Rage Against the Machine

The occupy movement is a Rage Against the Machine. The top 1% is grabbing 58% of the small economic growth that is occurring. We all complain and blame this event, or that group of people, but there are many reasons for our current predicament. Tyler Cowen is his e-book “The Great Stagnation” discusses the wonderful new time saving devices that have streamlined our lives. The only problem is these streamlines have made us more productive in the workplace. More productivity means less of a requirement for labor. Thus we have a higher natural rate of unemployment. We may just have to live with 7 – 9% unemployment.

What some are calling the golden age of manufacturing is gone. We cannot look to manufacturing to provide opportunities for a strong middle class, therefore we need to look in different directions, which will probably mean harder work and higher prices for the food and basic goods we purchase.
Business Week alludes to this in an article entitled “Do you want this job.” It discusses how many jobs that used to be filled by immigrants are now sitting vacant because Americans won’t do the work for the level of pay associated with the job. In September Alabama passed a law requiring police to question people they suspect of being in the US illegally. This also includes a punishment for any company that hires illegal aliens. HB56 has not only scared off illegals, but also legal immigrants who fear being harassed. My wife and I had quite a debate  this morning about basic human rights, but that is another blog entry.

The fact is Hispanic workers who come to the US do the work we don’t want to do. Alabama has 211,000 people who are out of work. Rural Alabama has an 18.2% unemployment rate, so there are plenty of people who could fill these jobs. These jobs have been vacated by the “thousands of immigrant field hands, hotel housekeepers, dishwashers, chicken plant employees, and construction workers who have fled Alabama for other states.” These jobs are going unfilled because the 211,000 Americans that are out of work don’t want the type of jobs that are available. One business owner said, “I have 158 jobs, and I need to give them to somebody.”

Why won’t native Alabamians do these jobs that require manual labor? Is it because they are lazy? I don’t think so, I think it is because of the level of pay. One businessman stated, “Don’t tell me an Alabamian can’t work out in a field picking produce because it’s hot and labor intensive. Go into a steel mill. Go into a foundry. Go into numerous other occupations and tell them Alabamians don’t like this work because it’s hot and it requires manual labor.” The difference between a mill job and a field job is the level of pay and benefits. The hot and dirty mill job pays a livable salary and provides benefits. The field job does not.

I remember a few years back when I was in the union. In 1977 we went out on strike, and things were tight. Another Boeing employee and I decided to pick grapes in LaCenter. We both had delusions of grandeur about the amount of money we would make. I made $5 for eight hours of labor. It was hard back breaking work. I never went back. In Alabama tomato pickers will make $2 per basket and $600 for clearing the field after all tomatoes had been picked. Tough work for little pay.

Why do these type of jobs pay so little? There are many reasons, but we have to take blame for part of it. Why do corporations fail to question contractors in other countries about using underage labor in sweatshop conditions? Why won’t farmers and hotels pay higher wages for employees? It is the consumer who wants to pay low prices for everything they purchase. Therefore the competition for our dollar is intense. To be able to compete the cost of labor must be held down.

Saturday is a special day. It is a day that we can support small businesses. We may have to pay a little more that normal, but this is where we can make a statement. For the good of our country, and helping the little guy, we need to pay a little more for goods. If we really want to put Americans back to work that is what we need to do. If we want Americans to do these dirty jobs then we need to pay higher prices for our goods so the farmers can pay higher wages. If we want the unemployed to clean hotel rooms then we’ll need to pay higher fees. The question is, are we willing to do this? There is a huge cost to low prices.

And that is my thought for the day!

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