If you’re looking for a silver lining in the dark cloud of the Trump candidacy, you might notice that it has brought some attention to the worsening state of white people without a college degree. It’s not that the world is rosy for non-whites without college degrees, of course, but on average they were starting from a lower base; it’s the white part of the working and lower-middle class that seems to be experiencing fairly serious downward social mobility and social dislocation, as demonstrated most dramatically by increasing mortality rates in young adulthood and midlife.
Trump’s success in getting non-college whites riled up about immigration and trade doesn’t answer the question about how much of their plight can actually be traced to those causes, but it has served to remind advocates of the free movement of goods and workers that those policies produce losers as well as winners, and that one function of the political process is to ensure that a rising tide does in fact lift all the boats, rather than lifting the yachts while swamping the dinghies.
Megan McArdle lifts a libertarian voice to join the chorus. And she’s skeptical that income-transfer policies can fix things. (Though in my view we need them just the same.) What the downwardly-mobile need, McArdle says, is not income per se as much as employment: “good work — by which I mean work that offers opportunity, stability, respect and enough money to raise a family.” And she argues that the answer can’t be turning working-class people into middle-class people by offering higher education to people “who don’t have the ability, preparation or inclination to sit through four years of college,” and that politicians’ other answers to the problem of bringing back good blue-collar jobs are mostly beside the point.
This is way outside my policy wheelhouse, but from a distance this looks like a problem with a bunch of obvious solutions, though each of them is partial:
- Economic stimulus (fiscal and monetary). I’m not sure how much of working-class malaise would be cured by five years of really tight labor markets – tight enough to pull discouraged workers back into the labor force while substantially raising real wages – but we could try it and find out. That means having the President and the Congress stop obessing about the deficit, and getting the Fed to keep its heavy foot off the brake pedal as the economy starts to heat up.
- Infrastructure investment. The world is awash in capital and short of safe and productive places to invest it. As a result, the U.S. Government can borrow mony for 30 years at an interest rate of 2.5% (nominal). Our roads, bridges, passenger rail, electric grid, airports, and urban mass transit systems are all in desperate need of upgrades, expansion, and catching up on deferred maintenance. When you have good investment opportunities, idle resources, and access to cheap money, you should borrow the money and invest. Construction work provides the classical source of “good” blue-collar employment.
- Public services. Policing, sanitation, and parks are also good blue-collar jobs. (So is school construction and maintenance, though the actual teaching is white-collar.) The crazy way we finance municipal governments means that even rich cities like New York have disgraceful levels of public service, while poor cities look like Flint. At the Federal level, we could restore postal service to the level of the 1950s. There’s work to be done, and people willing to do it. If the private sector doesn’t provide enough good blue-collar jobs, create them in the public sector.
- Human services. There are lots of jobs providing direct service to the poor, the mentally ill, people with physical and developmental disabilities, and those incapacitated by age. Some of them – the ones requiring advanced degrees – are very good jobs indeed, and even Licensed Practical Nurses are decently paid. But home health care workers, for example, and lots of nursing-home employees, scrape by on something close to minimum wage. That could be changed by policy.
- Wage supplements. The Earned Income Tax Credit provides income maintenance without the work disincentives by supplementing wage income with tax dollars. Expanding that could do some of the same work that could be done by increasing the minimum wage without any risk of pricing low-skilled workers out of the market. A related idea would be a subsidy to employers for hiring those with little education and little labor-market experience; ideally those subsidies would be based on each employee’s future earnings, to give employers a financial interest in developing their entry-level workers’ transferable human capital.
- Unionization. One reason blue-collar jobs have been getting worse is the very successful war that has been waged on union power by corporations, the union-busting consultants and law firms they employ, and the anti-union politicians whose campaigns they finance. This was epitomized by Gov. Haley of South Carolina’s public announcement that unionized factories weren’t welcome in the state. Abolishing “right-to-work” laws and instituting “card-check” organization, along with revitalizing the National Labor Relations Board, could promptly undo much of that damage. Even in firms that do not unionize, the threat of organization will help discourage the most exploitative “human resources” practices.
- Retirement policy. It’s true that income is a poor substitute for employment for people in their prime working years. But retirees with adequate pensions seem to do just fine, thanks. If we’re short of good jobs for younger people, it’s insane to talk about raising the retirement age for Social Security. Why not lower it instead, and open up some slots? More generally – since one key factor of a “good” job is that it provide adequate income security in retirement – we need to undo the disastrous shift toward “defined contribution” plans. Workplace-based retirement saving has proven to be a loser in the public and private sectors alike. We could improve retirement prospects for blue-collar workers while also reducing the cost of employing them by moving toward a national and largely tax-funded retirement system.
Now, as Colombo would say, there’s just one thing. None of these policies could be enacted except over the dead body of today’s Chamber-of-Commerce-and-Koch-dominated Republican party. Fortunately, Donald Trump may have a solution to that problem.
[Cross-posted at The Reality-Based Community]