What should liberals be trying to accomplish? by @DavidOAtkins

What should liberals be trying to accomplish?

by David Atkins

For all his inane and sophomoric blather, Thomas Friedman is right about one thing: globalization has changed the face of the world economy in a profound way. Almost any job that doesn’t involve face-to-face interaction or infrastructure building can ultimately be outsourced on the global labor market. In terms of major economic shifts in America, the main focus of the last several decades has been on the loss of domestic blue-collar manufacturing jobs or service jobs like drive-through window ordering and technical support centers. But white-collar jobs aren’t safe, either: technology already allows radiologists, IT technicians and similar occupations to be outsourced. Within a few years, communications technology will challenge domestic legal, education and finance professionals as well.

It has been the basic goal of 20th century liberalism to build and sustain a large middle-class, country by country, through protectionist trade policies, union organizing and, most importantly, investments in education, infrastructure and the social safety net. That focus worked–for a time. But the last twenty years of globalization have been changing all that.

Of course, it is true that the liberal program has been under assault from the direct intervention of plutocrats and their allies, who have relentlessly crafted economic policies designed to destroy the middle class. But it’s also true that that the plutocratic agenda has been made possible by the existence of a more globalized world in which to ply the politics of global labor arbitrage. More simply, it used to be that Henry Ford paid his employees well, because paying them well ensured a good, stable middle-class market for the purchase of his cars. A modern Henry Ford need not pay his employees well, since the cost of overseas labor is incredibly low, and the biggest growth market for cars lies outside the United States, anyway. A modern Henry Ford no longer needs the American middle class.

This point was well argued by Ismael Hossein-Zadeh in his recent essay “Keynesian versus Marxian Explanations” in Counterpunch. The whole thing is worth a read, but the conclusion sums up his argument succinctly:

To sum up, the Marxian theory of unemployment, based on his theory of the reserve army of labor, provides a much better explanation of the protracted high levels of unemployment than the Keynesian view that attributes the plague of unemployment to the “misguided” or “bad” policies of Neoliberalism. Likewise, the Marxian theory of subsistence or near-poverty wages, also based on his theory of the reserve army of labor, provides a more satisfactory understanding of how or why such poverty levels of wages, as well as a generalized or nationwide predominance of misery, can go hand-in-hand with “healthy” or high levels of corporate profits than the Keynesian perceptions, which view a high level of wages as a necessary condition for a “virtuous” or expansionary economic cycle. Perhaps more importantly, the Marxian view that meaningful, lasting economic safety-net programs can be carried out only through overwhelming pressure from the masses—and only on a coordinated global level—provides a more logical and promising solution to the problem of economic hardship for the overwhelming majority of the world population than the neat, purely intellectual, and apolitical Keynesian stimulus packages on a national level, which are based on the hope or illusion that the government can control and manage capitalism “in the interest of all.” No matter how long or loud or passionately our good-hearted Keynesians beg for jobs and other New Deal-type reform programs, their pleas for the implementation of such programs are bound to be ignored by the government of big business. Only by mobilizing the masses of workers and other grassroots and fighting, instead of begging, for an equitable share of what is truly the product of their labor, the wealth of nations, can the working majority achieve economic security and human dignity.

There’s an implicit and uncomfortable moral argument to be made against latter 20th century Keynesianism as well: why, in fact, should an American worker make a good middle class income and drive a BMW, when a worker in Malaysia could do the same work for 1/10 the money while climbing out of abject poverty? The usual answer from Democratic politicians is rooted in nationalism and Americana, which is fine politics, but less than adequate morality. A more rational argument is that if you follow that process to its logical conclusion, there won’t be a middle class consumer market for the product the worker is creating. But that’s not so certain, either, as countries like China, Russia, Brazil and India (the BRICs) grow their own middle classes.

The reality of globalization is that almost all work that doesn’t require either very specialized skills or face-to-face personal attention will eventually be fungible on a nearly limitless and desperate global labor market. Specialized skill jobs are few and far between; whole economies can’t run on them. Face-to-face personal attention jobs don’t typically pay very well.

So…whither liberalism in that context? Given the current capital consumer economy, progressives are fighting a battle we cannot win, attempting to protect a developed-world middle class from the encroachments of developing world underclass eager to do the same work for 1/10 the wages. Morally speaking, it might not even be a battle we should win. Those who would stop world trade and technological advancement in order to protect an American middle-class lifestyle at the expense of an impoverished Brazilian can hardly lay claim to the moral high ground.

But that doesn’t mean the answer is to allow the plutocrats to engineer a world with themselves at the very top lavished with unprecedented wealth, a small technocratic class below them, and a vast impoverished underclass consisting of 90% of society beneath them. The workers of the world must indeed fight back, while rejecting the horrific historical errors of state-based Communism.

The pushback must be on a global scale if it is to happen at all. No one nation’s middle-class can stand alone against the global labor arbitrage juggernaut. Liberalism must go big or go home.

There is evidence of just such a global consciousness beginning to emerge. It can be seen in the solidarity between the Occupy movement in America, and the protesters in Tahrir Square. But just what that solidarity will look like, and what sort of new order it might produce, must be the subjects of debate for progressives over the next few decades.

Laissez-faire economists have been proven wrong in their vision of the world–not to mention morally bankrupt. But insofar as Keynes was ever right, the world has in many ways moved beyond him. The future of the world will belong to people and intellectuals who can organize on behalf of dignity and a fair economy for workers worldwide in a new global economic system that is willing to try out new solutions to increasingly vexing problems.

Otherwise, the structural underpinnings of capitalism and globalization will inevitably leave us all in the hands of the plutocrats.