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The Jobs Crisis:
Obama, Romney and the Low-Wage Future of America
Dan Froomkin - Nieman Reports

[excerpt]

Jeff Faux, a progressive economist who founded the Economic Policy Institute in 1986, is the author of the new book, “The Servant Economy: Where America’s Elite Is Sending the Middle Class.” “The mantra, as you know, in today’s political debate is jobs, jobs, jobs,” he told an audience at EPI recently. “Listen carefully because the subtext is low wages, low wages, low wages.”

Faux argues that by the mid-2020s, even with the most optimistic assumptions about economic growth, current trends indicate that the average American’s wages will drop about 20 percent. One big factor is that more and more good jobs will go overseas, leaving even America’s best and brightest no alternative but to enter the service industry.

“You go into an Apple store and you see the future,” Faux said. “The future’s not in the technology—the future of the labor force is all in those smart college-educated people with the T-shirts whose job is to be a retail clerk for Chinese goods.”

One impetus for job growth, Faux writes in his book, is that as the super-rich get even richer, they’ll need more and more servants:

"They will hire people to take care of their large homes and to tutor their children in Chinese, tennis, and sophisticated strategies for getting into the best private schools and universities. They will hire personal assistants to shop, pay their bills, and run their errands. Coaches will come to their homes to instruct them in physical fitness, mental relaxation, and spiritual transcendence. They will need maids, cooks, and gardeners."

Neither party, Faux argues, is addressing the economic realities that make this the most likely future for our country—because changing course would require massive government intervention. There’s a pretty strong consensus among all but the most ideologically conservative economists that the solution would involve considerable public investment in education, infrastructure, and green energy, new policies to promote domestic manufacturing, more activist regulation of the financial industry in particular, and a more progressive tax structure.

But no matter who wins the election, Faux said, the governing elite has pretty much already ruled out that agenda, in favor of light regulation and governmental austerity.

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