The scared-stiff workaholic

Robert Reich's "The Future of Success" says we're too insecure to stop working.


Noam Scheiber
February 13, 2001 1:30AM (UTC)

A guy I knew in college once told me he wasn't interested in economics because he wanted to "tell stories." I'm still not sure what that means. But I'm guessing his point was that using cold economic calculation to explain the web of motivations that govern human behavior inevitably blinds you to some deep truth about the world.

After reading "The Future of Success," I'm guessing Robert Reich feels the same way. And, to be fair, he wouldn't be totally off the mark. Economists are annoyingly preoccupied with their abstract models -- which is probably why, after all these years, they still can't explain charity, or why anyone would bother to vote. Still, it'd be wrong to think that analytical rigor doesn't have its place. If nothing else, formal economics provides a check against sloppy storytelling, something Reich would have been wise to make use of.

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Reich is best known for his work as labor secretary/conscience without portfolio during the first Clinton administration. But among economists Reich is famous mainly for not being an economist -- despite popular presumption to the contrary. While Reich probably boned up on the subject during his Rhodes scholar days at Oxford (where he received a second undergraduate degree in PPE (a mishmash of politics, philosophy and economics), his more important accomplishment there was befriending the man who would one day make him a Cabinet secretary. After Oxford, meanwhile, Reich nurtured his budding interest in economics while studying law at Yale. (In Reich's defense, Yale Law School has minted many a famous uncredentialed economist -- Robert Rubin and Ben Stein among them.)

After a stint in the Ford administration, Reich went on to join the faculty of Harvard's Kennedy School of Government, a perch from which he authored several economics-related tomes, and from which Clinton snatched him up in 1992. But when, even before his inauguration, Clinton veered from his campaign's populist economic message, Reich's influence with the president shrank considerably. Thereafter Reich played the (increasingly isolated) role of champion of the working stiff in an administration often more concerned with bond markets and interest rates.

Which is probably why Reich's retirement from government in 1997 was something of a coming out. Freed from the obligation to toe the party line -- or at least not openly disavow it -- Reich was able to (re-)assert himself in a more public role as freelance economic kibitzer. His first step in that venture came only months after Clinton's second Inauguration with the much-anticipated "Locked in the Cabinet," the story of Reich's heroic struggle with the forces of evil (read: deficit hawks) lurking within the administration.

But, for all its Manichaean bravado, "Locked in the Cabinet" was essentially a memoir. To cement his position as the nation's leading economic liberal, Reich would need to return to his old form. "The Future of Success" is an effort in that vein.

Reich sets out to resolve the following paradox (why is there always a paradox?): People are making more money than ever before, yet seem to be working harder and exercising less control over their lives. To anyone who's ever studied economics, this situation is not particularly paradoxical. The textbook explanation is that people basically divide their time between two activities, labor (which they don't like) and leisure (which they like). When the reward for labor goes up -- as it has in recent years -- leisure gets more expensive. In other words, an hour not spent working is more costly when work pays $15 rather than $10 an hour. And so, they "buy" less leisure time as a result. Call this the "higher-wage hypothesis."

But for the most part, Reich sidesteps this simple explanation in order to pursue a much more elaborate one; clearly, the "higher-wage thesis" is not enough of a story for him. It's a habit that's all too prevalent in this book: Reich makes impressively broad hypotheses where simpler ones will do, but then loses steam before he can provide the evidence to support them. Why? Well, if there's one thing you get from Reich, it's that he's desperate to launch himself into the William Whyte/David Riesman "deep social thinker" canon. And so the question of why we earn more yet work harder is treated to an ambitious, yet not entirely convincing thesis. Reich's hypothesis goes like this: The revolution in information, communication and transportation technology witnessed in the last 20-odd years has made it easier for consumers to switch brands, products or services, leading to an increasingly competitive economy. More intense competition has dramatically increased the reward to success but also increased the cost of failure, resulting in greater disparities in wealth.

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Competition has the added effect of making life less predictable -- just because you're on top today doesn't mean you're going to be on top tomorrow. And the combination of these forces has thrown people into perpetual insecurity. The successful worry constantly that their prosperous days are numbered and work frantically to postpone that eventuality. The unsuccessful worry they'll never be successful and work frantically to catch up.

Readers of Reich's earlier work will find this territory familiar. Reich's 1983 book "The Next American Frontier" made the case for why big, plodding enterprises were outmoded, arguing instead for a more flexible organizational structure. In 1991's "The Work of Nations," Reich brooded about how globalization had elevated the "symbolic analyst" -- known for his data-manipulating prowess -- above ordinary production and service workers, and particularly about what this meant for income inequality. In both cases, as with "The Future of Success," the structure of Reich's arguments are the same: a mystical force (be it globalization in the "The Work of Nations" or, now, technology in "The Future of Success") is driving a change in the way we live and work.

Reich's latest story begins with two stylized facts that he lays out in his introduction: One, Americans work longer hours than ever before, and two, technology has revolutionized the way they go about it. Unfortunately, these facts conceal much of what's actually been happening (there's a reason we call them stylized). While it's true that the average American is working longer hours, the people whose hours have increased most tend to fall at the bottom end of the income and skill distribution -- not exactly the demographic whose jobs you'd expect to be revolutionized by technology. Meanwhile, the people Reich puts at the center of his story -- engineers and assorted technical types, managers, administrators and executives -- are the people whose hours have been more or less static since the mid-'80s.

Never one to shrink from a challenge, Reich presses on with remarkable insouciance. How do we know competition has intensified? Because today we have "Web-based cyber docs" where we used to rely on local pharmacists. Why has the economy suddenly become less predictable? Because the race for the next killer software application has replaced plodding industrial production. And how do we know all this makes us insecure? Because Todd Wagner, the co-founder and CEO of Broadcast.com, says so.

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The problem with all these examples, of course, is that they're just examples. None of them actually prove anything. But that doesn't stop Reich from using them to prop up key claims. Take Reich's point about the "free agentization" of the labor market, the idea that the new economy elevates individuals above organizations. According to Reich, this development forces organizations into bidding wars for scarce talent, which increases the reward to being a star but makes it tougher for the average Joe to get by.

Whatever you think of this idea, it's an essential component of Reich's insecurity thesis. But when you actually add up his evidence, the phenomenon seems to encircle roughly four people: Robert Barro, the Harvard economist briefly lured to Columbia by a $300,000-a-year salary; Mary Meeker, the Morgan Stanley investment banker whose endorsement has become the sine qua non of tech IPOs; screenwriter Aaron Sorkin, of "The West Wing" fame; and, oh yeah, an unnamed colleague of Reich's from Brandeis.

Now there may well be something to this -- we probably hear enough about high-stakes bidding wars to assume they're no longer just for athletes and actors. But in order for this to serve the argument that most people are working harder because most people feel less secure, the phenomenon would have to be pretty pervasive. I doubt if that's the case. When was the last time you heard about Harvard and Columbia duking it out over an obscure assistant English professor, much less a janitor?

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It's a little ironic that when Reich finally does get around to offering more systematic evidence, it all points to that old, textbook higher-wage hypothesis he's spent the book sidestepping (and which, to be fair, Reich does mention, albeit as an afterthought). At one point, for instance, Reich goes on an extended riff about what the whole insecurity paradox means for women, who started working en masse in the 70s and 80s. But according to Reich's own citations, this development coincided with the rise in women's wages brought about by the decline in gender discrimination. That is, women entered the labor force when it became too expensive to hold out.

This brings us to Reich's most grating indiscretion: his habit of simply asserting things when the evidence doesn't materialize. As Reich tells it, women began working during this period not so much because wages enticed them into the labor market but because families were struggling to get by on one salary. This sounds plausible enough on its face. That is, until you consider that women from families of all income levels were flocking to work, not just those further down the ladder. Reich never addresses this.

Regrettably, that's not the only place Reich pulls this stunt. You just don't always notice it because the assertions are clichés. In making the point that today's corporate world is nasty and brutish, for example, Reich tells us that, "No longer are companies responsible to employees, communities, and the public at large. They view their sole duty as maximizing investor shares." Or take this doozy about how worth has come to mean popularity: "as the economy grows more fiercely competitive, commercial evaluation can all but silence aesthetic criticism." I'm perfectly willing to let Reich persuade me the world is this simple, but he never makes the effort.

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None of which is to say that Reich is necessarily wrong. A cursory reading of the data suggests people are working longer hours because they're getting paid more and not because their pay is less predictable, which, at the very least, is what Reich would need in order to have a case. But to be able to conclude definitively you'd need the benefit of rigorous statistical analysis. Maybe that's a lot to ask. On the other hand, deep analysis doesn't come cheap.


Noam Scheiber

Noam Scheiber is a reporter and researcher at the New Republic.

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