In an Atlantic article from May, 2015, that just popped up yesterday on my Facebook feed (due to the same algorithmic wrinkle that cause old celebrity death notices, e.g. Percy Sledge, to pop up whenever a fresh one, e.g. Prince, passes on), Delaware governor Jack Markell outlines some approaches to getting more jobs for Americans.
Economically, Markell appears to be a centrist, Clinton-style Democrat: he says we must accept globalization and its challenges. Trade deals like NAFTA and PTT are good. We must enable private enterprise to find and explore the new, post-global, high-tech avenues to employment, because ... "governments don't create jobs." Governments only "create a nurturing environment where business leaders and entrepreneurs want to locate and expand."
"Governments don't create jobs."
Hmm. I know this is gospel among Republicans, but Democrats? Maybe, when it comes to jobs, the word "create"--for Republicans and for Markell--is code and has a meaning other than the one it actually has.
Do public employees not have jobs? I had a career in taxpayer-funded public libraries; my wife is a public school teacher. Are those not jobs? Created by the government?
More importantly, though, how much does the private sector depend on the government? Markell would do well to read a recent NYT interview with Barack Obama, in which the president "weighs his economic legacy." Part of it recounts just how it was that the US recovered from the worst economic slump since the Great Depression, and in quite a short time, considering the depth of the trough. Bailing out the financial sector, saving the auto industry, using Federal funds for infrastructure improvement, keeping interest rates at historically low levels: all of these involved the government. All of these "created" jobs by enabling corporations to hire (or continue to hire) people. Without that government activity, the slough might have become a bottomless sinkhole.
This is just one example, and it might not even be the best one. Did the Tennessee Valley Authority create jobs? Count the marinas at all those lakes and the big-box retail outfitters supplying all those bass fishermen. Did the interstate highway system create jobs? Trucking companies don't seem to be hurting. How about the internet? Jobs, jobs, jobs (including Steve).
It is a false distinction to call all those things simply a "nurturing environment." Not only did every one of them happen as the result of people working in publicly-funded jobs, but those achievements all have become foundational: an essential part of job creation. They point to the economic benefits of a vigorous and creative government such as seem impossible in today's USA because of the spread of Ronald Reagan's anti-government ideology.
Obama addresses this in the Times interview: a "mythology has been built up around the Reagan revolution" that Obama would like to "puncture." The myth is that Reagan "slashed government and slashed the deficit and that the recovery was because of all these massive tax cuts" when in fact it was due to "a shift in interest-rate policy." And of course the consequence for Obama has been the straitjacket of a legislative branch in thrall to the myth.
What about the future? Markell and Obama both note that the profits of the recovery have fueled widening income disparity. Markell basically shrugs his shoulders and does little more than tout education--a tired nostrum if there ever was one.
Obama at least has a clue. The interview finds him at a plant in Florida that was--ahem--created by his Recovery Act. According to the article, if the plant had been built decades ago, it would've employed thousands. Instead, because of advances in robotics and computerization, it employs 300. Job loss is as much due to technology as to globalization. Even if sales remains flat, if a company can reduce overhead by replacing people with robots or automation, it's money in the bank.
This is hardly a revelation. But for some reason the prevailing notion in the US today seems to be that, at a time of historic, disruptive economic change on the same scale as--if not greater than--the Industrial Revolution, the government should just move to the back seat.
I'm in the middle of reading Ron Chernow's biography of Alexander Hamilton. Hamilton was an astoundingly creative force in the formation of the new United States. Not only was he the principal voice of the effort to ratify the Constitution, he was also the person who--as the first head of the Treasury department--breathed economic life into the new central government. His handling of war debt, formation of a customs regime, and foundation of a national bank all showed how a central government might operate "to promote the general welfare."
In this he was bitterly opposed by Jefferson and Madison, who formed a party--the first such in American history--in order to stymie Hamilton's programs. The party was called Republican. It was not the same as today's party, which traces its lineage to Lincoln, but its small-government ideology was very much like the small-government ideology of today's post-Reagan Republican party.
That such an ideology is pro-business or good for jobs is belied by the fact that Alexander Hamilton, that ally of traders and friend of bankers, believed in the value of a strong, active, and creative central government. But he seems not to have thought of it as "governmental" activity in the same way we do. He referred to it as work on behalf of the public.
We in the US face economic changes that will be (already are) as far-reaching and deep as any in history. And we seem to want to do this without the kind of public-spirited activity that has been linked to American prosperity since the very beginning. I call folly.