Friday, December 19, 2014

Millennials and "Anti-Government" Government

What do our prime-age workers, the unemployed, the under-employed, the over-worked and the under-paid all have to look forward to in 2015 with the new GOP Congress when it comes to jobs and wages?

Over 9 million unemployed Americans (and more than 6 million others who are "not in the labor force" but who also want a job) will soon see what the new Congress will propose next year as their first "jobs bill" (Hint: It won't be for government jobs or public infrastructure investment — and it will be the GOP's very first bill).

CNN reports that soon-to-be Senate Majority Leader Mitch McConnell (R-Kentucky) said a measure authorizing construction of the Keystone pipeline will be the very first bill he'll schedule for a vote. McConnell said, "People want jobs. And this project will create well-paying, high-wage jobs for our people."

But TransCanada's website says the Keystone XL pipeline would only create 20,000 jobs for Americans — 13,000 in construction (until it's built) — and 7,000 in manufacturing. But the job estimates listed in their application draws from a 2011 report commissioned by TransCanada that actually estimates 20,000 “person-years”, not 20,000 people. Either way, that's not very many jobs at all.

So what do our prime-age workers have to look forward to? We might expect to see more offshoring with two pending trade agreements: the Trans-Pacific Partnership (TTP), a trade agreement linking the economies of the U.S., Japan, Malaysia, Vietnam and eight other Pacific Rim countries — along with an even bigger trade deal with the European Union: the Transatlantic Trade and Investment Partnership (TTIP).

And the new GOP Congress most likely won't pass a new federal minimum wage (which might have put pressure on all employers to raise everyone's wages) which might have allowed service industry employees, part-time workers and "temps" a semi-adequate income to live on.

Also, how will government agencies that protects our workers fare? Will their budgets also be cut like others were in the last spending bill? And on the state level, might we also expect to see more "right-to-work" laws, furthering the GOP's assault on labor unions?

And we also might expect more guestworkers visas (H-1B, etc.) to flood the labor market, putting more Americans out of work and further depressing domestic wages.

A poll released last October by Harvard University’s Institute of Politics found that among 18-to-29-year-olds who had planned to vote in the midterms (meaning: "definite voters", those not hampered by voter suppression laws) 51 percent said they would prefer to see Republicans in control of Congress — while 47 percent favored the Democrats. (They should have been more careful about what they wished for.)

On the question: "How important is the economy in determining which candidate you support in November?" — 77% had answered "important" — but yet, 40% were "not sure" which party they trusted to handle the economy. Maybe they weren't aware that the major U.S. stock markets had, not only regained all their previous losses from the crash of 2008/09, but they also hit many all-time record highs over the last two years. And even the most die-hard "free market" capitalists should realize that "capitalism" also requires "government". So the only question should be: What kind of government do you want? One that protects the rights and economic interests of everyone, or just those of the most rich and powerful?

In a recent interview posted at Reuters, David Kaplan asked former Democratic Congressman Barney Frank, "What do you think of the midterms?"

Answer: "I’m discouraged by more than simply the God-awful turnout. The root of our problem is people who are frustrated because we haven’t produced for them economically. You get into a vicious cycle in which people are disappointed in government because it hasn’t delivered, so they then get mad at government and vote for people who dislike government, which makes it even less likely that government will do anything for them." And this: "The press is very different today. It’s a major contributing factor to the pro-right-wing, anti-government feeling. Because even the liberal press is anti-government."

[Editor's Note: In an article titled Hunger Games Economy by David Cay Johnston, he writes about the new spending bill: "Far too many mainstream journalists help obfuscate the awful truth . . . our leading news organizations cater to economic elites favored by advertisers, and how the current generation of reporters at the best news organizations comes heavily from the upper economic tiers of American society. Reporters and editors whose parents were coal miners, truck drivers and clerks have given way to those with degrees from elite schools, some with trust funds that insulate them from the realities of American life for the vast majority. With that shift comes a predicable change in perspective." I've also noticed that CNN has been leaning a lot more "right" rather than "neutral" as they once were. See my post: Notable Economist Blasts Media Bias. I also touched on this subject in a post about The White House Correspondents Dinner.]

So it appears that a combination of factors had affected the last mid-term election results: voter turnout, apathy, lack of information (or ignorance), poor Democratic messaging and GOP propaganda (e.g. Fox News, SuperPACs and dark money in campaign ads, etc.), which may have all contributed to those Millennials who had voted against their own best economic interests (while also greatly harming the "Silent Majority" in the process).

So it seems that all of the GOP's "anti-government" rhetoric has helped achieved its desired affect. And budget cuts in the sequester didn't help much either. The Institute of Politics' poll showed that 56% of Millennials blamed all members of Congress for the gridlock in Washington, whereas only 22% correctly blamed the Republicans for obstruction (such as filibusters, nominations not approved and bills not brought to the floor for a vote).

This may have left many Millennials with a bad impression of all "government" in general. From the Washington Post: Millennials exit the federal workforce as government jobs lose their allure (by Lisa Rein on December 15, 2014) -- "Six years after candidate Barack Obama vowed to make working for government 'cool again', federal hiring of young people is instead tailing off and many Millennials are heading for the door."

Below are excerpts from the Financial Times: Millennials Rejecting Government Jobs May be Making a Big Mistake (By Eric Pianin on December 16, 2014):

A raft of developments have discouraged or scared away the Millennials — including last year’s government shutdown, periodic furloughs and pay freezes. Still, all of that couldn’t be any worse than the realities for undereducated Millennials who lack the verbal and technical skills to succeed in the workplace. So says The Future of Millennial Jobs, a new report by the Young Invincibles.

The report suggests that despite society’s mind-boggling array of technological advances, young people today have less to cheer about in terms of employment opportunities and advancement than people their age 50 years ago, at the dawn of the computer age.

“The optimistic vision of economic prosperity has been tarnished by severe economic retraction, industry shifts, and ironically, lost jobs due to increased technical efficiency.”

For those young adults fortunate enough to have found employment, their jobs are disproportionately more likely to be part-time, the study shows. About 25 percent of employed 18 to 34-year-olds are working only a part-time position.

What’s more, employers “have shifted towards hiring more part-time and temporary workers in lieu of investing in full-time employees,” the report states. Although contract workers comprise a relatively small sector of the labor market, contract workers have also increased four-fold in the past three decades. Career Builder’s annual jobs forecast claims that 42 percent of employers planned to hire temporary or contract workers in 2014.

“The trends are alarming for young adults who are starting their careers with fewer options than before,” the report concludes. So, with all of that to contend with, a government post many not look so bad after all.

[Editor's Note: And any union job also looks good. But then again, we have GOP politicians corrupting the process. Gov. Bill Haslam and U.S. Sen. Bob Corker were among several Tennessee politicians subpoenaed as part of the United Auto Workers' appeal of the failed union vote at the Volkswagen plant in Chattanooga.*]

Abraham Lincoln, our first Republican president, had advocated for "a government of the people, by the people, for the people". Today the Democrats are seen as the party of "government" (protecting the poor, the elderly, the disabled and the working-class) — while the Republicans more-or-less represent the "anti-government" (big corporations, big banks and the very rich) — except of course, when it is the GOP itself who is "the government".

The Millennials will certainly have a lot of obstacles going forward in their daily lives — and most likely, for the rest of their lives — because if the GOP ever has their way, young workers today won't have Social Security or a pension to look forward to either (after slaving away for 50 years at low-paying jobs). But the Millennials (the ones who were allowed to vote) got just what they wished for in the last mid-term elections — an "anti-government" government (less oversight, less regulations, more corporate tax dodgers, fewer voting rights, less worker rights, more budget cuts, a weaker safety net, fewer social programs, out-of-control tuition costs, etc., etc., etc.) So --- good luck with that.

There's a difference between "bad" government and "good" government (and/or more or less of either); but "government" itself isn't the problem, it's who we have "governing" the government that also matters. Yes, the Democrats made a HUGE mistake by not focusing more on what would also benefit white working-class Americans. Even former Democratic Congressman Barney Frank said in that recent interview: "We have to persuade white guys that we really do care about their economic interests." --- because most Americans are really "economic populists" --- so it makes less sense for them to "get mad at government and vote for people who dislike government, which makes it even less likely that government will do anything for them."

From the Washington Post: The Schumer prescription for 2016 (by E.J. Dionne Jr. on December 17, 2014)

Here’s the heart of Schumernomics: “As technology continues to advance, automation supplants employment across a number of different industries; low-skilled and even high-skilled wage and salary workers lose their jobs to machines. Globalization, enabled by technology, allows businesses and employers to relocate to low-wage markets halfway around the globe — putting downward pressure on wages. While overall, technology has many good effects — making markets more efficient — it cannot be denied it puts a downward pressure on wages."

The other part of Schumer’s argument is that only government can expand the bargaining power of the middle class and help it to “adapt to these new forces.”

From the Center for Economic Research: Schumer Should Focus on Keeping Government from Redistributing Income Upward (by Dean Baker on December 18, 2014)

The basic story is that technology and trade have displaced large numbers of middle class workers, and thereby redistributed income upward, but government can redress this problem. Every part of this story is wrong ... It is government that increased inequality ... So Dionne and Schumer are right. We need government [but] we need government to stop pursuing policies to give the rich all the money. Unfortunately, Schumer is not talking seriously about the real problem. He is putting on a silly show."

So it's not just "government" per se, but who runs the government and who decides what the government does for us. One government can allow for the offshoring of jobs and paying slave wages — while a different government can prevent this from happening. It's only in my humble opinion that "Third Way" Democrats and "moderate" Republicans (who are beholden to corporate interests) are equally guilty of destroying our middle-class.

Millennials would be much better off with FDR's party (progressives, who caucus with the Democrats). But if they believe they'll have a better future with the Tea Party (or with no government at all), then good luck with that too.

* UPDATE: The United Auto Workers qualified for the top tier of a new labor policy at the Volkswagen plant in Tennessee, giving the union its first formal role within a foreign-owned auto plant in the South.Contrats!

Zombie Workers: The Working Dead

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