USA Politics
Policies of the Democratic Party

There's a Pernicious Economic Theory Creeping into the Heart of the Democratic Party ... We have to get very clear on what kind of environment enriches working people. The good ideas don't come from Silicon Valley.

Burgess COMMENTARY
Thanks for this fascinating article! Most of the political class have no idea how the economy actually works. The USA has created financial capital by exploiting human capital and natural capital. The vast supply of natural capital enabled the creation of financial wealth and the idea of American exceptionalism. Huge immigrant flows provided labor that would otherwise have constrained the environmental exploitation!. In the 30 year period post WWII there was reasonable sharing of the wealth but this all changed in the 1970s with the OPEC oil shock and then a series of failed Washington economic ideologies that started with President Reagan and have continued ever since. American / capitalist business needs good strong regulation because its core principle is unbridled competition in the pursuit of profit and little or no consideration whatsoever for anything beyond that. The result is the most inefficient socio-enviro-economic system in the world, that will almost certainly implode catastrophically in the next decade unless there is some radical rethinking of how the system works. Peter Burgess http://truevaluemetrics.org
Peter Burgess

LABOR There's a Pernicious Economic Theory Creeping into the Heart of the Democratic Party ... We have to get very clear on what kind of environment enriches working people. The good ideas don't come from Silicon Valley. By Richard Eskow / Campaign for America's Future August 5, 2017, 8:27 AM GMT 10551 Print 66 COMMENTS

Nancy Pelosi and Democratic Caucus Photo Credit: Dems.gov

If a picture’s worth a thousand words, what’s the value of a single word?

If you’re a Democratic Party leader and the word is “compete,” the answer may be: more than you can afford.

Much of the Democratic Party’s rhetoric has been ‘Uberized’ by a creeping free-market ideology that treats workers as lone competitors in a survival-of-the-toughest economy.

The time has come to reject this language as well as the thinking behind it. The notion that people must compete with each for low-paying jobs undermines worker solidarity and weakens our sense of national community.

Better Than What?

When the Democratic Party rolled out its “Better Deal” language in July, Senate Democratic Leader Chuck Schumer and House Minority Leader Nancy Pelosi each wrote op-eds promoting an agenda whose subtitle is, “Better Jobs, Better Wages, Better Future.”

An earlier version of that slogan – “Better Skills, Better Jobs, Better Wages” – was roundly criticized when it was leaked to a reporter, and rightly so. That phrase first appeared in an op-ed by Sen. Tim Kaine, who wrote:

Better skills in our people and communities … will make us more competitive in a world where talent is now the most precious resource. We need to double down on retraining people whose jobs are destroyed by shifts in trade.

Those words offer nothing new to the American people. They could have been lifted from a speech Bill Clinton gave in 1993, when he declared that “workers in advanced countries must become ever more productive to deal with competition from low-wage countries on the one hand, and high-skilled, high-tech countries on the other.”

Since those words were spoken more than a quarter-century ago, millions of American jobs have been lost to bad trade deals that shifted work overseas and wealth upward.

Misguided government policies and greedy business practices ended a thirty-year period in which wages kept pace with productivity growth, resulting in soaring inequality and stagnating wages for American workers. Increasingly wealthy individuals in corporations have, in turn, used their money to hijack the political process.

No retraining program on Earth can prepare workers for jobs that don’t exist. And, as long as inequality remains the highest it’s been since the 1920s, “competitive” education strategies will do little to improve wages or social mobility. To beleaguered workers, the phrase “better skills” reinforces the perception that an out-of-touch elite would rather blame the victims of its policies than take responsibility for its actions.

Better jobs, better wages, better luck next time.

Better Than That

The finished slogan was a notable improvement from the beta version. The phrase “better skills” was gone, replaced by the noncommittal “better future.”

It was a welcome surprise to see Democrats taking on corporate monopolies and the rapaciousness of Big Pharma as they rolled out the “Better Deal” platform.

Those fights can energize voters if they’re properly framed and presented – as in,“these corporations are so big they think they can do what they want, but we’re gonna stop ‘em” – especially if they’re complemented by strong stands on labor, trade, Medicare and Social Security expansion, and other populist issues.

But it was disappointing to see both Sen. Schumer and Leader Pelosi echo Kaine’s unsupportable claims for worker retraining in their respective op-eds. Schumer wrote that “millions of unemployed or underemployed people particularly those without a college degree, could be brought back into the labor force or retrained to secure full-time, higher-paying work.”

The only concrete proposal he offers, however, is a training tax credit for businesses that’s unlikely to make a dent in unemployment. It won’t reduce inequality, either. As economist Lawrence Mishel wrote in 2011: “… workers face a wage deficit, not a skills deficit.”

The Ideology of Competition

For her part, Leader Pelosi promises a “fresh vision” from the Democratic leadership before saying, “It is time to ignite a new era of investment in America’s workers, empowering all Americans with the skills they need to compete in the modern economy.”

Compete? Democrats need to reject the idea that workers should “compete” with each other for jobs. That ideologically charged concept gained momentum in the 1990s, as the party’s institutional fundraising shifted its emphasis from unions to corporate donors.

Today we see the logical end-point of that ideology in the “Uberization” of American labor, as increasing numbers of workers are forced to scrabble like crabs in a barrel for low-paying piece work – or worse, as with Uber, are pressured to go into debt for car loans they must assume in order to “compete”

It’s no coincidence that high-ranking Democratic operatives have been associated with both Uber and its major competitor, Lyft.

The ideology of competition owes a great deal to “new economy” popularizers like Thomas Friedman and economists like Tyler Cowen, both of whom proclaim that “average is over.” It’s a cold-blooded ideology.

In his book of the same name, Cowen argues that we will be led by an elite he calls the “hyper-meritocracy” (he seems to use “merit” and “income” interchangeably), while a majority of people miss out on the benefits of the new economy.

Gone are the days when popular culture celebrated the “average Joe” or “average Jane.” In the world of worker-on-worker competition, only those who are exceptionally talented at making money will get ahead. Forget the folks who work for a living, love their kids, and serve their communities.

This ideology demands that we make heroes out of the billionaires who earned their wealth from the Internet, a government-created technology. The merely “average,” those heroes and heroines of mid-twentieth century films and TV, are left to fight over scraps from the “hyper-meritocracy’s” table.

The Language of Community

To be fair, there’s every likelihood that Nancy Pelosi was using the political language of her party without considering its origins or rhetorical baggage. She may not have intended to embrace that language’s ideological overtones. But language shapes thought, and it must be changed when it bends thought in the wrong direction.

“Compete”? Candidates compete when they’re applying for jobs, of course. But once they’re hired the competition should end. The history of organized labor – once the bedrock of the Democratic Party – is founded on the realization that individual workers cannot compete with powerful corporations in the fight for economic justice.

It’s not a perfect history. But it’s no accident that the greatest period of shared prosperity in our nation’s modern history coincided with its highest percentage of unionized workers. Or that, conversely, inequality grew as union membership fell.

Instead of training workers to “compete” for non-existent jobs, Democrats should create those jobs – by investing in infrastructure, by renegotiating bad trade deals, and by making the government the employer of last resort. And they should do more: they should call us together, by working with outside activists to form a broad coalition for economic and social justice.

Americans are a highly individualistic people in many ways. But we are also a nation with strong communitarian values. Those values can be found in our admiration for those who make sacrifices in times of war. They can be found in our willingness to help one another when disaster strikes. They can be seen in Fourth of July parades, or in clothing drives at the local fire station.

There is a yearning in this country – a yearning to belong to something greater than one’s self. Rather than asking workers to “compete” with each other, the new leaders of the American left should ask them to collaborate – in labor negotiations, in new forms of public service, in acts of selfless devotion to one another and the nation as a whole.

The Democrats should fill out the hazy language of the “better deal” with concrete proposals to improve people’s lives. Repeating the phrase like a mantra will hurt, not help, unless there is substance behind it. Voters have been burned by vague promises before. They’ll need clear commitments this time around.

But Democrats should also be brave enough to call Americans together again – as working people, as a movement, and as a community. After all, nobody can really offer us a “better deal” unless they ask us to give our best in return.

Richard (RJ) Eskow is a blogger and writer, a former Wall Street executive, a consultant, and a former musician.