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    The War on Work

    When I worry about the future of my chosen profession, which I do too often these days, I take bleak consolation from the fact that every other profession I considered during my early years is also in crisis. Was it a mistake to become a university professor just as the job market for professors collapsed? Maybe. But if the original question was, "Should I become a professor, a lawyer, or a newspaper journalist?" then maybe not. Lawyers are having a hard time finding jobs; newspapers are laying off. And I can't say I would have been better off staying a high school teacher, as wave after wave of "reforms" make that job harder and worse.

    So I can console myself that I didn't make an unwise choice of career, because there was no wise choice to make. It's not that I chose the wrong profession, but that it's a bad time to be a professional. The professions are no longer the path to security, let alone to upward mobility, that they were during the long post-war boom. That doesn't actually make me feel any better.

    The last three decades of our public life have been dedicated to the proposition that people should be paid less for their work. Naturally, nobody means that they, personally, should be paid less for their work. But the idea that other people are being paid too much for their work has come to be seen as simple, virtuous common sense. Our decision-making classes believe, with a profound and unshakeable conviction, that workers make too much and that investors do not make enough.

     This core belief is expressed in many ways. There is the Federal Reserve, which has become obsessed with preventing even non-existent inflation (which cuts into investment profits, and is connected to rising wages) and nearly abandoned its mission of combating unemployment (which depresses wages and, of course, puts people out of work). There is a dominant school of business-management dedicated to reducing labor costs in the name of increasing bottom-line profits, meaning round after round of layoffs and pay cuts. There is a steady attack on labor unions. There is the obsession with "reforming" Social Security by cutting retired workers' pensions. There is the rage for "reforming" education by making public-school teaching a less attractive job, with no other measure deemed necessary. And there have been changes in the tax code, which now tax money made from investments at a lower rate than money made by working at a job, something our recent struggles over tax rates did not change. (This is allegedly necessary for economic growth, but during the post-WWII boom investment income was taxed at a higher rate than salaries or wages.) Many of these specific measures are explained as inevitable consequences of technology or globalization or "economic conditions," but together they form a pattern larger than any of those proposed explanations can successfully explain. Globalization did not cut the capital-gains tax. Soaring profits and stagnant wages are not inevitable results of technological change. They reflect a choice about what to do with new technology. All of the things I have listed grow ultimately from a set of clear policy preferences, with investors favored over workers at every turn.

    These things have been done even at the cost of wrecking the economy. These things are more important to our decision-makers than the country's broader economic health. Both Democrats and Republicans do them, although the Democrats generally moderate things a little and the Republicans often double down. The very fact that Clinton-era Democrats could say "jobless recovery" revealed that they'd bought into the basic worldview, which imagines a "good economy" as a good economy for investors and views salaries, wages, and pensions the way investors do, as costs that need to be contained. The result Ramona blogs about, with workers pulling eighty-hour weeks but afraid to ask for the overtime that the law mandates, is not a side effect of these policies. It is an expression of their central goal.

    If you think about this as "the rich vs. the poor," or even "the rich vs. the middle class," it doesn't always make sense. This is not primarily about how much money you have, but about where your money comes from. Small business owners are a favored class under these policies (although not nearly as favored as they are in public rhetoric). The point is that the rules have been repeatedly changed to favor people who make money from things they own (whether that's a business or shares of stock or simply money they have lent out) at the expense of people who make their living by selling their work to employers or clients (whether that work is driving a bus or practicing the law). Favoring one group means hurting the other; stockholders and business-owners and commercial lenders increase their profits by reducing how much workers take home at the end of the week. This works great for the business owners and investors until it doesn't; our current economic crisis results from things getting so out of balance that workers, as a group, no longer have the money to buy much. But most of the proposals for fixing our economic problems aim at increasing the imbalance even more.

    The problem for white-collar professionals is that they did not see this coming. Many of us are used to viewing the world as upper, middle, and lower, white collar and blue, thinking about how much money a person makes rather than how that person makes the money. People who work in offices in business clothes tend to view themselves as in the same class as the people, say, who manage a car company rather than the people in the automakers' union. But this is a mistake. The preference is not for investors over blue-collar workers. The preference is for investors over workers, period.

    There have always been two basic paths to increased prosperity for workers. One is unionization, so that a group of workers can negotiate as a group for a better deal. The other is professionalization, investing in education and training that makes your labor more valuable to employers. During the decades when our economy grew, both the unions and the professions were strong. But most people who followed one path understood themselves as belonging to a different group than the other, with different interests. Lawyers and journalists and so forth did not see the crisis of the factory worker, or the terrible treatment of workers at places like Wal-Mart, as anything to do with them. But investors want to cut money everywhere. They view all salaries, and perhaps especially professional middle-class salaries, as liabilities that need to be reduced. And suddenly, surprise: it's tough to be an architect. Even if you have invested time, education and training into increasing the market value of your labor, you're facing an employment market that is constantly trying to decrease labor's value.

    The final result is that it becomes harder and harder to work your way up, no matter how hard you work, because work itself is held increasingly cheap. That is not what we say we believe about America. But that is how America has started to run.


    Excellent points. The NYT had an excellent article The Rise of the Permanent Temporary, which now includes professors, architects and other professionals, as well as the traditional temp office worker, and skilled and unskilled laborers of all kind. No stability in employment or pay, little or no benefits, and no future for advancement.

    Robert Reich pointed out another problem with the wealth in our country being concentrated at the top 5 or 1%.

    For the middle class, the home is often the biggest financial asset in their portfolio. Their net worth depends on it. Yet it is taxed every year, basically a tax on their wealth.

    For the rich, the home is a small, often insignificant portion of their wealth. Their actual wealth is not taxed at all, as in some nations. Why tax the value of a home, but not the stock portfolio? All these factors taken together, this is not a route to prosperity for a nation.

    Robert Reich: are subject to the only major tax on wealth — property taxes.  Yale Professor Bruce Ackerman and Anne Alstott have proposed a 2 percent surtax on the wealth of the richest one-half of 1 percent of Americans owning more than $7.2 million of assets.

    They figure it would generate $70 billion a year, or $750 billion over the decade. That’s more than the fiscal cliff deal raises from high-income Americans..

    /1952: tax table  Adjusted for inflation


    Marginal Tax Rate: 

    22.2% up to $16.9K

    24.6% up to $33.9K

    29.0% up to $50.8K

    34.0% up to $67.6K

    38.0% up to $84.7K

    42.0% up to $101.6K

    48.0% up to $118.5K

    53.0% up to $135.5K

    56.0% up to $152.4K

    59.0% up to $169.3K

    62.0% up to $186.2K

    66.0% up to $220.1K

    67.0% up to $270.9K

    68.0% up to $321.8K

    72.0% up to $372.6K

    75.0% up to $423.4K

    77.0% up to $508.0K

    80.0% up to $592.7K

    83.0% up to $677.4K

    85.0% up to $762.0K

    88.0% up to $846.7K

    90.0% up to $1,270.1K

    91.0% up to $1,693.4K

    92.0% from $1,693.4K up

    Now compare to the rates until the fiscal cliff:


    Married Filing Separately


    Marginal Tax Rate:

    10% up to $8.5K

    15% up to $34.5K

    25% up to $69.7K

    28% up to $106.2K

    33% up to $189.6K

    35% from 189.6K up

    I have no particular comment to add.

    Well I do not blame you.

    How doest one add to the TRUTH.

    Well done Flavius!

    This seems pretty undeniable:

    "The last three decades of our public life have been dedicated to the proposition that people should be paid less for their work."

    A lot of employers view compensation as their most controllable input.  Meanwhile, our capital has no boundaries while our workers are forced to remain at least somewhat local.  As you say, we somewhat prefer the small business owner to the employee, though we're inconsistent in that.  Most small business owners have more in common with employees than they would anyone else.  Our problem is that we make policy with the big, well connected players in mind.  We make policies that allows for Boeing to spend years hiring more than 50 outsourced firms to design a plane that was grounded worldwide just a few years after its debut.  At least they saved a buck building the thing.

    And, of course, on top of all of this, we have forces on the corporate left and corporate right who would like to do to our public programs what large employers have done to their people.  This is why I get so angry when Thomas Friedman writes that our next generation of leaders will have to take things away from people, rather than provide them.  Surely, they (and we) can do better than that?

    Friedman is basically the living personification of the world view I'm talking about. Virtually everything he writes is an expression of that ideology.

    If you check him out today, he's arguing that people need "lifelong learning" and a "passion quotient," to match their "skills quotient," and he does all this without ever once acknowledging how easy it is to have a "passion quotient" if you're Thomas Friedman and basically enjoy an elevated status in society.  For everyone else, it's the equivalent of Subway hiring "sandwich artists."  Have we done anything to guide our economy in a direction that Americans are actually and genuinely passionate about?

    Excellent piece. When you mentioned Republicans "doubling down", I was reminded of right-wing pundit Michelle Malkin's quip about Romney supporters being the people who sign the front of paychecks and Obama supporters being the people who sign the back of them--with the implication that the latter were a contemptible canaille whose interests and votes shouldn't count. The right-wing blogosphere loved it and quoted it endlessly, while progressive sites (even ones dedicated to publicizing gaffes by conservatives) made remarkably little fuss over what was really a horrifyingly antidemocratic sentiment.

    Thanks, AWJ. Come back again; the other bloggers here are, in my humble opinion, pretty rocking.

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