Hillary Clinton and the Demise of the Working Class

None other than the official mouthpiece for the American aristocracy, the New York Times, reported recently that a bit over 100% of the jobs created in the U.S. in the last decade were ‘non-traditional,’ meaning that they were job-like without really being jobs. The report was based on a new paper by economists Lawrence Katz and Alan Krueger that otherwise confirms ‘outsider’ accounts of the increasingly tenuous nature of working life in the developed West.

That it would take economists this long to get around to ‘discovering’ what has been known to most working people for the last several decades is testament to the insularity of the economics ‘profession.’ And while Messrs. Katz and Krueger are cautious enough to avoid drawing inconvenient conclusions as to precise causes and their social effects, the disaffection exhibited in the current political season offers answers of a sort.

The trend toward what is being called the ‘gig’ economy, or in the terminology of professional economists: ‘labor market flexibility,’ has been the goal of said economists, assorted and sundry international capitalists and corporate-state politicians for the last four decades. At this point in history it is safe to suggest that it is only the unsettled mood of ‘the electorate’ that makes this worthy of official comment other than satisfaction with a job well done.

In the early 1990s Republican ‘revolutionary’ Newt Gingrich joined Bill and Hillary Clinton to pass the NAFTA ‘free-trade’ pact with an articulated vision of what this gig economy might look like. Individual ‘producers’ would sell their individually produced wares without regular incomes, health care or pensions in a world where actual human needs are but a matter of opinion. Messrs. Katz and Krueger are more circumspect, but to repeat: labor flexibility of the contingent employment sort has long been a shibboleth of capitalist economics.

The employers have now all the cards, enjoying complete market advantage and flexibility. Capitalism has reached its natural conclusion: the people exist to serve “the economy” and not the other way around. 

In the particular terms of the report, the modern workforce is a world of independent contractors, temporary workers, Uber drivers and piece workers all plying their respective trades in the ether of the internet. The rate of growth of these contingent jobs, over 100% in a decade, is testament to the ingenuity of employers once all constraints of social accountability have been removed from consideration. And most certainly the assumption of student debt, thirty-year home mortgages and car payments takes on new meaning when the certainty of a paycheck has a half-life measured in minutes.

Where Hillary Clinton fits into all of this is as stalwart of a Democratic Party establishment that long ago assumed the role of ‘liberating’ labor from a steady paycheck so as to get in the good graces of Wall Street and the corner suites of corporate America. And this program didn’t arise in a vacuum— the policies behind the shift are a mix of neoliberal orthodoxy with longstanding IMF ‘workout’ practices crafted for the benefit of Wall Street. That Democrats are the more effective proponents of ruling class interests remains a conceptual challenge for the Party’s more fact-averse constituents.

Hillary Clinton can criticize Wall Street all she cares to but her economic policies have proceeded from the very same economic premises. Old style corruption, the exchange of money for specific acts, has been traded for a theology of eternally fluid market relationships— a competition of all against all, that never got around to ‘liberating’ the dependent class of connected insiders that now runs things from its dependence. And in fact, it was her ability to navigate this realm of connected insiders that only a few short weeks ago was touted as her ‘comparative advantage.’

The American labor market, to the extent that such a thing has a clear line of demarcation around it, is partially a reflection of the state of labor globally. ‘Flexible’ labor that isn’t paid and does what ‘it’ is told is a partial description of slavery. That the ‘new economy’ envisioned by establishment Democrats is premised in business management practices developed and used on Southern plantations to ‘manage’ slave labor ties to the broader neoliberal tendencies of the Democratic establishment.

When Bill Clinton joined with Congressional Republicans to ‘end welfare as we know it’ he used a left critique of welfare as engineered dependency to sell policies beneficial to connected capitalists. Mr. Clinton could have developed a government jobs program to employ welfare recipients under terms that brought them into the middle class. Instead he chose the punitive route of ‘freeing’ them to compete in labor markets as part of an increasingly desperate reserve army of the unemployed. And low-and-behold, we now see a newly contingent labor market.

When President Obama recently visited Cuba he took his Secretary of Agriculture, Tom Vilsack, with him to sell the Cubans American (industrial) agricultural products. This effort is interesting because, while agriculture has long been a ‘special case’ in international trade, the imperialist motive was showing. As agricultural economist Miguel Altieri explains here, Cuba has only recently begun to recover from an ‘efficient,’ import-dependent, agricultural system to redevelop integrated indigenous agriculture that is sustainable to feed the people of Cuba.

It was precisely this type of indigenous agriculture that the Clintons destroyed in Mexico when Bill Clinton passed NAFTA. The effects of ‘free-trade’ aren’t an economic ‘error’ that can be explained away as such— NAFTA was an essential part of the American imperial project sold by fully culpable liberals through a network of U.S. trained economists.

Illustrated conceptually in the chart above is that GDP growth (compensated production) can be touted by forcing people out of indigenous economic production into factory work without improving their economic wellbeing. As with the case of Cuba, economists touting imported economic ‘efficiency’ that destroyed existing economic relationships only counted what was gained and not what was lost. This same basic idea lies behind the capitalist practice of using the world as an industrial toilet— air, water, food and social relations are considered disposable without consequence until they have been commodified.

Trade agreements like NAFTA are usually debated in terms of growth in GDP, and occasionally in terms of jobs gained or lost. (In social benefit terms, GDP growth, the mantra of so many mainstream economists, politicians, and business observers, is actually useless as a yardstick of society-wide well-being. The far more telling index is how the economy’s product is actually distributed. The worse the inequality, the more meaningless any advances in GDP.—Editor) But in an important sense these are tangential to the broader facts of the capitalist-imperialist project to take over the world. Not only did NAFTA destroy a large, integrated indigenous economy in Mexico, but the newly ‘freed’ Mexican peasants were driven to migrate northward to exist at the bottom rungs of the American economy. Donald Trump effectively framed this forced migration in xenophobic terms for an American workforce made ‘contingent’ by bourgeois liberals doing the dirty work of global capitalists.

To be clear, this isn’t labor ‘arbitrage,’ the ‘exchange’ of expensive American labor for cheaper overseas labor— it is imperialism designed to immiserate the Mexican population for the benefit of multi-national corporations based largely in the US. American agribusiness moved into Mexico en masse (link above) after NAFTA was passed to control the Mexican food supply while reducing its population to wage-slave status. Newly ‘freed’ labor was forced to take whatever wages the new American employers were offering.

‘Labor arbitrage,’ the theory that much labor is ‘homogeneous,’ and therefore readily substitutable based on relative prices, is superficially attractive. Falling wages in developed countries will be offset by cheaper consumer goods (from imports) while rising wages in developing countries will contribute to increased economic wellbeing. And in fact, this has been the general outcome if one accepts the way that outcomes are counted by proponents of globalization. Sure, economic dislocations and contingencies may diminish the lives and livelihoods of a few hundred million people, but such is the price of ‘progress.’

In fact, the frame of homogenous labor is categorical in a way that substantially misrepresents the embeddedness of life. The history of capitalism runs from slavery through genocide against indigenous peoples to wars for economic resources and on to mass displacements like forced migrations. In the broader scope of human history where actual outcomes matter this view of labor as dis-embedded and disembodied is sociopathic, if not psychopathic. Its conceptual appeal is that it counts only what proponents of capitalism want to count while excluding the overwhelming residual of human existence.

As with the case of displaced Mexican peasants and the newly contingent labor force in the U.S., no one asked the recipients of this ‘gift’ from on high if they wanted to participate in the process. Additionally, in justifying the process Western economists only count what is visible to them— that which has been effectively commodified, and never deduct the losses. The great ‘mystery’ of looming environmental catastrophe can be partially understood through economic theories that place concrete value on high definition televisions, toaster ovens and trips to Disneyland but no value on drinkable water, arable land and breathable air until they are ‘rare’ enough to be commodified.

The American political establishment’s current economic program includes passing the TPP and TTIP trade agreements. As Mr. Obama’s Secretary of State Mrs. Clinton ‘softened up’ future WalMart suppliers in Honduras, Libya, Syria and Iraq while publicly selling Mr. Obama’s TPP some forty-five times before (implausibly) opposing it. Left unsaid so far is that it was Mr. Obama’s reign as President that coincided with the ‘great recovery’ in contingent jobs in the US. While the trend toward contingent employment preceded Mr. Obama, his steadfastness in promoting neoliberal policies in the face of the devastation they have wreaked on the lives and livelihoods of his nominal constituents might have given pause to less determined establishment stalwarts.

The great ‘mystery’ of looming environmental catastrophe can be partially understood through economic theories that place concrete value on high definition televisions, toaster ovens and trips to Disneyland but no value on drinkable water, arable land and breathable air until they are ‘rare’ enough to be commodified…

President Obama has repeatedly cited both GDP growth and the number of jobs created since he took office in 2009. The fact is that these jobs are qualitatively different from those that preceded them in ways that growing political disaffection is making evident. And here’s the joke— once GDP growth and jobs gained or lost are discounted there is little left for capitalist politicians and economists to sell. Both measures are generic in the sense that they are categorical, they hide more than they illuminate by design. The economists who developed them tended to be quite humble about their broader social significance. Those that followed have little else to support their ideologies.

Anyone with eyes can see that capitalism has changed the Western world. The question not asked is what was lost for what has been gained? Capitalism exists as the choice between Coke or Pepsi, not at the level of people living their lives as they see fit. The ISDS (Investor-State Dispute Settlement) provisions of Barack Obama’s TPP and TTIP ‘trade’ agreements lay bare the imperialist goals that have been behind ‘free-trade’ policies since Jimmy Carter was in office. The goals of the American political establishment are those of Wall Street and major corporations, not monolithic except in the sense of promoting systems of domination and control

Hillary Clinton and the other Presidential candidates are bit players here. It isn’t that an ‘outsider’ candidate like Bernie Sanders can’t affect the trajectory of Western capitalism. But the challenge of doing so goes far beyond issues to be resolved through electoral politics. That the ideas and practices used to ‘manage’ slaves still dominate the economic programs of the American political establishment speaks to the persistence of Western imperialism. Capitalism is the ideology of this imperialism as can be seen by what its proponents do and don’t ‘count’ as its product. And the most effective proponents of this program come from the nominal Party of the working class, the Democrats.