Anyone who doubts that there are plenty of reasons for middle and working class Americans to be pissed off need only read a few articles from today's New York Times Business Section (which is consistently the best section of that newspaper).
First, from NYT labor reporter Steven Greenhouse, is an excerpt of his book The Big Squeeze: Tough Time For the American Worker. Greenhouse tells the story of Jean Capobianco, who worked with her husband as a truck driver until she got breast cancer, had a mastectomy, and was abandoned by her husband because he no longer found her sexually attractive.
Capobianco ended up working for Roadway Package Systems, which was subsequently purchased by FedEx Ground. Capobianco put in 12 hour days. She was eventually forced to buy her own truck and FedEx Ground classified her an independent contractor. To lure drivers, the company promises yearly pay of $60,000, but Capobianco figured that after all her costs—truck payments, maintenance and repairs, gas, insurance, uniforms, business equipment, etc—-that her net pay was barely over $30,000 per year, working out to less than $11.00 an hour.
Then things got worse.
Many drivers find it hard to walk away because they have invested so much in their trucks. If they leave, they might still be stuck with years of monthly payments and the final payment of $8,000.
One morning in August 2004, Jean doubled over in pain. Three days later, her doctor informed her she had ovarian cancer.
"The doctor told me to stop working immediately," Jean said. She not only finished her route that Friday but worked the following Monday and Tuesday as she struggled to find someone to cover her route. Her terminal’s two replacement drivers demanded unrealistic amounts, she said. "They knew they had me over a barrel."
On Aug. 21, 2004, surgeons removed a large, malignant tumor and did a hysterectomy. The next week the doctors told her she had Stage 4 cancer that had spread to her lungs. She would need chemotherapy through late December.
Jean had twice beaten breast cancer, and she was intent on beating this, too. She fully expected to return to her job in January, and called FedEx Ground’s headquarters to request a leave of absence. Weeks later, a letter arrived saying she was terminated.
"I was crazy with anger," she said.
Fired and with no income, Jean stopped making payments on her truck. She had already paid more than $40,000 on it, but now she was powerless to prevent it from being repossessed.
"Ten years of beating my brains out for them, and they throw me away like I was a piece of garbage," Jean said.
FedEx's treatment of people who appear by almost any standard as employees but are treated for tax purposes as independent contractors has prompted numerous lawsuits. It's possible that their scheme will eventually be ruled illegal. But for too many workers, being thrown away like they're a piece of garbage is too familiar.
The job pressures on Americans have been mounting for many years. NYT reporter Louis Uchitelle has been writing about the effects of layoffs and corporate downsizing for years, including a book, The Disposable American: Layoffs and their Consequences. Many Americans are understandably worried about losing their jobs. But as Uchitelle describes this morning, worries about the existence of jobs may mean that not enough attention is being given to the fact that increasing numbers of jobs pay too little to keep workers in the middle class
Leaving aside for a moment those who have lost their jobs, what of those who still have them? Once upon a time, a large number earned at least $20 an hour, or its inflation-adjusted equivalent, and now so many of them don’t.
The $20 hourly wage, introduced on a huge scale in the middle of the last century, allowed masses of Americans with no more than a high school education to rise to the middle class. It was a marker, of sorts. And it is on its way to extinction.
[...]
The nation’s political leaders — Democrats and Republicans alike — have argued that education and training are a route back to middle-class wages for those who have fallen out. But the demand isn’t sufficient to absorb all the workers that the leaders would educate. Even now, roughly 15 percent of college-educated workers find themselves in jobs for which they are overqualified, the Economic Policy Institute reports, and many of these jobs pay less than $20 an hour.
"People are mainly worried about having a job and only secondly what it pays and whether they are gaining ground," said Frank Levy, a labor economist at the Massachusetts Institute of Technology, trying to explain the absence of an outcry and a political debate in which the candidates do not quantify the decline. "If you aren’t gaining ground," Mr. Levy added, "then you look for other ways to pay for consumption, going into debt or, until recently, refinancing your home."
[...]
That basic wage blossomed first in the auto industry in 1948 and served, in effect, as a banner in the ideological struggle with the Soviet Union. As the news media frequently noted, salt-of-the-earth American workers were earning enough to pay for comforts that their counterparts behind the Iron Curtain could not afford.
As the years passed, unions succeeded in negotiating this basic wage not as an ultimate goal but as an early rung in their wage ladders. That was the union standard, particularly in heavy industries, and in the early postwar decades nonunion employers fell into line, spreading middle-class incomes broadly through the service sector.
"The most important model that rolled off the Detroit assembly lines in the 20th century," said Harley Shaiken, a labor economist at the University of California at Berkeley, "was the middle class for blue-collar workers."
The high point came in the 1970s, just as the United States was beginning to lose its controlling grip on the economies of the non-Communist world. Since then the percentage of people earning at least $20 an hour has eroded in every sector of the economy, falling last year to 18 percent of all hourly workers from 23 percent in 1979 — a gradual unwinding of the post-World War II gains.
The decline is greatest in manufacturing, where only 1.9 million hourly workers still earn that much. That’s down nearly 60 percent since 1979, the Bureau of Labor Statistics reports.
Lost jobs and declining wages are, of course, related. Sending jobs offshore has weakened unions, driven down wage, and cut the number of manufacturing jobs, even as the workforce continues to grow. Thus, workers are too willing to work for less out of insecurities about not having any job. And when they make less, they also are less likely to save, especially if they're trying to maintain a lifestyle, much less attain a higher standard of living. And most American families aren't even treading water. As the Times reported a few weeks ago:
In 2000, at the end of the previous economic expansion, the median American family made about $61,000, according to the Census Bureau’s inflation-adjusted numbers. In 2007, in what looks to have been the final year of the most recent expansion, the median family, amazingly, seems to have made less — about $60,500.
This has never happened before, at least not for as long as the government has been keeping records. In every other expansion since World War II, the buying power of most American families grew while the economy did. You can think of this as the most basic test of an economy’s health: does it produce ever-rising living standards for its citizens?
In the second half of the 20th century, the United States passed the test in a way that arguably no other country ever has. It became, as the cliché goes, the richest country on earth. Now, though, most families aren’t getting any richer.
In the presidential campaign there's continual back and forth on the micro-issue of the day. There's a lot of talk about problems that have come up in recent years, that may involved wrenching decisions, like what to do about Iraq, and which are in the forefront of the public's eye. And of course health care will dominate much of the policy debate after the next president is inaugurated eight months from today.
There are a few challenges, however, that should have equal prominence in the policy debates over the next few years, because they address the sustainability of our lifestyles and indeed, of the earth. We need to deal with how we feed the planet. Closely related—because much of the current global food crisis is tied to the spike in biofuels production and higher operating and transportations costs, and even if financial problems are managed these problems will persist—is the need for a sustainable energy policy. Energy and agriculture/land use will have to be part of a global strategy to reduce carbon emissions and deal with global warming.
Finally, growing the American middle class, mitigating the growing income and wealth disparities and ensuring a high quality of life is essential, both for our national well-being and, assuming Democrats control the Congress and the White House, for Democrats' political fortunes. Growing the American middle class, lifting people from poverty, ensuring a high quality of life, and doing all these things in a way that's globally sustainable is probably the most daunting set of challenges America has faced since the Great Depression and the fight against fascism. Let's hope our elected officials are up to the task, and let's hope America can meet the challenge.