SALON

Tuesday, Jun 11, 2013 6:39 PM UTC

Stop blaming technology for high unemployment!

If our government invested more in education and raised the minimum wage, we wouldn't be having this inane debate

By

Topics: RobertReich.org, technology, Germany, European Union, Earned Income Tax Credit, Jobs Market, Unemployment, Wall Street, ,

Stop blaming technology for high unemployment!
This originally appeared on Robert Reich's blog.

Jobs are returning with depressing slowness, and most of the new jobs pay less than the jobs that were lost in the Great Recession.

Economic determinists — fatalists, really — assume that globalization and technological change must now condemn a large portion of the American workforce to under-unemployment and stagnant wages, while rewarding those with the best eductions and connections with ever higher wages and wealth. And therefore that the only way to get good jobs back and avoid widening inequality is to withdraw from the global economy and become neo-Luddites, destroying the new labor-saving technologies.

That’s dead wrong. Economic isolationism and neo-Ludditism would reduce everyone’s living standards. Most importantly, there are many ways to create good jobs and reduce inequality.

Other nations are doing it. Germany was generating higher real median wages until recently, before it was dragged down by austerity it imposed the European Union. Singapore and South Korea continue to do so. Chinese workers have been on a rapidly-rising tide of higher real wages for several decades. These nations are implementing national economic strategies to build good jobs and widespread prosperity. The United States is not.

Any why not? Both because we don’t have the political will to implement them, and we’re trapped in an ideological straightjacket that refuses to acknowledge the importance of such a strategy. The irony is we already have a national economic strategy but it’s been dictated largely by powerful global corporations and Wall Street. And, not surprisingly, rather than increase the jobs and wages of most Americans, that strategy has been increasing the global profits and stock prices of these giant corporations and Wall Street banks.

If we had a strategy designed to increase jobs and wages, what would it look like? For starters, it would focus on raising the productivity of all Americans through better education — including early-childhood education and near-free higher education. That would require a revolution in how we finance public education. It’s insane that half of K-12 budgets still come from local property taxes, for example, especially given that we’re segregating geographically by income. And it makes no sense to pay for the higher education of young people from middle and lower-income families through student debt; that’s resulted in a mountain of debt that can’t or won’t be paid off, and it assumes that higher education is a private investment rather than a public good.

It would also require greater accountability by all schools and universities for better outcomes — but not just better test results. The only sure thing standardized tests measure is the ability to take standardized tests. Yet the new economy demands problem-solving and original thinking, not standardized answers.

Better education would just be a start. We would also unionize low-wage service workers in order to give them bargaining power to get better wages. Such workers — mostly in big-box retailers, fast-food chains, hospitals, and hotel chains — aren’t exposed to global competition or endangered by labor-substituting technologies, yet their wages and working conditions are among the worst in the nation. And they represent among the fastest-growing of all job categories.

We would raise the minimum wage to half the median wage and expand the Earned Income Tax Credit. We’d also eliminate payroll taxes on the first $15,000 of income, making up the shortfall in Social Security by raising the cap on income subject to the payroll tax.

We’d also restructure the relationships between management and labor. We would require, for example, that companies give their workers shares of stock, and more voice in corporate decision making. And that companies spend at least 2% of their earnings upgrading the skills of their lower-wage workers.

We’d also condition government largesse to corporations on their agreement to help create more and better jobs. For example, we’d require that companies receiving government R&D funding do their R&D in the U.S.

We would prohibit companies from deducting the cost of executive compensation in excess of more than 100 times the median compensation of their employees or the employees of their contractors. And bar them from providing tax-free benefits to executives without providing such benefits to all their employees.

And we would turn the financial system back into a means for investing the nation’s savings rather than a casino for placing huge and risky bets that, when they go wrong, impose huge costs on everyone else.

There’s no magic bullet for regaining good jobs and no precise contours to what such a national economic strategy might be, but at the very least we should be having a robust discussion about it. Instead, economic determinists seem to have joined up with the free-market ideologues in preventing such a conversation from even beginning.

Robert Reich

Robert Reich, one of the nation’s leading experts on work and the economy, is Chancellor’s Professor of Public Policy at the Goldman School of Public Policy at the University of California at Berkeley. He has served in three national administrations, most recently as secretary of labor under President Bill Clinton. Time Magazine has named him one of the ten most effective cabinet secretaries of the last century. He has written 13 books, including his latest best-seller, “Aftershock: The Next Economy and America’s Future;” “The Work of Nations,” which has been translated into 22 languages; and his newest, an e-book, “Beyond Outrage.” His syndicated columns, television appearances, and public radio commentaries reach millions of people each week. He is also a founding editor of the American Prospect magazine, and Chairman of the citizen’s group Common Cause. His widely-read blog can be found at www.robertreich.org. More Robert Reich.

You Might Also Like

More Related Stories

Featured Slide Shows

7 motorist-friendly camping sites

close X
  • Share on Twitter
  • Share on Facebook
  • Thumbnails
  • Fullscreen
  • 1 of 9

Sponsored Post

  • White River National Forest via Lower Crystal Lake, Colorado
    For those OK with the mainstream, White River Forest welcomes more than 10 million visitors a year, making it the most-visited recreation forest in the nation. But don’t hate it for being beautiful; it’s got substance, too. The forest boasts 8 wilderness areas, 2,500 miles of trail, 1,900 miles of winding service system roads, and 12 ski resorts (should your snow shredders fit the trunk space). If ice isn’t your thing: take the tire-friendly Flat Tops Trail Scenic Byway — 82 miles connecting the towns of Meeker and Yampa, half of which is unpaved for you road rebels.
    fs.usda.gov/whiteriveryou


    Image credit: Getty

  • Chattahoochee-Oconee National Forest via Noontootla Creek, Georgia
    Boasting 10 wildernesses, 430 miles of trail and 1,367 miles of trout-filled stream, this Georgia forest is hailed as a camper’s paradise. Try driving the Ridge and Valley Scenic Byway, which saw Civil War battles fought. If the tall peaks make your engine tremble, opt for the relatively flat Oconee National Forest, which offers smaller hills and an easy trail to the ghost town of Scull Shoals. Scaredy-cats can opt for John’s Mountain Overlook, which leads to twin waterfalls for the sensitive sightseer in you.
    fs.usda.gov/conf


    Image credit: flickr/chattoconeenf

  • Nordhouse Dunes Wilderness Area via Green Road, Michigan
    The only national forest in Lower Michigan, the Huron-Mainstee spans nearly 1 million acres of public land. Outside the requisite lush habitat for fish and wildlife on display, the Nordhouse Dunes Wilderness Area is among the biggest hooks for visitors: offering beach camping with shores pounded by big, cerulean surf. Splash in some rum and you just might think you were in the Caribbean.
    fs.usda.gov/hmnf


    Image credit: umich.edu

  • Canaan Mountain via Backcountry Canaan Loop Road, West Virginia
    A favorite hailed by outdoorsman and author Johnny Molloy as some of the best high-country car camping sites anywhere in the country, you don’t have to go far to get away. Travel 20 miles west of Dolly Sods (among the busiest in the East) to find the Canaan Backcountry (for more quiet and peace). Those willing to leave the car for a bit and foot it would be remiss to neglect day-hiking the White Rim Rocks, Table Rock Overlook, or the rim at Blackwater River Gorge.
    fs.usda.gov/mnf


    Image credit: Getty

  • Mt. Rogers NRA via Hurricane Creek Road, North Carolina
    Most know it as the highest country they’ll see from North Carolina to New Hampshire. What they may not know? Car campers can get the same grand experience for less hassle. Drop the 50-pound backpacks and take the highway to the high country by stopping anywhere on the twisting (hence the name) Hurricane Road for access to a 15-mile loop that boasts the best of the grassy balds. It’s the road less travelled, and the high one, at that.
    fs.usda.gov/gwj


    Image credit: wikipedia.org

  • Long Key State Park via the Overseas Highway, Florida
    Hiking can get old; sometimes you’d rather paddle. For a weekend getaway of the coastal variety and quieter version of the Florida Keys that’s no less luxe, stick your head in the sand (and ocean, if snorkeling’s your thing) at any of Long Key’s 60 sites. Canoes and kayaks are aplenty, as are the hot showers and electric power source amenities. Think of it as the getaway from the typical getaway.
    floridastateparks.org/longkey/default.cfm


    Image credit: floridastateparks.org

  • Grand Canyon National Park via Crazy Jug Point, Arizona
    You didn’t think we’d neglect one of the world’s most famous national parks, did you? Nor would we dare lead you astray with one of the busiest parts of the park. With the Colorado River still within view of this cliff-edge site, Crazy Jug is a carside camper’s refuge from the troops of tourists. Find easy access to the Bill Hall Trail less than a mile from camp, and descend to get a peek at the volcanic Mt. Trumbull. (Fear not: It’s about as active as your typical lazy Sunday in front of the tube, if not more peaceful.)
    fs.usda.gov/kaibab


    Image credit: flickr/Irish Typepad

  • As the go-to (weekend) getaway car for fiscally conscious field trips with friends, the 2013 MINI Convertible is your campground racer of choice, allowing you and up to three of your co-pilots to take in all the beauty of nature high and low. And with a fuel efficiency that won’t leave you in the latter, you won’t have to worry about being left stranded (or awkwardly asking to go halfsies on gas expenses).


    Image credit: miniusa.com

  • Recent Slide Shows

  • Share on Twitter
  • Share on Facebook
  • Thumbnails
  • Fullscreen
  • 1 of 9

Related Videos

Comments

 20 Comments

Comment Preview

Your name will appear as username ( settings | log out )

You may use these HTML tags and attributes: <a href=""> <b> <em> <strong> <i> <blockquote>

follow salon

Most Read

Popular on Reddit

links from salon.com

From Around the Web

Presented by Scribol
listener_new_rect The Listener: "The Joker": Laughing at life's deepest sorrows