What if There is No "Recovery"?
This is the text of a rejected Op-Ed I sent into the Boston Globe, so it's a little less in-depth than usual. But I didn't want to let it go to waste.
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“When there’s trouble in Massachusetts, there’s trouble everywhere!” With these words from his victory address last week, the improbable Senator-elect Scott Brown may have augured a far broader state of affairs than he intended. He was, of course, speaking of impending woes for Democrats, big-government types, and aloof political elitists. But Brown’s election is likely a sign of an inevitable series of events that will force Americans to come to grips with a single terrifying question: What if there is no recovery?
Sometimes, despite the usual cliches about the rapid turnaround of the Washington news cycle, the long-term political future clicks into focus like the background of a Dutch landscape. The conventional wisdom, which seems accurate in this case, is that the Massachusetts outcome is a bad omen for Democrats in the midterms this fall. The GOP will certainly pick up seats, although retaining minority status. Then in 2014, there will probably be a massive reversal of power, with the Republicans taking both houses of Congress as well as the Presidency, sweeping the Obama hope-topia into the dustbin.
We can grant credence to this long prediction due to the political corner into which we have been painted by our two mainstream parties. Above all, the Democratic and Republican machines are designed to perform three interlocking functions: win elections, gather money to win those elections, and serve those funders via beneficial legislation. When conditions on the ground demand solutions that fall outside of these limited functions, our two parties struggle. They resort to the same tired narratives that have proven valuable in campaigns past, but are ill-suited to fixing the multiplicitous waves of decline that are lapping at our shores. Over the next few election cycles, we can thus expect a kind of musical chair politics, where the greatest electoral advantage will be the ability to run as outsider. Paradoxically, to actually be in power will be the wrong place to be, as Obama is finding out right now.
During these pendulous times, each major party will flail around for more creative ways to dress up their stock platforms. So we will hear more of the neo-trickle-down shtick that Scott Brown used to such effectiveness: ‘Taxes are bad! Tax cuts are good! Give us our money back! Unleash the entrepreneurial power of America!’ All very seductive claims, to be sure, but ultimately much too simple to address the macro-trends in globalization, wealth concentration, and technological unemployment that have completely changed the ratios of work and reward. On the Democratic side, there will be more calls for stimulus packages, better financial regulation, green job programs, etc. Again, much of this looks good on paper, but as conditions deteriorate and the tax-base for such endeavors enters permanent decline, the fiscal mechanisms for such projects disappear.
Ultimately, all of this inertia comes from a misunderstanding of the current recession. Liberals and conservatives both see our predicament as an anomaly caused by the housing bubble. Each see different demons in this bubble formation (do-gooder government interference in the market on one side, or greedy financial speculation on the other), but almost all commentators see recovery as possible, once all of the bad mojo is worked out of system.
But what if this is a misreading of our situation? What if the housing bubble was just the latest in a series of speculative misadventures made absolutely unavoidable by an overall structure that funnels the vast majority of the nation’s economic output to a very small financial/corporate elite? In this long view, American economic growth and productivity have been steadily surging for decades, but became uncoupled from worker compensation in the mid-1970s. Regular people have thus been working more and better, but getting less, with the resulting surplus being captured by the investor classes. All of that extra capital had to go somewhere, so it was shunted to serial financial instruments that promised outlandish returns. Of course, these instruments and their subsequent bubbles proved volatile and unsustainable, to say the least. It is a mistake to think that all of the myriad jobs that grew up around these bubbles will somehow come back, now that the hyper-speculative conditions that gave rise to them are gone.
The reality that will have to be acknowledged, before any type of recovery is possible, is that the fundamental relationships between labor, compensation, and economic growth have been inexorably altered. Labor input, in conditions of global competition and relentless technological de-skilling, is just not that valuable any more, in an overall sense. Certainly, there will continue to be many valuable jobs in America -- well-paid, skilled, and secure. But true full-employment, where anyone willing to work hard can get ahead and support a family, will recede as a realistic possibility, no matter how many job summits or small-business tax cuts we throw down.
How will America react to these new conditions? It's hard to say. As healthy men and women continue to get tossed out of work and home, and are unable to find new arrangements, the desperation, anxiety, and rage will build. As the major parties swap the unenviable positions of leadership, the finger-pointing and scapegoating will intensify, as their plutocratic, election-crafted narratives fade into disutility. This is unfortunately a recipe for either totalitarianism or unfettered empire-building. Excess popular energy will have to go somewhere, and the main pathways are internal persecution of undesirables or elimination of external evildoers. People will turn to strength, which in times of trouble tends towards hubris and cruelty.
A different, less-horrifying path would confront head-on the changing relationships of work, consumption, economic health, and individual reward. Our leaders should acknowledge that the full-employment world is behind us, but also that this is a development which opens up expansive new opportunities for cooperative endeavors of all kinds: in housing, business ownership, local government, and regional planning. Federal and state policies should be recrafted to create new tax and legal frameworks for pushing resources away from centralized planning towards autonomy at the smallest levels possible. In a very short time, it will become obvious that the individual and the family are simply not adequate home bases from which people can approach the wider spheres of government, economy, and environment. The creation of new collective social forms will prove to be the next great American project. But this will require a new kind of leadership from above and a cultural change from below.
Posted by Jeremy Raymondjack at 1/25/2010 7:07 PM 
Categories: Politics and Economics
Tags: economic recovery Massachusetts senate election economic recession Scott Brown
Categories: Politics and Economics
Tags: economic recovery Massachusetts senate election economic recession Scott Brown
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