Precarity, American-Style: Causative Factors

Today's post is a continuation of my series of posts on the subject of precarity.  Today's post will be rather short, since I don't have much time.  However, when considering the state of precarity in which an increasing number of people in the United States now live, it is helpful to study the occupational and economic factors which have led to our present troubles.  As we study economic precarity in the United States, we should therefore consider the following factors:

• The decline of small businesses in the U.S.  This has been due to "the tilting of the playing field to favor massive companies over small businesses," as reported in a 2020 article by Business Insider.  (See also "Monopoly Power And The Decline of Small Business" for a 2016 snapshot of the problem.)  Note that the laws passed by the U.S. Congress and the executive orders issued under the Trump administration only made this worse.  However, the Biden administration has begun taking steps to reverse small business decline by helping small businesses compete for Federal work, as reported by the Federal News Network in a 2023 article.

• The shifting of tax burdens from the rich to the poor.  A striking case in point is the number of states (red states, particularly) whose legislatures and governors have turned them into tax havens for the rich.  (See also, "How the Ultrawealthy Devise Ways to Not Pay Their Share of Taxes," NPR, August 2022.)  Thus these states have come to resemble enclaves of dirty money that are found in the Cayman Islands.  Note that the U.S has recently surpassed the Caymans to become the "world's biggest enabler of financial secrecy" as reported by the international Consortium of Investigative Journalists in May 2022.  But these are merely one part of the overall shift of tax burdens away from the rich which began in the 1980's under Ronald Reagan.

• The use of monopoly and oligopoly power to create monopsony and oligopsony labor markets.  We all know that a monopoly is a state in which there is only one supplier of a particular good or service which is needed by many buyers.  The monopolist can therefore charge whatever price he wants, even if the price is horribly unfair.  Oligopoly is the condition in which there is more than one supplier, yet the total number of suppliers is very small.  Examples of oligopoly include Airbus and Boeing among aircraft manufacturers, or Microsoft and Brave and Alphabet (owner of Google) among Internet search providers, or CVS and Walgreens and Rite-Aid among drugstores and pharmacies.  A monopsony, by contrast, is a situation in which there is only one buyer of a good or service which is offered by many suppliers.  An example of this is a situation in which there is only one employer who can offer jobs to people in a large geographical area.  Thus the many people in this area become horribly dependent on the one large employer, and if that employer uses his power maliciously or suddenly goes out of business or decides suddenly to cut costs, many people will be devastated.  Oligopsony works the same way.  Monopsony and oligopsony are the natural outcome of monopoly and oligopoly.

• The shifting of regulatory burdens from large businesses to small businesses.  A prime example of this is the case of trying to use your own personal car to earn money by giving people rides.  Most cities and states have laws that prevent you from doing this as a private individual.  In this case, there are only two legal ways you can earn money by giving people rides: go to work for a taxi company, or become an "independent contractor" for a multibillion-dollar ride-hailing service such as Uber or Lyft.  The regulatory burden on these ride-hailing services is very small, as seen in the cases of ride-hailing drivers who are injured on the job, or passengers who are sometimes assaulted by the ride-hailing drivers.  Regulatory burdens are now crafted by state and local legislators for the purpose of expanding opportunities for big businesses by smothering small businesses who can't afford the costs of regulatory compliance.

• The innovation-depressing strategies of big businesses.  It can be argued that once a monopoly or oligopoly economy is established, the big players in such an economy will tend to fear innovation, since innovations can be disruptive and can even destroy the pre-existing monopoly or oligopoly arrangement.  Thus it is no surprise that large businesses (and wanna-be large business owners) have evolved egregious strategies to stifle any potential innovations that might threaten their interests.  One such strategy is the misuse of the "non-compete agreement."  These are agreements which employees force new hires to sign, in which the new hire typically agrees not to work for any other business or start their own business within a certain time frame and within a certain geographical area.  Certain versions of these non-compete agreements also force the employee to give up all rights to any invention or intellectual product which the employee may devise while employed by his employer and for a certain time period after the employee stops working for the employer.  (If you work for such an employer, I can understand why you would not be motivated to think very much while on the job!)  The abuse of non-compete clauses in employment contracts has moved the Biden administration to start taking steps to ban them (see this also), which should provide immediate relief from employers who want to try to turn their employees into personal property.

Future posts in this series will examine these factors in more detail, along with other factors such as the absence of single-payer health care coverage in the U.S.  But for now, consider these factors as the means by which the wealthy in this country seek to prevent the American precariat from building individual and collective self-reliance.

Precarity, American-Style: Introduction

Every child had a pretty good shot

To get at least as far as their old man got

But something happened on the way to that place

They threw an American flag in our face

- Billy Joel, Allentown, 1982

This post is a continuation of my series of posts on the spread of economic precarity among the majority of the world's population.  The opening posts in this series explored precarity as a global phenomenon and characteristic of economies in both the developed world and the developing world which are dominated by rampant free-market capitalism.  Subsequent posts described how precarity came to characterize even those societies which withdrew from global capitalism for several decades in the 20th century but which returned to the capitalist fold during the last decade of the 20th century.  It is now time to consider the case of a nation which has been dominated by the "free market" arrangements created by its wealthiest citizens from its founding to the present day - namely, the United States.   It is time especially to examine the late-stage outworkings of those arrangements.  Those outworkings can be summed up as the spread of precarity throughout the United States.  We have looked at other peoples' messes.  It's time to look at our own.

A quick review: the first post in this series defined precarity as "the state of being uncertain or likely to get worse," and, "a situation in which someone's job or career is always in danger of being lost."  That first post also said,

The Journal of Cultural Anthropology describes precarity as ". . . an emerging abandonment that pushes us away from a livable life . . . [It is] the politically induced condition in which certain populations suffer from failing social and economic networks . . . becoming differentially exposed to injury, violence, and death."  The University of Georgia has an article on its "Neoliberalism Guide for Educators" webpage which describes precarity in concrete human terms, starting with the questions "Have you ever or do you currently live paycheck to paycheck?  Do you work 40 hours a week or more and still can't afford rent?"

The University of Georgia webpage cited above describes how precarity was not always a feature of modern American life.  That page describes how under President Lyndon Johnson, the United States began to construct a social safety net that actually worked to bring economic advancement to all Americans and not just the rich.  The page also describes how wealthy business interests organized from the 1970's onward to begin to unravel that safety net in order to protect and expand their dominance over the American economy.  Today's post will explore how the resulting increase in precarity spread throughout the United States.  We will see that, to use a word picture, many of those who thought that they would make out all right by being friends of wolves wound up becoming lamb chops themselves.

Let's consider first a paper titled, "Changes in Precarious Employment in the United States: A Longitudinal Analysis" (Oddo, et al, Scandinavian Journal of Work, Environment and Health, December 2020).  This paper introduces the term "precarious employment" (or PE, as the authors abbreviate it) and describes it as "the accumulation of multiple unfavorable facets of employment quality."   In plain words, PE is the accumulation of those factors in a person's job which make the job more like Hell than Heaven.  The paper measured PE in terms of the following seven variables:

1. Material rewards - that is, the relative adequacy or inadequacy of wages
2. Work time arrangements - that is, how long a person has to work as well as how much control the worker has over his or her own schedule
3. Stability - that is, whether the job has a stable employment contract or whether it is unstable (as in temporary, seasonal, contracted limited-time, etc.)
4. Workers' rights - that is, whether the employer offers benefits such as health insurance or retirement, as well as protection of workers from exploitation
5. Collective organization or empowerment - that is, whether employees are helped or hindered in their attempts to organize themselves for collective bargaining power
6. Interpersonal relations - that is, whether workers have to deal with toxic bosses or bosses who don't allow the workers to control how they do their jobs
7. Training and employability opportunities - that is, whether there is room for growth and advancement in the job

A high score in each of these variables indicated a workplace that provided healthy, long-term employment.  A low score in these variables indicated a workplace of precarious employment.  The authors of the paper measured changes in these variables over time for various populations and geographic regions in the United States from 1988 to 2016.  They then used this data to construct a precarious employment score (PES) for each group and region.  The authors found, unsurprisingly, that the overall PES for the United States increased during that period, rising from 2.96 in 1988 to 3.43 in 2016.  They also found, unsurprisingly, that the PES increased among historically oppressed groups in the United States, such as African-Americans, Latinos, women, and people without advanced education.  However, there were some rather surprising findings as well.  Men showed an 11 percent increase in precarious employment during this time, as compared to a 6 percent increase for women.  Precarious employment also increased significantly among those Americans with bachelors or advanced degrees.  Most surprising of all was the large increase in precarious employment among workers with higher wages.  

As far as regional variations, the American South showed the highest percentage of precarious employment and highest increase in PES.  This is significant because of the way in which state governments in the South have turned their states into attractive places for foreign manufacturers to set up plants - particularly automotive plants.  Yet this strategy has not translated to increased prosperity for the majority of people living in these states.  This may have to do especially with the fact that, starting from the 1970's onward, automotive plants in the United States have increasingly relied on the use of temporary staff to meet just-in-time production targets, as noted in an interview given by Professor Timothy Minchin of La Trobe University in 2021.  Professor Minchin has also written a book about the activities of foreign-owned automakers in the United States.

It is interesting that the beginning and growth of widespread precarity in the United States coincided with the terms of Republican presidents from Nixon onward.  This is especially significant when we examine the presidency of Donald Trump.  The Trump administration used to boast that it had achieved nearly full employment for Americans.  However, what actually happened was that there was a huge expansion of precarious, low-wage work under Trump, whose labor policies classified huge numbers of gig and temporary workers as "independent contractors" without rights to health or retirement benefits or other job protections.  Note that the term "gig worker" includes not only those highly-skilled, college-educated people who can craft a somewhat sustainable life out of present-day flexible, short-term economic arrangements.  It also includes the many, many people who were tricked into working low-skilled menial jobs without benefits for chump change wages, first by FedEx in the 1970's and 1980's, then by Uber, Lyft, Airbnb, and Door Dash, among others in more recent years.  As a result of the expansion of such arrangements, the United States has the highest percentage of low-paid, precarious workers among any OECD economy, as noted by Kathleen Thelen in her paper titled, "The American Precariat: U.S. Capitalism in Comparative Perspective."  At present, around 25 percent of the American workforce falls into the category of low-paid precarious workers.

These facts and considerations are quite naturally a big concern to me, because I am an African-American, and I have had to live my life watching many of my people suffer the malignancy and oppression of American society.  I have also experienced some of that malignancy and oppression myself.  This experience has taught me that the oppression of even one person threatens the peace of everyone who is not yet oppressed, or, to put it another way, allowing injustice against one leads eventually to injustice against all.  This is why I can't look the other way when I see others being oppressed, even when they are not of my "tribe".  But I think that what has blinded the eyes of many white Americans (especially among the privileged) over the last few decades has been the appeals to naked self-interest which have been pitched to them by the masters of the American economy.  So I'd like to return to a theme set forth in the opening paragraphs of this post, namely a description of how precarity has begun to bite even the members of the formerly "middle-class" or "upper middle-class" in recent years.  

Consider therefore a 2019 book by Alyssa Quart titled, Squeezed: Why Our Families Can't Afford America.  I am in the middle of this book right now, and have learned some surprising things, as well as being reminded of things I already knew.  One of the surprising things is how many degreed working female professionals suffer discrimination and career damage simply from the act of having a baby.  Another thing is the link between increasing overall precarity and the increase in costs of child care for working parents.  (Child care and other forms of paid personal care represent one of the fastest-growing segments of the U.S. economy, by the way, although personal care workers receive the lowest wages.)  Yet another thing is how people who once considered themselves well-off find their neighborhoods becoming hostile to them as those neighborhoods are taken over by the super-wealthy - a surprising case of how gentrification hurts even those who thought they were insulated from its effects by being part of the dominant culture.  Case in point: a game between two high school varsity baseball teams.  One was "decently middle-class" while the other consisted of kids from a wealthier nearby suburb.  Each group was cheering their own team, but the wealthier kids - and their parents - began to taunt the kids from the other team by chanting "Lower Average Income! Lower Average Income!" and "Can't your parents afford to feed you?  Can we call Child Protective Services?"  Quart's book also describes the shock and surprise which many formerly smug professionals are experiencing as they witness the dwindling of the value of a college degree in the United States.  We will consider these things in a future post, by the way, as this phenomenon is not just limited to the United States.  As noted in a previous post, Chinese degree-holders are finding out that there are fewer jobs than graduates in the Chinese economy.

As we explore the theme of precarity in the United States, we will consider the mechanisms by which precarity began to appear from the 1970's onward.  We will see, rather surprisingly, the link between these mechanisms and the increasing difficulties faced by small businesses and would-be entrepreneurs over the last four decades.  We will also ask what is to be done about the precarious situation many of us now face.  Here's a hint: I don't believe the answer lies solely in electoral politics or issuing policy recommendations.  While these things can be important, they are not enough by themselves, since they leave the locus of power outside of those communities which are suffering the most from precarity.

Here I speak as a Black man who has studied strategic nonviolent resistance and who has experienced cognitive liberation of the kind which moves me to challenge existing situations of oppression.  My study of precarity in the United States has shown me just how dire the African-American situation is.  But my attempts over the last six or seven years to organize my brothers and sisters for collective action have left me rather frustrated.  So I'd like to ask, How will we begin to change our situation?

First, let's say straight up that passivity and magical thinking will not help at all.  I am thinking of some of the people I have tried to organize and how they have told me that I should join an organization that helps people instead of bothering them.  But my answer to that is to quote from The Little Red Hen.  Others have seen what I was asking them to do and have said in essence, "Well, I don't have the time or resources to help organize my people where I live.  But I know that there are places where we do see Black doctors and lawyers and bankers - I think I'll move there!"  My answer (especially to those who tell me that such a magical place exists in the American South) is to say that there is no "Big Rock Candy Mountain" that they can run away to, and that they are lying to themselves in order to avoid the sacrifices, hard work and potential risks of collective action.

The inescapable reality is that the only thing that will reliably alter our situation is our choice to begin to organize ourselves for collective action.  As Maciej Bartkowski said in his book Recovering Nonviolent History, 

"The guilt of falling into . . . predatory hands . . . [lies] in the oppressed society and, thus, the solution and liberation need to come from that society transformed through its work, education, and civility.  Victims and the seemingly disempowered are thus their own liberators as long as they pursue self-organization, self-attainment, and development of their communities."

Or, to quote from Alex Soojung Kim-Pang,

"Collective action is the most powerful form of self-care."  (Emphasis added.) 

Precarity in the United States: A Preview of Coming Attractions

I have begun research on my next posts in my series on precarity and the precariat.  My focus will shift from precarity in formerly communist countries to precarity in the United States.  I believe we will see a surprising similarity of patterns to those patterns we observed in the Russian and Chinese cases.  We will also see that very few people in the Unites States can afford to be complacent anymore.  I have gathered a lot of material, and like a person who has just binge-shopped a gourmet supermarket, I'll need time to digest it all.  In the meantime I may write a post on another subject tomorrow, but if I do, it will be a short post.  Those who want to get a head start on me in my research on precarity, American style, can consult the following sources:

• The Educated Underclass: Students and the Promise of Social Mobility, Gary Roth, Pluto Press, 2019.
• Immigrant Labor and the New Precariat, Ruth Milkman, Cambridge: Polity Press, 2020.  (Note: Try not to order an e-book copy of this through the John Wiley website.  Wiley has e-book download policies that will make you want to kick furniture and punch walls...)
• "Not 'Just' a Barista: The Story of Portland's College-Educated Baristas, Ned William Tilbrook, Portland State University, 2020.  (Now this sounds interesting!)

And there's much, much more!  Stay tuned . . .