Trump Inflames the Trade Wars, Again [feedly]

Trump Inflames the Trade Wars, Again
https://www.nytimes.com/2019/12/03/business/trump-trade-wars.html

LONDON — President Trump left the global economy unsettled on Tuesday when he threatened NATO allies and suggested that he could wait a year to reach a trade agreement with China, sending stock markets swooning.

In comments to reporters sandwiched between meetings with fellow leaders of the North Atlantic Treaty Organization, Mr. Trump said a trade deal with China might not be finalized until after the 2020 presidential election in November. Earlier this fall, he hinted that a deal was near completion, signaling that the trade war could be winding down.

But this week, peace no longer seems at hand. Beyond Mr. Trump's downbeat assessment of the conflict with China, his administration is considering tariffs as high as 100 percent on French items including wines, cheeses and handbags. He promised to impose tariffs on aluminum and steel from Brazil and Argentina. And he raised fresh doubts about international negotiations that were supposed to defuse a growing conflict over how American technology companies are taxed in Europe.

The president's affinity for using unpredictability as a negotiating tactic has angered trading partners and at times roiled financial markets — including on Tuesday, when stocks dropped in Europe and the United States after Mr. Trump's trade comments. The S&P 500 index fell about 0.7 percent Tuesday, after a similar decline Monday.

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"In some ways I like the idea of waiting until after the election for the China deal," Mr. Trump told reporters during a 52-minute appearance in London with Jens Stoltenberg, the NATO secretary general. He added: "But they want to make a deal now, and we'll see whether or not the deal's going to be right. It's got to be right."

The president also said Tuesday that he might impose new import taxes on goods from Germany and any other NATO ally that did not fully pay its dues to the organization, an inaccurate description of how the military alliance is maintained. Member states are expected to maintain robust military spending, but they do not pay dues.

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He then renewed a threat, which his administration made in a formal trade investigation concluded on Monday, to place tariffs of up to 100 percent on some French exports. That would be in response to a new French tax on online economic activity, which will hit American giants like Amazon and Facebook. His administration has threatened similar actions in response to digital tax pushes in Italy, Turkey and Austria.

"They're American companies," Mr. Trump said. "We want to tax American companies. That's important. We want to tax them, not somebody else."

The threat of such draconian tariffs, which were spearheaded by Robert Lighthizer, the United States trade representative, raised speculation that the Trump administration could abandon the tax talks taking place through the Organization for Economic Cooperation and Development. However, the Treasury Department, which is leading those negotiations, is expected to proceed with them.

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The events of recent days seem to have put an end to weeks of relative calm and record highs in the stock market, after more than a year of tumult largely caused by Mr. Trump's decisions to impose tariffs on a variety of products, including $250 billion of imports from China.

Image
French wines could face a tariff of up to 100 percent.Credit...Saul Martinez for The New York Times

The jolt to the stock market this week stood out after three straight months of placid trading and incremental gains. Measures of global policy uncertainty, while still historically elevated, had dipped this fall as Mr. Trump suggested a breakthrough with China was near. Farmers, who have been hurt by Chinese retaliatory tariffs against the United States, had reported a surge of economic optimism in November, according to an index compiled by Purdue University.

While some analysts argued that Mr. Trump's bravado was a negotiating tactic that markets should ignore, others said the falling stock prices were a sign that investors had been too optimistic about the trade war. European leaders warned that they would retaliate if Mr. Trump levied tariffs on French goods, blaming him for escalating what is becoming a multinational fight over the taxation of tech companies. Some economic forecasters warned that Mr. Trump was risking the health of the global economy.

"It is remarkable how President Trump seems impervious to the delicate state of an economic expansion that is clearly long in the tooth," Bernard Baumohl, the chief global economist for the Economic Outlook Group, wrote in a research note. He called Mr. Trump's trade remarks "disheartening to say the least."

Legislation that the House passed overwhelmingly on Tuesday could also escalate tensions with Beijing. The bill would require the administration to toughen its response to China's crackdown on predominantly Muslim ethnic minorities, including Uighurs, in the far western region of Xinjiang. Beijing, which has called the bill a malicious attack, has threatened to retaliate.

Business groups expressed alarm about Mr. Trump's China comments.

"We want and need to see a deal as soon as possible," said David French, the senior vice president for government relations for the National Retail Federation. "The tariffs continue to hurt U.S. businesses, workers and consumers and are a substantial drag on the U.S. economy."

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But delaying a China deal could have political benefits for Mr. Trump, some analysts said.

"Any deal reached now will be subject to scrutiny for the next 12 months and the harsh disinfectant of sunlight during the general election cycle," said Henrietta Treyz, the director of economic policy research at Veda Partners, an investment advisory firm. "Trade wars are political — right now, President Trump has the benefit of widespread bipartisan U.S. voter opposition to China and a robust consumer spending cycle."

Mr. Trump's trademark volatility was on full display Tuesday. At points, he seemed to suggest tensions with trading partners like France and even the long standoff with China could be easily resolved. At others, he suggested that he would make final deals only when he felt like it, and that more tariffs could be on the way in the interim. At one point, he said he would not settle for an "even" agreement with China — only one that favored the United States.

Administration officials sounded increasingly pessimistic that a first phase of any China deal would be reached anytime soon.

Commerce Secretary Wilbur Ross said on Tuesday that he believed holding off on a deal until after the election would give Mr. Trump more leverage in negotiations — assuming he won.

"Because once the election occurs — and the president seems to be in very good shape for the election — once it occurs and he's back in, now that's no longer a distraction that can detract from our negotiating position," Mr. Ross told CNBC.

Mr. Ross said that the agreement in principle that Mr. Trump promoted in October was at the "40,000-foot level," but that coming to terms on details such as what American agriculture products China would buy and how the deal would be enforced had proved to be more challenging. He said that barring a breakthrough, additional tariffs scheduled to be imposed on Dec. 15 would go into effect.

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"We don't have a breakthrough until it's in black and white, on paper — signed, sealed and delivered," he said.


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Yes, our tax system needs reform. Let’s start with this first step. [feedly]

Larry Summers on the owed, but uncollected, taxes of the 1%. It is not a trivial amount of money.

Yes, our tax system needs reform. Let's start with this first step.
http://larrysummers.com/2019/11/17/yes-our-tax-system-needs-reform-lets-start-with-this-first-step/

By Natasha Sarin and Lawrence H. Summers

November 17, 2019

While there's plenty of disagreement about how the money should be used, almost everyone involved in public-policy debates agrees that it would be good if the federal government could collect more revenue without raising tax rates or reducing tax deductions or credits.

It should be indisputable that investment to make sure all citizens meet their tax obligations is desirable. Such investment would raise substantial revenue, as well as increase economic efficiency and help redress growing inequality: Our rough estimates suggest that at least 70 percent of the "tax gap"— defined as owed but uncollected taxes — comes from underpayment by the top 1 percent. This contributes to legitimate concerns that our tax system unfairly advantages the elite.

Our new analysis suggests that better-focused audits, raising Internal Revenue Service enforcement to previous peak levels, investing in information technology and broadening earnings reporting could raise more than $1 trillion in the next decade, primarily from very high-income taxpayers. This well exceeds the revenue benefit of raising the top individual rate to 70 percent.

Some basic facts about tax compliance and enforcement:

Extrapolating from the most recently available IRS information, the tax gap will be more than $7.5 trillion over a decade. You only need to close 15 percent of this gap to raise $1 trillion.

Enforcement effort — as reflected in the share of gross collections reinvested in the IRS — has declined by approximately 35 percent over the past decade, and the decline has been disproportionate for corporations and millionaires: In 2011, more than 12 percent of individuals making $1 million or more annually were audited; last year, only 3.2 percent were. Audit revenue declines proportionally to the declining audit rates.

At present, recipients of the earned-income tax credit — all of whom have incomes below $50,000 — are about as likely as those making $500,000 or more to be audited.

Only 5 percent of taxpayers earning above $5 million are audited — even though IRS data demonstrates that an extra auditor-hour spent on their returns raises almost $5,000 on average.

Fewer than 1 percent of corporate returns were audited in 2018 — even though corporate audits on average raised nearly $1 million in additional revenue.

The IRS invests less than a quarter as much in information technology as major banks and still relies on systems from the 1960s. Pilot projects suggest payoff rates on strategic IT investments could approach 50:1.

When third-party income reports exist to compare to individual tax returns, income is correctly reported more than 95 percent of the time. Almost all income earned by individuals who make $200,000 or less annually gets reported in this way. But without such substantiation, between 17 percent and 55 percent of income goes unreported (and so untaxed) — and more than two-thirds of the income of those who earn $10 million or more falls into this category.

There are more facts in this vein. But these should be sufficient to demonstrate that there is plenty of low-hanging fruit in the area of tax enforcement.

What is the overall potential? In a study released this weekend, we conservatively priced out a program of increased auditing, IT investment and greater third-party reporting. We estimated that it would be possible to close 15 percent of the tax gap by spending approximately $100 billion on additional enforcement, as would be necessary to return the IRS to its historical scale. Every $1 that is spent would generate more than $11 in greater tax collection.

Congressional scorekeepers have suggested more modest revenue potential from investment in enforcement; however, our study shows these differences can be reconciled. Their approach is based on a program that is more modest in size (only a quarter as large as our proposed restoration of enforcement effort to previous peak levels) and scope (we consider the revenue potential of targeting audit resources on high-income individuals, as well as increasing information reporting). Critically, the Congressional Budget Office does not account for deterrence effects, which Treasury Department reports suggest greatly magnify the revenue gains from increased enforcement.

Why is the federal government leaving so much money on the table? Part of the answer is that there are powerful interests that want to maintain a system that facilitates evasion.

Likely more important, though, are congressional budget procedures. Historically, it was common for congressional leaders faced with last-hour budget gaps to rely on substance-less "tax compliance initiatives" to plug holes. The practice became discredited, and revenue from increased enforcement came to be excluded from budget scoring.

What's counted counts. When credit is not given for the revenue that will be collected from increased enforcement spending, it can hardly be surprising that tax compliance is neglected.

Restoring the IRS budget would, we believe, pay for itself many times over. It would also create a more progressive tax regime: At a time when working people pay their taxes in full, because of withholding, it would be reassuring for the tax law to be equally well-enforced on high-income earners.

Assuring compliance to the maximum extent feasible is not where tax reform should end, given the many problems with the current system and our need for significantly greater revenue. But it is where it should begin.

Natasha Sarin is an assistant professor of law at the University of Pennsylvania Law School and an assistant professor of finance at the Wharton School.

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Bloomberg: Wait Until Donald Trump Hears About the Carbon Border Tax

The climate crisis and trade conflicts are two of the world's biggest challenges and they might be about to collide in the EU's green deal.

By 

Chris Bryant

December 4, 2019, 4:00 AM EST

Next week, the European Union's leaders will commit to cutting net greenhouse gas emissions to zero by 2050. This historic pledge will require the continent to radically overhaul its entire economy, including a revolution in the production of steel, cement and chemicals — whose carbon emissions are particularly difficult to abate.

None of this will happen, however, unless European companies feel able to invest in making themselves greener without suffering a loss of competitiveness. So the European Commission has been toying with the idea of a so-called "carbon border tax," which would penalize imports from countries that don't meet the same environmental standards.

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It's a sensible idea but one that's likely to cause the EU no end of grief. If U.S. President Donald Trump gets wind of a European "Green Deal" that includes a possible tax on American imports to help fight climate change (something he appears not to believe in), he'll no doubt hit the roof. The climate crisis and trade conflicts are two of the world's biggest challenges and they might be about to collide. 1

Relentless Rise

So long as CO2 emissions keep increasing, the climate crisis will worsen

Source: NOAA/ESRL and Scripps Institution of Oceanography

The logic of a carbon border tax is straightforward. To reach net zero emissions, Europe will have to expand the scope and effectiveness of its carbon trading system, which aims to to curb CO2 by making polluters pay. But if the price of purchasing pollution allowances keeps climbing (as it has been), businesses might decamp to countries with laxer emissions controls, a phenomenon known as "carbon leakage." 

"If necessary, if there is carbon leakage, we will have to think about a carbon border tax," European Commission president Ursula von der Leyen told the United Nations climate summit in Madrid this week. 

The risk of carbon leakage is much debated. There's been little evidence of it so far but that's probably because carbon prices have been low and heavy industry hasn't had to expend much effort on cutting emissions; the power-generating sector has done most of the work.

Slow Progress

Heavy industry emissions have barely declined since 2012

Source: Carbon Market Watch, Sandbag

Shows sector performance under EU emissions trading compared to 2012. "Industry" includes chemicals, steel and cement. These sectors tend to receive a lot of free pollution allowances.

Things are about to become much tougher for Europe's big industrial companies. In future, they'll have to shut down their most polluting plants or make them clean. Much of the technology to do the latter is still in its infancy and is expensive.  

By forcing non-EU businesses to pay the same carbon price as local companies via the border tax, the theory is that the EU could cajole other countries into following its climate lead, while ensuring a level  playing field for domestic industry. Naturally, large steelmakers such as ArcelorMittal SA are strongly in favor.

Structuring and policing such a tax would certainly be complicated; measuring the carbon content of imported products isn't simple. There are hints that it will be confined to just a few sectors at first. But the politics are even more nightmarish. Following the U.S. retaliation this week against  France's digital tax, there's a danger a carbon border tax would prompt Trump to ratchet up his trade crusades. German industry is particularly worried about this.

The EU says any border tax would have to be compliant with World Trade Organization rules. But Brussels needs to tread carefully and Trump isn't the only worry.

A decade ago the bloc tried to impose a carbon tax on flights landing in the EU, regardless of where they took off. International condemnation was brutal and swift. Then Secretary of State Hillary Clinton wrote a letter strongly objecting to the EU's unilateral approach. The U.S. Senate voted unanimously to block American airlines from complying. Amid fears that China would scrap a multi-billion dollar order for Airbus jets, Europe backed down. 2  

Is the EU about to overstep again? Maybe it has no choice. "The world is a different place than it was 10 years ago," says Andrew Murphy of the research group Transport & Environment. "With smart diplomacy there's no reason why a carbon border adjustment has to suffer the same fate as aviation did."

The urgency is certainly greater now and lots more countries have embraced emissions trading. But only last week China warned the EU against imposing a carbon tax on its exports.

Europe shouldn't let itself be dissuaded. Plenty of smart people think carbon border taxes are necessary, including Ben Bernanke and Alan Greenspan, both former heads of the Federal Reserve. As the birthplace of the industrial revolution, the continent has a unique responsibility to curb planet-heating carbon emissions, including those embedded in goods consumed here but produced elsewhere. 

So long as net carbon emissions keep rising the planet will keep getting hotter. Countries and companies leading the way shouldn't be punished for tackling this.

1. For more see this Centre for European Reform paperand this Bruegel blog postand paper. Carbon border taxes are also mentioned in the United Nations' Emissions Gap reportand by the Energy Transitions Commission.

2. Only intra-European flights were subject to emissions trading.

This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.

To contact the author of this story:
Chris Bryant at cbryant32@bloomberg.net

To contact the editor responsible for this story:
James Boxell at jboxell@bloomberg.net

--

John Case
Harpers Ferry, WV

Enlighten Radio

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Trapped by the Firewall: Policy Changes Are Needed to Improve Health Coverage for Low-Income Workers [feedly]

Trapped by the Firewall: Policy Changes Are Needed to Improve Health Coverage for Low-Income Workers
https://www.cbpp.org/research/health/trapped-by-the-firewall-policy-changes-are-needed-to-improve-health-coverage-for-low

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Dan Little: The second primitive accumulation [feedly]

A powerful argument about giant high tech and old style exploitation

The second primitive accumulation

Dan Little

http://understandingsociety.blogspot.com/2019/12/the-second-primitive-accumulation.html

Sunday, December 1, 2019

The second primitive accumulation

One of the more memorable parts of Capital is Marx's description of the "so-called primitive accumulation of capital" — the historical process where rural people were dispossessed of access to land and forced into industrial employment in cities like Birmingham and Manchester (link). It seems as though we've seen another kind of primitive accumulation in the past thirty years — the ruin of well-paid manufacturing jobs based on unionized labor, the disappearance of local retail stores, the extinction of bookstores and locally owned hardware stores, all of which offered a large number of satisfying jobs. We've seen a new set of bad choices for displaced workers — McDonald's servers, Walmart greeters, and Amazon fulfillment workers. And this structural economic change threatens to create a permanent under-class of workers earning just enough to get by.

So what is the future of work and class in advanced economies? Scott Shane's major investigative story in the New York Times describing Amazon's operations in Baltimore (link) makes for sobering reading on this question. The story describes work conditions in an Amazon fulfillment center in Baltimore that documents the intensity, pressure, and stress created for Amazon workers by Amazon's system of work control. This system depends on real-time monitoring of worker performance, with automatic firings coming to workers who fall short on speed and accuracy after two warnings. Other outlets have highlighted the health and safety problems created by the Amazon system, including this piece on worker safety in the Atlantic by Will Evans; link. It is a nightmarish description of a work environment, and hundreds of thousands of workers are employed under these conditions.

Imagine the difference you would experience as a worker in the hardware store mentioned in the New York Times story (driven out of business by online competition) and as a worker in an Amazon fulfillment center. In the hardware store you provide value to the business and the customers; you have social interaction with your fellow workers, your boss, and the customers; you work in a human-scale enterprise that actually cares whether you live or die, whether you are sick or well; and to a reasonable degree you have a degree of self-direction in your work. Your expertise in home improvement, tools, and materials is valuable to the customers, which brings them back for the next project, and it is valuable to you as well. You have the satisfaction of having knowledge and skills that make a difference in other people's lives. In the fulfillment center your every move is digitally monitored over the course of your 10-hour shift, and if you fall short in productivity or quality after two warnings, you are fired. You have no meaningful relationships with fellow workers — how can you, with the digital quotas you must fulfill every minute, every hour, every day? And you have no — literally no — satisfaction and fulfillment as a human being in your work. The only value of the work is the $15 per hour that you are paid; and yet it is not enough to support you or your family (about $30,000 per year). As technology writer Amy Webb of the Future Today Institute is quoted in the Times article, [It's not that we may be replaced by robots,] "it's that we've been relegated to robot status."

What kind of company is that? It is hard to avoid the idea that it is the purest expression that we have ever seen of the ideal type of a capitalist enterprise: devoted to growth, cost avoidance, process efficiency, use of technology, labor control, rational management, and strategic and tactical reasoning based solely on business growth and profit-maximizing calculations. It is a Leviathan that neither Hobbes nor Marx could really have visualized. And social wellbeing — of workers, of communities, of country, of the global future — appears to have no role whatsoever in these calculations. The only affirmative values expressed by the company are "serving the consumer" and being a super-efficient business entity.

What is most worrisome about the Amazon employment philosophy is its single-minded focus on "worker efficiency" at every level, using strict monitoring techniques and quotas to enforce efficient work. And the ability to monitor is increased asymptotically by the use of technology — sensors, cameras, and software that monitor the worker's every movement. It is the apotheosis of F.W. Taylor's theories from the 1900s of "scientific management" and time-motion studies. Fundamentally Taylor regarded the worker as a machine-like component of the manufacturing process, whose motions needed to be specified and monitored so as to bring about the most efficient possible process. And, as commentators of many ideological stripes have observed, this is a fundamentally dehumanizing view of labor and the worker. This seems to be precisely the ideal model adopted by Amazon, not only in its fulfillment centers but its delivery drivers, its professional staff, and every other segment of the workforce Amazon can capture.

Business and technology historian David Hounshell presciently noticed the resurgence of Taylorism in a 1988 Harvard Business Review article on "modern manufacturing"; link. (This was well before the advent of online business and technology-based mega-companies.) Here are a few relevant paragraphs from his piece:

Rather than seeing workers as assets to be nurtured and developed, manufacturing companies have often viewed them as objects to be manipulated or as burdens to be borne. And the science of manufacturing has taken its toll. Where workers were not deskilled through extreme divisions of labor, they were often displaced by machinery. For many companies, the ideal factory has been — and continues to be — a totally automated, workerless facility. 

Now in the wake of the eroding competitive position of U.S. manufacturing companies, is it time for an end to Taylor's management tradition? The books answer in the affirmative, calling for the institution of a less mechanistic, less authoritarian, less functionally divided approach to manufacturing. Dynamic Manufacturing focuses explicitly on repudiating Taylorism, which it takes to be a system of "command and control." American Business: A Two-Minute Warning is written in a more popular vein, but characterizes U.S. manufacturing methods and the underlying mind-set of manufacturing managers in unmistakably similar ways. Taylorism is the villain and the anachronism. 

Predictably, both books arrive at their diagnoses and prescriptions through their respective evaluations of the "Japanese miracle." Whereas U.S. manufacturing is rigid and hierarchical, Japanese manufacturing is flexible, agile, organic, and holistic. In the new competitive environment — which favors the company that can continually generate new, high-quality products — the Japanese are more responsive. They will continue to dominate until U.S. manufacturers develop manufacturing units that are, in Hayes, Wheelwright, and Clark's words, "dynamic learning organizations." Their book is intended as a primer. (link)

Plainly the more positive ideas associated with positive human resources theory about worker motivation, knowledge, and creativity play no role in Amazon's thinking about the workplace. And this implies a grim future for work — not only in this company, but in many others who emulate the workplace model pioneered by Amazon.

The abuses of the first fifty years of industrial capitalism eventually came to an end through a powerful union movement. Workers in railroads, textiles, steel, and the automobile industry eventually succeeded in creating union organizations that were able to effectively represent their interests in the workplace. So where is the Amazon worker's ability to resist? The New York Times story (link) makes it clear that individual workers have almost no ability to influence Amazon's practices. They can choose not to work for Amazon, but they can't join a union, because Amazon has effectively resisted unionization. And in places like Baltimore and other cities where Amazon is hiring, the other job choices are even worse (even lower paid, if they exist at all). Amazon makes a great deal of money on their work, and it manages its great initiatives based on their Chaplin-esque speed of completion (one-day delivery). But there is very little ability to change the workplace towards a more human-scale one, and a workplace where the worker's positive human capacities find fulfillment. An Amazon fulfillment center is anything but that when it comes to the lives of the workers who make it run.

Is there a better philosophy that Amazon might adopt for its work environments? Yes. It is a framework that places worker wellbeing at the same level as efficiency, "1-day delivery" and profitability. It is an approach that gives greater flexibility to shop-floor-level workers, and relaxes to some degree the ever-rising quotas for piece work per minute. It is an approach that sets workplace expectations in a way that fully considers the safety, stress, and health of the workers. It is an approach that embodies genuine respect and concern for its workers — not as public relations initiative, but as a guiding philosophy of the workplace.

There is a hard question and a harder question posed by this idea, however. Is there any reason to think that Amazon will ever evolve in this more humane direction? And harder, is there any reason to think that any large modern corporation can embody these values? Based on the current behavior of Amazon as a company, from top to bottom, the answer to the first question is "no, not unless workers gain real power in the workplace through unionization or some other form of representation in production decisions." And to the second question, a qualified yes: "yes, a more humane workplace is possible, if there is broad involvement in business decisions by workers as well as shareholders and top executives." But this too requires a resurgence of some form of organized labor — which our politics of the past 20 years have discouraged at every turn.

Or to quote Oliver Goldsmith in The Deserted Village (1770):

Ill fares the land, to hastening ills a prey,
Where wealth accumulates, and men decay.
Princes and lords may flourish, or may fade;
A breath can make them, as a breath has made:
But a bold peasantry, their country's pride,
When once destroy'd, can never be supplied.

So where did the dispossessed wind up in nineteenth century Britain? Here is how Engels described the social consequences of this "primitive accumulation" for the working people of Britain in his book, The Condition of the Working Class in England:

It is only when [the observer] has visited the slums of this great city that it dawns upon him that the inhabitants of modern London have had to sacrifice so much that is best in human nature in order to create those wonders of civilisation with which their city teems. The vast majority of Londoners have had to let so many of their potential creative faculties lie dormant, stunted and unused in order that a small, closely-knit group of their fellow citizens could develop to the full the qualities with which nature has endowed them. (30)

This passage, written in 1845, could with minor changes of detail describe the situation of Amazon workers today. "The vast majority ... have had to let so many of their potential creative faculties lie dormant, stunted and unused in order that a small, closely-knit group of their fellow citizens could develop to the full the qualities with which nature has endowed them."

And what about income and standard of living? The graph of median US income by quintile above in constant 2018 dollars tells a very stark story. Since 1967 only the top quintile of household income has demonstrated significant growth (in a timeframe of more than fifty years); and the top 5% of households shows the greatest increase of any group. 80% of US households are barely better off today than they were in 1967; whereas the top 5% of households have increased their incomes by almost 250% in real terms. This has a very clear, unmistakeable implication: that working people, including service workers, industrial workers, and most professionals have received a declining share of the economic product of the nation. Amazon warehouse workers fall in the 2nd-lowest quintile (poorest 21-40%). (It would be very interesting to have a time series of Amazon's wage bill for blue-collar and white-collar wages excluding top management as a fraction of company revenues and net revenues since 2005.)

Here is a relevant post on the possibilities created for a more fair industrial society by the institution of worker-owned enterprises (link), and here is a post on the European system of workers councils (link), a system that gives workers greater input into decisions about operations and work conditions on the shop floor.

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Amplified Advantage: Why Education Is Not the Answer to Our Class Problems [feedly]

Amplified Advantage: Why Education Is Not the Answer to Our Class Problems
https://workingclassstudies.wordpress.com/2019/12/02/amplified-advantage-why-education-is-not-the-answer-to-our-class-problems/

hirty years ago, after having dropped out of college after just one term, unable to pay for my dorm room, I was unsure if I would ever leave the working class.  Two years later I was a student at Barnard College, an elite small liberal arts college three thousand miles from my parents' home.  To this day, I am not sure how I made that leap, but it was smoothed over by significant financial assistance from the college.  Unable to pay for my public university, I was able to graduate from one of the best private colleges in the country virtually debt-free.

Now I study higher education and its connection to what we call intergenerational social mobility, the movement (or lack of movement) between classes, comparing children and parents' occupational outcomes over time.

I have some bad news.  While the path I took was not easy, gaining social mobility through college education is much harder for young people today.  Ironically, even as more children of the working class go to college, the educational attainment gap between the middle class and the working class continues to grow.

How can this be?  For one thing, the bar for "being educated" continues to rise.  As more people earn college degrees than ever before, the kindof college degree increasingly matters.  What type of institution?  What major field of study?  Also important is the level of education – in many fields a four-year degree is no longer enough to assure a middle-class salaried job.  You need a master's degree, or even a PhD, for some work, even outside of academia.

Scholars of education (including sociologists like me) have known all of this for a while now, which is why so many of us have studied access to colleges and programs.  Colleges have struggled to open their doors to first-generation and working-class students.  They are paying more attention to ways of broadening access, sometimes pushed and shoved into doing so by state boards of higher education.  At the same time, budget cuts at public colleges and universities undercut many of these efforts.

But getting working-class students into colleges is only half the battle.  Keeping them and helping them thrive has proven difficult.  I explore some of the many reasons for this in my first book, The Burden of Academic Success:  marginalization, impostor syndrome, feeling out of place.  Even at open access two-year public colleges and universities that are the most open to working-class students, middle-class students predominate.

My experiences at Barnard reflect why that matters.  I rarely talked to anyone about my family, and, when I did, I regretted the ridicule, mockery, and disbelief.  I knew I was different.  Most of the time I was too busy juggling off-campus work and an overloaded academic schedule to care, but the isolated feeling was always lurking in the background.  If I hadn't an abundant scholarship, I know I would have left.  As Tony Jack reminds us, "access is not inclusion."

Getting working-class students into college and keeping them has proven difficult, but not impossible.  Successes – like me, Tony Jack, all the working-class academics out there —  do exist.  Here's the real problem: even when we succeed academically, the gap between us and everyone else increases after we graduate, as Debbie Warnock'sremarkably honest account of her move into and through the academy so poignantly demonstrates.

In Amplified Advantage: Going to A "Good College" in an Era of Inequality,I demonstrate the many ways that parental resources and class cultures amplify the preexisting advantages of some students, even as colleges provide all students a solid education, expanded social networks, and useful cultural capital.  Based on a national survey of college students attending small liberal arts colleges, interviews, and a follow-up survey with recent college graduates, I found that colleges like Barnard did a lot of things well for their students.  Students generally had frequent interactions with faculty and peers, ample opportunities for doing research outside of class, abundant extracurricular activities, and a lot of institutional support for individual growth.  Given the quality of education and opportunity provided, the average $50,000 annual price tag for elite schools actually seems worthwhile, especially when low-income and working-class students receive sufficient financial assistance.

And yet, for all these colleges do to provide an equal playing field for students (all live on campus, everyone takes small classes, almost everyone is involved in useful extracurricular activities), once students graduate, their experiences and opportunities deviate sharply.  More elite students can leverage their advantages and resources in ways unavailable to other students.  They may, for example, take a risk on joining a start-up company, knowing that they have resources to fall back on if this risk does not pay off.  Others may rely on parental financial assistance to spend a year in New York City working at an unpaid internship or working for a nonprofit in a position that pays very little, expecting that such work will eventually pay off in a more secure and remunerative position.  Still others call on the friends and social networks of wealthy parents in the financial sector to ensure them high-paying jobs immediately after graduation, despite relatively shaky grades. Where elite students can afford to take big risks with potential big payoffs, knowing that the risk is ultimately ensured, working-class students' choices are heavily constrained by circumstance and necessity.   Even compared with more middle-class peers, who may owe just as much in student loans, working-class students are much more likely to take jobs that they do not like and that do not match their skillsets in order to repay student debt. They may have accrued a ton of social and cultural capital while in college, but they can't make use of it in the way of their peers.

In an increasingly unequal world, where elites outpace all others, reforming higher education from within won't solve the problem. Class inequities shape students' opportunities from before they enter college and long after they graduate. To the contrary, if we focus on education as the primary tool to level the playing field, we lose sight of the larger battle. As Andrew Sayer cautions, even reform efforts with egalitarian motives "are likely to be twisted by the field of class forces in ways which reproduce class hierarchy."  In other words, the more we turn to education as a way out of class struggle, the more we may actually end up amplifying advantages of the few.

And we cannot afford to do that now. The time for ignoring the larger class struggle has passed, as we are all implicated in the game that is being played.  Simply put, expanding opportunities does not work because some players start off with extra resources, and they will use all the tools they have at their disposal to amplify their advantages.  Struggles might ensue over the value of those tools, which suit is "trump," and which advantages accrue the most chips, but as the pot grows bigger and the stakes get higher, the game is still rigged against those who begin with fewer chips.  Do we want to keep playing this game?  Do we know how to stop?  It's time to stop asking how we can get more people into college and start asking why it matters.

Allison L. Hurst, Oregon State Universit

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Corporate America's debt load is nearing $10 trillion, a record 47% of the overall economy — and experts around the world are sounding the alarm [feedly]

Corporate America's debt load is nearing $10 trillion, a record 47% of the overall economy — and experts around the world are sounding the alarm
https://www.businessinsider.com/us-corporate-debt-10-trillion-record-percentage-economy-expert-warnings-2019-12?utm_source=feedly&utm_medium=webfeeds

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