“Every would-be populist in American politics purports to defend the ‘middle class,'” wrote Barbara Ehrenreich and John Ehrenreich recently, “although there is no agreement on what it is.“
Back in 1977 the pair (then married) proposed that the American economy had created a new “professional and managerial class” (PMC) that expanded the upper-middle class from its base of successful bourgeois merchants to include doctors, lawyers, accountants, journalists, professors, social workers and other professionals, as well as middle and executive managers at major corporations. PMC members’ success showed that anybody could achieve wealth through education.
The PMC grew rapidly, from an estimated one per cent of workers in 1930 to 35 per cent of workers in 2006, just before the great crash of 2008. By the 1970s, professionals had education, confidence and enough wealth to start questioning some social effects of the capitalist economic structure.
That’s when the “capitalist class” started pushing back, cutting business workforces and pouring resources into union busting. As capitalists cut the workforce, they also cut the management class, the PMC.
What’s more, capitalists reached across borders and moved their businesses to cheaper labour pools in other countries, which also had weaker labour and environmental protections. That, along with the Internet, brought near-total collapse of the PMC as well as the blue-collar job markets.
Ah, but in the 1980s and 90s, economists forecast a coming “Information Economy,” where knowledge itself would generate revenue. Just as industrialization’s much more efficient tools supplanted the cottage industries, they promised, so too would digitization produce useful goods.
Maybe all that will happen in a generation or two. To date, mostly what we’re doing is eating our own young.
Industry after industry has fallen to technical disruption. On February 7, Dominic Blanc, who chairs Justin Trudeau’s economic advisory council, told a university conference that automation will take 40 percent of existing jobs within the next decade.
An Investopedia article names 20 industries “threatened” by technical changes, (I’ve added a few too) such as:
- travel agencies found their customers making their own bookings online;
- tax accountants lost business to tax software programs;
- newspapers lost their subscribers and their lucrative classified advertising market to free online services;
- Secretaries, switchboard operators and executive assistants have lost their jobs to answering systems, online calendars and tailored software;
- bookstores have closed everywhere as people order their books online;
- employment agencies have had to compete with online listings and networks like Linked-in;
- postal workers have much less mail to sort or deliver;
- the whole film manufacturing and developing industry has folded with the advent of digital cameras;
- ATMs and online banking are replacing bank counter clerks;
- most corporations have flattened their structures, trimming middle management;
- self-serve check-outs are replacing cashiers;
- pre-recorded playlists (like Clear Channel in the US) have replaced most radio DJs;
- hotels and motels are challenged by AirBnB and HomeAway;
- taxis and couriers are challenged by Uber and Lyft;
- driverless cars may do away with driving jobs altogether, although right now truck driving is the second-largest occupation in North America;
- Napster crashed the U.S. music and movie industry business model; and of course,
- as U.S. student debts top $1.3 trillion, universities have to compete with MOOCs (Massive Open Online Courses) like Udemy, Coursera and the Khan Academy, which make higher education available even to students who can’t afford university tuition.
Hold on, because that’s just the beginning of the list. The Paris Agreement calls on fossil fuel industries to restrict current activities, let alone explore for more resources. Banks and financial industries already compete with online services. On the horizon is “blockchain” software that promises security for anonymous financial dealings, such as Bitcoin. Meanwhile, a whole generation of computer experts is becoming obsolete as smartphones and tablets replace desktops and laptops.
Consumer spending drives 70 per cent of the economy, yet retail stores are folding in the face of Walmarts and online catalogues. Supermarkets may be next, as more people can order online from local warehouses that send out vans for local delivery. Amazon has said it will add groceries to its online products, with drone delivery within 30 minutes in urban areas.
So where are the new industries, the new jobs? Gigs like Uber and AirBnB seem almost regressive, stepping back from health and safety standards, and paying the worker even less than the industry does. Amazon’s monitored warehouse workers might well envy the bored department store clerk.
Sometimes it seems like there isn’t enough work to go around. Scratch that: the world is full of essential tasks that need to be done. What we lack are ways to pay people to do them. There certainly aren’t enough paid jobs.
On the other hand, maybe capitalism has just reached the earthly limits of constant growth. Maybe this is the tipping point forteold by 1950s futurists, when robots take over dirty and dangerous jobs, computers handle personal and corporate transactions, and people like you and me receive Basic Annual Incomes (plus housing if we need it) to keep the retail economy going.
We live in a time of paradoxes. Sixty-three million refugees are on the move globally, fleeing war and famine — famine in four countries simultaneously. At the same time, U.S. corporations are sitting on $1.9 trillion in their bank accounts, not invested in any active enterprises at all — despite the tax breaks they get as “job creators.” Everybody is waiting for the next innovation.
Here’s an innovative idea: let’s share! Let’s suppose two ideas about the futurel 1) Whatever you think of capitalism, the global economy is in flux, and will be volatile for quite a while. 2) Humans are much less inclined to ignite conflicts when they have their basic needs met.
We have a choice. We can step in and share necessities. Or we can throw up our hands in horror and let shortages cause tensions that develop into war, which is capitalism’s usual method for re-booting the economy.
Now is the time to kickstart a true sharing economy. The government could start by funding start-up groups dedicated to establishing national and local sustainable housing (and co-housing) programs, universal connectivity, and geothermal greenhouse farming everywhere across Canada.
Maybe an unemployed coal miner can’t become a computer programmer, but almost anybody can learn how to retrofit homes, from insulation to solar panels. Maybe we can use sustainable technology in a way that means that Indigenous people don’t have to pay $12 for a fresh tomato or travel far from home to get a high school education.
The Ehrenreichs say the Professional Managerial Class rose in the 1930s and started to fade early in the 21st century, lasting barely 100 years. Instead, in recent decades, the educated middle class spiralled down into service jobs as wealth was sucked upwards.
Last January, Oxfam announced that eight individuals controlled as much wealth ($426 billion US) as all of the poorest 3.6 billion people on earth. Such are the wages of unfettered free markets. No wonder Bernie Sanders found that Americans are finally receptive to the phrase, “democratic socialism.”
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