Eight Careers in a Lifetime of Work—
The Giant Sucking Sound
Jerry Lobdill, retired physicist
This paper reprises one that I wrote in the early 1990s. At that time Robert Reich, Clinton’s Secretary of Labor, was floating a new American order (NAO) of labor, a new covenant between business and labor. This new covenant had all the benefits on the side of corporations, and all the costs were allocated to labor.
The essence of the NAO was that the days of careers spent working for a single employer were over, and that the American worker, at all levels, should expect to change careers an average of eight times during a working lifetime. This new covenant was necessary, it was said, because technology and the needs of the marketplace were changing too rapidly for a college education to be sufficient to prepare any worker for all the changes that would happen in a working lifetime. It was likened to the demise of the buggy whip industry with the advent of the automobile.
Not to worry, though. If workers would just keep their chins up and accept the inevitability of this NAO, there would be training programs available to help them retrain and get a new start each time their jobs disappeared.
This came at a time when Ross Perot had been saying that if NAFTA were passed there would be a “giant sucking sound” as American jobs were lost to other nations. Clinton had co-opted Perot supporters by promising to veto NAFTA, but had lied about that, and now, his Labor Secretary was delivering the bad news with a saccharin coating to the people.
Today, in 2003, we see the results of that perfidy. There was a giant sucking sound that was muffled by the cheers of the speculators who were running up the stock market in the biggest mania of all time. The stock market bubble finally burst as Clinton’s second term ended, and now the loss of millions of jobs that began with the approval of NAFTA is obvious. Three million manufacturing jobs have been lost since 2000, when George W Bush took office.
The free traders still say that retraining is the key to our economic problems. Of course, the Republican Party peddles this fiction, but worse, the Democratic Leadership Council (DLC) which brought Clinton into the White House, also chants this nonsense. The American worker knows this lie for what it is. And it is becoming more difficult for the pied pipers of free trade to sell. But, even so, the DLC and their darlings, Richard Gephardt, John Kerry, and Joe Lieberman still chant the mantra.
When Mr. Reich first floated this lie, I saw it for what it was. I performed an analysis using computer simulation—one of my apparently obsolete job skills—to show that, given a reasonable training period necessary to acquire skills worth the kind of compensation a worker was previously paid, and given the normal job search time required to find a job at that skill level, an engineer could expect that this new covenant would cost him a 35% loss in lifetime earnings.
Mr. Reich did not answer my letter explaining this projected result.
Yet, today, this is exactly what we see happening in the US economy. And it is now appropriate to ask, “What jobs will displaced workers be trained for?” This question is never answered by the pied pipers of free trade. The answer is, there are no jobs with equal pay to be had, and the jobs available do not require technical training. Today, corporations are busy moving not only factory jobs overseas, but also engineering and research jobs as well. Additionally, they are importing cheap labor on H-1B and L-1 visas to displace American workers whose jobs they have not yet been able to move overseas.
What did any thinking person expect would happen? What values does a corporation hold? Only one. Maximize the profit on investment in each quarter of each year. This is the fundamental reason why corporations should never be considered “persons” in law. There is no place in corporate thinking for consideration of moral obligations or consideration of long term effects of policy.
Corporations are artificial constructs that were meant to serve the welfare of nations, and in that capacity they serve well. They aggregate large amounts of capital that is necessary to accomplish large projects that small business could never manage. But corporations are never required to “die” for their country, never “executed” for capital crimes for which human citizens are made to pay the price, and cannot be placed in prison for lesser crimes. Their motivations, however, are driven by pursuit of profit by any means that the law will permit. This impels corporations to invest large sums of money in currying favor with politicians and lobbying for legal advantages that have no concern for human values.
The first mistake we made was to listen to the spokesmen of corporations. They told us back in 1886 (Santa Clara County vs Southern Pacific Railroad) that corporations were persons within the meaning of the Fourteenth Amendment of the US Constitution, and ever since we have behaved as if that unsupported, ridiculous, and un-litigated proposition were true! From this mistake has flowed all the legal decisions that have led to the transnational corporations we see today making decisions that affect the well-being of nations, pitting one nation against another in bids for the favors of jobs for their citizens, consolidating ownership of all the world's assets, and moving money and assets unimpeded wherever labor is cheapest, while freely moving products across national borders to be sold wherever buyers can be found. What we have done is to define a legal type of freebooting buccaneer "person" who can roam the globe unimpeded in pursuit of profit and cheap labor.
A few days ago, September 25, 2003, I heard U.S. Representative Adam Smith (D) Washington, in whose district Seattle lies, the home of the giant Boeing Corporation, saying to Lou Dobbs on CNN that the government cannot tell corporations that they cannot take jobs overseas, if that is what the company says is necessary to improve the bottom line. He also said that foreign investors find that American companies are poor investments when they keep their jobs at home and pay American wages. These remarks were made in response to Lou’s question as to how the Representative could justify the loss of three million jobs in the last two years. Mr. Smith then proceeded to offer the mantra that what is needed is more education and retraining programs.
The fallacy of this thinking is obvious. Training for what? A four year college degree and in many cases two to three years of graduate school are insufficient training to permit a person to keep working for a lifetime with normal continuing study? Yet all the jobs requiring such skills are being transferred overseas where labor costs are cheaper. What kind of jobs are you going to train these college-trained people for? How long will that training take? How much will it cost? Who will pay? How will workers sustain their families during this retraining? And not least, how much will the new jobs pay, and why will they not also be shipped abroad if the pay exceeds that which is available in foreign lands? No one ever even asks these questions when the pied pipers begin to chant this “retraining” mantra.
The simple fact is that this notion of an average of eight jobs per working lifetime is not a solution to the loss of American jobs. The simple fact is that corporations must be restrained from their freebooting on the international stage if a prosperous America is to survive. This pronouncement will horrify the DLC and their darlings, but it is the simple truth. And why should one think this is an inappropriate thing to do?
The preamble to the US Constitution begins, “We, the people...” not “We, the corporations...” The word, corporation, is not even mentioned in the Constitution. The Constitution is the agreement between the people of this nation and those that govern this nation.
The very idea that the Fourteenth Amendment establishes that corporations are “persons” under the Constitution is a preposterous idea. It does nothing of the sort. It, like the original Bill of Rights was intended to protect the rights of relatively powerless human citizens against the power of wealthy interests. It specifically was written to guarantee the rights of the freed slaves. Corporations have made it their business to turn the Constitution on its head in claiming to be persons endowed with inalienable rights. They have no justifiable rights beyond those granted in their corporate charters. And those rights deal with their permission to conduct business and to be held accountable in the courts for violations of their privileges. To treat them as persons with the rights intended to apply to humans is ridiculous, and it must be tried in the courts and brought before the Supreme Court. Corporations must be stripped of the privileges they have arrogated to themselves before this insane concept destroys this nation.
Corporations must be made to serve the society as they were originally intended to do. The fact is that most of our GNP is consumed within our borders by our citizens. There is a symbiotic relationship between corporations and the citizens of this nation. If the citizens are not prosperous, the corporations are not going to be able to sell their products to Americans. It is not a sensible or patriotic idea to allow American corporations to take their assets off shore, produce product at low labor cost, and import it back into the US at no tariff for sale to Americans. This nation must relearn this lesson: The government is of the people, by the people, and for the people, and it was founded to provide for the common defense, promote the general welfare and secure the blessings of liberty to ourselves and our posterity.
These words apply to human citizens only. Corporations are only artifices created by men to achieve some of those goals for the people.
Gone With Globalization
By E.J. Dionne Jr.
Tuesday, September 30, 2003; Page A19
Except for the saints in our midst, everyone has prejudices, including the well educated and well-to-do. But when upscale folks have prejudices, they usually call them ideas, convictions or principles.
So how can you tell when a principle is merely a prejudice? When someone keeps making an argument even though the facts suggest it no longer holds up.
It is time to ask whether the overwhelming support for free trade and globalization among well-off, highly educated people is more a prejudice rooted in their own self-interest than a matter of high principle.
Okay, maybe that's too harsh. So try this: Even if globalization made a lot of sense during the buoyant 1990s, shouldn't the troubling economic developments since 2000 force people to modify their views? Is it not now undeniable that globalization has serious costs that are not merely "transition problems" and that these costs are borne disproportionately by certain parts of the country and the society?
Now, I don't want to be accused of prejudice myself, so let me stipulate that most educated folks really believe on principle in free trade. They can rely on reams of writing by intelligent economists to support their view.
Moreover, no one likely to hold power in our country would return us to the days of William McKinley and high tariff walls. The globalizers are right when they argue that too many Americans are now reliant on the global economy for such policies to work.
But it ought to be equally obvious that the globalizers in both political parties were too carefree when they asserted in the 1990s that, well, yes, there are "losers" from globalization, but there are so many more "winners" that we really shouldn't worry. Those who lost out in this grand process would eventually find their footing, the argument went, and government could help them make the transition. By the way, where was all that help? In any case the prophets of our bright future said the United States shouldn't worry about "old" industries such as steel or apparel. It should worry about leading the way in all that is "new" and "high tech."
Having grown up in Fall River, Mass., a place whose job base was once rooted in the apparel industry, I've always felt that writing off an industry as "old" is a lot easier for people who never depended on it. Maybe that's an "old economy" prejudice on my part, especially since my home town has been remarkably inventive in giving birth to new enterprises.
Still, it's not a form of prejudice to cite statistics showing that the sharp decline in manufacturing jobs over the past few years has been accompanied by a decline in overall family incomes.
Consider the Census Bureau's report for 2002 showing that U.S. household incomes had declined for the third year in a row and that the number of Americans living in poverty had increased by 1.7 million in a year. The old manufacturing states -- including Michigan, Illinois, Ohio and Missouri -- were among those hit the hardest. (Politicians take note: These are swing states.)
The economists reassure us that the poverty rate is a "lagging" indicator and that a robust recovery will start lifting people up again. But will it? Is it not just as plausible to worry that the flight of jobs to China and elsewhere, courtesy of globalization, has combined with big improvements in productivity to create an economy that leaves many of our fellow citizens behind even in flush times?
The Institute for Supply Management, which keeps some of the best numbers on manufacturing, pleased the stock market earlier this month with a report showing that economic activity in manufacturing grew in August, as it had in July. But its manufacturing employment index actually fell and remained below the 50 percent break-even point for job creation for the 35th consecutive month.
If supporters of globalization really do hold principles and not prejudices, they should admit that the facts make it increasingly difficult to say that everything will eventually get better for everyone, and that changes in the system will only make it worse. Worse for whom exactly?
Our tax and social policies are supposed to respond to inequities as they arise. But our current approach seems based mostly on begging China to fix its currency and praying for 5 percent growth. Michigan, as it sometimes has in the past, will just have to rely on a pass and a prayer.
The evidence suggests that we're not in the New Economy anymore but in a New New Economy with problems that weren't supposed to arise. The real lagging indicator is our economic thinking.
2003 The Washington Post Company
From:"Jerry Lobdill" <email@example.com>,
"To: Bob Moneymaker" <firstname.lastname@example.org>
Subject: The bleeding continues...
BUSHS BETTER DAYS ECONOMY
Bushs policies continue to take American jobs overseas. Levi Strauss & Co. will close its last manufacturing plants in the United States and Canada, eliminating nearly 2,000 jobs, the struggling jeans maker said Thursday. The company will close two sewing and finishing plants in San Antonio by year's end and lay off 800 workers. It will also shutter its three remaining plants north of the border that employ 1,180 people. The company will contract with foreign plants to make up for the closings. CBS
America is bleeding jobs and federal deficits keep ballooning. The federal government's budget is in far worse shape than most Americans realize, and the fiscal hole is deepening, the head of Congress' nonpartisan watchdog agency said Wednesday.
Our projected budget deficits are not manageable without significant changes in taxes or spending, U.S. Comptroller General David Walker said in a speech to the National Press Club. We cannot simply grow our way out of this problem.
. . . The time has come for all responsible parties to recognize reality, Walker said. Our nation has a major long-term fiscal challenge that is not going away. Walker's assessment of the budget deficit is far grimmer than the Bush administration's. White House officials have stressed the importance of cutting taxes while calling the deficit a manageable and relatively minor problem. Walker vigorously disagreed. The bottom line is, there is little question that deficits do matter, especially if they are large, structural and recurring in nature, he said. The days of surpluses are gone, and our current and projected budget situation has worsened significantly. Atlanta Journal-Constitution
The gap between rich and poor more than doubled from 1979 to 2000, an analysis of government data shows. The gulf is such that the richest 1 percent of Americans in 2000 had more money to spend after taxes than the bottom 40 percent. In 1979, the wealthiest 1 percent had just under half the after-tax income of the poorest 40 percent of Americans, analysis of new data from the Congressional Budget Office shows. The figures show 2000 as the year of the greatest economic disparity between rich and poor for any year since 1979, the year the budget office began collecting this data, according to the Center for Budget and Policy Priorities . . . . New York Times