In the aftermath of the COVID-19 pandemic, could working-class incomes and bargaining power increase? The crisis has given Americans a new appreciation of the importance of many working-class jobs that are often taken for granted, from warehouse worker to grocery clerk. The heroic sacrifices of these essential workers will not be forgotten by American voters, who will demand higher wages and better workplace conditions for their hardworking fellow citizens.
Just as the Great Depression led to the New Deal, so the Great Pandemic is likely to lead to a new era of pro-worker policy. Already the progressive movement has pushed Democratic centrists so far in a pro-labor direction that if Joe Biden is elected president, he may be the most pro-worker president since Franklin D. Roosevelt.
The dependence of the United States on China and other countries for medicines and manufactured goods that were cut off during the crisis will lead to a renaissance of onshoring and manufacturing on American soil. At the same time, residual difficulties and new restrictions in travel will reduce the pressure of unskilled immigration on wages for the poorest workers. Combined with the retirement of the baby boomers, American workers may enjoy a tight labor market for the first time in decades, giving them the bargaining power to demand higher wages, better benefits and better working conditions from employers.
A final beneficial outcome of this terrible tragedy may be the long-overdue expansion of social insurance. In the aftermath of COVID-19, even neoliberal Democrats and conservative Republicans may agree upon the need to expand Social Security, lower the age of Medicare to 50 or adopt universal Medicare, and provide universal, paid family leave along with a much more generous child tax credit. …
Just kidding! I had you going there for a minute, didn’t I? I didn’t mean a word of what I said in the first four paragraphs of this essay.
The suggestion that a Biden administration would be pushed in a pro-worker direction out of fear of incurring the wrath of veterans of the Sanders campaign and the feckless Democratic Socialists of America could make a cat laugh. A Biden administration would be staffed by conventional, conformist, careerist retreads from the administrations of Bill Clinton and Barack Obama, representing the pro-Wall Street, anti-labor wing of the Democratic Party that has been dominant since the 1990s. Biden Democrats are likely to use a combination of social liberalism and fiscal conservatism to bring well-heeled Bloombergian independents and country-club Bush Republicans permanently into the Democratic coalition, accelerating its transformation into an alliance of affluent whites with members of minority groups who vote on the basis of race, not class. As long as enough well-off whites and African Americans and Hispanics vote for the centrist candidates of the Clinton-Obama-Biden machine, neoliberal Democrats have nothing to fear from “democratic socialist” poseurs in pricey hipster neighborhoods and college towns.
The Democrats need the votes of public sector unions including teachers unions, but they can win elections even if labor unions in the private sector go completely extinct. In 2020 private sector union members accounted for a new low of 6.2% of the U.S. workforce, concentrated in a handful of industrial and liberal states, many of them losing factories to offshoring and inhabitants to other states in the United States.
To be sure, a Biden administration, if there is one, might have one or more token pro-labor officials, as the Clinton administration had Robert Reich and the Obama administration had Jared Bernstein. Like those estimable public servants, they would have little or no influence in a Biden presidency, compared to the many appointees with backgrounds in finance or tech or consulting or lobbying. Ambitious social climbers in a Biden administration would hope for lucrative post-government jobs or board positions at major corporations and banks.
Will the vulnerability exposed by the COVID-19 crisis lead to large-scale reshoring of industry in the United States, to the benefit of American workers? Not if it is up to the U.S. business community. On April 16, Reuters reported that a survey carried out by the American Chambers of Commerce in Beijing and Shanghai and PricewaterhouseCoopers asked U.S. firms with operations in China if they had plans to relocate production as a result of the pandemic. Most said no.
There is bipartisan support in Congress for rebuilding chip foundries and some medical manufacturing capability in the United States. But don’t expect President Biden (or the vice president who might succeed Biden as president) to support a large-scale effort to relocate strategic manufacturing to the United States. Executives and shareholders would object and threaten to withhold campaign donations and offers of well-paying jobs and board positions for ex-Biden officials and former Democratic members of Congress and their staffers.
If U.S. multinationals do move production out of China, absent specific legislation by Congress very little of it would return to the United States. Most would probably go to other countries with low-wage, nonunion, easily exploited workers like Vietnam, India, or Mexico. Africa is expected to add between a half billion and a billion people in the remainder of this century, so the supply of poor foreign workers whom U.S.-based multinationals can use to replace American workers will only expand in the future.
As recently as the 1980s, many on the labor left wanted the federal government to limit unskilled immigration and crack down on the employment of illegal immigrants by American businesses. This pro-labor perspective was reflected in the 1996 report of the U.S. Commission on Immigration Reform, chaired by Barbara Jordan, the first African American woman from the South to be elected to the U.S. House of Representatives. At that time, the constituency for increasing unskilled immigration and turning a blind eye to illegal immigration was limited to business-class Republicans and kooky far-right libertarians.
From the 1990s to 2020, however, the old labor left has been almost completely replaced in the Democratic Party by a new group of affluent, college-educated “progressives” and “democratic socialists.” Many share a personal interest in maintaining their middle-class lifestyles in trendy, expensive places like Brooklyn and Austin by being able to afford nannies, maids, apartment building personnel and food-truck and restaurant workers on their modest government, nonprofit, or academic salaries. This explains why the false talking points of right-wing Cato Institute libertarians and Chamber of Commerce lobbyists dating back to the 1980s—immigration has zero effect on wages, immigrants do jobs that Americans refuse to do, any suggestion that immigration has adverse effects on native competitors is racist—are now recycled and laundered as “progressive” orthodoxy.
The cognitive capture of Democratic progressivism by right-wing libertarian labor market ideology is illustrated by a recent tweet of Robert “Beto” O’Rourke, the failed Democratic candidate for the U.S. Senate and U.S. presidency who was born into one of the richest Anglo families in El Paso, Texas (his nickname was bestowed by a Mexican American servant of his family): “Who the fuck do you think is working on the farms and feed lots, in the packing houses and processing plants at a time when we are struggling to feed ourselves? Who is in the kitchen? Who is picking, preparing, serving the food we eat and cleaning up afterwards?” Clearly not well-paid, unionized citizens or legal immigrants with generous benefits, Don Roberto.
Michael Bloomberg, like O’Rourke a rich man and a failed candidate for the Democratic presidential nomination in 2020, told a radio host in 2006: “You and I are beneficiaries of these jobs [filled chiefly by low-wage immigrants]. You and I both play golf; who takes care of the greens and the fairways in your golf course?”
As the comments of these two candidates for the Democratic presidential nomination in 2020 suggest, many elite liberals as well as elite conservatives approve of the ongoing transformation of the U.S. economy into a system of labor market apartheid similar to that of Saudi Arabia or Dubai, countries which import perpetually refilled underclasses of badly treated immigrants and guest workers toiling in poorly paid jobs without benefits.
Whether the United States recovers from the pandemic in a few months or a few years, at some point the on-and-off lockdowns are likely to end. When they do, U.S. business leaders and the opinion pages of the overclass press will demand a “pivot” toward rapid deficit reduction.
This is what happened under the Obama administration during the Great Recession, a crisis far less severe than the present economic disaster. In 2009 and 2010 the U.S. economy was still in the early stages of the decadelong recovery from the financial crisis, with mass unemployment and idle capacity ensuring that inflation would not be a problem for years or decades to come. And yet America’s bipartisan oligarchy decided almost from the outset of the Great Recession that it was necessary to slash spending to avert the imaginary prospect of Weimar-style hyperinflation.
At least that was the public rationale. The real rationale was the desire of financial firms and other special interests to use the Great Recession as a convenient excuse to cut Social Security and other public services. Cuts in federal income maintenance programs, under Democrats and Republicans alike, are part of the conversion of the U.S. government into what the economist James K. Galbraith calls ‘the predator state” and the replacement of much of the productive economy in the United States by what the economist Michael Hudson calls the “the tollbooth economy.” The predator state replaces tax-funded public services with private tollbooths like tax-favored, fee-charging private retirement accounts that extract wealth from the citizenry and transfer it to unproductive, politically connected rentier interests. These profiteers then recycle some of their windfall rents as contributions to their agents in politics, journalism, universities, nonprofit advocacy groups and think tanks.
As part of his pivot toward austerity at the beginning of the Great Recession, President Obama appointed the National Commission on Fiscal Responsibility and Reform, called the Simpson-Bowles Commission after its co-chairs, Alan Simpson, a business-class Republican, and the Democrat Erskine Bowles, who was among other things the founder of a private equity firm. The Simpson-Bowles Commission wasted no time. In 2010, only two years into the Great Recession, the rich, elderly co-chairs in an inspiring demonstration of cross-party amity published their bipartisan proposal to cut Social Security spending by increasing the retirement age, slashing military and domestic spending, and imposing a regressive federal gasoline tax that would hurt working-class Americans the most.
Rebellions by the left and the populist right doomed the Simpson-Bowles proposal. But Obama was not done with his war on social insurance. He persisted.
In 2012, after being reelected on a pledge of strengthening Social Security, Obama betrayed his voters and pleased his donors once again by proposing to use a different inflation-adjustment measure—“chained CPI”—that would have cut Social Security benefits by 2% over time for most beneficiaries. “Democrats Plead with Obama to Abandon Social Security Cut,” read the headline in The Hill on Jan. 11, 2014.
Despite his best efforts, Obama failed to cut Social Security. Biden, if he is elected, will get another chance. Biden will be pressured by the national economic elite to do something about the enormous post-pandemic debt and deficit—and to do it to the working class, not to the donor class.
One of Biden’s top campaign aides in 2020 is his former chief of staff Bruce Reed, who was executive director of … you guessed it … the Simpson-Bowles Commission. Under Reed’s leadership, the salaries of two of this government commission’s senior staffers, Marc Goldwein and Ed Lorenzen, were paid respectively by the Committee for a Responsible Federal Budget and the Peterson Group, advocacy groups that were funded by the late Pete Peterson, the billionaire founder of Blackstone who created a huge network of front groups to lobby for cutting entitlements. Although his campaign plan calls for expanding Social Security, Biden himself has a long record of calling for Social Security freezes and cuts. If Biden replaces Trump, don’t be surprised by headlines like “Democrats Plead with Biden to Abandon Social Security Cut.”
Even if the Democrats win a trifecta of the White House, House, and Senate in November, the boss class will remain firmly in control, kicking American labor while it is down. Welcome to the 2020s, American workers of all races. Have a nice decade.
Michael Lind is a columnist at Tablet and a fellow at New America. His most recent book is The New Class War: Saving Democracy from the Managerial Elite.