prohibiting the manufacture of FDA-controlled products outside our borders.

An aside: we pay the world's highest prices for pharmaceuticals, and have many laws prohibiting individual citizens from buying pharmaceuticals in other countries and bringing them home for their own use. And yet, a growing percentage of the price-supported drugs we buy are made elsewhere. This makes no sense whatsoever. If "safety" is the reason not to allow individual Americans to import drugs on their own, why should pharmaceutical manufacturers or wholesalers be allowed to do it? This is a ripoff. And I'm scared that we won't get rid of it anytime soon because the pharmaceutical industry has always been a prolific source of political donations and the Supreme Court recently decided to make it even easier for pharma companies and their trade associations to influence elections. Grrr....

Where Will We Put the Welfare Trailer Parks and Tent Cities?

Another way to make American workers competitive is to house them in circumstances similar to those "enjoyed" by Indian and Chinese workers. In other words, get away from the idea that Americans inherently deserve luxuries such as separate bedrooms for children, indoor plumbing, and broadband Internet service, let alone government-paid education or decent medical care. Under this scenario, we dump the concept of a minimum wage and let the market determine the value of each human's contribution to our increasingly corporate-dominated society. If supply and demand in a world of free trade dictates that the value of an American blue-collar worker is $5/day and that a knowledge worker is worth $10/day, so be it. Of course, this means most American workers won't be able to afford any market-rate housing we currently have, let alone allow their children to attend school instead of working for their daily bread (or possibly nutritious soy mush). TV? We'd better make sure they still have that, along with low-cost beer (and possibly pot) to keep them happy in their new ghettos, where they will live out their lives in the equivalent of FEMA trailers. Or tents. Or yurts. Or shanty towns and slums like the ones common in third-world cities.

Provide a Minimum -- but Low -- Income to All

I am starting to believe we need to provide a minimum income "floor" for all Americans, along with basic education and health care services. This is not an ideological belief. It is purely practical. Perhaps you want to live somewhere people are falling off the edge of civilization and you need to carry a gun whenever you go out because many of your fellow citizens have no way besides crime to eat, clothe, and shelter themselves. I do not want to live in that kind of country. At the same time, I don't want to live in one where the government dictates my every move, including where I live and how I earn a living.

This is why, when I say "minimum income floor," I mean truly minimal, not in suburban houses people work hard to afford. And I don't believe everyone has a right to the most expensive medical treatment available, either. And education? I have nothing against you (or anyone else) sending your children to a private school at your own expense, any more than I have a problem with you wanting (and paying for) medical care from a private physician and private hospital rooms while people with less money deal with clinic-style medicine and open hospital wards.

Housing? This is what I wrote about housing the homeless in 2007. I haven't changed my mind since then.

As far as food, I am not in favor of the current program that lets poor people spend government food subsidies on things like soft drinks and cheese doodles. Sorry, but if you're going to eat on the taxpayers' tab, you had better get used to cooking from scratch or at least from low-cost mixes. Want more than four to six ounces of meat per person per day? You are going to have to find a way to make some money. Ditto if you want white meat chicken instead of thighs and legs or butter instead of (generic) margarine.

Opportunity is Important

What keeps people from going wild when things aren't going well is hope. For many, religion furnishes it, in the sense that there will be pie in the sky bye and bye. But for even more it is important to have a belief, even a false one, in our ability to make our lives better through our own efforts. This is the oft-cited "American Dream.

If you're broke and facing bankruptcy or you've already lost a home you sweated hard to buy, that dream seems more like a nightmare. We have millions of citizens who are living that nightmare, and even when we read "hopeful" employment numbers, they are "hopeful" only because fewer people lost jobs this month than in previous months, not because more people are suddenly getting hired than are getting fired.

So what are we going to do?

I'm afraid that lowering taxes, especially on our richest and greediest citizens, isn't going to help put a lot of unemployed Americans back to work. An awful lot of people seem to have forgotten that some of the years when this country experienced its greatest economic growth, and saw the greatest rise in the percentage of citizens who owned their own houses, and the greatest rise in standard of living for working people, and some of our greatest scientific advances, along with major strides in civil rights and other social aspects of our lives, happened in the 1950 - 1970 period when we had some of the most progressive income tax schedules ever. Banks and other financial institutions were highly regulated. Unions were far stronger than they are today. And in most married households, one income paid all the bills.

Sure, our houses were smaller then, and we didn't have Medicare for old people. But, in general, every year was a little better than the year before. Every day, in every way, we really were getting better and better.

Can we say the same thing today? I don't think so. If anything, life is getting worse for a majority of Americans.

Are we really willing to see our fellow citizens living in tents, especially in winter? Are we willing to risk that kind of life, ourselves, if we lose our jobs and health insurance and face medical bills we can't pay? Are we so determined to hold on to the illusion of liberty it's easy to enjoy when we have substantial incomes, but not so easy to hold onto when we run out of money before the end of the month, that we want to keep saying, "The free market will save us," in the face of evidence that it will not? And increasing evidence that our most vocal "free market" proponents aren't even interested in trying?

At the same time, we can't run government deficits forever. I'm okay with the Keynesian ideas that led to the Golden Age of Capitalism after WWII, but sooner or later we need to pay back the money we have borrowed -- and that means true government austerity, not the little bits of savings (starting next year) Obama has proposed, plus it would mean tax increases larger than any American politician at the national level has enough guts to propose.

No matter what, the current "rich get richer while the poor get poorer" economic reality will not go on forever.

The only question is whether we'll end it by purely political means (more transfer payments), by government stepping in and helping capitalism work (creating jobs during bad economic times; increasing import tariffs; tax incentives to help persuade businesses to hire more Americans) or by civil breakdown and insurrection.

So which alternative do you prefer?

The ultra-leftist ideal of giving money to everyone in need, no strings attached
The ultra-rightist ideal of low taxes on rich people, regardless of their neighbors' misery, until society breaks down
The Keynesian course of helping people get back to work with government help

I prefer the third alternative, myself. But I don't hold an elective office and don't plan to run for one (and don't have the level of corporate support it's going to take win future elections, anyway), so you might as well disregard my opinion since it can't possibly translate into action in today's sad political climate.

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