In this Jackson Hole, we have Alan Greenspan, proclaiming his belief that “The U.S. economy and the global economy are now better able to withstand shocks because of government deregulation and more flexibility in such areas as labor markets.”
Meanwhile, in Washington DC, we have Ohio Democrat Representive Sherrod Brown proclaiming on behalf of the party “In the last two and a half years, since George Bush became president, our nation has hemorrhaged 2.5 million manufacturing jobs…. Ten percent of our manufacturing jobs have disappeared. … Good jobs in steel and auto and textiles.” Days later, President Bush finally has acknowledged that just maybe, this loss of manufacturing jobs in our economy is a problem. Particularly for a man who would like to be re-elected.
Now then, in what ways have deregulation improved our lives? Deregulating airlines has resulted in the hub-and-spoke system, substantially lower airfares, and a parade of airline bankruptcies putting both skilled and unskilled workers out of jobs. Deregulating the power grid has resulted in energy traders gouging the American consumer for their “well earned” mark-up, an unreliable power transmission system, and Enron. Deregulating meat packing may have kept meat prices down, but it has definately made life tough for the small rancher, and compromised the safety of our foodstuffs. Deregulation of financial institutions has, um, meant we can do all our banking and brokerage business with one company. Deregulating telecommunications may have facilitated the rise of the internet, but it also may have also facilitated the rise of WorldCom. Deregulating telecommunications, cable, electricity, and a host of other things was supposed to bring prices down for consumers; instead of putting money in consumers’ pockets, it lined the pockets of a few potentially crooked executives.
And can we talk about this flexible American worker for a few minutes? The American workforce is currently the most productive in the world. The American worker makes this possible not just by the judicious use of technology (you aren’t reading this at work, are you?), but mainly by putting in longer hours than anyone else in the world. An average* American worker put in 1825 hours in 2002, generating over $60,000 of value to his employer. That breaks down to $32 per hour. The hourly is higher in several other countries, but as one economist on the project put it, “If you work 15 hours a day, of course there are hours when you are not as productive as if you only work six hours a day.” Efforts to “reform” overtime pay regulations will not improve matters. In addition to working more hours, American workers are dealing with more dangerous workplaces than in much of the developed world. We encounter abusive customers, co-workers with weapons, clueless supervisors, tactless coworkers, repealed OSHA regulations, and bosses who try to cover up workplace injuries wherever possible. Wages are going down, good jobs are harder to find, and job security is a fairy tale. It would appear that “flexible” means “able to suck up any and all hours and hardships just to stay employed.”
As “productive” and “flexible” as the American worker supposedly is, it is amazing that jobs are still vanishing overseas. And not just those quality, high wage, high benefit manufacturing jobs Representative Brown is referring to. High tech, decent paying jobs are being sucked away from the American economy. Tech support is being outsourced to former British colonies such as India, taking advantage of English speakers who will accept wages that are low by American standards. All the while, customers with now-tenuous employment are being told that this exportation of American jobs saves them money.
Happy Labor Day. Particularly if you are one of the lucky people with employment, and one of the even luckier people getting the day off with pay.
*Unfortunately, the people covering this study fail to mention whether by “average” they intend the mean, median, or mode. We therefore must assume they are using whichever figure makes the data look better.