Camille Roy is a writer and performer of fiction, poetry, and plays. Her latest book is a collection of poems and prose called Sherwood Forest. It is published by Futurepoem.
Landslide Brought It Down
A ground level view of the American economy
by M.C. Adams with Camille Roy
I'll start by going back to the spring of 2003. I was walking down an apartment building hallway towards the door of a technology startup called Friendware. I had a feeling of assurance. Behind that door I believed lay my next job. Despite the fact that none of 35 mid-career professionals in my recently completed Advanced Java class had gotten a job, I believed I would get this one.
I was right. The glib follow up would be, It went downhill from there. But getting the job was a little bump on a downhill slide which was already in progress. Just days before, another member of my class had taken me aside and whispered that at the thriving small company where she had worked for 15 years, business had just evaporated. Gone. She was laid off and her prospects were dismal.
So I opened the door to Jack Porterfield's apartment for the interview knowing that some sort of economic turn had started. I was unsettled, but more curious than afraid. I had no clue that the way events would ultimately shake out would shock me to my shoes.
Jack had a recently issued patent and high hopes for a new product based on it. My assignment for him was a side project which was supposed to earn operating income as he crafted the first release of a technology that he had been working on (with breaks) for probably seven years.
At first there was just one other employee (a secretary, whom I'll call Stephanie) and we worked in his apartment which was high on the northern side of a building on Broadway. It was furnished in basic startup style: Office Depot tables, a dirty wall to wall carpet, workstations. But it had a view that swept from the Golden Gate to the East Bay hills. Given that it was a job, I had some perfect hours there. Sea breezes flowed through the room and I could look up from my desk and watch sail boats leaning with the wind. The air over the Golden Gate held an intense yellow sparkle of sunlight reflected from the water. One day a window in the adjoining elegant art deco building was open and for hours a large filmy curtain undulated in the wind.
As it was Jack's apartment and he was the boss, we settled into his rhythm – insights and plans, laced with jokes. “Excuse me if I'm yanking your chain...” he'd begin. One day I was working on an awkward technical corner case when a chat from a sex worker popped up on my screen. 'Hey Jack sweetie call me...' etc. Jack saw this and told me flatly that he loved prostitutes. I felt apprehensive. Was this the sort of boss confession that would lead to unwelcome asides or even advances on female staff? No - Jack was too cool for that. He just liked prostitutes. He had a little engine of liking that filled the office. He loved his ex-girlfriends (who called frequently) and his many friends and talked story about all of them.
Do you want to picture Jack? He was rotund. Fleshy and pale, with dark hair, thinning on top. About my height and age. His grin was easy and made his lower lip stick out. He was from New York. Strong accent. In his younger skinnier days, he went to the same dance club I did, back in the 80's (the I-Beam).
Some interesting things about Jack: he had written a couple of novels. He was one of the first 20 hires at a major tech corporation (Sun Microsystems) and he walked out of that job with stock options that at their maximum were worth 100 million dollars. (Sob story: he didn't cash in anywhere near that.) He was also part of another company that had gone public. As these things are scored in Silicon Valley, this was an excellent show. To start off his career he had gotten the highest score in the country on the computer science GRE. And he'd earned a Ph.D when he was only 21.
For most tech entrepreneurs, there are at least a few bright flashing indicators of techno genius. Jack was only unusual in that he told us about them. How gabby he was!
But a boss is not a friend. He paid me a third of what I'd made only a year before. A third! When I argued with him, it seemed there just wasn't any more money. It was that or no job.
And, along the way, there were more signs of economic disintegration.
A few months after I started, Jack hired Howie Lee on a technical marketing contract. The interview took place behind a closed door but after Howie left I heard Jack on the phone bragging to a former colleague.
“Why should I outsource to India or China! I just hired an American with a Masters in Computer Science, for a little over double minimum wage with no benefits? Plus – he's got contacts!”
Why, indeed. Salaries were plummeting all around. I felt lucky to be employed – although Howie did not seem to feel that way. After a few weeks he quit Friendware.
At home I began to surf the web trying to figure out what was going on. I discovered the columns of Stephen Roach, who at that time was the lead economist for Morgan Stanley. He had a column in a newsletter for big clients, where he laid out all the shiny new profit making opportunities. He described one of the major new opportunities as the 'Global Labor Arbitrage.1 This boiled down to offshoring American jobs to low wage and low regulation locales, and then pocketing the savings as higher corporate profits. He documented that this was happening rapidly, not only for manufacturing but for insurance claims processing, legal services, and even corporate technology research and development labs – the top of the American value chain. This newsletter had tables of data for job cuts in America while centers, labs, plants and so on were opened overseas, to robust hiring. The numbers were in the tens of thousands, for individual companies (such as IBM). There wasn't a peep about this data in the mainstream press. No newspaper bothered to do the research, and the corporations were careful to keep this massive job transfer under the radar.
Roach at that time had misgivings. (He has since gotten with the program and written off the USA, in favor of China.) He said that this new profit play, the 'Global Labor Arbitrage', implied the end of something important, which I had also never heard of. This thing he called the 'Great American Jobs Machine'. This term seemed to be well known in certain circles. I learned that in these circles it was regarded as the secret ingredient that all along had been making the country function. Who knew. We didn't need good schools or nationally funded health care or well funded unemployment insurance or re-training, etc. We didn't need a European safety net because we had this magic Jobs Machine. It enabled us to assimilate immigrants, provide upward mobility, and, with a lot of rough edges, support 'The American Dream'. If our 'Great American Jobs Machine' broke down, there would be trouble, fretted Stephen Roach.
He was advising the corporate employer class to, in essence, go gently as they left the United States. Instead of just turning out the lights, they should sponsor re-training, or something. I had an uneasy feeling of recognition. Chicago, when I was born, was throbbing with manufacturing, with miles of flaming smokestacks and many hiring halls. From my neighborhood I could see the so-called Largest Steel Mill In The World. When I left, manufacturing was rapidly departing, shedding unions as it headed for Southern right-to-work states with lower wages and benefit costs. It is hard to describe the depressing feeling of growing up in a deeply entrenched economic decline. The chill has a particularly penetrating quality. There's a rising tide of shabbiness. Broken windows, even in schools. Gangs become more entrenched and violent, as the economy withers.
There is a narrative that goes along with this kind of economic abandonment. It consists of a flurry of reasons Why You Are Not Worth It. You are: Too expensive! Too many benefits! Not flexible! Not educated enough! Over educated! Too old! Too young! We don't like you! You smell icky! The content varies but the message is snide and weirdly unanimous, as the press assumes the role of echo chamber for the board room. Abandonment forces into view the fundamental nature of capitalism-as-adversary. So when I originally chose a skill to train for, I picked one that I thought would be in a fortified position. I wanted my work to be incomprehensible to most people. Highly technical. Making me harder to replace. I figured this would give me a measure of security, decent pay and benefits, the whole bundle.
And it had been a great ride for 17 years. For 12 of those years I worked in a lab with high levels of expertise, commitment, and stability. It was the kind of place where you could take graduate computer science classes at Stanford on company time, paid for by the company. At one point I even had one day off a week to write poetry (I earned this through high productivity). Some employees called it the 'Happy People' company (a.k.a. Hewlett Packard). The corporate culture was apolitical and imbued with a faith in founders and free enterprise. Despite my engrained skepticism of these things, they seemed to work. The deeply agreeable environment produced clear and effective technical communication and problem solving. Strong egos were mostly neutralized in the overall niceness. A colleague of mine, an immigrant from a country of hard politics and lively all nighters where conversation and vodka flowed freely, complained about our American shallowness. “You go to a cocktail party here. And you are not allowed to talk about politics, sex, religion, or death. What can you talk about? There is nothing to talk about!”
In retrospect this shallowness seems like an American form of innocence.
The facility where we worked was big. It was off the 280 Wolfe Road exit in Cupertino. There were many very large buildings and many very large parking lots. It took me nearly half an hour to jog around it, during my lunch break. There was a huge amount of work concentrated there. During my interview I was shown the fab (chip fabrication) labs. People in white safe suits moved like ghostly robots behind thick panels of glass. These facilities soon departed for cheaper environs but the software and chip design labs and technical marketing offices expanded over subsequent years into new buildings in what had been remaining patches of an old orchard. The jack rabbits dashed around in confusion as they lost habitat until I didn't see them anymore. I was sad about the jack rabbits but there was an ease to the sense of a rising tide. We were all doing well and it remains overall the most decent place I've worked.
By the time I worked for Jack, I had been gone from Hewlett Packard for six years. The world outside my highly functional corporate cocoon continued to surprise me. I learned that people wanted to extract value from my skill set while paying me as little as they could get away with. The relation was extractive. I was the resource, like aluminum. Hewlett-Packard was very interested in developing its staff, but this was hardly universal, I learned. This creates conundrums. How freely do you offer your expertise to the people who are paying you for it? Sometimes staying silent or writing incomprehensible code actually increases your value in these extractive relationships, because they can't get rid of you as quickly. They must struggle to extract the value they need. It turned out I was not good at these calculations. The habits of openness and helpfulness that had been explicitly inculcated at the beginning of my career at Hewlett-Packard were too strong.
This issue came up as I was working for Jack. He had taken what I thought to be a wrong technical turn. I explained the issue in depth. I told him what I thought should be done: scrap the existing work, start over (it wasn't too late) and I showed him a different technology that would make the work easier, more extensible, and less fragile. I offered to do it, quickly. He nodded indifferently. I wasn't sure I had gotten through. It turned out I had given him so much information he felt he could do the work himself. I was laid off.
With my new free time I continued to investigate the queasy economic moment. I began attending meetings of laid off tech workers. These were dispiriting gripe sessions mostly. Young hipster types tossed their longish hair and looked indignant that a movement was not available to them. The political apathy and centrism of the corporate workplace had worked its enervating magic on us. It was like floundering in jello. The only people who wanted something like a union were out of a job. I felt sorry for the older guys were might never work again. Some were facing bankruptcy, loss of their homes, kids dropping out of college because tuition money was needed for the bills. Most often whether you plunged or tread water had nothing to do with merit. The music stopped, and those who happened to have a chair were fine.
I learned from the papers that 40% of the tech jobs had disappeared, and that this was the biggest job loss in any community since the Great Depression. Deep pervasive silence greeted this information.
After a month or two, Jack emailed me. He wanted me back, at that incredibly low wage rate, of course. Fine with me. Once back I found that he had gone in the direction I had suggested and made a bit of a mess. I needed to clean it up and finish it. There was also some work that I could do that involved his patent.
While I was gone, the economic downhill slide had manifested in Jack's digs. Gone was the fabulous view. The new Friendware headquarters was a plain and functional apartment with no view and bare floors. It was near Japantown. Stephanie was still there, now looking anxious as she tipped around in her sandal heels which made clicking sounds on the wood floors. Jack was muttering about running out of money.
I kept my head down and plowed through the work, which was going well. Jack's talking story in the office continued. I learned why Jack had not released the technology based on the patent a few years earlier. Boom: tumors. He had gotten sick. One day tumors burst out everywhere, he told me. As he was in his early 40's this was totally out of the blue. Like many (most?) entrepreneurs striking out on their own, he carried no health insurance. He had to let everybody go just when he had a major client about to sign his first big contract. His remaining capital all went to cancer treatment, and now he was a million in debt.
A million! I couldn't imagine it.
The project I was working on soon had its first users and things seemed to be going reasonably well. I wondered to myself whether he had counted on more demand. There was some demand, but it didn't seem like enough to be the fountain of capital that would support the other technology, the one based on the patent, which he had not yet released.
As my project would wrap up soon, I began to contemplate my exit, or my negotiation strategy: which would it be? On the one hand, the patent work seemed interesting and I thought I could make a contribution. For that project, he was more interested in a technology sale than he was counting on building a company, which made it seem that there might be a payoff for me if I stuck around for a little while. And if I couldn't work that out with Jack, the levels of disloyalty and instability which seemed to be coursing through the field made me consider starting my own company. To build my own house, as it were, as shelter from the storm.
Then Jack obtained some funding from an 'angel investor' – not a lot but it encouraged me to negotiate for a real job with stock options.
Jack was firmly negative. There was no wiggle room at all. I left and started my own company.
I would check his website every couple of months. I was curious about the progress of his business – wishing him well despite feeling a little tug of resentment. After skipping a few months I checked it and realized it hadn't changed since my previous visit. Suddenly I felt dread. New companies with new products have constantly changing sites, to trumpet good news, to provide updates and new releases.
I searched for his name. This was probably in April or May of 2004. I quickly found an obituary, dated February, 2004. There was no information in it about the cause of death.
I wondered if his cancer had come back. If so, death had come incredibly fast. Then I recalled a comment he had made which was so outside of my frame of reference that at the time it slipped by me. He said, apropos of nothing I can recall, “If this company doesn't work out, there is nothing for me.”
I had met an ex-girlfriend, but forgotten her name. I knew she was getting a PhD in Computer Science, and I remembered the university. Their list of doctoral candidates jogged my memory and I emailed her: what had happened to Jack? She replied right away. When it became clear that the business would not make it, he committed suicide, in those cheap digs that were the last headquarters of Friendware.
In 2005 one of Jack's many friends put up a memorial website (home2, about3, photos4).
Part 2.
That's such a discouraging story.
It's a sad story.
You're sad.
Yes.
So how do you shift gears and get on with the rest of this? There's a lot more you want to say.
I'll get there. I'm building my fuel pile. You know how I like to blow things up. But first the story about Jack reminds me of what happened to Oluchi McDonald.
Son of our dear friend, the brilliant poet and teacher Akilah Oliver.
Let's go back to March, 2003. Oluchi had severe gut pain. But his health insurance had lapsed (temporarily). So when he was taken to the ER at a private hospital, they refused to treat him. The crap hospital that accepted him (since closed down) kept him for many hours untreated and even without pain meds. After seventeen hours he died in his own vomit. Twenty years old.5
Completely treatable condition, right?
Yes.
An utter tragedy.
Yes. Also the product of a depraved system.
...But we continue. We're in for the long haul.
So a question formed in my mind. It's the basic question, the one that mutates or cracks or balloons according to current conditions. And that is, what the hell is going on?
I began to investigate our queasy health care moment. A study on the impact of lack of health insurance on American health had just come out, done by the very best people (The Institute of Medicine of the National Academies). It found that about 17 thousand people died every year directly because of denial of care due to lack of health insurance.6 Direct causation. Oluchi was direct causation. Indirect causation – such as Jack's suicide as a result of health care debt – would give you a much higher number.
So that 17 thousand would include Oluchi but not Jack.
Right.
Jack is part of that much bigger number.
Right.
I felt weirdly relieved at the horrible statistics. There was a presidential election coming up and I expected that the Democratic candidate would address it. Change is slow but acknowledgment that it's needed is the beginning, right? So I waited.
Waited. For the war hero to take a stand. Was the issue even mentioned in the campaign?
No.
Why not?
Good question. Over the next few years more studies came out: some said 45 thousand died every year7, another said we had an extra one hundred thousand dead every year.8 Lots of dead Americans. Over a decade or so – up to hundreds of thousands! Meanwhile we are over in Iraq killing Iraqis by the hundreds of thousands and taking thousands of American casualties supposedly because some Saudis killed 2,985 Americans on 9-11. If Arabs kill Americans they can't catch a break.
And life goes on. My brother in law was trying to start up a restaurant in Florida. He worked extremely hard, getting it ready as fast as he could. No money coming in. Doing the work himself. And that meant he had no health insurance. So when he got sick, he put off going to the doctor. He ended up in becoming critically ill with acute pancreatitis and was in the hospital for a week. This put him into tens of thousands of dollars in health care debt and he had to declare bankruptcy. There have been long term chronic (and expensive) consequences of his tardy medical treatment. He had to give up on the restaurant before it ever opened.
We're lucky about that.
The economists have a notion of freedom which flows from what they call 'efficient markets'. Freedom means the market can do its work without restraint. This notion is highly convenient for the those whose deep pockets fund our political parties. They can suck the country dry, deny health care to their workers, and offshore jobs by the tens of millions, all in the name of freedom.
They've hijacked the word.
Free markets. Free trade. Free enterprise. The word used to mean the freedom of the individual to live in a republic of laws based on democracy. Now it means the freedom of the rich to do whatever they want to the rest of us.
I still don't get it. Tens of thousands of Americans have been dying every year due to lack of health insurance. How does this just not register?
Obama did address it, give him his due. Once he gave a speech where he forcefully connected a scheme for national health insurance to the basic moral dictum, I am my brother's keeper.
Which is a fine principle whether you are Christian or not.
Indeed. Then he never mentioned it again. Instead the whole rationale for a new system shifted to bending the cost curve, or something. Policy ping pong.
Meanwhile there was a different energy at the bottom of that campaign. I know because I was there. I went to a several day long organizing caucus for national health care insurance and it was packed. We spend a whole day talking story about health insurance.
A quiet woman in her fifties shared with us that she had gotten cancer after working in a corporation for over twenty years. Health insurance covered her treatment for awhile, but she was disabled for several years and became unemployed, uninsured, and unemployable. She could not afford the medicine or treatments for her condition. She was just waiting in terror for her cancer to come back. Everything about her seemed solid and dignified except the fear in her voice.
And there was a man in his early 30's who looked beautiful, healthy. He was working around the clock on this campaign without telling anyone that he had a fatal condition and could die at any time. When he told us he was uninsurable he burst into tears.
It was an incredible weekend. There was this outpouring of story and energy. Afterward people did their little organizing projects but nobody at headquarters was interested. These workshops were organized by Obama people but they weren't interested in the driving this content into the health care campaign.
The moral case for changing the system was never made forcefully to the American people.
When you don't make the argument, you can't win the argument. The moral case ending up being argued by the Tea Party, who claimed that in the future a new system might possibly include health rationing 'death panels'. For that reason we shouldn't have a new national health care system at all, ever. Also, of course, any sort of national system would hurt our precious freedom.
The irony could kill me.
Yes it could.
Let's check. Since Hillary Care failed in 1993 some studies suggest 300,000 extra deaths and other studies bring us closer to 2 million.
I wonder whether the new system will ever be implemented. It seems the Republicans would do anything to kill it.
Maybe they'll steal an election!
Ha ha. Very clever. But why are you going on and on about health care? Aren't you supposed to be writing about labor?
They are the same, in a way. The deep indifference to American health is mirrored by the decay in our job market. No one makes a moral issue of it, but it is degrading the welfare of tens of millions. I've seen it get worse and worse, and incredibly, it doesn't seem to register.
Why doesn't it register?
You keep asking me that. Part of the reason is this. Our political system (including the media) is now completely consumed by kissing and licking and slobbering on rich butt.
One of those things that once you get an appetite for, you can't live without.
Seems that way. Heroin for the politicos.
How can we get the political class to lose its taste for slobbering on plump and buttery rich buttocks?
Slobbering and kissing and licking. It's a complete package.
I've got an idea about that but it comes at the end. Analysis first! Let's talk about what happened at the Happy People Company.
Hewlett-Packard.
Yes.
I bet they don't call it the Happy People Company anymore.
No they don't.
As you can imagine, since I worked there for twelve years I paid some attention to what was going on. Four years after I left they got a new CEO, a woman. You may have heard of her. Carly Fiorina.
Firoina. Yes. She eventually ran for Senator in California. And she was chief economics adviser to McCain.
Chief economics adviser – what a joke.
An old friend of mine whom I went to school with – I'll call her Ellen – was still at HP. We had started there at about the same time. Ellen's path was in technical management and she was very good at it. Ellen is decent, very smart and capable, and works well with others. She fit in well with the values of the company and her progress up the ranks was steady. Her verdict on Firoina was positive. She was appreciative of having a woman at the top. Just to see what that was like, in meetings and so on.
It's heartening. The way women and minorities can and do get ahead in this country.
Isn't it. We're special that way.
Eventually Ellen's tone changed. It seemed things at HP were not-so-good.9 Of course there were a number of very public conflicts that roiled HP through these years. But Ellen was not enthused about the environment inside the company. It was hard for me to understand. I was a member of the technical staff in an era when HP was very serious about developing and keeping the engineering talent. So I couldn't recognize what Ellen was talking about. Still, Fiorina said something in a speech that made me wonder. The gist was: Americans had better get with the program. Because there's no such thing anymore as an American job. Her term for offshoring was “right-shoring”.
I remember that quote was used against her when she was running for Senator. It helped defeat her, I believe...
Yes. When people know what's really going on, they don't like it.
The next time I saw Ellen I was shocked by her news. She had gotten fairly high up in technical management, and had found a good location for herself in the company hierarchy. But she was leaving and gleeful about it. She was snatching an early retirement opportunity offer. She said she was getting out with some extra cash before they had a chance to lay her off. When her manager looked at her in disbelief and said, I can't believe you are taking advantage of this, she chortled to herself. It was one of those private victories.
I realized then that HP must be shedding its technical people – including the very best. A shocking thing to do really, for an engineering company. You would not believe how much expertise a good experienced technical person has. If you are outside the field you can't appreciate this. It was mind boggling to me that HP would take an ax to itself in this way, but by this time I had started to read Roach about the Global Labor Arbitrage, so I had a context for it. Because of course HP was opening labs overseas, especially in India and China. Where the cost of labor was cheaper.
Then HP acquired a new CEO – and he was even worse than Fiorina. Mark Hurd.10 The most amazing thing he did, that I knew about, was slash two thirds of HP Labs. This was the most advanced research and development part of the company. Slashing costs and increasing profits made him wildly popular on Wall Street. To me it seemed so dumb it must be a joke.
But this is all about Hewlett Packard. One company, a technical company. Companies make mistakes all the time and it means nothing for the wider economy. I bet all those smart people who left or got laid off found good jobs.
The more you learn, the worse it looks. American companies have created millions of jobs overseas as they have cut back here and HP is just a part of that pattern.11 Specifically big American companies cut their work forces in the U.S. by 2.9 million during the 2000s while increasing employment overseas by 2.4 million.12
I was astonished when I found out what had happened in manufacturing. As factories became more productive with fewer people, over the last four decades, they have made more products with fewer workers. But the total number of people employed stayed close to constant – there was a very slight decline. Starting in 2001, American manufacturing employment plummeted. Wow.
Another story that wasn't covered in the news. Had manufacturing jobs returned to 1999 levels, there would be 6 million more jobs in the U.S. today.
Although everybody noticed that most everything they bought was now made in China.
There was uneasiness about that but no good information. Did you know that the USA lost 40% of its manufacturing jobs in the last ten years?13 That is a major collapse.14 It happened after Clinton and Bush greased the skids to get China into the World Trade Organization (WTO). That, disaster, ironically, happened on September 10, 2001. No one noticed because of what happened the following day. But the collapse started then. WTO membership made it easy to replace products made by Americans with products made by Chinese, and the savings went into corporate profits and CEO salaries.
How do you get soaring inequality and job scarcity? Take the actions which will create soaring inequality and job loss.
Exactly. Then act surprised.
Actually there were a few people who had been part of the problem, knew exactly what was going on and who spoke out against the status quo. For example, Andy Grove, who started Intel.15 But largely, the silence has been deafening.
Yet again.
The deal is, if you can make money through the Global Labor Arbitrage, you are going to do it, unless there is some countervailing power. Unions are an example of a countervailing power, but our unionized sector is small and shrinking.16 So a huge swathe of our economy and workforce is in the process of being abandoned. The corporations are pulling up stakes.17
Another example. China has been manipulating its currency for years now, keeping the yuan low. Unlike the dollar, their currency is not freely traded; the central bank determines the exchange rate and they choose a rate that keeps their exports cheap. Many knowledgeable people think it is undervalued 20 to 40 per cent. This should be an unfair trade practice. By lowering Chinese costs, it's increased offshore outsourcing of American jobs.18
But our government does nothing. The first move would be to label China a currency manipulator and no one had done it. Neither the Republican not the Democratic administrations.19 20 21 It's the slobber problem again.
Slobbering and kissing and licking on that rich butt keeps them from protecting the interests of the American people.
Exactly. Corporations want to cut American jobs, and our government enables that. It's a strip mining mentality and ethics. Now it's not just West Virginia, or the Rust Belt. It's pretty much the economy of the nation as a whole.22
So you don't think our job market is going to recover.
No I don't. I also think wages are going to continue to go down, along with benefits.23
Something occurs to me, that suddenly strikes me as pretty ironic.
What's that?
We have employer based health insurance, just when employers want to dump us.
A bit of a problem, that.
It's a huge negative for American entrepreneurs. It even has a name: the Golden Handcuffs. Many would be entrepreneurs are stuck in the corporate world and can't strike out on their own (creating jobs for others in the process) because they can't get health insurance except through their corporate connection.
Here is something I don't understand. If this was all so clear, why didn't the smart economists in the Administration know what was going on?
You mean, why didn't Obama's people know that jobs were going to be a problem?
Yes.
That is a mystery. What happened to the American Jobs Machine? It's like a family car that someone took an ax to. Now it is hardly drivable. Was it so hard to notice that someone was axing the family car? They've been working hard at axing it for ten years. Look at what's been damaged: IT, insurance, manufacturing, R&D, back office, call center, on and on and on.
Anyway, it was obvious to me. I was outraged and dismayed by their choices. I think the conventional wisdom is exactly what has gotten us into this morass, and Obama picked advocates and architects of the conventional wisdom. I think he's pretty much governed, with respect to the economy, just as Mitt Romney would have done. The bad ideas have bipartisan support. Of course lately the Republicans have gone off the deep end and Romney is now practically a leftist among them (and trying hard to avoid his moderate record).
It didn't have to be this way – but the seeds were planted long ago. I think the single most essential factor is the crushing of American labor and the withering of unionization. That started in force in the 70's. Note that we have the triumvirate 'Free Trade – Free Market – Free Enterprise' but freedom to unionize is hardly mentioned anymore.
We criticize other countries on human rights grounds when they don't permit independent unions, but hey – we hardly have unions as all. That right there is a powerful indicator of American unfreedom.
Look at Germany. They went through the same financial crisis, and their unemployment rate climbed to about 9% , but it has fallen steadily and is now lower (at 6.1%24) than before the crisis, and still declining. Ours is over 9% and climbing again. What's the difference?
Yes. Tell, please.
There are very strong German unions and they are powerful enough to have a seat at the table.25
Imagine that.
Yes. Action was taken. Lots of different actions. For example, companies cut hours rather than jobs.26 For one reason: power. Germans workers have power and American workers don't. We don't even have indignation on our own behalf.
What I want to say to the unemployed is: You don't have a job because of the scam-what-I-am of American capitalism.
There is one big problem with what you're saying.
What's that?
Tech is booming! In Silicon Valley, companies are poaching on each others employees. Google raised salaries 10% across the board. There is so much recruiting going on – Google even interviewed you.
What do you mean – 'Google even interviewed you'?
I made a funny.
Ha, ha.
Anyway -the fact you don't take into account that tech is booming makes you sound, well, out of touch or something.
I sound cranky and washed up.
Kinda.
Maybe I am cranky and washed up. Maybe today is the day I became cranky and washed up. Or was it yesterday? Last week?
But seriously. This boom has some of the attributes of a skank.
...That probably sounds odd. But it has sketchy characteristics.
Like a bad neighborhood?
Not exactly... It's like this. The entry jobs have been outsourced, mostly to India. When I got into the field, there was a huge conveyor belt from all the local universities into good jobs. Now, if you're entry level, you better be Ivy League. No tramps from San Francisco or San Jose State need apply.
You were a tramp from San Francisco State as I recall.
Right. And proud of it.
Do you think that Google et al cares that the State of California is destroying its public higher education system? I don't see any signs of it. And they are notorious for hiring only graduates of the Ivy League.27 You know what that means. You have to be born and bred into the elite – probably the child of an Ivy League alumni – to get a decent job out of college.
I think the fact that we have high level engineering segment here overshadows how sick the market is.
Apple is a good example of how this current success actually demonstrates the problem. Do you remember the site off of Wolfe Road where I worked at Hewlett-Packard?
Vaguely.
Huge site. Lab after lab. Sort of plunked down in this suburban neighborhood of Cupertino. It took me nearly half an hour to jog around it. Thousands of HP employees worked there. As they expanded, taking up more and more of an old orchard, the jack rabbits dashed around the parking lots in confusion and then finally vanished.
Oh yeah. You were sad about the jack rabbits.
Well that site was completely emptied by HP's offshoring of jobs. And then HP Labs, in Palo Alto, was chopped by two thirds. So the pathetic remnants of HP's Bay Area workforce huddled together in the old HP buildings in Palo Alto, and the Wolfe Road site was vacant.
Apple came along and bought it. They are going to do a really cool Apple style thing with Wolfe Road: one building, partially undergound, underground parking lots, and lots of restored open space and woodlands. A really big part of the site will be open forest.
Fantastic.
The jack rabbits will come back! We can all celebrate that.
I feel sure something is wrong with this picture.
Several things. Apple is a great example of the new economic model for American corporations: American design and offshored manufacturing. Guess what?
You're going to tell me another thing I don't want to know.
Indeed I am. Suck on it.
Apple actually contributes to the American trade deficit.28 So much of their production chain and value chain are offshore, that just the iPhone contributes about 1.9 billion dollars a year to the American trade deficit. Apple's profit margin on iPhones is 64% - they could easily afford to manufacture in the USA and employ Americans, if they were willing to lower that extremely high profit margin even a little bit.29 So they are a symptom of our trade problem, not a solution to it. Also if they produced in the USA there would be lots of jobs created. Probably at least tens of thousands.
But that's not all. There's a seriously creepy thing about Apple which somehow isn't widely known. They are an abusive employer, associated with poisoning and suicide.30 31 We are such suckups for their products that their hipster cred is not diminished.
I can't take this anymore.
Of course you can. It's called reality. You take in loads of it, every day.
At the end you were going to say what could be done. Have we finally gotten to that point?
Oh right. My idea is everyone's idea, all over the world. It's what they're doing, over there. Greece, Tunisia. We can do it too. It's not easy, but it works.
Give the mofos a message they have to understand.
Your Chicago roots are showing.
Born and bred. Seriously. All you need to do is shut it down: Washington, Sacramento, Wisconsin. A blockade. Mass not virtual movement. Bodies on the line. Nobody cares about riots or takeovers of university administration buildings. So shut down the government until it represents the people. Insist on democracy. Make them go cold turkey...
...On their licking & slobbering.
Right. Make it real. Make it hurt.
I grew up with that, so it doesn't seem so strange to me. Maybe we won't need to go there – maybe things will just 'get better'. Does it look that way to you now?
No.
I agree. So imagine – what are people going to do, if it doesn't get better? If it gets worse?
On that note – well, there's lots more to say, but not now.
Yeah. I need a break.
Agreed. Let's say good night.
Night.
G'night.
____________________
1 href="http://www.nytimes.com/2004/07/22/opinion/22roac.html">http://www.nytimes.com/2004/07/22/opinion/22roac.html
2 http://jackporterfield.org/index.html
3 http://jackporterfield.org/about.html
4 http://jackporterfield.org/photogrid.html
5 http://www.pulitzer.org/archives/6936
6 http://www.iom.edu/Reports/2003/Hidden-Costs-Value-Lost-Uninsurance-in-America.aspx
7 http://www.factcheck.org/2009/09/dying-from-lack-of-insurance/
8 http://content.healthaffairs.org/content/27/1/58.abstract
9 http://www.signallake.com/innovation/CarlysWay030405.pdf
10 http://fumh.blogspot.com/
11 http://www.latimes.com/business/la-fi-economy-rd-20100913,0,3957503,full.story
12 http://online.wsj.com/article/SB10001424052748704821704576270783611823972.html
13 http://www.huffingtonpost.com/dave-johnson/china-springs-the-trap_b_681855.html
14 http://www.washingtonpost.com/blogs/ezra-klein/post/manufacturing-collapse/2011/06/01/AGTFhSGH_blog.html#
15 http://www.bloomberg.com/news/2010-07-01/how-to-make-an-american-job-before-it-s-too-late-andy-grove.html
16 http://www.washingtonpost.com/wp-dyn/content/article/2011/03/04/AR2011030406264.html
17 http://www.bls.gov/opub/mlr/2008/12/art4full.pdf
18 http://economix.blogs.nytimes.com/2010/10/08/china-u-s-trade-a-big-outlier/
19 http://www.zerohedge.com/article/tim-geithner-refuses-brand-china-currency-manipulator-again-says-yuan-rate-impairs-china-inf
20 http://www.bloomberg.com/apps/news?pid=newsarchive&sid=ahdeoAfmllx4&refer=asia
21 http://www.asiabizblog.com/u-s-economy/treasury-secretary-paulson-china-is-not-a-currency-manipulator/
22 http://www.thomaspalley.com/?p=71
23 http://www.nytimes.com/2009/05/04/opinion/04krugman.html
24 http://www.economist.com/blogs/democracyinamerica/2011/06/unions-and-unemployment
25 http://www.nytimes.com/2011/06/08/business/economy/08leonhardt.html
26 http://seekingalpha.com/article/218576-unemployment-rates-u-s-vs-germany
27 https://www.quora.com/Google-Recruiting-Retention-People/Does-Google-hire-people-exclusively-from-top-tier-universities/answer/Brandon-Smietana?_escaped_fragment_=n%3D40#!n=40
28 http://www.fastcompany.com/1710368/how-the-iphone-widens-the-trade-deficit
29 http://motherjones.com/mojo/2010/12/iphones-trade-deficit-problem
30 http://www.allroadsleadtochina.com/2010/05/27/you-cannot-build-a-brand-on-a-foundation-of-an-abusive-supply-chain/
31 http://www.allroadsleadtochina.com/2010/06/13/what-did-apple-and-foxconn-do-wrong-everything/
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