Saturday, September 12, 2009


Harry Targ

Every Labor Day, major media provide a synopsis of the state of the American working class. Spokespersons from the progressive Economic Policy Institute usually are asked to comment about the status of jobs, income, wages, and health care and retirement benefits. EPI is contacted because of their diligence in assembling data on these and other economic issues over long periods of time. Their data is compiled and issued on a biannual basis in well-researched volumes such as the latest called The State of Working America 2008-2009.

The “EPI FACT SHEET: Labor Day by the Numbers” provides a compelling and tragic portrait of the U.S. economy as it pertains to the working class:

-The jobs lost during this latest recession beginning in 2007 total 6.9 million, 2 million of which were from manufacturing.

-The number of workers who are currently unemployed constitute 14.9 million and an additional 16.8% of workers are underemployed. Together 1 in 6 workers are unemployed or underemployed, about 26.4 million workers. Black and Hispanic unemployment is almost double that of white workers.

-Worker productivity from 2000-2007 has increased by 19.2%, but worker wages have remained stagnant or declined during this period.

-Forty-five million Americans have no health insurance

-Only half of workers near retirement age have a 401K balance greater than $40,000.

EPI does note that rates of deterioration of some labor market indicators have declined due to the recent economic stimulus package. However, EPI asserts that government programs, such as extending unemployment benefits, need to be continued and expanded to address the serious problems that endure.

In an EPI press release Heidi Shierholz writes that “unemployment will likely pass 10% by the end of the year and remain elevated for years to come, and unemployment spells for those who have lost their jobs will continue to lengthen from their already record-breaking levels.”

Reflecting on the deeper meaning of data like these suggest a number of disturbing long-term trends. For example:

The United States economy over the last thirty years has shifted dramatically from profit and growth derived from manufacturing to financial speculation. Significant portions of manufacturing jobs that have remained have been exported to low wage poor countries. Currently less than 15 percent of the American work force is employed in manufacturing. And manufacturing jobs have traditionally provided livable wages for most workers.

In addition, worker productivity has dramatically increased over the years (without additional compensation). Fewer workers produce more goods and services.

Major job growth in the twenty-first century has occurred in selected low wage sectors of the service economy; such as in tourism, health care, day care, and fast food.

Putting all this together we see a dramatic transformation of the U.S. economy from one based on manufacturing, which employed relatively high paid workers, to one based on financial speculation, job exports, rising low wage service employment, and significant increases in worker productivity due to technological advances and declining union protection for worker rights in factories and other work sites. The new economy, born in the era of Reaganomics , and culminating in repeated economic crises, is a high profit/low jobs economy.

The number one question for our times is “how to get out of this historic trajectory?” Although thinking about a transformation of the global capitalist economy is justified, the United States government, needs to act now.

One approach to overcoming a high profit/low jobs economy is to develop a long- term public commitment to investment in renewing the basic infrastructure of the United States in conformance with twenty-first century needs for jobs, income and environmental change.

An articulate spokesperson, with a hopeful, realistic plan for overcoming the jobs/income/wages/survival crisis we face is Van Jones, the author of The Green Collar Economy. He and a variety of civil society organizations such as the United Steel Workers of America and the Apollo Alliance believe that the Obama administration, to really address the deep economic crisis we face, must propose, educate about, and lobby for a massive green jobs agenda. We can, Van Jones has argued, develop a New Deal style agenda to put people to work reconstructing the U.S. economy in the twenty-first century to save the environment, construct new forms of energy, reduce global warming, and create a national community that protects the future while providing livable wages for people today.

So while we read the statistical summaries over Labor Day, reflected on the fundamental contradictions of the U.S. economy-high profits, financial speculation, low wages, lost jobs, increased productivity-we may have noticed on the back pages of our newspapers that Van Jones, advocate for a green jobs agenda-which just might save the U.S. economy from the apocalypse-was forced to resign from the Obama administration. Right-wing media spokespersons mobilized a public campaign to smear the man. They resurrected harmless political statements he articulated or endorsed in the past that have no bearing on his current work. The real explanation for the campaign against Van Jones has more to do with his advocacy for the creation of a new economy, an economy based on jobs, livable wages, and environmental sustainability rather than the economy that created this Labor Day economic crisis.