The Jobless Summit and the Disappearing Middle Class
As America becomes more and more a nation of haves and have-nots; as the great middle class continues to shrink and the U.S. begins looking increasingly like a developing nation with rich and poor and little in between, the White House holds its big jobs summit today. Is it anything more than a photo-op? The answer to that question won’t be forthcoming right away. We need to watch closely to see if anything comes of this over the next couple of months.
The political need for this summit is obvious. The administration fears looking AWOL on this critically important issue as its attention gets diverted daily by health care reform and prosecuting multiple wars overseas. With deficits skyrocketing, there is no more White House appetite for additional government stimulus that creates what some argue are just temporary jobs anyway. Enter the Best and the Brightest from private industry as well as a few Nobel laureates to help lead the Obama administration out of the woods.
Presumably, someone at the White House has the guest list (and given recent events- will watch it carefully) but they’re not sharing it. We know Disney Chief, Bob Iger will be there as will Comcast’s Brian Roberts (how many folks will he be laying off in a year and half after the expected merger with NBC). Google’s Eric Schmidt will offer guidance as will newspaper columnists Paul Krugman (NY Times) and Alan Binder (Wall Street Journal). According to some conservative media outlets, we also know who won’t be there; the U.S. Chamber of Commerce and the National Federation of Independent Business. Neither has been friendly at all on issues like cap-and-trade and health care reform.
The Track Record on Summits
Do we have a guide on how idea talk-fests like these succeed? Not really- but I’m not optimistic. For example, did you know that Vice President Joe Biden is the guy in the administration who is in charge of the whole issue of the shrinking American middle class? He heads something called the Middle Class Task Force. On November 4th, The Vice President hosted a big forum on the issue at the Center for American Progress, a liberal think tank that served as the incubator of progressive thought during the exile of the Bush years. Here’s the White House.gov report on how that all went:
On Thursday at the Center for American Progress in Washington D.C., Vice President Biden moderated an in-depth discussion focusing on the long-term, structural challenges facing middle class families in today’s economy. Joined by a panel of policy experts, the group focused on broader issues such as the overall labor market in recent decades; shifting gender roles and the need for work-life balance in today’s economy; economic inequality and mobility; the increased gap between productivity and wages, and much more.
I like the “and much more” part. The White House promised there would be follow-up with the policy experts that took part. There’s no way to know at this point if that’s happened or not. It’s only been a month so I kind of doubt it.
The Middle Class is Vanishing
But as if you needed one- here is the most recent wake-up call on what is happening to the American middle class.
It comes from Elizabeth Warren, Chairperson of the Congressional Oversight Panel created to oversee the banking bailouts. How’s this for chilling:
Today, one in five Americans is unemployed, underemployed or just plain out of work. One in nine families can’t make the minimum payment on their credit cards. One in eight mortgages is in default or foreclosure. One in eight Americans is on food stamps. More than 120,000 families are filing for bankruptcy every month. The economic crisis has wiped more than $5 trillion from pensions and savings, has left family balance sheets upside down, and threatens to put ten million homeowners out on the street.
You remember how in the 1950’s, Dad went to 3-maritini lunches and brought home the bacon while Mom took care of the kids, baked apple pies and took valium? Well, that stereotype got busted wide open in the 1970’s and 80’s when economic pressures forced families to produce dual income-earners. With Mom and Dad both working, the joint incomes gave the appearance all was well- and affordable. But it has now caught up with us. Two incomes don’t cut it anymore. And increasingly, because of the jobless situation, the stresses increase exponentially when two incomes become one income or none at all.
Call to Action
We are in crisis here, folks. Middle Class Task Forces and Jobless Summits are not bad things. Ideas need to be discussed. Traditional orthodoxies, both liberal and conservative, need to be challenged. Tax cuts and hiring incentives for small businesses that end up employing most of America should be considered. We should think about reducing payroll taxes to give people a larger chunk of their own paychecks. Maybe Paul Krugman is right when he argues that the national deficit as a percentage of the total economy is actually quite small and that there is room for more government stimulus.
But at some point, the talking has to end and action is required. It is called leadership. If it’s true that the economy has changed to the point that many of the jobs that have been lost are never, ever coming back, then I can’t think of a single more pressing issue affecting the core of what people used to consider a prosperous nation. It had a name: the American Dream. Somebody, please, step up to the plate before that dream becomes completely unattainable for most of our citizens.