The huge increase in productivity has created great wealth for the 1%, but, with the decimation of the unions, the U.S. has failed to create public policies that would find a way for the middle class and working class to have a fair share. This graph stops at 2006, but since then the gap has grown even larger.
Those who pay the fiddler call the tune and the tune we keep hearing again and again is that if only corporations had more freedom, less taxes, things would be better. And, we keep hearing that the main problem with our economy is the low skills of workers and the failure of our public educational system to properly educate students for jobs requiring Science, Technology, Engineering and Math. The elite who want to keep this tune playing have a lot to gain via public brainwashing.
While the powerful gobble up the incredible increases in wealth now being produced in this country they like to say: “Hey buddy, if you had worked a little harder in your high school math class, maybe you’d now have a better job.” Perfect. And our politicians who serve as lackeys for the elite, repeat the message with fervor. They blame teachers, public schools. They push the idea that our way forward is a focus on STEM education, big increases in college enrollment, and their solution for everything is more market freedom, more privatization.
We are immersed in the propaganda that the ruling class wants us to hear and this propaganda presents a reality that is mostly false. Any voice of thoughtfulness is shouted down by think tank “intellectuals” who have prostituted themselves to their ruling class overlords. Reality may start to get our attention by tapping politely on our shoulder, but eventually it hits us over the head, and many who now, through no fault of their own, find themselves among the working poor — no money, no insurance, no hope — are ready to hear what reality has to say.
Lawrence Mishel of the Economic Policy Institute is the voice of reason when he writes: “The huge increase in wage and income inequality experienced over the last 30 years is not a reflection of a shortfall in the skills and education of the workforce. Rather, workers face a wage deficit, not a skills deficit.” He says it is nonsense that we should blame the worker, because such blame is misplaced. Mishel writes:
“We increasingly hear or read claims that we have a serious structural unemployment problem, even to the extent of claiming that most of the unemployed beyond a normal (full-employment) rate face structural problems in finding work. This argument implies that unemployment difficulties reside in the workers who are unemployed: they either are located in the wrong place or do not have the required skills for the currently available jobs. If this is so, then macroeconomic tools such as fiscal policy (spending or tax cuts) or monetary policy cannot address our unemployment or long-term unemployment situation. But surprisingly, perhaps amazingly, there is no systematic empirical evidence for such assertions. …
The challenge, in my view, is to provide a much broader path to prosperity, one that encompasses those at every education level. The nation’s productivity has grown a great deal in the last 30 years, up 80% from 1979 to 2009, and such productivity growth or better can be expected in the future. Yet with all the income generated in the past and expected in the future it is difficult to explain why more people have not seen rapid income growth. It is not the economy that has limited or will limit strong income growth, but rather the economic policies pursued and the distribution of economic and political power that are the limiting factors. for lack of skills and that this argument is a foil meant to suppress the action that is actually needed.”
I became acquainted with Mishel when Stan Hirtle responded to my post “Let’s Reject Phoney Ideas About Prosperity And Start Discussing The Future Of The Working Class.” Stan pointed to this article: “Schools as Scapegoats.” Some excerpts:
“American middle-class living standards are threatened, not because workers lack competitive skills but because the richest among us have seized the fruits of productivity growth, deny- ing fair shares to the working- and middle-class Americans, educated in American schools, who have created the additional national wealth. Over the last few decades, wages of college graduates overall have increased, but some college gradu- ates—managers, executives, white-collar sales workers—have commandeered disproportionate shares, with little left over for scientists, engineers, teachers, computer programmers, and others with high levels of skill. No amount of school reform can undo policies that redirect wealth generated by skilled workers to profits and executive bonuses. …
Statistically, the falling real wages of high school graduates has played a bigger part in boosting the college-to-high-school wage ratio than has an unmet demand for college graduates. Important causes of this decline have been the weakening of labor market institutions, such as the minimum wage and unions, which once boosted the pay of high school–educated workers. …
Another too glib canard is that our education system used to be acceptable because students could graduate from high school (or even drop out) and still support families with good manufacturing jobs. Today, those jobs are vanishing, and with them the chance of middle-class incomes for those without good educations….
It’s true that many manufacturing jobs have disappeared. But replacements have mostly been equally unskilled or semi- skilled jobs in service and retail sectors. There was never anything more inherently valuable in working in a factory assembly line than in changing bed linens in a hotel. What made semiskilled manufacturing jobs desirable was that many (though not most) were protected by unions, provided pensions and health insurance, and compensated with decent wages. That today’s working class doesn’t get similar protections has nothing to do with the adequacy of its education. Rather, it has everything to do with policy decisions stemming from the value we place on equality. Hotel jobs that pay $20 an hour, with health and pension benefits (rather than $10 an hour without benefits), typically do so because of union organization, not because maids earned bachelor’s degrees….
It is cynical to tell millions of Americans who work (and who will continue to be needed to work) in low-level administrative jobs and in janitorial, food-service, hospitality, transportation, and retail industries that their wages have stagnated because their educations are inadequate for international competition. The quality of our civic, cultural, community, and family lives demands school improvement, but barriers to unionization have more to do with low wages than does the quality of education. …
In a paper recently posted on the National Bureau of Eco- nomic Research’s Web site, Massachusetts Institute of Tech- nology economists Frank Levy and Peter Temin wrote, “The current trend toward greater inequality in America is primarily the result of a change in economic policy that took place in the late 1970s and early 1980s.” They went on to say that “the recent impacts of technology and trade have been amplified by the col- lapse of these institutions,” by which they mean the suppression of unions and the abandonment of the norm of equality.
These are not problems that can be solved by charter schools, teacher accountability, or any other school intervention. A balanced human capital policy would involve schools, but would require tax, regulatory, and labor market reforms as well.”
