The job-killer policy

June 13, 1994|By Bob Herbert

TO ANYONE who has grown up with the deeply American belief that the best way to get ahead is to roll up your sleeves and get to work, it must seem peculiar that the Clinton administration has adopted a policy that deliberately puts a brake on the economy, and thus on the number of Americans who can work.

The administration, genuflecting before the Federal Reserve, is now more concerned with inflation than with the chronically high unemployment that is eroding the promise of the American dream for millions of men and women.

But what inflation? Nobody can find the inflation. Having run from so many other battles, the administration is now engaged in a fight to the death with a phantom. It's a fight that pleases the wealthy but has painful consequences for ordinary working men and women, and for the poor.

Stephen Blackwell, a supervisor with the New York state Department of Labor, mentioned the discouragement he continues to see in the faces of the working poor as they sign up for unemployment benefits and job search assistance. "We hear that things are getting better," said Mr. Blackwell, "but our gut reaction is that things haven't substantially improved."

Mr. Blackwell has worked in the same Manhattan office for 30 years and knows many of the clients personally. "You now see people accepting jobs that pay much less than jobs they would have accepted years ago. At some point it gets to be an emotional thing for me. I see people that I've known for years who are now struggling; people who are hard workers just like me, maybe harder."

The decision to sacrifice the livelihoods of real people to placate the evil spirit of inflation has enormous consequences, most of them bad. A lack of meaningful work is at the core of nearly all the social problems plaguing the country.

You cannot gather up the pieces and begin to repair the damage we have done to families without finding a way to create many more jobs. You cannot achieve meaningful welfare reform, or universal health coverage, without a growing market for labor. And you sure can't make any real headway on crime without putting vast numbers of young people to work.

But we are not moving in that direction. The outplacement firm Challenger, Gray & Christmas reported Tuesday that work-force reductions through May were running 18 percent ahead of the first five months of 1993.

While there are jobs being created (many of them temporary or part-time), corporate downsizing continues at a rapid, perhaps record-breaking rate.

There are vast regions of the work force that have yet to be reached by the economic recovery, and they won't be reached as long as the brakes are kept on expansion.

Joseph Kneafsey, who manages Mr. Blackwell's office, says he is seeing professionals who are "a job away" from their specialties. An example would be a senior programmer who loses a job, cannot find other work in the field, manages to land a job as a bookkeeper, and then loses that job.

Mr. Kneafsey was asked, in light of official statistics showing decreasing unemployment, if he was seeing any improvement at all. After a long pause he replied, "Very limited."

If the country is not yet strong enough economically to have nearly full employment for the middle class, how will it be possible to get decent jobs to the working poor, and beyond them to the hard-core unemployed?

"You can't at this level of growth in the economy," said Jeff Faux, president of the Economic Policy Institute in Washington.

In Mr. Faux's view, the argument that you have to sacrifice jobs to keep inflation under control is a specious one, given current economic conditions.

Mr. Faux noted that over the last 80 years, the period for which price indices are available, the United States has never experienced runaway inflation that resulted from a peacetime economy surging out of control.

"In our actual experience," he said, "the dreaded wage-price spiral has only occurred when markets have been suddenly jolted by war or supply shocks, such as occurred with the oil embargoes."

The inflation rate is a shade under 3 percent, yet the Federal Reserve remains mesmerized. As for out-of-work Americans -- well, too bad about them.

Bob Herbert is a columnist for the New York Times.

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