Saturday, October 03, 2009

Globalization and some home truths for Bernard Avishai

Globalization: Chinese underwear on sale in Madrid, Spain

David Seaton's News Links
A couple of days ago  Canadian-American-Israeli, professor, author and businessman, Bernard Avishai, blogged an article, "Unemployment Or Unemployability? A Story", which he posted to his blog and cross posted to Talking Points Memo Café. This snippet will give you an idea of the content and the tone of his piece
But here is the sad reality impinging on unemployment. For there was greater social risk to the compact, too, and it was not hard to imagine what became of car mechanics who, unlike Dave, were not prepared to hold up their end of the deal. You ran into many such people in rural New Hampshire: not-quite-enough schooling, too much beer, too much TV.It was precisely because direct labor used to be so simple, mechanical and yet critical to value creation that labor unions made sense. The logic behind unions may still apply to some kinds of work—fast-food servers, apparel assemblers, hospital orderlies. But any job that is simple and repetitive, that requires so little individual creativity that an employee would rather join a union than negotiate an individual career path, has become a prime target for the computer-integrative technologies. All of this has meant that tens of millions of people—people with children, people hobbled by dullness and self-doubt, people who played by rules that simply evaporated from the time they were 15 to the time they were 35—are hard pressed to see a future. Bernard Avishai
Aviashai's is a fairly accurate, if uncritical vision of the new "knowledge economy", but his posting caused a firestorm of comment at Talking Points Memo. It was if he had broken a dam of pent up anger and frustration.

What impressed me most is that the anger wasn't from "people hobbled by dullness and self-doubt" or people with, "not-quite-enough schooling, too much beer, too much TV". No, it came from precisely the people that the system had prepared  --  using Avishai's phrase -- to "negotiate an individual career path", even people with post-graduate degrees.

The system is failing them and believe me these are the dangerous ones for a system to fail.

If you have read a bit about revolutions you'll remember that they are not put into motion by the uneducated, those who consume "too much beer and too much TV" -- no matter how oppressed they are -- but by the dissatisfied intellectuals of the middle class, those who have the necessary skills, knowlege and tools to first understand and then to subvert the system.

From time to time the uneducated, the sans cullote rise up in their blind desperation, but if there is not a group of intellectuals who are prepared to channel that anger it soon blows over and fades. It is the intellectuals that turn rebellions into revolutions. 

I don't remember ever seeing this type of third world intellectual's anger in educated Americans before. During the sixties,  American university students rebeled against the war, the draft, racial segregation and so forth, but the anger I sense in the comments to Avishai's post is traditional class anger. This is the anger of people, who  as Avishai says, "played by rules that simply evaporated from the time they were 15 to the time they were 35", and despite their education, "are hard pressed to see a future".

Here is a small sample of the abuse he received. I recommend reading it all as the quality of some of the comments is superb:
Bernard Avishai, that condescending, anti-union, globalist jerk, has a summer-house near Wilmot, New Hampshire. He thinks anybody who isn't very, very smart should be very, very poor, or, better still, just fucking die.
Tell me about the high level of "risk" in the life or the real owners of our "ownership society," you know, the Goldman Sachs fraternity, the Paris Hiltons, the George Bushs, the Robert Rubins, the Tom Friedmans, the Warren Buffets? How come nobody re-engineers Tom Friedman's job so it can be done more intelligently? What "risk" means for the top dogs at Lehman Brothers or AIG? If owning the "means of production" means so little these days, why can't we have it?
The picture one gets from this anecdote is that the contemporary world is just so inherently fraught with dynamic change and ceaseless creative destruction that no one can survive any more on average, stolid intelligence and workaday responsibility. Everyone in America now has to become a "creative thinker" and an entrepreneur, and spend their brief moment on Earth restlessly "negotiating an individual career path" to keep up with the torrent of change. To me, that sounds like a very annoying, stressful, spiritually lonely and unsettled way to live.(...) I am appalled by the amount of intellectual talent that is drawn to edgy, decadent and expensive outposts of human desire and craving, while the fundamentals of human life are neglected and taken for granted. Our lives seem deeply out of balance.
I am really glad you live in the rarefied world of successful entrepreneurs and innovators. The rest of us have to exist too. We have to buy that stuff. Your disdainful conceit is nauseating. I know a lot of great hardworking smart people and this economy is utterly failing them. My whole life has been watching our middle class struggle to stay in place. (...)  I am relatively young (early 30's), and this is the experience of my generation. I have friends who have already gone through 3 career changes already- mimicking the economy at large (, real estate, service, etc.). I know engineers that have spent their last employed months training overseas replacements. One was just laid off from a good printer company (the one that gave Carly 20mil plus) and now works a late night fish taco stand. He has a masters from UC Berkeley. He has only one other 'good' job prospect- going to Tianjian to train. On contract. MASTERS. Reminds me of when I would travel in third world countries and used to be shocked that a doctor would be a taxi-driver. I get it now. I know so many older smart hard working people who are now permanently underemployed it, or worse. They have been screwed, and they are not the 'too many beer folks'... Fucking Prick.
One thing that is ludicrous is how 1980s this blog is. Security for college grads is, in fact, so very 1980s. These days kids graduate with a ton of debt, to a job market that has six applicants for every opening. That's why we recently witnessed a talented recent grad -- double major -- die from lack of health insurance when she came down with H1N1. People who graduated in the 1980s and 1990s have no security either, since there is an army of ready replacements. But hey if it makes you feel good we'll give you a PhD in asshattery.
Of course in all fairness, some places have got it worse than the USA.

Mr Avishai's other country, Israel, for example.

Noemi Klein in her seminal book, "The Shock Doctrine", devotes an entire chapter to Israel, entitled "Israel a Warning", where she describes how Israel has been transformed from a labor intensive agricultural exporter to a high tech super power, selling security and weapons technology for the "war on terrorism". This transformation combined simultaneously with a Friedmanesque  (Milton) reduction of the previously generous welfare state has been disastrous for a great many Israelis. Few countries have ever changed as drastically as Israel has in such a short time.

These first quotes are from the Israeli mass circulation Yediot Aharonot and the Jewish Journal:
Once idealized as a socialist paradise, the Jewish state is increasingly becoming a country of two classes -- those who have soared in the increasingly capitalist economy and those who have stumbled in its wake.
Despite its much-mythologized egalitarian image, Israel has always experienced economic gaps. But now the divide between haves and have-nots has grown to alarming proportions. If economic policies and other factors have spawned a privileged class, they also have produced a deeply entrenched underclass populated by the elderly, Holocaust survivors, Arabs, immigrants, ultra-Orthodox Jews, single parents -- even two-income families.
Israel has bypassed the United States and now leads Western countries when it comes to child poverty figures, according to a grim National Insurance Institute report released Monday.
According to the report, child poverty grew by about 50 percent since 1988, with about a third of all children living below the poverty line. Meanwhile, 28,000 additional families dropped below the poverty line in 2004, comprising 107,000 Israelis, 61,000 of them children. YNet
And this next is from the Bnai Brith; founded in 1843, it is the oldest continually-operating Jewish service organization in the world. (It should be noted that this article was published before the "great recession". Things are obviously worse now).
The reality of poverty in Israel is relatively new to the Israeli consciousness. Hundreds of thousands of Israelis face serious financial hardship-even as Israel has developed into a fledgling economic power, posting impressive gains in gross domestic product (GDP) and achieving dizzying growth on the Tel Aviv stock exchange.
Throughout the 1990s, the poverty rate in Israel climbed steadily. The number of poor Israeli families grew by 4.4 percent of the total population-the sharpest rise in the developed world. Public assistance increased to meet the need; from 1990 to 2001, welfare payments in Israel more than doubled, from about $5 billion annually to more than $10 billion. Nevertheless, the ranks of those living in poverty continued to swell and the socioeconomic gap in Israel between rich and poor rose sharply.
Between 1998 and 2005, child poverty rose 50 percent, to 35 percent of the child population, according to the National Insurance Institute (NII) and Israel's Central Bureau of Statistics. There was a sharp spike in poverty overall between 2002 and 2004, when Israel's then-finance minister, Benjamin Netanyahu, instituted drastic cuts in welfare services. This coincided with the peak years of the Intifada, when the economy flagged as Israel coped with that ongoing crisis.
Although poverty rates in the Jewish state leveled off in 2005, they still remain higher than in any other industrialized country except the United States. "We have had stabilization, but it's not good enough, because we have stabilized at a very high level of poverty," says Miri Endeweld, head of the economic research department at the NII, which manages Israel's welfare system. "When you get to a high level, of course you're going to stabilize. How high can you go?"
And it is not just that poverty has risen. In 2004, Israel also had the second-largest gap between rich and poor among industrialized countries; only Taiwan's was larger. Israel's income gap was twice as large as that of the United States. To wit: While luxury homes with two-car garages are built in the beach town of Caesarea, residents in the next town on the other side of Israel's coastal highway use food stamps at local supermarkets in Or Akiva. Bnai Brith

And in Israel, "the light unto the Nations" nearly 30 percent of the population goes hungry: this from the Israel News Agency:
Over 400,000 families in Israel suffer from "nutritional insecurity," a euphemistic term for "hunger." 28% of Israeli citizens, or 1,600,000 people are living in poverty. Among them are more than 600,000 hungry children. Those experiencing "nutritional insecurity" eat smaller portions, skip meals and, in extreme cases, don't eat for a whole day. Diets may be high in carbohydrates and lacking or almost devoid of meat, dairy products, vegetables and fruit. In Israel, 22% of families are deemed moderately insecure and 8% suffer from severe insecurity. A family's situation is considered moderately insecure when the parents deprive themselves of food to ensure their children get what they need. In families whose situation is severe, the children are deprived as well. 60% of nutritionally insecure are Jewish, 20% are Arab, and 20% new immigrants. 80% of nutritionally insecure people reported a deterioration in their situation in the last 22 years, as Israel economic conditions have deteriorated. About 24% of Israelis are forced to make choices between food and other expenses such as mortgage, rent, medicine, heating and electricity. About half choose to get along with less food. The 'poverty line' in Israel in 2002 was NIS 4,500 a month ($937.50) for the average Israeli family of four - mother, father and two children. Signs of how severe the problem is are all too apparent on the streets of Israel. In Jerusalem, for example, nearly 1,000 people a day come to four soup kitchens at which hot meals are served. It is also commonplace to see older men and women picking through the garbage at outdoor markets in Israel's cities. The collapse of the economy has taken a great toll on the lives of Israel's poorest families, and many children from middle-class families are now joining their ranks. Unemployment in Israel is around 20%, and the difficult economic situation has taken its toll on huge numbers of Israelis. Israel News Agency
And to finally drive home the point further, this piece from America's foremost Jewish newspaper, The Forward:
Economists are bracing for an early warning about what toll the world economic crisis may be taking on Israel’s population. Popular wisdom is that Israel is weathering the current world financial storm, with the economy faring well given the circumstances. Last August, the Bank of Israel revised its forecasts of growth in 2009 to one of stability from a reduction of 1.5% in GDP. But this offers little comfort for many ordinary Israeli householders. Figures set for release later in October by the government’s Central Bureau of Statistics show that even when the economy was at its very strongest, in 2007, more and more Israelis had difficulties putting food on the table. That year, the country’s economy grew by 5.4% — faster than the United States, Europe, the United Kingdom and Japan. But the percentage of Israelis who went without food for economic reasons at some point during 2007 stood at 21%, up significantly from 14% in 2003. “I am afraid that the figures for 2009 will not be better, but rather even worse,” said Yosef Katan, an expert on poverty in Israel from Tel Aviv University’s School of Social Work.(...) The universal measurement of inequality in a society is a complex mathematical calculation called the Gini coefficient. The lower the number- — between 0 and 100 — the more equal income distribution is in a society. Israel’s score in the latest UN-published table is 39.2. This is higher than all other western industrialized nations but for the United States at 40.8. Most European countries have scores in the high twenties or low thirties. Back in the 1950s, Israel boasted some of the lowest scores in the world. The Forward
It seems to me that an economic system -- one which supposedly favors intelligence -- where even Jewish people starve, is a simply a fraud.

Israel was a country specifically created to keep the Jewish people safe from harm. An economic system which fails miserably to fulfill the founding "mission statement" of such a state, can certainly not be expected to produce results in any country, especially in one which like the United States has repeatedly shown that it has no such protective view of its citizens.

The anger and frustration of the educated and the skillful will surely find an outlet in action. What form that action will take I do not know.

Certainly I think the progressive community of the United States deserves a better home than the Democratic party. Things have to get done, people have to get organized, strikes and demonstrations have to be called and the Democrats are never going to do any of that... They exist so that those things wont ever happen. DS


Anonymous said...

Your almost there David! You now can aknowledge that the world has changed. Now all you have to do is change your ideas and abandon all these late 19th/early 20th century solutions to our 21st century economy.

And stop obssessing over class. This America, not Europe or Israel. And if there is class resentment in this country then it's directed at suburban progressives so your "revolution" wouldnt go as planned.


David Seaton's Newslinks said...

Class divisions in the USA are beginning to harden in ways similar to a third world country. This is totally new.

How, exactly, this will change American politics I'm not sure, but I'm sure it will.

I also see for the first time in US history (correct me if I'm wrong here) the appearance of a large group of university educated cadres who are not being employed at the level they were trained for and whose social and economic aspirations are being frustrated.

Highly trained, life is passing them by.

This class of frustrated intellectual is historically the most volatile and subversive political actor of all. These are the people that make revolutions.

So, in my opinion, something is going to happen as this class of highly trained malcontents grows.

Growing inequality, hardening class differences and a large mass of frustrated university graduates is an explosive mix.

This is why the police and the army are always occupying college campuses in the countries with great inequality and poverty.

I don't know when this will all come to a head, but in less there is some sort of miracle, come it will.


When was New Orleans supposed to flood?

When will the San Andreas fault shrug?

Things that are just waiting to happen.

Anansi said...

Yes, things are just waiting to happen but what things will be the trigger? There is a lot of talk but not much action except among the most emotional and least coherent. Having watched them swallow torture, aggressive war, obvious financial chicanery and Fox news, are we to hope that their blighted self-interest will be the tipping point? Maybe.

Forensic economist said...

The US is highly class bound, it just pretends it isn't. There is less social mobility here than in the UK; the UK is more honest about it.

I don't consider most people who live in the suburbs upper class, defining upper class as "ownership of the means of production." What is new is that the middle class suburbanites' children no longer are assured that they will stay at that level.

By the way, how much of the Israeli income divide is Ashkenaz versus Sephardic ie by the color of their skin?

Irony time:

Now it’s a pity to see
When the land of the free
Turns out to be
Nothin’ but a free for all

If you got dough
You’re freer than most
Cause your freedom goes up with
The size of your bank roll
- Del McCoury, Moneyland

The Del McCoury band is one of the finest bluegrass bands around, highly recommended. Not likely to ever be top 40 since they have no electric instruments.

Heard at Hardly Strictly Bluegrass, free courtesy of Warren Hellman, amateur banjo player, financier and descendant of the founder of Wells Fargo Bank.

PS living on the Hayward Fault, an offshoot of the San Andreas Fault, we all take the attitude that while a Big One is guaranteed to hit sometime in the next 50 years it won't happen tonight, so no precautions are necessary. You can take that as a metaphor for our planning in a lot of fields.

bailey said...

Ironically, this may be where the internet becomes counter productive. Everyone argues all over the comments sections, the 'wild west' as 'they' call it, corny, but true. Fair enough, people vent, exchange ideas, etc, but no one gets off the couch.
I find it unfortunate the left/right paradigm rules. They argue about one another rather than ideas, revolutionary ideas or revolutions at all.
Sure we know who's pulling the strings, but what are they going to do about it? This conundrum plays into two items I drone on about, one; the place is too big, second; the pathologies have to do with big 'God's'; corporate/org religions/moralistic values, or whatever authority they easily play into....I grew up in a mid to upper middle class neighborhood but I mixed with everyone, was more curious than most, travelled because of tennis and lived in NY and Colorado before I finished university in Seattle and London so my experience from a young age was far from narrow, combining the corp with the art crowd, and then some, but what I always found interesting was how relatively benign and bland the different groups are...the punks and hippies alike become bitter and more conventional than ever and the yuppies just stay on the 'track' until they have a stroke or get breast cancer. Too simple and brutal, c'est vrai, but then so is life and as Americans, so many of us had it so easy.
I don't see revolutions. These tea parties shown along the distraction that is our media means nothing. Obama is thoughtful, intelligent, but I'm with Gore Vidal. Call him a fantasist but he's been spot on for 6 decades and he's still going strong and gets it, America's entered a new chapter and it's not pretty, but it happened incrementally, slowly and very openly.

Anonymous said...

Yep, there's always been bluegrass and country singers writings songs about the blue collar white man's problems. CCR made a career out of it. Your analysis of how we are "class bound" is flawed however. Even if it's true that there's more "social mobility" in the UK, to whom can you attribute that? Margaret Thatcher or Tony Blair? In the end Americanesque bourgeois values win the day. The only thing progressives can do is scream about the inequities of the system and that will only take you so far.

The problem all of the supposedly educated people on this site have is a fundemental lack of understanding about human history and our current condition. That and you cant seem to do anything but repeat the same hackneyed BS the "enlightened" have been saying for over a century now.

Human beings used to be hunter gatherers, now we're consumer traders. All of this collectivist thinkning might have made sense back when we were chasing antelope across the Serengeti, but it doesnt make sense NOW. People made around $150 on average before the industrial revolution, now they make $6,600. You can read one of your retarded writers who talks of us returning to some kind of way of life that existed before this transition, but that's logistically impossible and it would also be taking a huge step backwards. How much bloodshed and how many political prisoners would it take to turn an increasingly decentralized world into a more centralized social structure?

I know all about this group of frusrated intellectuals of which you speak, because I'm one of them. I'm university educated and I'm struggling. But one thing I've noticed is everyone I speak to, whatever their politics, has very little faith in the elite who are running the country, and more people in the polls are calling themselves "conservative" and saying they trust the market over the government. You also should ponder how my generation is going to respond to this massive transfer of wealth from the young to the old because it's coming. Baby boomers might get smothered in their sleep by their children before it's all over.

Revolution is coming, but most likely not what YOU would call "revolution". We'll be living in an unequal world when I'm as old as you are. And that's life.