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Working America: The Shoes Tell The Story

People are working longer hours, often without more pay. Americans have less vacation time than most workers in other industrialized nations. With staff cuts and job pressures many Americans take less and less of their vacation time - and more and more they bring their work with them on vacation, holidays and weekends. Seeing working conditions in the world of “always on” is what Nike’s plugged into with their impulsive smart sneaker slogan “Just Do It!” - and Reebok plugged into it with the more explanatory “Life is Short, Play Hard.” Not working isn’t easy, and leisure is virtually unknown.

Not working isn’t easy, but unemployment and more commonly underemployment isn’t easier. There is greater job insecurity. The greater expectation of changing jobs and careers frequently over a lifetime provides no compensation for lost vacation and pay, the traditional benefits of seniority and experience. With the exception of middle-aged women, there is a general trend of workers having less and less tenure in jobs - and women likely have increased their tenure because more have entered the job force on a permanent basis, out of necessity, with many women earning more than their spouse, contributing to a greater say in women’s career decisions. Since one paycheck is often not enough for a family, and there is little job security, two wage earner families have increased out of necessity (Salon subscribers read uncut original). Two wage earning households are now the norm, and families with young children are even more likely to have two wage earners (over 60%). The work/life balancing act is too often a cruel joke - and the source of readers for self-help books. The massive restructuring of American employment, not limited to areas like manufacturing, air travel, telecommunications and the computer industry, has meant many workers are being laid off - often in their prime working years. Americans that are laid off and take another job often take significant pay and benefit cuts.

Well, as bad as that is, at least American workers can look forward to their retirement. Oh, wait. We’re losing that too.

Retirement - Another Wage Cut For Workers

At the very time that defined pensions (i.e. pensions with guaranteed payoff amounts for life) are threatened by company bankruptcies and the increasing insolvency of the federal agency set up to insure the pensions, at a time when the stock market has remained stagnant for four years and interest rates are low which hurts those on 401K Plans and fixed incomes, Republicans are talking about how to eliminate the security of Social Security - or at least reduce what it pays. They propose to bankrupt Social Security by increasing its obligations (permitting people to gamble some portion of Social Security money in the stock market - money that would otherwise go to paying out fixed (secure) benefits) - or else they are talking about outright Social Security benefit cuts that could amount to a third of monthly benefit payments in my lifetime (I’m 34), and 45.9% by 2075. The Bush Administration is proposing a future for seniors that was our distant, dismal past - the “other America” of senior poverty and destitution.

[Click below to read more on Why Retirement Matters - Transferring Wealth and Impoverishing Ordinary America]

Why Retirement Matters - Transferring Wealth and Impoverishing Ordinary America

So, other than the fact that most of us hope to retire with a secure income some day, why should we care? This is where Dan Conley gets it wrong on Social Security - and he isn’t the only one with a similar view - it isn’t about your retirement - it’s about everyone’s retirement, and America’s economic future.

We all know that Bush taxes have transferred the burden of taxation increasingly to working wages and away from investment income by lowering the capital gains tax. This has the effect of taxing lower, middle and even upper-middle income people proportionately more than the wealthiest in our society. Changes in retirement plans are doing the same thing. When airline pilots, who used to represent a comfortable upper-middle class income, stand to lose as much as 60% or more of their retirement money because of airline bankruptcies and the limits of the Pension Benefit Guaranty Corp., the federal agency insuring defined-benefit pensions, you see a major wealth transfer - and the possibility of middle class political action. The same is true of Lucent employees who fear their pension may be taken over by the Pension Benefit Guaranty Corp. resulting in lost retirement funds for some according to the federal organization’s formula. How does America lose from this loss of retirement funding?

Elder Care

Who Pays? Today we live in an America where the best predictor of your children’s education and the best predictor of your children’s income is your own - upward mobility in America is a myth for most people. As tragic as that is for the prospects of poor and lower-middle class families and even some solidly middle class families, in the perspective of elder care it means their parents, those most likely to find housing and health care unaffordable, will tend to be cared for by the families least able to sustain them. While this is true now, the reduction of Social Security and retirement pension income/benefits (i.e. healthcare) makes a bad problem worse. More and more elderly people who are without families, or without families willing to take them in, will become either homeless or wards of the state - especially if they face high healthcare costs.

As bad as taking care of parents may strain the family budget, elder care has other important implications for the modern family.

Mobility Restrictions. At a time when employment often requires moving to locate near the new job, elder care can force the choice between abandoning one’s frail parents and taking a job to sustain the family. Even if a family does not move from the home, the medical requirements of elderly parents may make it impossible for their care-giving children to maintain certain types of jobs.

Elder Abuse. Forced by economic circumstances to depend on children who never expected to live with and support their parents, or at least not soon, it doesn’t take a genius to figure out that domestic abuse and neglect are likely to rise. This is made all the worse by the likelihood in many more modest families of insufficient living space and resources.

Social and Economic Impact on Communities and the Nation

Retirees are consumers and supporters of communities. Many of sufficient means support charities through donations and volunteering. Forcing them to work extra years, if they are able to, or cut back on expenses, if they can, to make ends meet takes away the time and/or funds necessary to support charities and community groups at the same time that increased elderly employment deprives younger workers from holding jobs, and in general contributes to depressed wages. Social Security and retirement funds add to our economy by giving money to many people who will spend it either out of necessity or choice. It is a broad based way of supporting jobs that come from substantial senior spending, from grocery stores and healthcare, to entertainment and travel.

Conclusion

Ryan Lizza in a recent New Republic article “WHITE HOUSE WATCH: Hardball 101″ explains the case for Democrats learning lessons in “hardball” from the Republican experience killing Clinton’s health care bill in 1993 and 1994. I would add, from my first blog entry, that it is generally easier to do nothing than it is to do something. Historically this has worked in favor of the “small government” Republicans - but since those actually legislating small government and fiscal responsibility are not in power - Democrats are poised to take the advantage. In the case of Social Security, doing nothing works in the Democrats (and the people’s) interest by preserving the Social Security program uncut. We have decades to deal with Social Security’s relatively small deficits that may or may not materialize. We can pick our time to do what is financially and morally right for retirees.

The Lizza article is also notable for it’s concluding paragraph:

“It’s not just about Social Security. The Republicans knew in 1993 that they were not just engaged in a fight over health care but over the future of their own party. In a memo, conservative operative Bill Kristol warned Republicans that they had to ‘kill’ rather than amend Clinton’s proposal. Its success ‘will re-legitimize middle-class dependence for ’security’ on government spending and regulation,’ he wrote. ‘It will revive the reputation of the party that spends and regulates, the Democrats, as the generous protector of middle-class interests. And it will at the same time strike a punishing blow against Republican claims to defend the middle-class by restraining government.’ An almost perfect mirror-image of those sentiments applies to Bush’s proposal and the Democrats’ situation today. Democratic strategist James Carville succinctly echoed this point recently. Speaking privately to one of the Senate leaders charged with formulating a strategy to defeat Bush’s plan, he warned, ‘You’re the only thing standing in between Democrats and the abyss.’ No wonder Democrats are so united.”

Lizza is wrong when he suggests, “An almost perfect mirror-image of those sentiments applies to Bush’s proposal and the Democrats’ situation today.” The difference is that middle class voters have a real and clear (if Democrats will only articulate it) choice: voters must choose if the vast majority wants the benefits of smart public investment of their taxes - or if they want to pay taxes to invest in tax breaks for the wealthy few, bankrupting public programs that work, like Social Security. It sounds like class politics - and class politics is what Bush and the Republicans are waging. Democrats need to call them on it. As I’ve described above, for Democrats the theme of domestic security is a winning issue - if they will only address it. Democrats must advocate security in retirement, healthcare and employment, among other areas. They must provide the security that other, civilized industrialized nations have long provided for their people. Democrats must show through words and deeds that they care about people’s lives. I’ll take up healthcare and employment in future posts.