Tag: upward mobility

Closing the Revolving Door: Income Inequality, Wage Stagnation & Deficits Make an Urgent Case for Campaign Finance Reform

On By The Social CriticIn Economics & Globalization, Politics & Public PolicyLeave a comment

If poor people knew how rich rich people are, there would be riots in the streets.

— Chris Rock

The wealthiest 20 individuals in the United States — a group small enough to fly together on a Gulfstream jet — have as much wealth as the 152 million people who comprise the bottom half of the U.S. population, The Institute for Policy Studies reports in “Billionaire Bonanza: The Forbes 400 and the Rest of Us“.

But what’s really driving the widening gulf between the haves and the have nots in America?

Among the more widely appreciated reasons for declining economic growth is the advance of automation. But other factors have begun to collide with technology to launch what may be a Perfect Storm: reshaping the economy to a “new normal” marked by economic uncertainty.

Another culprit is the rise of lopsided trade deals in the 1980s and ’90s, which have provided greater incentive to offshore jobs. The late billionaire and financier Sir James Goldsmith in his book “The Trap” predicted that poorly crafted free trade deals would produce a “net job loss”. In the early 1990s, Goldsmith testified before Congress advising against entry into another globalization deal known as GATT. Goldsmith also called out the Clinton administration on the Charlie Rose show in opposition to NAFTA, again predicting an outflow of jobs and capital.

If the wage stagnation of the late 1970s had not persisted to the present — some four decades! — the average American would earn $92,000 per year, reports Forbes in “Average America vs the One Percent“. In today’s dollars, those who identify as middle class are less secure than families that relied upon on a single breadwinner in the 1960s and earlier. We have gone from a society that can pay its bills and raise a family on a single income — and often a blue-collar income at that — to one in which the norm is for two able-bodied adults to work full time to support a family. (And because this is the new normal, illness and divorce are now the leading causes of child poverty and personal bankruptcy, according to the book “The Two-Income Trap“.) During this same period household debts have grown and savings diminished.

While cynics use these economic indicators to berate Americans — promoting the simplistic conclusion that Americans are eager to live beyond their means — reality is far more nuanced. In recent years recessions have gone deeper, last longer and recoveries are that much weaker. In part this is because our economy is nearly 70 percent dependent upon consumer spending for its health. Economic growth has instead remained tenuous in ways that economists typically ascribe to “lack of consumer confidence”. Behind the euphemism lies the unsettling reality that fewer Americans have the discretionary income necessary to stimulate the economy. More than 2/3 of Americans struggle to come up with $400 in an emergency.

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White Men Can’t Mow Lawns

On By The Social CriticIn Economics & Globalization, Politics & Public Policy1 Comment

How often have we heard it said by conservative pundits and talk radio personalities that unemployed Americans are inclined to refuse menial work, apparently content to accept government handouts? The list of supposed “shall nots” are numerous: Americans won’t bus tables, clean hotel rooms, harvest crops and, in general, bust our chops. On the flip side, how many times have liberals argued that undocumented labor has little to no adverse impact on American job prospects?

In one key respect, the two sides seemingly agree: American-born workers won’t take “those jobs” anyhow, whereas the undocumented workforce contributes to cheaper goods and services — such are the hands that infuse America with entrepreneurial spirit, after all.

Never mind the reality: The bulk of today’s job growth takes place in the service sector — precisely where the legal and undocumented alike mingle.

But what does one make of it when “reality” is beholden to stereotypes — perceptions so routine, we scarcely question them?

A phenomena of “enforced roles” may help explain why socioeconomic groups become occupationally stratified.

“Jim’s” story provides a window into things present — and trends to come. It began when a middle-aged man and his parents began sharing a roof. The Great Recession had not been kind, having hit the state of California particularly hard. For Jim, the eldest son of retired healthcare professionals, the economic downturn entailed prolonged underemployment — in spite of experience in a supposedly in-demand field. Having hit his late 40s with a résumé that reads like a who’s-who of defunct employers, things weren’t looking up. For Jim’s parents, likewise, failure to pay off their primary residence before retirement forced a difficult choice: upend their son, or live under the same roof.

Like any earnest job-seeker, Jim sought to do “whatever it takes” to get by while searching for full-time work. Imagine, then, his surprise when his parents turned down his offer to do yard work — lawn and garden care for the very home he occupied as his parents’ renter for nearly 20 years.

Why deny one’s own son a mundane job, an offer that if accepted would have netted a savings for a couple who themselves depend upon a fixed income — an offer that, if little more, would have helped a demoralized Jim feel useful? Their objection, Jim says, centered around the difficulty of finding a “good gardener”. And who might a good gardener be?

Stereotypically, the illegal variety.

Too add insult to injury, Jim’s parents spend upwards of 10 hours per day watching FOX News. If anyone were to be opposed to undocumented labor, it would be them — right?

Wrong.

To add yet another layer of irony, it wasn’t the first time Jim had lost out on work he was more than willing to take. When a neighbor passed away before the recession, Jim kept up the vacant home’s yard while the trustees weighed their options. Upon noting Jim’s neighborly actions, the inheritors of the property began to pay him a small sum — fortuitously for by this time Jim’s employer had succumbed to the recession. The owners compensated Jim, that is until they inexplicably apologized for “taking advantage” of him, opting instead for — you guessed it — a gardening service run by those whom society has apparently come to regard as legitimate partakers of such labor.

Jim’s experience is hardly isolated. During the Great Recession, employment prospects for the very rich and the very poor were not as heavily hit as those of the middle class. Under-the-table workers in the underground economy, for instance, suffered less unemployment than blacks and teens. The Great Recession, more accurately portrayed, consisted of the bottom dropping out of the middle class. Some four years into this so-called recovery, three-quarters of Americans live paycheck to paycheck, 80 percent of us will at some point in our working lives grapple with “economic insecurity”, and most have endured wage loss in the face of increased costs of living.

Jim’s reality is a poor fit for conservative critics’ allegations of pervasive, American lassitude and laziness, nor does it jive with the liberal romanticism our nation of immigrants reserves for the newly arrived. More telling, it begs the question: Is there a double standard in society — a racist typecasting of sorts — that keeps ethnic minorities behind a barrier of subordinate or low-wage occupations and majority “whites” entrenched in roles of a different but no less rigid type?

Maybe it’s time to ask.

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* The title for this blog entry is a take off the film “White Men Can’t Jump”.