Hillary's Biggest Challenge: Bringing Back Decent Jobs

Democratic presidential candidate Hillary Clinton attends a National Security working session at the Historical Society Libra
Democratic presidential candidate Hillary Clinton attends a National Security working session at the Historical Society Library in New York, Friday, Sept. 9, 2016. (AP Photo/Andrew Harnik)

One of the biggest ironies about Donald Trump's Presidential campaign is his pledge to bring back jobs that have been outsourced to other countries--the major driver behind his support from blue-collar workers. On the campaign trail, Trump has blasted Ford Motor Co. for opening factories in Mexico, criticized a U.S. drug company that moved its headquarters offshore and said he will eat no more Oreo cookies because its maker, Nabisco, moved part of its production to Mexico.

Why hasn't the media confronted Trump about the fact that Donald J. Trump Collection shirts - as well as eyeglasses, perfume, cuff links and suits - are made in Bangladesh, China, Honduras and other low-wage countries?

The 21st century has ushered in a massive globalization shift when it comes to jobs--and while conservative economists like to compare economics to a rising tide that lifts all boats it's more like an Olympics featuring an exponential increase in contestants competing for a limited number of prizes.

What does a U.S. university professor and a UK laborer have in common? Puny wages and/or benefits.

Anne McLeer's experience as an adjunct professor at George Washington University inspired her to not only start a union but help lead one: SEIU's Local 500's higher education work, which now represents GWU's part-time faculty.

"Before I started teaching I was a grad student with a 20-hour a week job as an administrative assistant to one of my dissertation advisers," McLeer recalls. "I was considered "permanent part-time staff" and had access to a retirement plan...and health plan. The day I gave up that job and I started teaching, which you would think is closer to the mission of the university, I became a `temporary part-time person' with absolutely nothing.

Incredibly, the majority of professors in the U.S. are benefit-deprived. According to the American Association of University Professors, 70 percent of college faculty work outside the tenure track. So they likely wind up working at multiple employers but still get no benefits.

Across the "pond", a survey of social attitudes found that while only 25 percent of Britons have jobs that involved routine or manual labor, 60 percent of them view themselves as working class, the major driver behind their votes for Brexit.

Like Anne McLeer, Colin Hewlett of the U.K. has seen his standard of living collapse. Hewlett, who has worked as a garbage man, bakery worker and now a packer at a canned food factory, has seen his pay crash from more than $665 a week to just $318 in three years. Worse, he added, is that his previously secure full-time employment contract has morphed into a "zero hours contract," under which his employer decides how much he works and how much it pays him depending on what it needs. "It is basically slave labor," Hewlett said.

McLeer and Hewlett's jobs may not have been outsourced but like millions of others they are working for companies who can't be bothered to pay them what they're worth.

The former president of the SEIU, Andy Stern, has authored a must-read book, "Raising the Floor," that tackles the threat to American jobs, from slave-labor wages to automation.

Stern points out that the investment in self-driving cars will inevitably morph into the development of self-driving trucks, a move that will not only put millions of workers out of work--driving trucks is the most common job in 29 states-- but its ripple effect will destroy millions of other jobs.

As Stern puts it, "I'm thinking about all those truck drivers. And the cooks and waitresses who work at highway diners and truck stops. And the men and women who license trucks and drivers at the DMV. "

Despite the Census Bureau's recent rosy jobs report, the first decade of the 21st century has been a "lost decade" of wage and income growth for most American families., according to the Economic Policy Institute's 2012 report, "The State of Working America."

Wages for the top 1 percent grew about 156 percent between 1979 and 2007, whereas wages for the bottom 90 percent rose by less than 17 percent.

One of the major drivers to our economic stress is outsourcing of jobs requiring a college degree. In the early 2000s globalization affected the jobs of computer programmers, scientists, and doctors. A recent survey by the Center for College Affordability and Productivity found that 48 % of employed college graduates work in jobs that the Bureau of Labor Statistics says require less then a 4 year college degree. Of those that found work, 16.5% are bartenders, 14% are waiters or waitresses, 18% are telemarketers and 24.6% are in retail--an industry that will shrink even more due to the explosive growth of online purchases.

Then we've got the freelancers, part-timers, contingent and 1099 workers who share Ann McLeer's dilemma. As observed in the book Raw Deal, a 2015 survey commissioned by the Freelancers Union and Elance (a web-based platform for online, contingent work) found that 53 million workers had engaged in supplemental, temporary, or project- or contract-based work in the past 12 months. In other words, 34 percent of the total US workforce is freelance.

To make matters worse, no matter how highly rated a freelancer might be, she or he can always be outbid by another worker willing to work for less money in the Philippines, India, Bangladesh, or other locations.

Stern says if we can't bring back high-paying jobs we should at least institute a Universal Basic Income of $1,000 a month for those between the ages of 18 and 64 who are struggling to make ends meet. The program would be paid for by eliminating some welfare programs or some tax deductions or instituting a value-added tax (VAT) which currently 160 countries use to generate revenue, among various other approaches.

Universal basic income is a concept that's been supported by many economic thinkers, from Thomas Paine to conservative economist Milton Friedman. Andy Stern is probably right that ultimately machines or workers in other countries may take American jobs, but in the meantime can't we treat our workers better?

As Pulitzer Prize winning author Hedrick Smith observed in his book Who Stole the American Dream, so disproportionate has America's ratio of incomes become when you're comparing the wagers of 1 percenters to the other 99% that in 2011 the OECD ranks the U.S. 31st--fourth from the bottom--among its 34 member countries. Only Mexico, Chile, and Turkey did worse.

Compare the U.S. with Germany, an economic powerhouse that treats its workers like assets, not liabilities. Since 1985, Germany's average wage has gone up nearly 30 percent versus only 6 percent here. In foreign trade, Germany generated $2 trillion in trade surpluses from 2000 to 2010, while we racked up $6 trillion in trade deficits. So today, Germany still has more than twice as many people working in manufacturing as the U.S.--21% of its workforce compared to 9% of ours.

In fact, during the 2008 economic collapse, big German companies shortened everyone's workweek instead of laying off masses of workers, saving 400,000 jobs. As a result, Germany's unemployment rate went down during the recession while America's rose sharply and stayed high. (Speaking of Germany, Trump's German relatives are utterly embarrassed by him and a study by Pew Research Center found that only 6% of its citizens considers him trustworthy.)

First off, why can't we boost in government spending on research and development?. As the authors of Second Machine Age point out, GPS systems, touchscreen displays, voice recognition software like Apple's Siri, and many other innovations arose from government-sponsored research. Google's driverless car was a direct outgrowth of a Defense Advanced Research Projects Agency (DARPA) challenge that offered a one-million-dollar prize for a car that could navigate a specific course without a human driver.

And maybe robots will ultimately replace construction workers but in the meantime we need to hire them to replace our crumbling roads, bridges and rails. The U.S. Chamber of Commerce estimates that America's faltering infrastructure costs the United States $1 trillion in economic growth and hampers U.S. exports. In world rankings of infrastructure, the United States has fallen from No. 1 to No. 15. In high-speed rail development, China is outspending the United States $300 billion to $10 billion

Clinton is facing the biggest economic challenges since FDR ran the White House. Let's hope she takes the right steps.