← Economic Update with Richard D. Wolff
Economic Update with Richard D. Wolff
ECONOMIC UPDATE: PRECARIOUS WORK = CAPITALISM'S INEFFICIENCY
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Sam.
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Saint gonna change. Welcome friends, to another edition of Economic Update weekly program devoted to the jobs, the incomes, the debts, the present, the future, all in terms of our economic well being and our economic problems. I'm your host, Richard Wolff. I've been a professor of economics all my adult life and currently I teach at the New School University and New York City. Before jumping into the Update program for today, and a little bit later introducing to you our guest who will be interviewed in the second part of the program, I wanted to mention some upcoming trips that I'm taking and if you're in those areas, to urge you to check our websites to find out the specifics. I'll be going to Kansas City, Tampa, Houston, Ames, Iowa, Fresno, California, Seattle, Washington, Berkeley, California, Farmingdale on Long island, and probably several other places I have not remembered. But if you're in any of those, check rdwolff with two Fs com or democracy at work, all one word, democracyatwork.info and you can get the particulars. Second, I want to thank the many of you that have sent in very valuable leads to radio stations that we now are working with to get this program on even more stations. We're over 45 now. More stations, as many as possible. And your connections, your friends, your knowledge, your suggestions have been very, very valuable in finding new outlets for this program. Thank you and please keep up the good work. And finally, if you go to that website, democracyatwork.info Please sign up for our newsletter. Like everything else, it's free, it's available to you all the time, and you will be getting regular updates about a whole host of things that we're doing that I think you will find interesting. So let's jump right in. This is an important weekend in American history. It's the anniversary of what we've come to call 9 11, a horrific moment years ago when airplanes crashed into the World Trade center in New York City, expressing rage, anger and frustration of people affected by world politics, mostly in the Middle and Far east, and holding the United States obviously responsible because of that act committed here. And it's on our minds, not only because it's the anniversary, but because in a peculiar way, it's being played out again. In the last few weeks, all of you have seen or heard stories about the horrible refugee crisis now crashing in on Europe. Roughly 10 million people have been displaced, chiefly in the Middle east, in places like Iraq, Syria, Libya. And their conditions have deteriorated in some cases. Now for as far back as 9 11's events, conditions of life have become unbearable, leading 10 million people to pull up stakes, to leave the countries of their birth where all their families reside, where they know the language, where they had a job, and to go in a very dangerous way, a very long distance to a country whose language they do not know, whose customs they have never heard about, under conditions they cannot foresee or imagine. This is a trauma in every conceivable dimension of the term. And what's driving these refugees is not different from what drove those people who did that awful act back on 9 11. These were people coming from places where poverty and deprivation had existed for a long time, making people very upset. These are folks who came in 9 11, like the refugees today, running away from war and conflict that made the problems of poverty even worse. It's like an object lesson that if you have an economic system that develops extreme wealth in a few places and the opposite, extreme deprivation and poverty in another, you're going to get angry, bitter, resentful people able to damage innocent folks without thinking about it and desperate enough to undertake becoming a refugee in the middle of their lives. It's a problem of economics not only, but in good part. And we ought to reflect on these twin disasters because they have so much in common as to what brought them about. The second update for today is a peculiar one. I want to take off my hat to the French, but perhaps in a way they won't be happy with. I caught a story about the Ford Motor Company. Well, what, you might wonder, does the Ford Motor Company have to do with France? Well, Fords don't sell well in France. They do much better in Britain and Germany. But. But they really have not been able to get the French people to buy a Ford, no matter what they've tried to do. So they decided to buy politicians, something large corporations make a specialty of anyway, because it solves a whole bunch of their problems. Well, apparently they decided even better than a top politician is a top politician's visible wife. And so it was that in France this last week, Carla Bruni Sarkozy became a spokesperson for the Ford Motor Company, trying to get fellow French citizens to buy Fords, which they haven't been doing. Who says politicians aren't for sale? Next item, Los Angeles. Los Angeles has something called the Los Angeles Homeless Services Authority. And whatever they do for or to the homeless, I'm not exactly sure, but I do know they keep good statistics. And that is not done in many, many cases across the United States. So that much of what is said about homeless people and homelessness Is, let's be kind, conjecture, guess, estimate, but not very reliable. But in Los Angeles, they do a good job. And the Los Angeles Weekly this last week reported that over the last nine years. Get ready for this, because it blew my mind. 942,000 people became homeless in Los Angeles. That's just shy of a million people. The overwhelming bulk of them were people already on public assistance. So what this means is even if you qualify for public assistance in this country, it's so meager, it's so inadequate that you will likely be homeless for part of the year or maybe even for several years. The LA Weekly referred to this as an epidemic of homelessness in Los Angeles. And for me, it was another sign that when I hear about recovery, it again underscores it's only recovery. If you look at the numbers that suggest that if you're willing to look at all the other numbers that are relevant, no recovery. The line of homelessness in LA reported this last week as a line that goes up since 2007 and it doesn't go down. It's getting worse, not better. Well, last week was Labor Day, and a couple of you chided me for not saying more about Labor Day. So let me do that. And I thought a little history, we don't do enough of that on this program, might be useful. Where does Labor Day come from and what is it that we can say about it? Well, the history of Labor Day is roughly the following. And I want to thank the United States Green Party for having put out literature that reminded me of this history and enabled me to compile this segment. Back in 1894, the workers who produced the Pullman train carspullman was very, very important as a producer of rail cars. Train cars were suffering layoffs. And in those days, what was often the case, workers who had factory jobs lived in housing provided by the employer. So the employer paid them a wage on the one hand, but then charged them rental on the housing on the other on the other. And Mr. Pullman, who owned and operated the Pullman company, came up with a novel way of improving his profitability. He laid off the workers producing the cars he couldn't sell, but did not relieve them of the rental that he demanded from them, putting the workers in an impossible situation. They weren't earning any money because Pullman wouldn't pay them, and therefore they didn't have the rent that Pullman insisted they pay. Led by Eugene Victor Debs, an important fellow in American history, they went on strike. The strike was quite successful. It called on workers all over the United States to boycott, not to take a train that had a Pullman car on it. At its peak, this strike in 1894 involved 250,000 workers in 27 states. Riots broke out as starving workers faced off with the police. Pullman involved a private security force, people later known as Pinkertons and nowadays known as Blackwater. And it got so tense that the president of the United States at the time, Grover Cleveland, called out the army and the marshals, and they killed 30 people in crushing the strike. But even though the strike was defeated, everybody who paid even a little bit of attention knew that disrespect and hostility towards working people was not tolerated by millions of Americans. And that something had to be done, at least symbolically, to recognize labor, since what was actually done to labor was as terrible as what I've just said. So there began to be a movement to have a day devoted to labor. It's a little bit like how, having eliminated the Native Americans, we name so many states and cities after the people that we eliminated. There's some guilt in there, isn't there? Anyway, the idea came, let's have a Labor Day, a day to honor labor. Kind of a strange idea given what you've just done. But that's the way guilty people function. So we had a conversation, but here was the problem. Workers around the world had already begun celebrating a Labor Day every May 1st. And that was in honor of a strike and of an action for the eight hour day in Chicago, in Haymarket Square in Chicago. And so it wasn't possible for the people who wanted to have an honor Labor Day to inadvertently join in the May 1 designation the way they did in other countries, because that honored striking workers and that condemned the police brutality against those workers in Chicago and the hanging of several people on very dubious evidence that in Chicago, end result, we would have a Labor Day to honor what had happened in the Pullman strike, but we wouldn't make it on May 1st. The way labor is celebrated everywhere else in the world. We'd make it on the first week of September. And that's the story of Labor Day. And it might make you think a little bit about what's at stake here. Okay, moving right along, I want to tell you all about a transaction that's almost done in which an American millionaire is dealing with a Russian billionaire because the two of them have made a decision that they can make more money by cutting this deal, and we in the United States will be affected by it. But of course, in the nature of capitalism, the millionaires and the billionaires make the deals. We read about it in the newspaper and try to figure out what it might mean in our lives. Having any democratic input in the decisions is of course, not how capitalism works. In this case, it's a brand new sports arena right in the middle of New York City called the Barclays Center. And it's also about a very famous basketball team, the Nets, who play in the Barclays Center. Turns out they are owned, that is the Barclays center and the Nets, by a duo. Two. One is an American millionaire, Bruce Ratner, who develops real estate in New York City and has for a long time. And the other one is a somewhat murky Russian billionaire named Mikhail Prokhorov. And the news is, for those of you that are glued to the radio as we speak or to the television, that Mr. Ratner is going to be selling his share to Mr. Prokhoroff. So when you go to the Barclays center, if you do, and when you look at the Nets, if you do, you. You're going to be watching what two millionaire billionaires have decided to do. Your job is to take it, to look at it, and to forget about the fact that we allow something like that to happen so that two individuals can make a decision that all of us have to live with, which will go in directions no one can foresee. Next, I want to congratulate the teachers in Seattle, Washington, yesterday, at the time this program is being made, on September 9th, they went on strike. 53,000 students in the Seattle area had to postpone the beginning of the school year because the teachers are on strike. They haven't gotten a cost of living increase in six years. If you realize that the prices of everything they had to pay for went up each of those years, 1, 2, 3%. If you don't get any wage increase and the prices you have to pay go up 1, 2, 3% a year, and this goes on for six years. You do the math. It means the value of what you're being paid, what you can actually buy with your income has gone down about 15% at least in those six years. So you've been dishing out cuts. The funding of education in the state of Washington is so bad that the Supreme Court of the state has fined the state of Washington for underfunding public education. They're so determined not to tax corporations and the rich that they're sacrificing the education of their children. And there's beginning to be a fight back, and in this case, it's led by the teachers union that is making that part of the issue that they're organizing a strike about. And Washington deserves another congratulations. The Supreme Court of Washington handed down a ruling recently 6 to 3, that charter schools are unconstitutional. Here was the reasoning as explained by the Chief Justice. The law in Washington stipulates that if you form your own charter school that's effectively a private school organized by an institution or parents or whoever puts it together, you're entitled to get funding. In other words, as it was interpreted, the public money, city money, state money, county money has to be provided to a private school. So people complained, the union complained, and all kinds of other associations complained. Wait a minute. How can you give public money to a school that isn't accountable to the public? It's paying for it. A charter school has its own leadership, a private leadership. Private decisions are made as to who to accept in a school and what to do in the school. That's fine if you want to do it, but no public money should go to a private school. That was the argument and that was the argument with which the Supreme Court agreed. So there are no charter schools, at least for the time being. It will be appealed. Finally, news from Japan. And this is an important thing because we're going to be talking about that in the interview that we're going to be doing later in Japan. As back in 1984, 85% of Japanese workers had secure jobsjobs where they knew what days they were working, what hours they were working, how much they would get paid, what exactly the benefits were, and their jobs were secure for Life. Today, today, 37%, over a third of Japanese workers have no such security. They've lost it. It's been taken away. In the words of an article that appeared in the Bloomberg Financial News Service and I as economic growth stalled in Japan, companies became less willing to hire full time workers, turning instead to part timers who are easier to lay off and often receive less pay and fewer benefits. Moving jobs from secure to precarious is a major assault on working people happening in the United States, Europe and as you can see, in Japan. And we're going to have occasion to come back and look at that some more in the time that remains in this first half of our program. I want to respond to your questions as we always do, and here's one that several of you sent in that I think very much deserves an answer. The question is $15 an hour as a minimum wage is sweeping the country, at least as far as fast food and retail workers are concerned. What about the Argument. The questions say, what about the argument put forward by the owners and operators of fast food restaurants and big box retail stores and so on, that if the wages go up to $15 an hour, well, then all the prices will go up and it won't make any difference. They'll cancel each other out. What about that? Okay, let's respond to that. The short answer is when costs go up, prices do not necessarily go up. They never have worked that way. This is an attempt by employers to undercut the support for $15 an hour minimum by suggesting that if that happens, we all are going to face higher prices. Let's see the logic here. When the costs of an employer go up, for example, because he has to pay higher wages to his workers, the employer might like to pass on the higher cost in raising his prices. He might wish to be able to do that. But here are two considerations every employer faces that may make him decide not to do it. And this happens all the time. Number one, let's imagine the fast food industry. And let's imagine that just one of the companies decides not to raise the price. That is, let's pick one Wendy's hamburgers. They decide, we're not going to raise the price. We're going to take a cut to our profits, pay the higher wages, but not raise our prices. You know what will happen if Wendy's does that? McDonald's will have to follow suit and Burger King will have to follow suit. They'll all have to follow suit. Why? Because if they don't, if they raise their prices, they will lose their customers by the droves who will go over to Wendy's. In other words, in economics, if a competitor, just one, chooses not to raise the prices, it'll make it impossible for any of them to raise the prices. But that's not even the most important reason why a wage increase doesn't necessarily lead to a price increase. Here's the more important one. Every business has to worry that if they raise the prices of what they charge for what they produce, that they will lose customers. So what every business has to do, even if it's only an estimate, is to weigh the gain from raising the price against the loss for all those customers who won't buy whatever it is you're selling anymore because you raised the price. If the loss they suffer from customers they lose is bigger than what they gain by raising the price, they don't raise the price. If Americans are paid $15 an hour, it is perfectly possible that either the competitive reason I gave first or the Risk of losing customer reason I gave second. Or the two together will mean that, guess what? The workers will do better by having $15 an hour, and the employers will have to eat the cost in reduced profits. End of story. So when an employer tells you that he or she isn't interested in paying higher wages because they want to protect you from the higher profits, you're being hustled. It's not at all clear that an employer facing higher wages can or will raise prices. And here's a final point just to drive it. If the employer thought that he could raise prices and not worry about a competitor failing to do likewise and not worry about the customers he might lose if he raises prices, he would have already raised them. That's what market economics tells every employer. Put the price as high as you can, make the most profits. They're already doing that. And if you raise their wages, they probably can't do any more of it than they've already done. And so it's an empty argument. It's meant to fool the public into becoming passive or even oppositional to the efforts of working people to get better wages. Okay, folks, we've come to the end of the first half of our program. As usual, I had other questions I wanted to respond to and other updates I had hoped to be able to elaborate. Please stay with me for the second half of this program. I think you will find the interview we do there having to do with precarious work, particularly here in the United States, follows immediately from what we said about Japan and gives a whole new window on the struggle between capital and labor and the importance of that struggle now that capitalism as a system is in such turmoil and and crisis around the world. Stay with us. We'll be right back. Did you stand there all alone?
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Oh, I cannot explain what's going down I can see you standing next to.
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Me.
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In and out somewhere else right now you sigh look away I can see it clear as day close your eyes so afraid hide behind that baby face. You can drive all night looking for the answers in the pouring rain you want to find peace of mind looking for the answers. Funny how it seems like yesterday.
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Welcome back, friends, to the second half of Economic Update. For today, I want to remind you, as I always do, to make use of our two websites, rdwolff with two Fs.com and democracyatwork, all one word, democracyatwork.info both of those websites available to you 24. 7 at no charge whatsoever. And please make use of them. Sign up for our newsletter as a way of keeping up with what we do. Click on the relevant icons and you can follow us on Facebook and Twitter. And likewise, make use of the email facility on both of those websites to communicate with us what you like and don't like about the program, suggestions, questions you'd like us to address. All of that is looked at by all of us, every single email that comes in. And that's how we plan and structure our programs. I'm very happy today to introduce my guest, Dr. Harriet Frad. She is a mental health counselor in New York City, a hypnotherapist, and a person with a special interest in the connections between economics on the one hand, and the psychological and intimate lives of people on the other. Which is why I bring her on this program and why I can tell from your email responses her commentary strikes a chord. It's a little bit like having a window into the souls of people as they struggle with an economic system described in all the ways we try to do on this program. So welcome, Dr. Farad, to the program.
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I'm glad to be here.
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Okay. The topic we have for today can best be illustrated with a story. Once upon a time, workers expected in the United States, in Japan, a point that I made in the first half of today's program and in Europe, that if they did their job well, they would be able to keep it. That there was a presumption that working well would secure your job. You knew what your hours and days were, what the benefits were that went with it, what the wages were and how they would grow over time as you became better able to do the job, etc. Etc. Jobs were secure. Income was secure. May not have been high, but it was secure. Nowadays we have something called precarious work. And what that word, precarious means is that you're not sure that all of the things that once seemed certain have become precarious, uncertain. In Europe, they coined the phrase that workers are no longer part of the proletariat, they're part of the precariat. That working now means never knowing how secure your job is, what the benefits that go with the job really are, what will happen when you go and get medical care or when the time comes for you to have a pension, Will it really be it's all precarious? Will you be sure that you work from 8 in the morning to 5 in the afternoon, or will that be altered and on and on and on? Well, the business community has been pushing. They don't want firm commitments to their workers. They of course, choose a word that makes it all sound reasonable. That's what they always do. So they speak about labor market reform or labor flexibility. They have lovely terms like that, which sounds good and reasonable. And what I want to show and what I want to ask your opinions about is what the uncertainty of a precarious or if you like flexible labor market, what that uncertainty means, what it costs to the workers, what it means in their lives, and therefore what it does to society as a whole. That's what we want to explore. So let me begin by something that's in the news a great deal. It turns out that the movement for a fifteen dollar minimum wage has been not only very successful across the United States, but has been provoked as much by the precarious problem as it is by the fact that these folks are underpaid in terms of what it costs to live. They've been interviewed countless times and you hear the following. My supervisor tells me not to come in on Thursday but to do extra hours on Friday, or says not in September as often as in October. In other words, I don't know anymore from one week to another what hours I work, how many hours I will get paid for, etc. Tell us a little bit about how that impacts a worker.
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Well, first of all, I want to say that that impacts workers up and down the income levels. You know that I have a client who is an actuary who makes reasonable money. However, he's sent out of town with very little notice for days at a time to sit and go over someone's books. I have another client who is in advertising and she sometimes goes to an advertising site to help shoot a commercial with day's notice, only a day's notice. And the notices are always changing. There are also people that I have in my practice who are at the bottom of the economic ladder working as fast food workers. What this means is, first of all, if you have children, you can't plan their child care because if you have a child care provider, that provider too usually has to know what her hours and responsibilities are, how many children she can afford to take, at what price, and if you have a public child care, which there are some, though precious few preschools, you have to sign up for a given slot and be able to take your child and pick that child up. And you may not know. So it means for parents that your children are left alone or in precarious arrangements with strangers they hardly know, thrown in with relatives who don't want them, who stick them in front of a television in their wet diapers. And so you can't be the parent you want to be with that kind of schedule. In addition, one of the reasons that people don't stay in relationships, and we should face that although a stable 50% of marriages end in separation or divorce legally, there's another untold percentage, I would think at least 15 or 20% that don't have the money to fight over assets and just decide to split and work out an arrangement. If there's children, who's going to watch the kid when. And so that you have people who can't work out the problems in their relationship with, who don't know when they'll see each other, who can't take a day to go to the beach because they don't know if they'll have to work, who don't have the income to make a plan to go away for a day, no less, have a vacation.
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Or have the freedom to know that that day is free, et cetera, et cetera.
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That's right, they can't make a plan because they don't know when they're free. What this has meant is that not only do people get separated or divorce, but as Arlie Hochschild illustrates nicely, or in her book Time Binds for office workers and upper end workers, it means that the primary other to whom you relate all the time is basically the people with whom you work. My client who's in advertising, her marriage is folding. Her husband doesn't even know if he'll see her, when he'll see her.
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And.
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And her primary other is the guys and the women at the office where she works who go out to a bar after work and bond with each other and do other things together because their primary other can't be a mate outside of work because you can't count on time together. And relationships take time. This affects people all across the board. And so that you have a phenomenon of personal life being utterly eroded. And people have their personal lives if they can afford an Internet, much more with the friends in quotes on the.
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Internet and the social media.
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And the social media and the dates on the social media. And Ashley Madison is a great example that 37 million people are on these Ashley Madison accounts of how to cheat on your spouse. It turns out that only, what is it, 5 million are actually real women out of the 37 million. But they have a balance because they have fembots, women who are actually social media robots who tell you how sexy you are and let you get off talking to them. And so that you are relating to a fembot while cheating. And you're cheating because you don't have time to work out a relationship. In part, of course, there's lots of issues. And the whole thing is taken out of a human interaction, interactional relationship. It means that even your sexuality is with porn on the net or with a fembot on the Internet. Gay relationships that are cheating do better on Ashley Madison because both men tend to be real cheaters and that you lose contact with a human interaction that has some complexity and nuance at intimacy.
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Because a relationship, whether it be. If I can condense what you said, the relationship, whether it's between parents and children or between adults of any kind, need time, need space, and need you to be able to plan that your life is not only at the beck and call of your employer at his will and whim, but that you know when you're going to have the time free so that you can make an arrangement to be the parent you want, to be the friend or the lover that you want, et cetera, et cetera. And that for me, what I find so stunning is that the very people that continuously support the needs of business for flexibility in the next breath portray themselves as champions of family values when the flexibility is an enemy of family and an enemy of relationship. So that whatever you think about a family, if relationships with children, with people your own age are important to you, this is an amazing loss for you if the business succeeds in making everything precarious. When it comes to the days and.
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Times you have to work, there's research that really reinforces that. There's a study that came out that was reported on in September 10th New York Times that shows that union representation and union membership is highly correlated with children's ability to. To have mobility, to do better than their parents, to economically thrive. It's as correlated as single mothers or as desegregated neighborhoods. It's as high as any correlation. And the effect is not only on the specific children whose parents are unionized or whose parent is in the union, but a whole neighborhood where there are a lot of unionized workers. And I think that's because if you are in a union, it is a whole lot more likely that you could have the eight hour day that's been lost in precarity, that you could know when your day begins and ends, that you know when you're working and when you're not working so that you could create the consistency with your children and with each other that allow a better quality of life and that for your children Is a model of possibility. Also unionization, which is one of the reasons that the $15 an hour people want a union that that allows you to have some hope, that you do have an effect on your world, that there is some input you have in your daily life. Otherwise your soul belongs to the company store, as Johnny Cash sang about it, you know, and that you are indebted and owe your soul to the company store. And you have to work because otherwise you won't have any life.
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Well, it's very interesting because unions, as they developed in our capitalist world very quickly came to be focused on what's called the contract. That is how a union works, is it signs an agreement with an employer. As soon as a union is established in a workplace, one of its first acts is to sit down and negotiate with the employer on a contract which both the union on behalf of the workers and the employer sign as their agreement governing, say, the next two or three years of the work. And the interesting thing is that very quickly, those contracts specified what hours you would work, what days you would work, and a procedure. If the employer wanted to change those. The employer has to go through a procedure. Can't just do it whenever he or she feels like it's a nice deal. They can't do those things. So that it's very clear that the decline of unions and the rise of precarity have more than a little to do with one another. Because getting rid of a union enables the very behavior, which is why employers want the flexibility. In Europe, it's a little different from the United States because laws specify laws pushed by unions, often by unions, but it's the law in this country, it tends to be more a contract. But whether it's the law or a contract, whether you get rid of a union so you don't have a contract, or you by the political system so you don't have the laws anymore. The freedom of the employer comes at the expense of the freedom of the employee. And that conflict cannot be glossed over, made to disappear. And what you're saying is it goes to the most fundamental needs of working people as human beings to have meaning, relationships with children and with one another.
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Well, what it means is that, look, you have to look at it this way. Human beings are the most social of animals. When you're born, the size of your brain is the size of a small fist. By the time you die, it's the size of a Nerf football. All those neuronal connections are initiated with emotion. There's a very good book about it by Candace Pert. But in any case, that's corroborated by neuroscience. And so you need relationship, you need connection. The worst punishment is solitary. And so what you are doing is that you are driving people away from interpersonal connection towards connection with machines that are profitable. And one of the wonderful ironies on the right wing is that the right wing ministers condemn pornography, even though if you want a sexual relationship with the machine, that's pornography. And that's something you can do in the spare time you have whenever your employer who owns you gives you a little time. And so that not only is the hypocrisy that was revealed when 400, quote, men of the cloth were on Ashley Madison, some with multiple accounts, but 400 individuals. But you have them saying how marriage is sacred, how connection is sacred, how the family is sacred, while they are destroying the family and replacing it with a lack of personal connection.
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Let me explain.
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Or utter loneliness, I should say.
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Yeah, let me explore this. Coming at it. Another. We've been talking really about scheduling. You know, the flexibility of the employer to do something which might strike a person as trivial minor and turns out to be enormously important. Hours. But that's not the only precarity. What about the precarity that the job itself isn't secure? That you can't, as many workers once did, rely on the fact that if you do your part, you work hard, you work effectively, you learn, you become better at it, that your job is secure. You're a psychotherapist of a sort, a mental health counselor, hypnotherapist, and all of the. And I know you have a thriving private practice. Tell us what you've learned about the costs to human beings emotionally and personally from not the loss of a job. We can kind of imagine that, but the anxiety of not knowing that a job is secure, that your place in the world that shapes your income is safe.
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Well, there are huge effects. One of the interesting studies is that if several people in an office close to one another are fired, the mental health crisis of the people remaining is worse than those who were fired.
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Because the terror anxiety is greater than the actual event.
- [48:47]
A
That's right. The anticipation is worse than the event. And that what happens is people don't feel they have a future. One of the reasons given, the most dominant, actually given for people not getting married and planning a future because marriage is way down, is that they don't know if they'll be able to support a family. They don't know what to expect of each other. They don't know if they'll be able to sustain a household. And so that people have a sense that nothing is safe in their whole world. Their relationship isn't safe, their, their home isn't safe. As you can, as the story you told about Los Angeles, which I know has 13,000 new homeless every week. And I have a phone client from LA who said he used to take the shortcut to the beach, but he can't because the underpass is now too crowded with tents, too many people are living under the two places he used to cross to go over the bridge and from his apartment because too many homeless people are living there and he can't make his way through. So that you have a general precarity, a terror of homelessness, a terror of the future, which is so uncertain and so that people are terrified, and particularly men terrified. The newest group that most is fastest growing for suicide are middle aged men who have lost their jobs and who feel that their personhood comes from I am a man, I can support my family and they can't. Or who now have to take precarious jobs, part time jobs, insecure jobs, and their whole sense of humanness is now insecure. It is no wonder that in my brief study of several months of mass killers, which we read about several times a week, the biggest motivations are that a wife or girlfriend has left, creating even more insecurity or their job has been taken from them. And because those were the mainstays of men's sense of self, women's sense of self was much more relational with other women who met their emotional needs with children, with family. But this is a terrible emotional crisis that can lead people to desperation.
- [51:34]
B
Yeah, it strikes me also as from a narrow economics point of view, as wildly irrational to make another percentage point or two in profits. You will move to a flexible labor arrangement, visiting disaster on your workers. And when you add up the family crisis, the counseling expenses, the future of children, the future of the children, the extra compensation of physical and mental health, the crime, the cost to society is huge, is huge, and the benefit is privately grasped by employers who are a tiny minority of the population. This is an irrational way to organize the economic life of a society. And you're driving the point home by talking about what the majority of now have to face in the way of a precariousness or precarity built in to the work experience.
- [52:41]
A
That's right, because what you're talking about is you're saying, hey, wait a minute, the parlance that capitalists use is this is efficient, we have to ask for whom.
- [52:53]
B
That's right.
- [52:54]
A
For the person who can't plan their life, for the person who's terrified of homelessness, for the person who can't function because they're too anxious, for the person who loses his relationships or her relationships. Is that efficient? Wait a minute. Who is this economy for? If it's for us, this is not efficient. If it's for them, the very few who own everything or Most everything, about 80% to 90% of our institutions, it's very inefficient. So even within their vocabulary of efficiency, this is not efficient?
- [53:35]
B
No, it's the shame of the economics profession, of which I am a part, to have counted efficiency only from the perspective of the employer and never from the perspective of looking at and trying to count all the costs visited upon the majority of the workers. And this precariousness that is so big an issue everywhere is absolutely fundamental to getting that point.
- [54:06]
A
And the United States is among the worst of the industrialized countries.
- [54:10]
B
Say something, please.
- [54:11]
A
It is the worst in terms of our murder rate. It's seven times more than the second out of 30 more industrialized countries. And these are not necessarily rich countries. Hungary is included, Poland is included, and so on. You know, we're not just talking about France, Germany, England, but that people, now, of course, we have guns the way they don't. But also that people are driven to desperation. And overwhelmingly men are driven to desperation. Men who have identified themselves most with I am a man because I have a job and I am a provider, which women have not had as much, you know, as we have not been the major providers for most of our history. And so that you have a mental health crisis. Precarity is a mental health issue for the mass of Americans who are terrified and not without reason.
- [55:14]
B
It's interesting, you know, you can say, and your comments open this up for me in a way I hadn't seen before, that the press is now enjoying saying that even though the economy of the United States is in tough shape, we're in better shape than in Europe, which in many ways is true. But the flip side of that is that the mass of people in Europe have less precarity and a better safety net in terms of social programs than in this country, that the ability of corporate profits to be more robust in the United States than in Europe, that the flip side of that is we suffer in this country a level of precariousness and a level of low government program support that makes this a very costly.
- [56:08]
A
Because health insurance is often dependent upon full time employment. In France, Germany, other industrialized countries, that isn't the case. So you still keep your health care, you still keep your child care. 100% of 3 year olds are enrolled in public quality child care. In France, we're not talking about the same thing. We're also talking about different union influence in those countries, which is an equalizer and also helps to regulate work hours, shifts and days.
- [56:39]
B
And it's even true in Europe that the high quality of the public services and the safety net is a bit of an offset to the precarity that they also have. We have more precarity and less of a social offset.
- [56:56]
A
Absolutely.
- [56:57]
B
Dr. Farad, as so often. Thank you very much. We've come to the end of our time. I hope you have gotten as much as I have from understanding something that is crucial to evaluating any economic system, how it shapes the lives of its people. And you understood, as I have, that we live in a society that substitutes for the reality of taking seriously human relationships an endless talk about the family values of by the very people doing their utmost to undermine them. Thank you very much for staying with me. I look forward to talking with you again next week. It is. Sam.