Oct 102016

onaschoutsmall  by Bill Onasch

In this WIR I take up some issues that received scant, if any attention in the first PG-rated Presidential “Debate.”

As Good As It Gets?

The BLS monthly jobs report–always chock full of useful information about the state of the working class—was released last Friday as the election campaign enters the final month. It was kind of lost in the shuffle between Hurricane Matthew and new outrage about the misogynist Republican nominee. That was just fine with his Democrat opponent.

BLS says, “The unemployment rate, at 5.0 percent, and the number of unemployed persons, at 7.9 million, changed little in September. Both measures have shown little movement, on net, since August of last year.”

That’s the “official” unemployment stat. But also reported, there are an additional 1.8 million long-term jobless now designated as only “marginally attached to the workforce” and another 5.9 million are listed as “involuntary part-time”—both numbers essentially unchanged. Combined as the “real” unemployment, these three measures show a job creation that has become stalled—hardly keeping up with new first-time job seekers–while leaving behind 15.6 million who want full-time jobs but can’t find one.

Most job growth, both in September and year to date, was in business services-ytd 582,000; health care-ytd 445,000; eating and drinking establishments-ytd 300,000; and retail sales added 317,000 jobs so far in 2016. To be sure, these industries have some well compensated professionals and technicians–but the majority of these new jobs are low wage, many part-time.

A lot more could be expected—especially after a record year of auto sales and a rebound in housing. The old vaunted “Middle Class” still exists on a much smaller scale but the dream of younger generations to join it—or middle aged workers to rejoin after being pushed out–is still elusive after seven + years of “recovery.”

In the last WIR, I wrote about how the Middle Class has been in a long decline through automation and cybermation. During the Great Recession, bosses also successfully reduced labor costs through outsourcing, job combinations, and big concessions in union contracts. While this enhanced profits in production, at the same time it reduced the purchasing power of many workers. Readers outside the USA may be shocked by some numbers associated with this contraction.

Disturbing Math

The average work hours per week for private sector “nonsupervisory and production employees”—that includes the majority of the working class—was only 33.5. The average hourly wage for the same category rose 5 cents to 21.68. That works out to an average annual wage of 37,766.

Unlike Donald Trump, this average worker doesn’t earn enough to itemize deductions on Federal income tax. Social Security and Medicare payroll taxes amount to 7.65 percent. Nearly every state also has an income tax and most cities/counties assess property taxes to support schools. Kansas City has a one percent earnings tax. After all this taxation with misrepresentation, our average worker will be lucky to take home 30k. And much of that disposable income will be eaten by sales taxes.

Most average and below workers are renters. While prime mortgage rates remain relatively low rents are skyrocketing. The median annual rent for just a one-bedroom apartment in the 50 biggest urban areas is 14,808.

Single parents and two breadwinner households often have to pay for child care. The Economic Policy Institute calculates professional child care averages 11,666 dollars a year per child. That would devour over a third of the average worker’s net pay—so most must make other arrangements for “baby-sitting” with relatives or neighbors.

With the average price of a new car or light truck around 33k, our average worker is not powering those record vehicle sales. Even a reliable used car may not be in their budget. They learn to make their routine fit the bus schedule.

Annual health care spending per person is 8,223 dollars—and double digit increases are expected next year. Much of this flows through insurance nominally provided by employers–but actually charged to the total compensation package in lieu of higher wages. Even subsidized plans of the misnamed Affordable Care Act leave workers vulnerable to thousands of dollars in out of pocket expenses.

Last year the average cost of just tuition and fees for in-state students at a public college was 9,410 dollars. Private colleges generally charge 3-4 times more. The best our average worker could do for college-bound kids would be to cosign for a student loan, sharing what is sometimes a life-long and beyond burden of debt that can’t be discharged through bankruptcy.

A Last Generation of Prosperity

Of course, there are still workers who earn far more than this average. They help keep the lines rolling at Ford’s Kansas City assembly plant building F-150 pick-up trucks. They can remodel their suburban houses—granite and stainless in the kitchens, theater seats and giant screen TVs in their entertainment center.

But many of these are still prosperous because of a tiered workforce. They are slated for extinction through attrition. Their replacements earn far less in wages and benefits–and it’s unlikely their kids will ever have the same life-style.

The numbers I’ve presented so far deal only with the private sector. The variety of jobs in government make it difficult to arrive at broad meaningful averages. Public workers are more highly unionized than private—but their collective bargaining rights are usually much more restricted. And they have been under bipartisan “austerity” attack—including from the Oval Office.

The Obama administration has aggressively pursued privatization of public education and attacks on teacher unions. The first African-American President has also pursued privatization accompanied by massive elimination and downgrading of US Postal Service jobs–long a rare opportunity for Black youth to get secure “middle class” employment.

It is clear many, if not most workers are at best treading water. Such a mode can’t be supported indefinitely—sooner or later it must transition to swim–or sink. Some groups are so far under water they have little hope of recovery. Youth unemployment ticked back up a tenth of a percent last month to 15.8.

The Democrat presidential candidate has closely identified herself with the marginally more popular current President’s policies. Many of those trace their roots to the Bill Clinton administration. The one concession she made to the unions giving her whole-hearted support was a change of heart on so-called trade deals initiated by her spouse.

But already serious doubts about the sincerity of her conversion are being raised. WikiLeaks released transcripts of some of her speeches to bankers—for which she received six-digit honoraria–that included remarks about a “dream” she shared with Goldman Sachs about “a hemispheric common market, with open trade and open borders.”

Climate MIA

The domestic economy and globalization are not the only issues Secretary Clinton struggles to avoid. Even the supportive New York Times had to note that since her rival Bernie Sanders endorsed her about the only remarks she has made about climate change is to remind audiences that Trump is a global warming denier.

Unfortunately, that has been good enough for the most prominent climate activist Bill McKibben, and the 350.org network he helped found, to mobilize for turning out votes for the candidate that once gave State Department blessing to the Keystone XL pipeline.

This election campaign began with the major parties selecting not only the oldest candidates to ever make a first run for the White House but also the most unpopular. The so-called “debates” not only lack substance—they have sunk in to the gutter, with one still to go. They personalize the degeneration of American capitalist society.

It’s little wonder that a Harvard University poll, reported in the Washington Post, found 51 percent of Millenials reject capitalism and 33 percent favor socialism.

It’s too late to achieve a different out come to this disgraceful election. Since I’m going to the polls to vote against reactionary ballot questions anyway I will cast a write-in vote for the Socialist Action candidate Jeff Mackler. “It’s better to vote for what you want and not get it than vote for what you don’t want—and get it.” After the bad news on November 8, I’ll return to agitating for a revival of the movement for a labor party.

Gayle Swann

Gayle was a working class feminist. She had to sue to get a job cleaning locomotives for the Burlington Northern Railroad in Northeast Minneapolis. She not only fought for her own rights but also spoke up in defense of her coworkers. That earned her such respect that the mostly male membership of the Fireman & Oilers local union elected her Local Chair.

She also became a staunch, open socialist, joining the Socialist Workers Party in 1976, which is how I came to know Gayle. The SWP nominated her for Mayor of Minneapolis in 1979 and she conducted what proved to be a lively, high profile campaign. In a televised debate, she chastised her DFL and Republican opponents for limiting their program to “curb and gutter” issues while she focused on the Equal Rights Amendment, runaway inflation, and the dangers of nuclear power.

After I moved from the Twin Cities in 1987 I didn’t have much contact with Gayle. I last saw her at the Founding Convention of the Labor Party in 1996. Like me, she was enthusiastic about this effort to launch a new working class party. I admired her honesty, dedication and her underlying personal generosity. I was saddened when our mutual friend and comrade Dave Riehle informed me that Gayle had died from a heart attack in late September at age 69.

That’s all for this week.


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