Monday, June 25, 2012

Who is Responsible For the Jobs Crisis?

With the campaign season in full swing, and the identities of both candidates known, we are seeing more discussion about our national issues.  Unemployment is still very high, with 8.2% officially jobless and at least 32 million Americans without full-time work who want it.  Yet we are not in a recession.  Financial markets are hardly tanking - the Dow Jones Industrial Average is up for the year, and corporate profits are generally solid.  When people complain about "the economy," then, they don't mean investments, they mean jobs.  So how are the two sides reacting?

Both conservative and liberal commentators have seen the other side as the problem, with little exception or reservation.  In the New York Times, Paul Krugman continues his push for greatly increased government spending in "The Great Abdication" (, saying that it's clear to anyone thinking that there is no alternative.   Mitt Romney, who barring a tragedy or a bizarre intraparty challenge will be the Republican presidential nominee, says that his "plan to get America back to work" is to "reduce taxes, spending, regulation, and government programs," with a "fundamental change in Washington’s view of how economic growth and prosperity are achieved, how jobs are created, and how government can support these endeavors" (  The current administration reality is well shown by this morning's Tom Toles cartoon, titled "Jobless Recovery," which shows Congress, the President, and the Federal Reserve all telling each other that unemployment is their job ( 

We know by now the sides are intractable.  Neither rates to move much on the jobs crisis, and Congress has been earning their now 9% approval rating by getting nothing on it accomplished. But who was at fault for the crisis in the first place?  Neither. 

Work's New Age is a product of good things that have happened.  Extensive technological development, increased freedom in places like China, and improved business practices from manufacturing to transportation - all very positive developments - have put us in a position where fewer and fewer Americans are needed to produce the goods and services we use.  We don't know yet how to deal with it, but we do know neither Obama nor the Republican that preceded him are at fault. 

Neither side has anything magical now either.  Come 2013, the problem will continue, and with time we will realize we are looking at not a failure of public policy but a 200-year historical shift.  When we realize that, we will be on the road to making the most of it. 

Monday, June 11, 2012

Agriculture, Manufacturing, Services... Then What?

Today the Washington Post had a cartoon from Tom Toles, showing different kinds of economic activity through time.  "Hunter-gatherer" gave way to agriculture, then "services" and "tech," each of which was higher on the picture than those previous.  The last step, though, "job-hunter-gatherer" was at the lowest level and showed someone dumpster diving.  Even more than he probably realized, Toles had a point.

Agriculture replaced hunting and gathering for humans at least 10,000 years ago - other extraction activities such as mining followed some time after.  With the Industrial Revolution, which started in the late 1700s in England and took some time spreading through the Western world (as of 1850, the United States was still 90% rural), a second phase, manufacturing, took hold.  Since some time in the first half of the 20th century, most Americans have been employed in the third phase - services.  American employment in extraction and manufacturing has long since peaked, and even the number of service jobs, in the last decade, has probably reached its all-time maximum. 

So what will replace service jobs?  We know of nothing.  Technical jobs as such do not constitute a new phase - they are themselves only service positions, and are too few in number as well.  Futurist Herman Kahn, who flourished in the 1960s and 1970s, said the next stage would be "quaternary" (for phase #4) activities such as learning for its own sake, political activism, collecting, community activities, and the like.  True, these ventures can consume whole lives, but they have one problem - they do not usually pay anything.  So if Kahn was right, the future will call for Americans to change from earning to not earning. 

That seems likely from here.  In economic terms, the United States has excess capacity in workers.  Fewer people are needed to work than want to, and the gap is growing.  That is the problem we are facing.  Is the answer guaranteed income, in which everyone is supported in some fashion, or something else?  How can people make money if their labor is not needed? 

These are the issues we will be confronting soon, by the end of this decade if not before.  We need people on both political sides to determine what will follow service jobs.  As of now, we don't know. 

Thursday, June 7, 2012

We're All Americans

Lately there has been a flurry of articles on two subjects.  One is on complaints that Obama has not greatly helped the economic status of blacks in relation to whites.  The other is about how much money women earn in relation to that paid to men.

No matter how much merit you think these concerns have, whether inequality of results must indicate inequality of opportunity or not, there is a real problem with them.  With the possible exception of during the Great Depression, chances for all working Americans have never been weaker.  Almost anyone in the workforce can talk about being turned down for jobs, getting poor raises or none at all, or not being chosen for promotions or better assignments where they clearly thought they were the most deserving.  Discrimination is everywhere, and not only against people of specific groups.  As with the perceived problem of inequality, the issue is not that others are doing better, but that so many can't support themselves decently. 

So what is the result when a great majority of Americans, those who are black, gay, Hispanic, or female, Vietnam veterans, or what have you, are told that their employment problems are because of these things?  It divides the country.  People see others as being protected, with smooth paths and ample chances, when in fact that is far from the truth.  Instead of Americans realizing that the jobs crisis, which is permanent and will not end with better economic times, is a national problem that needs national attention, we turn on each other.  As citizens of a huge, diverse country remarkably physically isolated from others, we have long had the luxury of thinking our group membership means our differences with our countrymen and countrywomen outweigh what we have in common with them.  No longer can we afford that.

We are Americans.  We comprise fewer than 5% of the people in the world.  We have our differences, but almost all of us want the best for our country.  That now means taking the jobs crisis as an American problem needing American - not white, straight, black, Baptist, Italian ancestry, self-employed, or whatever - answers.  The sooner we can realize that American issues belong to all of us collectively, and are no longer confined to those in different groups, the stronger we will be and the quicker we will be able to discuss and implement solutions. 

Friday, June 1, 2012

May's Jobs Numbers - The Sad Reality

This morning, the Bureau of Labor Statistics' May employment numbers were released.  They showed that for the month, only 69,000 net new American jobs had been created, and the official unemployment rate increased to 8.2%. 

A few observations:

- This is the first month this year where all should agree the numbers are bad.  Previously, the number of new jobs at least approximated the population increase (which requires 125,000-140,000 just to break even), or the unemployment rate dropped.  There were reasons for previous months doing better, besides the idea that the economy is improving (it is not), but this time there are no illusions.

- We are still at about 32 million Americans who want to work full-time and are not.  This number can only reasonably be assessed by surveys, as more and more are leaving the labor force entirely, and it will only increase.

- Unemployment claims, a poor indicator of improvement since it only reflects those who have recently become jobless, increased as well.

- It has been a quiet month in the press on jobs.  Expect much more activity over the next two weeks.  Maybe we will see more articles suggesting that, as I maintain, the jobs crisis is PERMANENT and will NOT go away with better economic times.  Within a few years, many if not most will agree with that, and months such as May will only bring that sooner. 

- Both political sides will, of course, spin this number to their advantage.  Romney, in particular, will have a lot to say about how he would do better.  Both sides will bend the truth.  There is nothing much wrong with that - they are, after all, politicians - but we don't need to believe it. 

- As I have said many times on the radio, without Congress and both political sides working together, it won't matter whether the next president is Romney, Obama again, or Daffy Duck - the jobs crisis will not be solved, or even significantly eased.   We need to THROW OUT Congress members who will only stay on their side of the fence, and vote for people who will NEGOTIATE and LEGISLATE!

We must continue to personally adjust to the times we are in, and govern ourselves accordingly.  Watch this space for more advice on how!