In the lede article in Tuesday’s New York Times, David Leonhardt pointed out that a critical topic has been glaringly absent from the presidential debate: the standard of living of Americans.
Hats off to Leonhardt and the Times for bringing this issue to the front page. Unfortunately, as is typical of the Times and other media outlets, the article was based exclusive on interviews with mainstream economists.
A particularly sharp juxtaposition between economic and sociological analyses of living standards and inequality was posed today with the publication of a symposium of sociologists in the journal Work and Occupations on Arne Kalleberg’s recent book, Good Jobs, Bad Jobs.
Based on his interviews with economists, Leonhard lists the top two causes of “a decade of income stagnation” as automation and globalization. No one to blame here, just impersonal forces we can’t control!
Among a “second group” of forces, he notes rising health care costs and “shrinking” unions.
In contrast, neither Kalleberg nor any of his commenters highlight technology as playing an independent role in wage stagnation and growing inequality, unmediated by the decisions of managers and policymakers. Instead, Kalleberg focuses on the rise of low-wage work, driven by a shifting balance of power between employers and workers as employers, aided by policymakers, engaged in corporate restructuring to achieve flexibility.
Globalization is a key force here, indeed. But rather than viewing it as an impersonal force to which corporations respond, sociologists emphasize how globalization is actively created by American corporations through global outsourcing.
“My reading of several decades of labor market research is that the main source of America’s low-wage problem lies in domestic service industries not impacted by globalization, where the key driver of precariousness is the growing evasion and violation by employers of both legal and normative standards, facilitated by the withdrawal of government’s hand in the labor market.”
In his comment, Jeff Madrick highlights the role of deliberate government policy in the 1980s – “before the rise of very low-wage emerging markets like China’s” – such as the preference for maintaining low inflation, at the expense of allowing unemployment to rise.
Our own Steve Vallas and Chris Prener add that uncertainty in the labor market has been ideologically legitimated through a discourse that idealizes flexible employment and personal responsibility. Labor market uncertainty is portrayed in this cultural discourse as emancipatory.
These and other arguments by sociologists – in this symposium and elsewhere – present a more enlightening analysis of trends in living standards and inequality. According to the sociologists, these outcomes have been driven by the decisions of real managers and real policymakers.
All that I would add is that, as I have recently written here, these decisions in favor of employers at the expense of workers are decisions in favor of capital against labor. This is class struggle. Capital is winning.