A Scarcity of Good Advice

Scarcity, Economy, and the Workforce in Modern American Politics

I watched Fox News the other day. It was absolutely against my will. I was taking my grandma to the doctor and there in waiting room at the doctor’s office was a TV set to Fox & Friends (I’ve never understood that title; who is Fox and who are the Friends? Is Fox simply the channel and the host are the friends? Are the viewers the friends? I’m probably thinking too much; this is not a cerebral show).

After an advertisement for hearing aids and a hit piece on “Taxing Tim Ryan” – Republicans really love their nicknames and alliterations – the panel opened with a segment on supply problems and inflation. An actual news story quickly turned into a list of grievances against President Biden. Apparently, and I was shocked to learn this, the entire supply chain problem is the fault of Joe Biden and the Democrats? This was incredible to me, as in my experience Democrats aren’t capable of turning the on lights in the House Chambers, let alone bringing the entire global supply chain to a halt via a hitherto unseen political prowess.

The show was over-the-top and theatrical, full of attention-grabbing infographics and histrionics. In other words, it was quintessential Fox News. For anyone watching it was just another example of the network’s efforts to bamboozle and mislead. Hidden within though – way, way, way down – was a core truth. Global supply chains are a mess and have been since the pandemic, a seemingly insolvable problem. Underneath that, we’re going subterranean at this point, is the real issue, one that does not get enough airtime or print space. The global supply chains are not a product of scarcity of resources but a misappropriation of resources and an understaffed and underpaid workforce. At a time when corporate profits are at an all-time high it seems impossible that this could be true. But you know that old adage; neoliberalism’s gonna neoliberal (neoliberalize? Ok so maybe it’s not that old…OK so maybe I just made it up on the spot).

It’s easy for politicians and economists to chalk up the issues to a myriad of red herrings – quiet quitting, people not wanting to work, the slow but inexorable collapse of democracy (that last one is real). But these are all excuses not reasons. We’re not talking about issues of scarcity. In typical historian fashion, I’m going to say that it’s a lot more complicated than that. We’re talking about issues of will or political malfeasance, and straight-up greed.

Let’s dig into what scarcity actually is first.

Scarcity is the idea that there are limited amounts of resources and that there is a maximum amount of product that technology and human effort can produce from it. A fairly simple concept, it’s foundational to understanding economics, in theory (oh boy)and in practice (sheesh). Whether you have a lot or a little of something, there are limits to how much of it you can harvest, refine, or otherwise utilize (the opposite of scarcity is “abundance”). Simple right? Scarcity so dominates modern economic thought that in 1932 Lionel Robbins of the London School of Economics even went so far to include scarcity in his definition of economics, saying that “Economics is the science which studies human behavior as a relationship between ends and scarce means which have alternative uses.” It’s a testament to the intractable nature of economists that this definition still carries weight.

Many concepts in economics can be a little abstract and obscure. Scarcity, though, is something that we all know, almost intuitively. A great example in the modern world is in the rare-earth elements; naturally occurring metals, many of which are critical in the production of modern technologies like smart phones, touchscreens, and electric vehicles. As the name would suggest, they are very rare, found only in a few places and our supply of them will run out. Nothing we can do can “make” more of either resource, so how we distribute and use them is critical. 

Or is there more to it? Obviously, the answer is yes. You see, scarcity is not some naturally occurring reality that lies beyond out control. In some instances, yeah, like the example I used above. But more often than not, scarcity is someone that we impose upon ourselves. (By “we” by I mean nations, corporations, politicians; anyone who controls capital). Sometimes things are scarce because someone is stockpiling it for later, like the bottom-of-the-barrel people who were hoarding toilet paper during the early stages of the pandemic. Sometimes things are scarce because of malfeasance and indifference, like clean drinking water in Flint, Michigan or Jackson, Mississippi. In all of these examples, there was plenty to go around for everyone. Some people just decided to take more for themselves (toilet paper), that they’d rather make a quick buck with an inferior and dangerous alternative (politicians in Flint), or poor infrastructure and greed (Jackson). Notice how greed factors into all of these examples?

This shouldn’t be surprising. Contemporary American politics have ceased to be a discussion between two ostensibly reasonable interpretations on the role of government (it’s problematic that there’s only two, but). In a binary political system, there is plenty of room for important issues to fall through the cracks, either by design or lack of perspective. Issues around the economy fit into both.

Scarcity in this moment manifests in a lot of ways and in a lot of places. I mentioned earlier the record high corporate profits. Let’s use the classic example, gasoline. Across the country in the last few months, we’ve seen record inflation around a variety of products, perhaps none more acutely than gas. The refusal/inability of our political leadership to divest from fossil fuels – if anything they’re trying to make us more reliant on that dead animal juice than ever before – means that increased gas prices, even by a few cents, ripples across the economy. Everything comes to a stop when gas gets too expensive.

Now. You’re a smart person. You can probably see where this is going. “If gas prices are high, then surely it’s because there’s less available? Nope. Not even close. One of the great indicators than supply-and-demand is absolute nonsense is by comparing the price of gasoline to the price of a barrel of crude oil. While economists, politicians, and even the Washington Post article I linked here would say that “perhaps” consumer interest is the main reason, that flies in the face of the free-market ideologies they all hold so dear. If there is plenty of supply (crude oil) then the price of the final product (gas) should be lower irrespective of whether or not the consumer has high or low demand (obviously with some variance). Gasoline is kept high artificially, a testament to the power of oil corporations, oil-producing companies, and the over-reliance of the American economy on fossil fuels. Scarcity, a foundational principle in modern economics, collapses under the briefest scrutiny.

Scarcity, the idea that there are limited amounts of “stuff” in the economy, does not just relate to the raw materials and finished products that drive a consumer-based economy and global trade. Supply challenges, logistical issues, and personnel problems. All of these are affected by scarcity, the reality of limited goods and materials and the scare-tactic fabrication meant to intimidate buyers and sellers. The global economy is not driven by supply and demand but on fear and greed. Scarcity in practice means artificially withholding access to resources to either drive up profits, control the workforce, or suppress any innovation which would threaten the dominant industries (think waging a war on hemp to drive up the value of timber and then saying “Well there’s simply not enough hemp” when people inquire about moving to hemp instead).

 If we peel back the larger conversations around the world and the nation, we can see the effect of a fear-driven narrative on not just the economy but on conversations around the economy. Creating a sense of scarcity is as effectual as real scarcity. A brief look at some of the more recent topics in American economic and political discourse will demonstrate how absurd the idea of scarcity is, in both theory and practice.

The (Hard) Worker Shortage
If you’re like me and you aren’t from a family and/or town that is exclusively liberal, you’ve probably heard this one a few times in recent months. My neo-conservative uncle, a hardcore Trump supporter and businessman, has said this on a regular basis. “There’s plenty of jobs out there, people just don’t want to work hard. They just want handouts. It’s better for them to collect unemployment than to work.”

This one is the most pernicious and as a historian of labor, it hurts my soul the most. Setting aside for the moment the cataclysmic impact of the COVID-19 pandemic on America’s working-classes – really, the impact of our poor response to the COVID-19 pandemic – and looking at the vague conversations around work, we see how this is easily debunked.  

On the face of it, there is a small truth at the beginning. There are a lot of jobs to be had. A simple search on the Bureau of Labor Statistics reveals that. But like I always say to me students, fact don’t speak for themselves. Without context and understanding, facts don’t actually do much of anything. On the same BLS page about job growth, we can see the numbers broken down by sectors. The top 10 sectors for job growth since 2021 are: home health aides, cooks, software developers, fast food and counter workers, general managers, restaurant servers, registered nurses, labors and freight/stock and material movers (hand), stockers and order fillers, and market research analysts. Of those, only software ($120,730), general managers ($97,970), registered nurse ($77,600), and market research analyst ($63,920) pay what could be considered a living wage based on the median rent in the U.S. and the general rule that you don’t spend more than ~30% of your income on housing.

Those occupations, it should be noted, are all ones which require a college degree and/or a certain degree of professional experience (short of nepotism, you’re probably not getting a GM job for your first gig). This is all without mentioning that jobs like cooks likely require specialized education like culinary school and that many of these jobs are very physically demanding (you don’t think nursing is physical? Ask a nurse and see what they say).

So while yes, jobs are being created, how attractive and realistic are these jobs for people looking for work when most of these jobs are either out of reach for many or simply do not pay enough to make them viable options? Gross job growth is a poor metric for economic success and without a higher minimum aka living wage, you’re talking about a barely scraping by existence. Try living in most places in this country making $26,000 (the average salary of servers). You basically can’t. We don’t need “more jobs” and “more people willing to work hard.” Americans are extraordinarily hard workers. If anything, we’re working too hard, working ourselves to death. What we need are more jobs with better pay and with good benefits.

What about the idea that workers can make more money being on welfare, about people wanting “handouts?” It’s a hilarious but often effective misdirection to make that claim especially considering that many business owners committed fraud to get PPP loans and that super-wealthy institutions somehow got loans meant for small business. Perhaps no one in the country is more reliant on/addicted to handouts than corporate America, a statement born out by history time and again. People aren’t trying to game the system; welfare fraud is famously quite low. What people are wanting is to change the system in order to eliminate the massive power imbalance that exists between the rich and super-rich and the rest of the country. Across the country, workers are striking or threatening to strike. For the first time probably ever, the top results on a Google search of “railroad strike” are not references to 1877. Workers at Starbucks, Apple, and Google are unionizing. Teachers and graduate students have been unionizing for several years, leading a massive resurgence in working-class activism.

Even when these frustrations don’t reach the level of formal strikes or labor disputes, workers are finding ways to fight back. The recent fake-culture war outrage over the extremely poorly named “quiet quitting” phenomenon. Simply put, it’s when workers refuse to work harder than they have to, especially without any financial incentive. It should be obvious that the outrage over this is contrived nonsense, a bullshit attempt to reframe low pay, hostile work environments, and toxic work culture as “workers are lazy.”

Much of this political hamfistery was generational in tone, as many references to quiet quitting also referenced (and blamed) Millennials, my generation, the latest in a list of industries that we have supposedly crushed with our nefarious tweets, maniacal blog posts, and insidious Netflix binge-watching. Employers, predictably, are retaliating. After over two years of many folks working from home, largely to everyone’s benefit, employers are looking to cancel that. This “return to work” push must be viewed in the larger context of workers pushing for more rights, an effort for employers to retake more direct control over the working day even as costs go up (office spaces are not cheap).

Even if workers were opting to stay unemployed than to work, let’s pause and think of the implications there. That would imply that either Americans are the laziest people on Earth and are fine being poor (we’ve disproven the former and the latter is simply absurd), or that our economy is so broken and stacked against regular Americans that not working pays better than working full-time. Another point in favor of paying people more.

How does this relate to scarcity? We’ve established that outside of a few examples, scarcity is largely a contrivance by corporations and powerful economies. Throwing out the original definition and taking this new perspective, we see that many of the socio-economic crises in the country right now are not “natural ebbs and flow of the market” but are actually the result of malfeasance. A lack of resources is more than likely just hoarding. Not enough workers? Try low wages, poor benefits, and hostility to workers.

Inflation? More like Stagflation
Like the railroad strike which threatened the country until just the other day, history seems to be coming back around again. Inflation is the media darling right now, headlining news stations across the country and flooding our TVs in the seasonal deluge of political ads. What’s not getting as much airtime, though, is stagflation. That perfect confluence of slow growth, high unemployment, and rising prices stagflation is a relatively new development in the long history of capitalism. Ever since making its grand debut in the 1970s, though, it’s become a recurring character in the comedy of errors that is neoliberalism. 

 For the economists and economic historians reading this, I am sure they are screaming at the screen. “But Brad” they say “stagflation requires high unemployment. It says so in the definition you used!” And so it does. But just like job growth is not a sign of a strong economy, neither is the overall unemployment rate. Even since wages stagnated – the “stag” in stagflation – (un)employment has been a more metric. So what if the national unemployment rate is 3.7% if people aren’t making enough money in those jobs to pay their bills? With an ever-increasing number of people turning towards the gig economy to supplement their income in the nation that leads the world in medical debt and student loan debt, the gross number of people working is a laughably poor metric. The U.S. has been carrying a substantial debt for some time. It’s only fitting, then, that the internal economy also run on debt. We are a debtor nation and a nation of debtors.

Stagflation, like scarcity, must be redefined in the light of the present moment. When real growth is slow, real and nominal wages are down, and everything is more expensive than ever before, what is that if not stagflation in a newer and more terrible form? The record corporate profits reinforce this idea. If profits are at all all-time high, why can’t wages go up? Why does everything need to be expensive if there aren’t actually physical shortages or limitations to the supply chain?

The answer as always is greed. Greed, coupled with substantial deregulation of the economy, has bred a perfect storm wherein workers are left to shoulder the burden. The Trump Era tax cuts shifted even more wealth from the bottom to the top, slashing the already low corporate tax rate of 35% to an insulting 21%. In one of the great examples of insanity – same thing different result etc. – trickle-down economics has not, in fact, trickled down.

The U.S. Economy in Reality
I went to the grocery store the other day to get a few things. It’s a local chain, a bargain chain comparable to ADLI. I got my things and checked out and as I was leaving, I saw a sign on the door “NOW HIRING TEENS AS YOUNG AS 15.” Passing the sign, it made me think. On that particular day, everyone who was working there was either retirement age or probably under 25. The ideal working age person – 25-50 – was largely absent, outside of the one person who was clearly the manager. It reminded me of my Trump-loving uncle: “The only people who want jobs are kids desperate for money and older folks who know the value of hard work.” I know he doesn’t shop there – that store is not nearly fancy enough for him – but I grimaced thinking how much he would love that store’s policy.

Oh, by the way; the starting salary on that sign was $13/hr. I’ll spare you the math, that’s $27,040 a year, assuming it’s full-time and 52 weeks. My guess is that it isn’t because what kid is working 40 hours a week?

Anyone who says that being unemployed is a choice hasn’t looked for a job in a long time. The job market has never been more stacked against workers than it is now. Employers want $150,000 talent and work for $40,000. They want people right out of school with a decade of experience. They’ll never say it, but they don’t want workers with dependents, because those are the kind of people who will want more pay, want benefits, need time off for family emergencies. They want workers to be desperate, willing to take anything, thereby permitting them to offer low pay, poor working conditions, and little to no room for career advancement.

The American workforce and economy are both in a critical moment. Wages are depressed, benefits are scarce, workers are desperate and in debt. The supply chain is in shambles because of greed. The only thing higher than inflation are corporate profits. With the 2024 general election campaign season essentially already here, the situation is getting more and more desperate.

Here are some things that could fix the problems and deliver a winning strategy:

  1. Comprehensive student loan debt forgiveness. The outrage over student loan forgiveness is fake nonsense. Congress should pass a much more comprehensive student loan forgiveness package. Anyone they anger in doing so were likely not going to support future initiatives anyway. Student loan forgiveness would immediately flood the economy with money, as loan holders would no longer be shunting substantial amounts of money into paying of loan interest. If the political will does not exist to cancel all student loan debt, then at the very least they should cancel all interest and 50% of all debt for all borrowers.
  2. Additionally, they need to raise the national minimum wage. In real dollars the minimum wage is the lowest it’s been in over 30 years. Even the Fight for $15 movement is outdated at this point. $15/hr is only $31,200. Show me where in the country that is a livable wage. As long as workers stay in this cycle of week-to-week existence, we’ll never escape this malaise.
  3. Embolden unions. The unions in this country are a shell of themselves. Partially this is because union leadership in the last 20 years has, largely, been timid and feckless. Mostly though it is because of neoconservative attacks on unions starting back in 1981 when Reagan broke the PATCO strike. Union membership and union power has been on the decline ever since. We need a powerful public and private union sector in this country again if workers are to ever have a chance at improving their positions and their lives.
  4. Medicare for All. Medical debt is the number one cause of bankruptcy in this country. How we are OK with this hellscape is a testament to how much Americans love capitalism and how easily we are swayed by political scare tactics. Such a thing should not exist. Having universal healthcare would not only ensure that no one would ever go into debt for healthcare again but would also relieve the pressure to stay in a bad job simply for the insurance. Tying healthcare to work is a form of control that keeps people in bad working environments and from unionizing.
  5. Start investing NOW in new technologies and infrastructure. The climate crisis is the greatest existential threat to the world. The future, if we have one, needs to be one of wind, solar, hydroelectric, and nuclear energy. We need to divest from fossil fuels. Want to immediately create jobs? Marry technological innovation with an infrastructural overhaul. Something like the Green New Deal (except more comprehensive and urgent) would be a good start.
  6. Start making plans for after automation. At this point, it’s pretty clear that we have no intention of stopping the inexorable automating of the economy. It’s not just blue-collar jobs either. Automation is encroaching on all aspects of our economy as technocrats seem hell-bent on destroying the world simply because they can. Short of moderating this potential employment cataclysm, the government needs to start looking forward to what this post-automation landscapes
  7. Tax the rich. Raise the corporate tax rates. Raise the capital gains tax rate. Tax university endowments over $1billion dollars. Tax Wall Street transactions. This country is the richest country in the history of the world and yet we let the majority of our wealth sit in the hoards of a handful of powerful individuals and corporations.

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