If nothing else the government shutdown demonstrates that neither party cares about the needs and interests of workers and the middle class. The Republicans continue to espouse less regulation and lower taxes as the holy grail that will lead to job creation. A shutdown on the way to a default because the debt ceiling has not been raised will only force government to spend less, which they believe will only lead to the private sector taking off. Never mind that their solutions do no more than rationalize the status quo that rewards their corporate cronies.
But the Democrats have their own cronies. They believe that simply spending more and taxing at the high end will solve the nation’s problems, particularly increased income inequality. One cannot help but think that the two sides really speak past one another. British political scientist Harold Lasswell famously defined politics in the 1930s as who gets what, when, and how. It isn’t, as the battle over the shutdown and the debt ceiling suggest, about serving the public interest. Which group gets what it wants, when it can get it and how, is the classic definition of politics. Amplifying this definition, political scientist Theodore Lowi observed that there were three types of politics: regulatory, redistributive, and distributive. Regulation involves restricting the activities, or rights of some, for the benefit — maybe protection — of others. Redistribution involves taking from one group in society — usually in the form of a tax — and giving to others — usually in the form of a program or tax break. With both regulatory and redistributive politics it is fairly easy to identify those who benefit and those who bear the costs. Distributive politics, however, involves the political system providing benefits to whatever group makes a request and passing the cost on to all. It is precisely because of distributive politics that we have the budget deficit that we have.
It is foolhardy to believe that cutting programs as the Republicans suggest will simply reduce the deficit rather than be passed on to their cronies. But it is equally foolhardy to believe that raising taxes as the Democrats so often advocate will either be applied to reducing the deficit or to assisting the middle class. Taxing those at the top of the distribution does not reduce income inequality; rather boosting the incomes of those at the bottom does. This is because for income inequality to be reduced the percentage increase in wages at the bottom has to be higher than the percentage increase in wages at the top.
Consider that unemployment is still over 7 percent and since this political drama began, we have heard nothing about it. In fact, because of the shutdown we don’t even have current numbers. If either of the parties really cared about the middle class, they would stop playing political games that over time can only exacerbate unemployment and address the issues of both long-term unemployment and stagnant wages. And yet, as I suggested a few months ago, despite all of the talk about the middle class there is little reason to address unemployment because it serves the cause of suppressing wages through the maintenance of an industrial reserve army of labor. A low-wage and flexible labor market where little is invested in human capital is the hallmark of a “low-road” strategy that American industry has been pursuing for close to four decades now.
Stagnant wages, the assault on organized labor, plant closings, the outsourcing of jobs, and increased unemployment due to “restructuring” has all been part of a corporate strategy since the late 1970s to assert the property rights of corporate America at the expense of working Americans. The problem that working Americans have is they no longer have a constituency in place to advocate for their interests, as they once did.
The future of the labor movement is to organize workers who have long been at the margins of the economy. But they need to do more than simply resurrect collective bargaining. They need to become the voice of middle class America. They need to argue for a wage policy that will operate alongside both fiscal and monetary policy. They need to advocate for investment in worker education programs that can upgrade workers’ skills, add value to their work, increase productivity, and then argue for sharing that increased productivity in the form of higher wages. They need to, in short, argue for the replacement of the low-road with a “high-road” strategy that places more emphasis on the human capital of the middle class. They need to get their workers involved in communal affairs. Among the things that unions used to do prior to their decline, is that they got their members out to vote and were instrumental in the increased civic participation of their members. In other words, they formed the basis for social capital.
Increasing the voice of working Americans is not only about improving wages and working conditions, but about enabling more people to be participants in the democratic process. Unions, as the voice of workers are central to democracy. Organizing workers needs to be about a grassroots social movement intended to give democratic voice to those who have been lacking, and whose absence has been evident in the course of policy over the last several decades. As our two parties no longer serve the interests of the middle class, it may be time for organized labor as a social movement to take the movement to the next level and form a workers’ party that speaks to the needs and interests of America’s middle class.
Oren Levin-Waldman is Professor of Public Policy and Public Administration, Metropolitan College of New York