The Wind-Down: Good jobs & bad jobs PT 2

In my previous post on "good" jobs and "bad" jobs, I reviewed the major strains of contemporary thinking seeking to explain why some jobs are pleasant and well-paid, while others are unpleasant and poorly paid. Worse than the glaring inequality of living conditions produced by this inequity, the dynamics of the labor market seem to exacerbate (rather than moderate) these tendencies.

This is directly counter to the predictions of mainstream economics. Most economists - who tend to fit observed realities to their models, rather than the other way around - simply explain away these trends, or devolve into thinly-veiled moralisms (along the lines I describe in the earlier post). Even the best of them do not seem to deal with the subject square-on, or come up with accessible explanations which can be politically deployed.

Thus, Joeseph Stiglitz, when describing the deplorable fate which has befallen the majority of wage-earners over the last 4 decades (!), resorts to either an overly general theory of "over-supply of unskilled labor" (as in his recent book), or the rarefied notion of "asymmetric information."

If we are to break out of the ideological shackles of "inequality of access" or the liberal/conservative debate around "equal opportunity" (see the previous post), we are going to need sturdier tools than this.

Simply put, the basic conclusion that we are led to by the real dynamics of work suggest that workers, rather than being denied access to the Elysian Fields that are made available to those with superior social value, are, in fact, imprisoned within their workplaces, locked-in to bad and worsening conditions. Or, to say it another way - they are trapped in work relations of increasing exploitation.

Does that put it bluntly enough? Read on, and I think I can sharpen this analysis...

Needless to say, this portrait runs completely counter to the libertarian utopia that supposedly exists within capitalism, and therefore will run up against certain predictable counter-arguments.

"If you don't like it here, you can always quit"

This is, of course, the entire basis of the claim that individual liberty is absolute. Without this sovereignty of the individual, many of the grandiose claims about progress fail, or at least falter.

But, just for a moment, let's pull our heads out of the clouds and look at this claim as it really plays out.

First of all, we have to get beyond the "general" description of being trapped - ie, there is an "overall" condition of the working class, which is (for the vast majority), inescapable. This is basically what Stiglitz refers to when he talks about an oversupply of unskilled labor.

Of course, the prescription this implies (at least at the individual level) channels back into the liberal panacea of education. Even if the claim that the majority of new jobs in the next decade-plus will not require higher education, it still does not describe a situation in which individuals are trapped, only one in which the betterment of one comes at the expense of another. This satisfies most leftists -- even those that consider themselves socialists, who implore us to take a general (or as they like to call it, "political" view) - but it is hardly a popular dystopia. This is the level of the populist discourse in the U.S., which is pessimistic about the fate of our country, alternately hopeful and despairing about personal fortunes, and collectively de-mobilized.

In order to get beyond this generalized paralysis, this description "from the clouds" (for which we would need to be angels to fully endorse as a political philosophy) we have to look at the way the dynamics of wage suppression actually play out on the ground.

The Wind-Down

Your boss comes to you and says: "Times are tough, your wages are going to be cut by 10%." (Increasingly, brazenly, companies are not even claiming that times are tough when they ask for across-the-board wage concessions.)

The universality of this situation has been obscured by the fact that the struggles highlighted by left- and right-wingers are mostly union struggles. In these cases, the right argues, union workers are being asked to give back only because they have gotten ahead of the rest of the working class. This is, in fact, the basis of the brazen assaults linked above. From the New York Times:

Carlos Revilla, the [Caterpillar] plant’s operations manager, defended the push for a pay freeze, saying the top-tier workers were paid 34 percent above market level.

But this scenario goes on all the time at firms where workers are making average or below-average wages. To some extent, this failure to universalize the scenario is the inevitable result of a labor movement - and left - which doesn't place real importance on organizing unorganized workers. Perhaps more importantly, it has been obscured by the way the rhetoric of "outsourcing" has usually focused on jobs moved overseas, even though "onshore outsourcing" (subcontracting) has also been an important source of wage suppression.

It is worth remembering that this is, essentially, a revival of the worst employment practices of the late 19th and early 20th century. The "sweatshop" was not named for the sweat of its workers, but for the method of "sweating" work to layer after layer of subcontracted labor. In this scenario, the only way to lower prices was by lowering wages, resulting in a system (all else being equal) of constantly deteriorating wages and conditions.

Why do workers accept such reductions? In our description "from the clouds," it seems that it must be that the workers have no better options. Note that this includes liberals like Paul Krugman (see link), as well as the expected conservatives.

In the Stiglitz scenario, this viewpoint is sharpened by the notion that employers often have better information about prevailing market conditions (or, more pointedly, the financial health of the company) than do workers. Thus, when an employer lowers wages, it is often difficult for workers to effectively rebut claims that such reductions are necessary to ensure competitiveness.

But what I want to highlight here is a different (if related) dynamic: the set of practices used by employers to reduce or punish mobility among workers. Combined, these create a significant effect at the level of the workforce. To ignore them in favor of "whole market" (from the clouds) analysis is, to me, like trying to claim that the dynamics of a dewdrop can be understood by studying the ocean. (Note that Stiglitz's analysis does begin this process of looking at "dewdrop-level" dynamics, though it does not deal with coercion.)

Stay tuned for the next post, where I will try to lay out the variety of coercive techniques employers have a their disposal (and offer more salty commentary on why such dynamics "don't occur" to establishment economists)...