Wednesday, June 14, 2006

'The Greatest Challenge Facing the American Center-Left'

In In Search Of a New New Deal: How Will the Good Jobs Of the Future Be Created?, Washington Post columnist E. J. Dionne identifies what he sees as 'the greatest challenge facing the American center-left', including progressives. Note the crucial distinction between tactics and strategy, highlighted below, that is made much too rarely in contributions to progressive strategy. Ironically, one would expect precisely political 'strategists' to systematically draw that distinction:
It's large enough that it should swamp all the silly arguments about whether Democrats need some sort of program for the 2006 elections. That is a tactical question -- of great importance to political strategists, but far less critical than whether progressives can, over the long run, keep their core promise to expand opportunities for the middle class and the poor.

There is no sturdier liberal or Democratic slogan than "Jobs, jobs, jobs." But liberals have a problem: The old capitalist job-production machine is not working the way it used to. The venerable promise that new (progressive) leadership will create masses of well-paying jobs is harder to make and even harder to keep.

In principle this is a larger problem for conservatives, whose main economic program involves reinforcing the status quo by giving tax cuts to rich people so they have more money to invest. Conservatives simply ignore the fact that fewer jobs are being created, particularly at home, for each dollar invested. But conservatives are expected to stand up for the rich. Liberals are supposed to expand the standard of living for everybody else. That is harder than it used to be.

To make his point, he refers to recent evidence, provided by Bruce Stokes, Ron Gettelfinger, and Alan Blinder:

In the National Journal of June 10 (article not [yet?] available online), Bruce Stokes, using data from the Economic Policy Institute (EPI), states that job growth in the current recovery is the slowest since the Kennedy administration, and warns that 'the global economy's job machine may be breaking down, again.'

At the beginning of this week's annual convention of the United Auto Workers (UAW), whose membership has dropped from 1.5 million in 1979 to less than 600,000 in 2005, its president, Ron Gettelfinger, issued a report arguing that the severe problems of the US auto-industry are not cyclical but structural and demand 'new and farsighted solutions.'

In Offshoring: The Next Industrial Revolution?, in Foreign Affairs of March/April 2006, Alan S. Blinder, co-director of the Center for Economic Policy Studies at Princeton University, and former Federal Reserve vice chairman, warns that 'we have so far barely seen the tip of the offshoring iceberg, the eventual dimensions of which may be staggering.'

Given these somber prospects, and noting the public's strong desire for an improvement in their socioeconomic situation, Dionne suggests the negotiation of a new New Deal:
This week's UAW meeting is simply the most obvious harbinger: The old bargain is breaking down and is in urgent need of renegotiation. The most promising place to start would be in reforms of the areas where the old bargain worked best: health, retirement and schooling.

Because electorates are looking for a better economic bargain, the words "New Deal" never sounded more up to date -- though if the marketing specialists insist, A New and Improved Deal would do just fine.

Interestingly enough, Jeff Faux, founding president and distinguished fellow at the EPI, in his most recent book, The Global Class War: How America's Bipartisan Elite Lost Our Future - and What It Will Take to Win It Back, published early this year, comes to a similar conclusion. Arguing that globalization has allowed the political and economic elite to abandon the social contract, he offers a strategy to democratize the global economy, beginning with a renegotiation of the social contract in North America.

Indeed, it seems to be the case that as long as progressives can't offer a convincing proposal of how to create a great number of good jobs, paying, at the very minimum, a living wage, any progressive strategy is bound to remain critically deficient.

While the problem is obvious, the solution is far from clear. Dionne cautions:
For the past 15 years, progressive free-market politicians have offered an appealing mantra about how to save the middle class: What's needed, they've said, is heavy investment in education and job training to allow people to make the transition from the "old" economy -- those auto jobs -- to the new. "What you earn depends upon what you can learn," President Bill Clinton said over and over.

There's certainly some truth to that still, but in the global economy, competition is fierce even for high-end jobs requiring great skill and education. To think otherwise is to deny the obvious: that the people of India and China, to pick just the two obvious examples, are gifted, energetic, ambitious -- and numerous.

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