Walking Away With The Cake


Out here in Trump Country USA, the economy remains in a coma; the big employers in Clearfield County are the WAL-MART distribution center, and the prison system.

Fracking has been a big deal (and Trump played off of that) because it sparked a bunch of new jobs: people that were hauling truckloads of coal are now hauling truckloads of slush. But, while it’s a boost for the economy, it’s mostly low paid/low skill jobs – the kind the establishment likes to create, but that it only creates when there is no cheaper alternative. The prison system and the WAL-MART distribution center are also representative of the “new” job market: low paid jobs with employers that can game the benefits system by giving hourly workers 39 hours/week so they don’t have to offer them benefits.

“(Sigh) Proles, these days…” Somehow, instead of the working class rising up and massacring the rich, the rich convinced them to vote them into office so they could be subjected to a few more rounds of subjugation. Here’s a chart:

You can see that starting around 2000, the job market for the manufacturing sector started to tank. Then, there was a horrendous burp around 2008/2009 when the economy fell into a depression, during which time capitalists did what capitalists always do: they renegotiated their relationship with the workers. I work in high tech, and even there I remember a certain attitude of “you should just be glad you have a job at all.” If someone set that to music, you’d have the theme music of the 2008-2012 period: it was when all those people who worked for small businesses wound up becoming hourly workers at Amazon distribution centers, WAL-MART distribution centers, etc.

While the economy started jerking back to life (just in time to put another supply side idiot in office!) more of the jobs being created are captive – instead of being a unionized car-builder you’re a robot-tender. Look at the jump in output as a factor of employment: what that shows is that more work is getting done by fewer people – and they’re going to be people who are paid less, too. That process started in 2000 and metastasized after the 2008/2009 depression. But businesses are doing fine, at least at the point that matters to the capitalists:

The top line is management, professional, and related occupations. That’s an ongoing trend that you might call “getting top-heavy” and it’s probably the real issue in the job market: everyone wants to be a boss, and the bosses get to be bosses with bigger bonuses by cutting back on everything for everyone else.

Here’s a scary chart that fits with the others:

Source: [think progress]

That’s from 2009. What it shows is that companies moved in several ways to increase profitability coming out of the downturn:

  1. They restructured labor relations – that’s code for telling people “you should be glad you’ve got a job at all. sorry about your medical benefits but you won’t be getting those any more.”
  2. They cut jobs – outsourcing aggregates and automates work (that’s how outsourcers are able to achieve efficiencies that they pocket in the form of profit)
  3. A few of the outsourcers also took it in the neck, and were replaced with cheaper ones or were forced to aggressively re-negotiate their existing arrangements

In other words, the economic downturn wasn’t just a slaughter of the workforce, it was an opportunity for the ruling class to solidify their gains. Where did the job market go?

These aren’t the mining jobs, the shelf-stocking jobs, the mowing rich people’s lawn jobs – these are the jobs that could be moved abroad to captive work-forces that can’t negotiate. They’re jobs that won’t – ever – come back, because that ever-growing top-line of bosses’ jobs? That’s where their profit margins are coming from.

Remember, there are two ways to get profitable:

  1. Make and sell more better stuff
  2. Make cheaper stuff that costs you less, and sell it at the same price

(Note: the reason Apple is so rich is because they do both 1 and 2! And, if you cheat on your taxes, it makes you even more profitable! Win, win, win.)

The first strategy is the one that drives economic growth and builds great businesses. Guess which one the US has mostly been pursuing since 2000? Well, you don’t have to guess because the numbers are staring you right in the face. The US’ businesses that are driving the economy are highly automatable (in order to get workforce requirements down) and are mostly false-fronts that stand before a captive labor force overseas. As someone who is concerned with social justice, I’m on the fence about some of that: it’s transforming China and the changes are rippling through India and Pakistan, Malaysia and everyplace else where the capitalists have been exploiting marginal labor conditions. Building iPhones for Americans is a good gig, if you can get it, but not if you’re an American because you can’t live in an apartment – never mind that – you can’t live indoors in America for what the people who build iPhones are getting paid.

The jobs that are staying here are the ones that can’t practically be exported. Because, if they could, the capitalists would have exported them back in 2008.

Meanwhile, I know a guy who used to work for a phone company, who now drives Lyft and Uber and had to sell his house (“downsize”) and is struggling in the ‘gig economy’   For my neighbors in Clearfield County, “you’re lucky you have a job at all” is the order of the day: the workers who are doing the fracking are being brought in from Montana and Texas because they work cheaper. If it weren’t for immigration controls, the capitalists would be rushing to bring in workers from other 3rd world countries, like they did in the 1880s to build the railroads and bridges.

What amazes me is that my neighbors don’t see this for what it is: the rich won the culture war. They won it rather decisively in the last battles at the end of the 1990s and 2000 was when they started consolidating their gains. There’s no culture war, anymore, it’s a “mopping up” action. And somehow the rich have managed to convince the poor (who they helped keep poor) to love and worship them. Somehow, laborers looked at Trump – who has never passed up a chance to screw the working class – and said “you’re our boy.” The writing is on the wall: the only good job to have is to be The Boss.

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I wonder what Jose [stderr] thinks now.

Those charts above point to a general hollowing-out of the US economy, which is both continuing and speeding up. The next crash is going to be pretty tremendous. The financial crisis of 2008 was a side-effect of the money guys getting overzealous, but it was possible to paper that over with economic stimulus (which just made more rich people rich) the economy turning into a potemkin village is a totally different sort of problem. Globally, the good news is that when the US empire collapses, it will give everyone that survives some breathing-room.

The future job-market will look like: gig economy hauling stuff for rich people. Get those new model stainless steel Keurig machines on the conveyor belt faster than your co-worker in “death match mode” and you get to keep your ‘job’ another week.  And managing money for rich people: lawyers, accountants, drug dealers, plastic surgeons – people who specialize in supporting the comfort of rich people, they’re going to do OK. You want to look for jobs that can’t be done cheaper by someone else.

Personally, I am surprised that the ruling class continue to play on Americans’ basic racism. I guess it’s still useful as a political “divide and conquer” line – because otherwise I’d expect to see a massive program for importing day-labor from Mexico, to polish rich people’s cars, mow rich people’s lawns, give rich people lap-dances, etc. Oh, wait, “that’s already happening?” You noticed. Well, if American labor ever starts to organize again, the rich will re-discover their love of immigrants, mark my words.

Comments

  1. tbrandt says

    Don’t forget another reason for the growth in management positions: “managers” can work as much as the employer wants and still be exempt from overtime pay. Obama tried to change this a year ago but was blocked by the courts, and the new rule is dead now that Trump is president.

  2. says

    Oh Christ, I know this too well. People here are hanging onto the oil and fracking jobs like grim death, but they aren’t going to stay, and most of the jobs are filled by out of state people anyway. When that goes, holy shit, things are going to be much worse here, and they aren’t grand right now.

  3. says

    Caine@#2:
    I’m really surprised that the capitalists haven’t hit on some scheme for importing temporary work from Mexico, officially. Ironically, all those “immigrant” regulations make it hard for them to hire undocumented workers – which they’d do in a heartbeat if they could.

  4. Siobhan says

    @Marcus

    I’m really surprised that the capitalists haven’t hit on some scheme for importing temporary work from Mexico, officially.

    Canada did that with the Temporary Foreign Worker program, though it’s the Philippines which seems to be the primary recipient. It’s a raw deal for all the proles involved–the Filipino immigrants are being paid below Canadian minimum wage and can’t unionize, and citizens are being squeezed out of low paid, low skill work. Unfortunately those same proles often blame the Filipinos rather than the capitalists for this rather brazen admission that Capitalism does not provide a sustainable means of living for the working class.

  5. naturalcynic says

    What amazes me is that my neighbors don’t see this for what it is: the rich won the culture war. They won it rather decisively in the last battles at the end of the 1990s and 2000 was when they started consolidating their gains. There’s no culture war, anymore, it’s a “mopping up” action.

    It’s not so much a culture war as it is a class war. Gimme some of that old time Marxism. The culture war isn’t settled yet

  6. jrkrideau says

    @ 5 Siobhan
    Didn’t some mining company from China try to staff a new mine in British Columbia totally with Chinese temporary foreign workers back in the late Harper days, using the reason that the workers need to speak Mandarin?

    I think even the Cons had to back away from that one.

  7. Siobhan says

    @jrkrideau

    using the reason that the workers need to speak Mandarin?

    Sounds nicer than “because it helps my bottom line,” doesn’t it.

  8. says

    naturalcynic@#6:
    It’s not so much a culture war as it is a class war.

    If I swear that I meant to write “class war” would you believe me? I’ll leave my mistake uncorrected. Yes – you’re right.

  9. says

    Shiv@#8:
    Sounds nicer than “because it helps my bottom line,” doesn’t it.

    Now that Trumpism is in place, they’re not even bothering to fig-leaf anymore. Next it’ll be “because, fuck you!”

  10. kestrel says

    @#10: Yes, right: “Because, fuck you, you’re not even human!”. There. Fixed it for you.

    We are so screwed.

  11. jrkrideau says

    # 10 Marcus
    But we’re Canadian and much politer/more hypocritical as we bludgeon you or grind you under our heel.

    Two discussions of the death of capitalism.

    For a nice pessimistic one http://www.cbc.ca/radio/ideas. Streeck is proposing a dystropic interregnum between the collapse of capitalism and the emergence of a new order.

    The signs are troubling: the ever-widening chasm between the ultra-rich and everyone else. Mass protests. Political upheaval and social division. It looks as though the rocky marriage between capitalism and democracy is doomed, at least according to Wolfgang Streeck. In conversation with Paul Kennedy about his book How Will Capitalism End?, he makes the unnerving case that capitalism is now at a point where it cannot survive itself.

    For what looks like a more optimistic one (not read) see:
    https://www.theguardian.com/books/2015/jul/17/postcapitalism-end-of-capitalism-begun

  12. lanir says

    I thought some aspects of immigration were hitting the accelerator. Granted, they’d rather move tech jobs off to Asia but there are still enough here for companies to wax poetic to the government about the need for green cards. Then they can later make noises at their employees about belt tightening and increasing efficiency and everyone doing their part while they replace as many of them as possible with green card holders. Because it’s harder to move jobs when you’re in that situation.

  13. says

    lanir@#13:
    Because it’s harder to move jobs when you’re in that situation.

    Yup. Captive work-force. Saudi Arabia is like that – it was really unsettling. You have to have a job and a sponsor or they immediately deport you by putting you on the next plane out of the country. It’s a tremendous threat – something like 25% of the population are contractors. The royal family all get a slice of the annualized oil sales action, so they are rich, and everyone works for them, subjugated by economic power to a greater or lesser degree. It’s rich people heaven – it’s what the US elite aspire to: walled compounds with Bentleys and armed guards, private airports, private roads, private malls, private neighborhoods, and then everybody else. A gigantic Mar A Lago, except more tasteful.

  14. jrkrideau says

    # 14 Marcus
    You have to have a job and a sponsor or they immediately deport you by putting you on the next plane out of the country. It’s a tremendous threat

    And you cannot leave voluntarily since your employer holds your passport.

    OTOH, at least back in the 1980’s, there were a lot of “undocumented” aliens in the Kingdom. A combination of foreign workers who did not want to go home and defecting pilgrims from the Haj or Umrah.

    Compared to some parts of the world Saudi Arabia looked pretty good.

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