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On ?Repairing the Breach?: Economic forces wreak havoc

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article reprinted from the UMConnection: Commentary
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JULY 9, 2003

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VOL. 14, NO. 13

COMMENTARIES

 

 

On Repairing the Breach: Economic forces wreak havoc

When I read the theme for our recent annual conference, Repair the Breach: Restore Gods Community, my first thought went to a kind of breach caused by the upcoming changes in our health insurance. When I was ordained, 10 years of ministry would have made me eligible for 50 percent of my insurance premium during retirement. Now that I have reached 10 years, that percentage will be reduced to 25 percent. I cant complain; too many in my congregation and community face greater loss from the collapse of Bethlehem Steel.

The point is, we cannot ignore economic trends if we are to speak of repairing the breach. These powerful forces affect us and our institutions in ways we dont always see. Making it more difficult, we willingly believe convenient rationales, comfortable platitudes, perhaps even a few lies, rather than face unpleasant truths.

One of those unpleasant truths is that our economy is no longer able to produce work for all of us. We dont want to hear it; it undermines the American dream. How can a society that cannot give its people work expect loyalty? How are Christians to love others if we are constantly in competition with each other for the simplest of things?

These conditions began with the Clinton administrations support of global markets. A critical element was the elimination of U.S. trade barriers, making it possible for corporations to manufacture elsewhere and ship the goods to the United States without penalty.

Another element is the mantra of productivity, often confused with efficiency. Efficiency is interested in the way humans work, productivity focuses on minimizing expensive humans in the production process. As a result, for over a decade we have seen massive job elimination or downsizing by automation or moving jobs to nations with lower labor costs. In concert with these have been major wage reductions, benefit reductions and an increase in part-time employment.

For the first time in history, the stock market rose as jobs, wages and benefits declined. Unemployment significantly increased but so did the number of adults outside the labor force. These are folks whose unemployment benefits have run out but who have not found work. There is no effective way to actually count them. In March, the Department of Labor estimated 74.5 million such people.

Because the number of those disconnected from the economy is much higher than unemployment figures indicate, the unemployment rate has become less useful as a measure of economic health. (Since the prison population exploded during the same period, some in our prisons must be regarded as unemployed.)

Similarly, no leader has acknowledged that the stock market is no longer a reliable measure of our economic health, unless you dont care if everyone can get a job. The Clinton administration avoided the fact by constantly advertising new job creations, failing to subtract those jobs eliminated or sent elsewhere. Also, they failed to mention that those new jobs did not measure up to the salaries, hours and benefits of those jobs lost.

Recently, the Republican administration has promoted economic plans it claims will provide a job for everyone who wants to work. (Weve heard that code before.) Current economic trends will cause their plans to fail. If they know it, they are lying; if they dont know it, they are making decisions based on how they want the world to be rather than how it is.

For example, the administration has reduced taxes for many of us and will send us a check during the next few months, claiming it will increase jobs because we will spend it. They did it once before and it had no effect on jobs. Why?

Two reasons. First, many people made payments on their already too high credit card accounts that doesnt create new jobs. Second, they went to a store like Wal-Mart and bought something made in another country. That created new jobs in other countries and increased the profits of multinational corporations that import those products, but no new U.S. jobs were created.

Another example is the claim that reductions in corporate taxes will encourage new investment and, therefore, create new jobs. Most new corporate investment is in technology to eliminate jobs or in construction of plants in countries with lower labor costs.

Similarly, tax reductions for the wealthy are touted as a way to channel money into new investments that will create jobs. Those who actually do invest will be looking for increasing levels of productivity, meaning they will invest in corporations preparing to downsize their work force by automation, or to transfer jobs elsewhere.

What can we do? Some suggestions to help us think about it:

  • We can stop equating democracy with an economic system. Democracies can have whatever economic systems they choose.
  • We can stop blaming the poor, the uninsured and the elderly for economic problems they have not caused; i.e., stop blaming the victim.
  • We could admit that those who most benefit from our economy are the wealthy, and that they are making a great effort to avoid paying for what they receive.
  • We could begin to think of an economy as a network of moving money and that the health of an economy depends on how well money moves among the people of the society in which the economy is located.
  • We have to begin to rethink what we mean by work; i.e., what are we willing to pay people for?

These general directions might lead to some solutions. Whatever we do, we will face major challenges to the way we think about work, money and social organization.

The Rev. Peter L. DeGroote is the pastor of College Park UMC.

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