Democrats’ Next Big Thing: Government-Guaranteed Jobs

From today’s New York Times:

Prominent Democrats — stung by their eroding support from working-class voters but buoyed by the deficit-be-damned approach of ruling Republicans — are embracing a big idea from a bygone era: guaranteed employment.

The “job guarantee” plans, many of them pressed by Democratic White House hopefuls, vary in scope and cost, but they all center on government-sponsored employment that pays well above the $7.25-an-hour federal minimum wage — a New Deal for a new age, absent the bread lines and unemployment rates of the Great Depression. The most aggressive plans seek to all but eradicate unemployment and to set a new wage floor for all working Americans, pressuring private employers to raise wages if they want to compete for workers.

How such guarantees would be paid for is still largely unresolved. And criticism of the idea has emerged not only from conservatives who detect a whiff of socialism but also from liberals who say guaranteed employment is the wrong way to attack the central issue facing workers in this low-unemployment economy: stagnant wages.

But Democratic leaders hope the push will help their party bridge the growing political divide between white and minority workers, and silence the naysayers who accuse the party of being devoid of new, big ideas.

The employment plans, along with single-payer “Medicare for all” health care, free college, legalized marijuana and ever less restrictive immigration rules, are parts of a broader trend toward a more liberal Democratic Party in the Trump era.

“It’s going to create a more competitive labor market where people are going to start getting living wages, not just minimum wage,” said Senator Cory Booker, Democrat of New Jersey, who unveiled a job-guarantee planin April. “Giving people the dignity of work, of being able to stand on their own two feet, there’s such a strengthening element of that.”

Read the complete article here.

The Case for a Federal Jobs Guarantee

From the New York Times “Opinion” Section by Eric Loomis:

Employment numbers may look solid now, but economists, physicists and industrial engineers all say that automation will, in the not-so-distant future, drive higher unemployment. The Columbus Dispatch recently calculated that in Ohio, out of total state employment of about 5.5 million workers, 2.5 million jobs are at risk of automation.

How do we prepare for such disruption and the future of work? We might revisit an idea from the 1970s: a federal guarantee of employment. In recent weeks, three Democratic senators (and likely presidential contenders) — Kirsten Gillibrand of New York, Cory Booker of New Jersey and Bernie Sanders of Vermont — have either expressed their approval of the idea or unveiled initial ideas about how an updated version could work.

They are building on the legacy of the Humphrey-Hawkins Act, introduced in the 1970s by Senator Hubert Humphrey, Democrat of Minnesota, and Representative Augustus Hawkins, Democrat of California. In addition to the guarantee of employment, their initial bill allowed citizens to sue the government if they could not find a job.

Resurrecting Humphrey-Hawkins can help pre-empt a technology crisis and even future labor dislocation from globalization. In the original Humphrey-Hawkins bill — not the watered-down version that ultimately passed in 1978 — the president would submit an annual plan to Congress to achieve full employment, and local committees would coordinate job needs in their communities. The bill would have spurred private-sector job creation and a New Deal-style federal job creation program. Private employment would limit government investment, while federally mandated wage and price controls would fight inflation.

The final bill fell far short of this. Unions stripped out the wage and price controls in exchange for their support and put a priority on negotiating better contracts for their members over the fate of the nation’s poor. The Carter administration fretted about the potential impact on inflation from a bill without those controls. President Jimmy Carter never truly supported it, and the bill that passed committed the nation to ending inflation more than to full employment. Since then, the idea of full employment has largely disappeared from the American political system.

The arguments against Humphrey-Hawkins in 1978 are largely irrelevant today. After decades of low inflation, wage and price controls are unlikely to be problems. Mr. Booker’s pilot plan to test these ideas in 15 areas of the country builds on the Great Society belief in community control over federal resources.

Read the complete article here.

Market Update: Why Rising Wages Are Scaring the Hell Out of Stock Investors

From today’s Slate Magazine:

On Friday, the U.S. Department of Labor released a strong jobs report showing wages rising at their fastest rate since the Great Recession. Then, the stock market promptly began to plummet. The Dow Jones fell an amusingly on-the-nose 666 points—its worst day since the U.K.’s Brexit surprise. Global markets subsequently took a beating, and U.S. equities are still sliding as I write this today.

Why is good news for workers turning into bad news for shareholders? The answer is a useful illustration of why the stock market is often a poor guide to the overall health of the economy.

Right now, traders seem to be worried that if wages rise too fast, it will cause the Federal Reserve to hike interest rates in order to head off inflation down the road. When, earlier this year, the central bank suggested that it would raise rates, much of the market was skeptical, in part because inflation has been so subdued for so long. But faster pay gains for workers make it more likely the Fed will follow through, both because rising wages are a sign that the whole economy is heating up and because employers will eventually have to raise prices to keep up with the cost of labor.

Read the complete article here.

Op-Ed: Should we set up New Deal-style work camps for the needy?

From today’s LA Times:

They are sending out emergency calls for shoes, underwear, sleeping garments, household equipment, mattresses, springs and bedding,” a Los Angeles Times story reported from Southern California. Do-gooders were doing what they could to help the destitute. “They have no sanitation,” a volunteer said. “No running water. Before the storms this week, we had set into motion a campaign in their behalf.”

The above reads like an article about the homeless from this month’s California section. But the dispatch actually dates from 1938, and the needy were the most mythologized of Golden State refugees: the Okies. Some 16,000 had settled in Montebello and Bell Gardens, the Times wrote, and the “distress … [was] terribly acute.”

Dust Bowl migrants have been on my mind recently, mostly because I just finished “California and the Dust Bowl Migration” by Walter J. Stein, a 1973 book that’s one of the earliest academic surveys about how that momentous exodus changed the state. It’s a great, if dry, read, and the Canadian professor puts more blame on the New Deal for pushing Oklahomans from their farms than he should.

But the book offered me perspective. The most recent estimate of California’s homeless population, by the Department of Housing and Urban Development’s annual Point in Time Census, is 114,000. That number pales in comparison with the estimated 350,000 Okies who flooded California, mostly during the second half of the Great Depression. And, despite initial hiccups, we came out of it just fine.

Stein’s tome also provides a way forward: workers’ camps. Yes, that sounds politically incorrect, somehow, but stay with me.

The Farm Security Administration (FSA) built about 15 such camps to house Okies who were getting booted out of the shantytowns known as Hoovervilles. The government-sponsored camps were refuges from hate, with running water and clean living quarters and an ordered way to find work. Most even printed monthly newsletters. They sprang up in the Imperial Valley and Sonoma, the Central Valley and near Indio. Only one remains in operation: the Sunset Labor Camp just outside Bakersfield, which served as the inspiration for the Rooseveltian eden that the Joads find in “The Grapes of Wrath.”

Now’s the time to bring them back, especially since Orange County officials plan to evict the hundreds of homeless along the biking trails of the Santa Ana River, within eyesight of the 57 and 5 freeways. Similar schemes are in the works across the state. Advocates are already warning that the homeless will have nowhere to go: There’s not nearly enough shelter space, and many are in no condition to reenter society, which means they will set up their tents in residential neighborhoods, whose inhabitants will just call the cops and offer no help.

Read the complete article here.

MLK Day 2018, A Time to Reflect on Socio-Economic Injustice In All Forms

In honor of MLK Day, we post a short educational video here with excerpts from Martin Luther King, Jr. and James Baldwin that draw the connection between racial injustice and economic inequality in the United States. Their insights are as true today as they were fifty years ago, showing just how far we’ve come and how far we have to go. If we want peace, we must work for justice in all its forms.

Strategies to Manage Your Career: From Networking to Balancing Work and Life

From the New York Times Business Section:

There is no shortage of books claiming to reveal the secret truth behind successful careers. Then there are all the podcasts, TED talks, late-night motivational speakers and your relatives’ sage advice. The bottom line of most of these advice-givers? A successful career requires managing the person in the mirror – overcoming your tendencies and habits that can undermine efforts to find happiness at work. Read on to see what professors and researchers suggest for managing different situations, whether you want to improve your situation at work, if you suspect changes are coming down, or if you are making a go of it in the gig economy.

Build a Strong Foundation

There are some key fundamentals of building a successful career that you should be aware of whether you are just starting out, or are closing in on retirement.

There are some key fundamentals of building a successful career, whether you are just starting out, or are closing in on retirement. And they apply to all walks of life – if you are a butcher, a baker or a computer systems analyst.

Fair warning, the following tried-and-true strategies will have little impact on what you do every day. They will not necessarily help you meet an assignment due by Friday morning, or complete a to-do list.

Instead, they are foundations that will give you a solid base on which to build a successful career that can withstand unexpected changes. These ideas will also help you put work and career in proper perspective, because there is a lot more to life beyond the daily grind.

The Value of Networking

There’s no getting around it: Networking has an awful reputation. It conjures up images of self-absorbed corporate ladder-climbers whose main interest is, “What’s in it for me?”

But there is almost unanimous agreement among researchers that building and nurturing relationships with people — current and former colleagues and people we respect in the business — provides a strong medium for a vibrant career and a cushion for when the unplanned happens.

Read the complete article here.

Robots Are Coming, and Sweden Is Fine

From New York Times:

From inside the control room carved into the rock more than half a mile underground, Mika Persson can see the robots on the march, supposedly coming for his job here at the New Boliden mine.

He’s fine with it.

Sweden’s famously generous social welfare system makes this a place not prone to fretting about automation — or much else, for that matter.

Mr. Persson, 35, sits in front of four computer screens, one displaying the loader he steers as it lifts freshly blasted rock containing silver, zinc and lead. If he were down in the mine shaft operating the loader manually, he would be inhaling dust and exhaust fumes. Instead, he reclines in an office chair while using a joystick to control the machine.

He is cognizant that robots are evolving by the day. Boliden is testing self-driving vehicles to replace truck drivers. But Mr. Persson assumes people will always be needed to keep the machines running. He has faith in the Swedish economic model and its protections against the torment of joblessness.

“I’m not really worried,” he says. “There are so many jobs in this mine that even if this job disappears, they will have another one. The company will take care of us.”

In much of the world, people whose livelihoods depend on paychecks are increasingly anxious about a potential wave of unemployment threatened by automation. As the frightening tale goes, globalization forced people in wealthier lands like North America and Europe to compete directly with cheaper laborers in Asia and Latin America, sowing joblessness. Now, the robots are coming to finish off the humans.

Read the complete article here.

Automation Could Displace 800 Million Workers Worldwide By 2030, Study Says

From today’s National Public Radio:

A coming wave of job automation could force between 400 million and 800 million people worldwide out of a job in the next 13 years, according to a new study.

A report released this week from the research arm of the consulting firm McKinsey & Company forecasts scenarios in which 3 percent to 14 percent of workers around the world — in 75 million to 375 million jobs — will have to acquire new skills and switch occupations by 2030.

“There are few precedents” to the challenge of retraining hundreds of millions of workers in the middle of their careers, the report’s authors say.

The impact will vary between countries, depending on their wealth and types of jobs that currently exist in each. In 60 percent of jobs worldwide, “at least one-third of the constituent activities could be automated,” McKinsey says, which would mean a big change in what people do day-to-day.

McKinsey looked at 46 countries and more than 800 different jobs in its research.

In the year 2030 in countries with “advanced economies,” a greater proportion of workers will need to learn new skills than in developing economies, researchers say. As many as a third of workers in the U.S. and Germany could need to learn new skills. For Japan, the number is almost 50 percent of the workforce, while in China it’s 12 percent.

Jobs that involve predictable, repetitive tasks are more easily automated, “such as operating machinery and preparing fast food,” and data processing, like paralegal work and accounting. However, McKinsey estimates less than 5 percent of jobs can be fully automated.

Jobs that pay “relatively lower wages” and aren’t as predictable are less likely to face full automation, because businesses don’t have as much incentive to spend on the technology. This applies to jobs like gardening, plumbing and child care, according to the authors.

Occupations that pay more but involve managing people and social interactions face less risk of automation due to the inherent difficulty in programming machines to do those types of tasks.

Read the complete article here.

Will Robots Take Our Children’s Jobs?

From today’s New York Times:

Like a lot of children, my sons, Toby, 7, and Anton, 4, are obsessed with robots. In the children’s books they devour at bedtime, happy, helpful robots pop up more often than even dragons or dinosaurs. The other day I asked Toby why children like robots so much.

“Because they work for you,” he said.

What I didn’t have the heart to tell him is, someday he might work for them — or, I fear, might not work at all, because of them.

It is not just Elon MuskBill Gates and Stephen Hawking who are freaking out about the rise of invincible machines. Yes, robots have the potential to outsmart us and destroy the human race. But first, artificial intelligence could make countless professions obsolete by the time my sons reach their 20s.

You do not exactly need to be Marty McFly to see the obvious threats to our children’s future careers.

Say you dream of sending your daughter off to Yale School of Medicine to become a radiologist. And why not? Radiologists in New York typically earn about $470,000, according to Salary.com.

But that job is suddenly looking iffy as A.I. gets better at reading scans. A start-up called Arterys, to cite just one example, already has a program that can perform a magnetic-resonance imaging analysis of blood flow through a heart in just 15 seconds, compared with the 45 minutes required by humans.

Maybe she wants to be a surgeon, but that job may not be safe, either. Robots already assist surgeons in removing damaged organs and cancerous tissue, according to Scientific American. Last year, a prototype robotic surgeon called STAR (Smart Tissue Autonomous Robot) outperformed human surgeons in a test in which both had to repair the severed intestine of a live pig.

So perhaps your daughter detours to law school to become a rainmaking corporate lawyer. Skies are cloudy in that profession, too. Any legal job that involves lots of mundane document review (and that’s a lot of what lawyers do) is vulnerable.

Software programs are already being used by companies including JPMorgan Chase & Company to scan legal papers and predict what documents are relevant, saving lots of billable hours. Kira Systems, for example, has reportedly cut the time that some lawyers need to review contracts by 20 to 60 percent.

As a matter of professional survival, I would like to assure my children that journalism is immune, but that is clearly a delusion. The Associated Press already has used a software program from a company called Automated Insights to churn out passable copy covering Wall Street earnings and some college sports, and last year awarded the bots the minor league baseball beat.

What about other glamour jobs, like airline pilot? Well, last spring, a robotic co-pilot developed by the Defense Advanced Research Projects Agency, known as Darpa, flew and landed a simulated 737. I hardly count that as surprising, given that pilots of commercial Boeing 777s, according to one 2015 survey, only spend seven minutes during an average flight actually flying the thing. As we move into the era of driverless cars, can pilotless planes be far behind?

Then there is Wall Street, where robots are already doing their best to shove Gordon Gekko out of his corner office. Big banks are using software programs that can suggest bets, construct hedges and act as robo-economists, using natural language processing to parse central bank commentary to predict monetary policy, according to Bloomberg. BlackRock, the biggest fund company in the world, made waves earlier this year when it announced it was replacing some highly paid human stock pickers with computer algorithms.

So am I paranoid? Or not paranoid enough? A much-quoted 2013 study by the University of Oxford Department of Engineering Science — surely the most sober of institutions — estimated that 47 percent of current jobs, including insurance underwriter, sports referee and loan officer, are at risk of falling victim to automation, perhaps within a decade or two.

Read the complete article here.

Racism at Work in America: Unemployment in Black and White

From today’s New York Times Editorial Board:

The recent finding by The New York Times that black students are still vastly underrepresented at the nation’s top colleges and universities is one sign of how little the country has managed to do to close racial gaps.

Unemployment rates among black workers give a similarly gloomy picture. The jobless rate for black Americans is generally about twice that of white Americans, a ratio that improves only somewhat in “good” times, like the present, and persists no matter the level of educational attainment. The overall unemployment rate for black workers is now 7.4 percent and for white workers is 3.8 percent. For college-educated workers, the recent average jobless rate was 4.2 percent for blacks, compared with 2.5 percent for whites.

The hard truth is that the persistence of twice-as-high joblessness for black workers has led policy makers to accept it is as normal. Just look at the Federal Reserve. Monetary policy is supposed to foster stable prices and full employment. But the Fed has historically favored inflation fighting over boosting employment, a policy bias that generally leads it to raise interest rates before the job market is as strong as possible, as measured by low unemployment and rising pay for all groups of workers. The Fed has already raised rates twice this year and many Fed officials appear to favor a third increase by year’s end, with evident disregard for the fact that black unemployment is now at levels that prevailed for white workers in 2012, when the economy was still very much in the shadow of the Great Recession.

Another hard truth is that even when the economy picks up and employers are on a hiring binge, black people have a harder time getting jobs and are paid less than similarly situated white workers. That is exactly what happened from 1996 to 2000, the last genuinely hot job market, and it points clearly to racial discrimination, not just in hiring, but in a range of public policies that disproportionately affect black people. These include the dearth and high cost of child care, which harms single mothers the most; poor public transportation in many rural and suburban areas, which makes keeping a job difficult; and mass incarceration of black men and the barriers to employment that go with it.

Other factors include erosion and weakness in the enforcement of labor standards and legal safeguards. The wage gap between black and white workers is larger now than it was in 1979 or in 2000, and has grown the most for college graduates.

The whole economy is weighed down by the higher unemployment among black Americans, in part because it deprived the economy of consumer demand, the main engine for growth. Worse, the job and wage gap signals a loss of human potential, a singularly valuable form of capital. The economy cannot be said to be at full employment while black workers lag behind their white counterparts. Nor can the society be said to be just or healthy.