Conservatives’ Newfound Interest in Dignified Work
They can give up free-market orthodoxy, but still can’t bring themselves to embrace labor.
January 23, 2020
Jan 23, 2020
14 Min read time
They can give up free-market orthodoxy, but still can’t bring themselves to embrace labor.
The Once and Future Worker: A Vision for the Renewal of Work in America
Encounter Books, $25.99 (cloth)
In a December 2019 speech at National Defense University on “American Industrial Policy and the Rise of China,” Senator Marco Rubio made a forceful case for industrial policy, rooted both in geopolitical rivalry and in domestic politics: “When dignified work, particularly for men, goes away, so goes the backbone of our culture.” Dismissing conservative canards about laissez-faire markets and economic efficiency, Rubio described a new National Conservative dirigisme, an emerging and much-contested strand of Republican policy argument. This newfound economic nationalism of the right, embraced by Rubio, Donald Trump, and foreign analogues such as Boris Johnson, commands high levels of political support, precisely because it abandons traditional conservative economic dictums.
The newfound economic nationalism of the right commands high levels of political support, precisely because it abandons traditional conservative economic dictums.
The most compelling statement of the intellectual foundations of a conservative industrial policy can be found in Oren Cass’s The Once and Future Worker. Cass, chief policy advisor to Mitt Romney in 2012, articulates a modern version of worker-centered economic nationalism. Besides the political novelty of the economic project, Cass also offers a contrarian take on labor market policies and institutions, rejecting both free-market prescriptions of past Republicans as well as the job protection–oriented policies of the left.
I was at first puzzled why Cass chose an apparently contradictory source for his book’s title: T. H. White’s celebrated fantasy novel The Once and Future King (1958) ends with a wizened King Arthur pondering the natural environment and the folly of conflict based on fictions of political geography; he concludes that “freedom of trade and free passage and access to the world” should characterize the relationship among diverse nations. But Cass’s book articulates an intelligent view of how the labor market works. His hypothesis is simple: work, particularly in tradable sectors such as energy and manufacturing, has considerable benefits above and beyond wages. Family formation, local spillovers onto other businesses, low crime rates, and cohesion of local community all follow from thriving industrial employment. He notes that the production of tradeable goods benefits small towns in a way that services do not, that the homogenization of work schedules (contra jobs in the gig economy) allows coordination of non-work social activities, and that interactions at work form meaningful friendships and dense social networks.
These externalities mean that the social value of jobs exceeds the wages paid to workers and the revenue accrued by employers. These jobs ought to be subsidized by policy, Cass argues, because the market will underprovide them. Cass also identifies a number of more debatable “internalities” which such jobs supposed provide workers beyond the wages they are paid—notably, he argues, that the work fosters a variety of bourgeois behaviors, such as punctuality, hygiene, and reliability.
The book’s policy proposals flow from this perspective. The most interesting implications are the need for interventionist, market-distorting mechanisms: sacrificing more easily measured efficiency and GDP growth in favor of increased low-skill employment; impeding globalization—from trade liberalization to immigration—where it reduces demand for American workers, despite consumer-price increases; and privileging locally tailored, voluntary collective bargaining agreements over federal employment regulations.
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The book conveys a commitment to the deep Polanyian truth about the labor market: workers are people, with diverse tastes and skills that are difficult to price in the market. An economy that has something for everyone—that is as good at allocating dignified, remunerative work to the computer illiterate fifty-five-year-old as to the twenty-three-year-old coding dynamo—would be more egalitarian culturally and materially.
The book conveys a commitment to the deep Polanyian truth about the labor market: workers are people, with diverse tastes and skills that are difficult to price in the market.
This is why “More Perfect Unions,” in which Cass describes a conservative vision of collective bargaining, is the book’s most interesting chapter. Cass recognizes the inequality in bargaining power between employers and individual workers, and understands that collective bargaining might mitigate that power. Instead of the traditional unions protected by the National Labor Relations Act (NLRA), he envisions a competing ecosystem of nonprofit “coops” that would negotiate with employers in exchange for voluntary dues payments. Like unions, these coops would be granted exclusive bargaining rights, but they could not compel dues, nor engage directly in political activity. These coops would not necessarily bring about good labor relations nor skilled, loyal workers, but the ability to contract around federal regulations. Thus their added value is that they would let an employer bargain with workers around federal defaults; coops would add flexibility, rather than reduce it.
This is a promising idea, but the devil is in the details. Why would the employer have to negotiate with the coop? Cass is silent on the role of strikes and the vital ability of collective bargaining units to threaten economic harm on their (generally wealthier) partner in the event of an impasse. Current labor law allows permanent replacement workers during strikes, defanging unions’ effective threat and severely reducing any benefits of collective bargaining. While nobody likes acrimonious, costly strikes, their unexercised threat underpins the bargaining power that Cass deems necessary. We should want powerful, disruptive strikes to be safe, legal, and rare.
Cass would also prohibit multi-employer bargaining when, in fact, this is needed. Many pathologies of U.S. unions flow from the contractual jurisdiction that limits bargaining to one establishment, reducing incentives to internalize effects on other employers and workers. Sectoral wage boards, the extension of collective bargaining agreements to all workers in a sector, joint employer liability, and bargaining with firms higher up the value-chain (such as the Coalition of Immokalee Workers securing agreements with companies such as McDonald’s to source their products in ways that benefit farmworkers) would all update collective bargaining to increase worker coverage under a single agreement. As owners of firms are increasingly distant, financialized, and concentrated, the scope of a labor action required to pressure an employer is much larger than it was; collective bargaining must therefore expand beyond the firm-based entities protected by the NLRA.
Further, to have bargaining power, unions must finance strike funds, staff and lawyer pay, and other expensive services. Without the ability to compel dues, unions would spend all their time campaigning. While the problem that worries Cass—unresponsive and corrupt unions coasting on coerced dues—is real, it is also rare, and there are better mechanisms to ensure accountability than eliminating agency fees. Cass could have proposed a “voluntarily compelled” dues structure that was like an assurance contract: everyone commits to pay contingent on at least 50 percent of workers paying. Cass could also have suggested a matching funds approach, where governments match workers’ voluntary dues. But Cass leaves his coops with no sword and no shield. Why would an intransigent businesses bargain with them?
Cass leaves his coops with no sword and no shield. Why would an intransigent businesses bargain with them?
There is, nonetheless, merit in the idea of a grand bargain between left and right over unions: the goal would be unions that can bargain around federal employment regulations (like overtime pay or even minimum wage), but whose ability to strike is protected—replacement workers would be banned and right-to-work repealed. A pro-union Republican party wouldn’t have to worry, as Cass does, about unions as Democratic vote banks. Rather than hiring consultants to legally decimate union activists inside a shop, employers would have incentives to work with. The federal government could demand meaningful national standards knowing that there is a pro-worker opt-out for companies that find it too costly. And large, encompassing, multi-employer unions would eagerly seek the additional dues revenue and target low-income areas that find federal employment regulation extra onerous.
But Cass does not ask for real economic power for unions, and this is symptomatic of the book’s missed opportunity to make the case for a pro-worker policy agenda. While he might reject laissez-faire in his enthusiasm for jobs, he isn’t willing to confront owners, large and small, whose untrammeled insistence on the primacy of profits have led to many of the ills Cass identifies.
Indeed, Cass misattributes what made jobs in traditional tradable sectors good—basically, union-imposed high wages, good working conditions, and seniority schedules ensuring job security. Before NLRA unions, manufacturing jobs were in fact terrible, high-turnover, low-wage enterprises, hardly living up to Cass’s fantasies about independent and self-sufficient workers steadfast in their communities: whole towns would completely change population over short windows of time, with extraordinarily few workers staying put and ascending into skilled or management positions. Or consider the status of coal workers in weakened union environments today, such as the twenty-nine Massey workers killed in 2010s Upper Big Branch Mine, a direct consequence of union busting practices in the 1980s. What made Cass’s ideal jobs ideal was not any self-sufficiency inherent in the physical labor in tradeable goods, it was union contracts negotiated in the shadow of credible threats to hurt the profits of their employers. Even in non-union manufacturing transplants in the South, the perpetual threat of union organizing helps keep wages high and working conditions good. Much of what Cass finds attractive about traditional sectors was won by an insurgent labor movement and then maintained by brute political maneuvering in the face of employer hostility.
The Once and Future Worker refuses to hold the owning class responsible for stagnant wages and unfulfilling work at the low end of the labor market. Cass cannot bring himself to systematically punch up instead of down, and so he can only envision policies that improve workers’ fortunes without harming those of their bosses and their bosses’ bosses. Perhaps driven by his conservative audience, Cass poses tradeoffs between the welfare of an imagined heartland industrial worker and somebody outside the Republican coalition: an immigrant, a foreign power, a liberal professional, or a metropolitan service sector worker. His enemies line up with the culture war, not the class war, and he clearly doesn’t think the institutional or individual concentration of economic power is either real or a real problem for a good jobs agenda. The silences in Cass’s book on weakened antitrust enforcement, increased transfers to shareholders, hypertrophied finance, and low pay/high turnover practices of employers are perhaps predictable from a conservative writer. He opens the book lamenting stagnant wages, but doesn’t mention the skyrocketing stock market. And the resulting agenda of ostensibly pro-worker policies constrained by U.S. profit margins can’t help but be cramped.
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Despite some new policy ideas, Cass is still conservative in politics, unwilling to challenge the discretion of employers, industrialists, and financiers to determine the level of employment. The drive to line shareholder and financial industry pockets got us outsourcing even without globalization. It contributed to ever-increasing consolidation in U.S. businesses, generated HR practices coordinated on low wages and high quits, incentivized firms to overstaff on supervisors and understaff line workers, overinvest on monitoring technology and underinvest on productivity improvements—all to economize on wages per unit of effective labor. Increased wage-setting power, union busting, declining federal minimum wages, undignified levels of workplace surveillance and routinization, and consolidation in small-town tradables all have contributed to lower wages and lower employment. The neoliberal playbook, empowering shareholders and constraining unions, cutting taxes at the top and curbing minimum wage growth at the bottom, is the basic force that despoiled the labor market for non-college-educated workers. Some of Cass’s prescriptions do in fact curb neoliberal policies (such as free trade), but most don’t, keeping faith that the job creating class is in fact interested in creating dignified, good-paying jobs rather than maximizing profits for themselves and their capital suppliers.
Even in non-union manufacturing transplants in the South, the perpetual threat of union organizing helps keep wages high and working conditions good.
Cass’s political limitations create many missed opportunities for ideas about creating good jobs. Cass could have discussed what a robust high-road employment industrial policy could look like. Current technological change is driven by financial arbitrage, advertising revenue, and the Defense Advanced Research Projects Agency ecosystem, none of which have any particular interest in raising the productivity of low-education workers. But modern manufacturing, systematically declining as a share of employment since the 1950s, has extremely high value added per worker, so it is extremely unlikely that manufacturing will ever account for a huge share of employment in the near future. Beyond manufacturing, one could imagine building on technologies, for example via U.S. National Grand Engineering Challenges, that make human decision-making and judgment integral parts of artificially intelligent systems, raising productivity of both humans and machines in the process. Cass thinks a small town getting an automated 3-D printing hub owned by a conglomerate will experience a stunning revival, but he ignores the job-creating parts of climate change adaptation and mitigation generated by a much less science fictiony Green New Deal. Instead he bemoans EPA regulations that hem in an energy sector that employs fewer workers than Walmart.
A book that truly cared about jobs more than bondholders would also discuss how to run the macroeconomy hot for a generation. It would praise a willingness to risk creditor wrath over inflation and austerian wrath over deficits in exchange for massive infrastructure spending and unemployment around 1 percent. As the recovery from the Great Recession fades, we may see many of the nascent positive social changes wrought by a decade of employment growth, especially pressure to raise wages, wither and die before taking hold. A more systematic approach to maintaining high effective demand, where workers can quit their jobs easily and fearlessly, could begin the road of repairing labor’s share of national income.
Cass could have explored what parts of Big Government make it a net contributor to employment, particularly for women. In his 2014 paper “How Can Scandinavians Tax So Much?” Henrik Jacobsen Kleven argues the answer is that the public expenditures are so complementary to labor supply. Public and cheap high-quality childcare, elder care, health care (including family planning) not contingent on a particular employer, and education, alongside high quality public transportation, are all things that make working easier for individuals and families, and incentivize work even in the face of otherwise rebellion-inducing taxation. In the United States, we restrict reproductive freedom, give ten weeks maternity leave, and demand that prime-age working households juggle care of their parents and children while paying down their student loans and waiting in traffic jams while on phone calls with insurance administrators. A healthy library of high-quality public options would raise attachment to work for both men and women.
Even on globalization—the one place where Cass is willing to impinge on employer choice—he focuses on product markets and immigration. An honest criticism of globalization would include a criticism of tax arbitrage and global corporate tax evasion, which forces government revenue to be generated from middle-class labor income taxes. Cass evades discussing the increase in the use of tax havens by the ultra-wealthy, and the lax IRS enforcement of high-value tax dodgers.
Most disappointingly predictable is Cass’s enthusiasm for wage subsidies (essentially a more salient monthly Earned Income Tax Credit decoupled from children) as preferable to welfare, basic incomes, or minimum wages. While the research is in flux, work suggests roughly thirty cents of each dollar of EITC money actually paid to low-skill single mothers is captured by employers, and EITC fraud among the self-employed is rampant. Similar effects would obtain with the wage subsidy: lowered wages for those already in the labor market, incentives to form fake LLC “employers” and claim the credit, and blunted incentives to search or ask for a raise. While the safety net is partially a transfer to workers, a work subsidy is partially a transfer to employers.
Beyond its missed opportunities, the book suffers from a selective and sloppy review. From howlers about the “stuff” intensity of modern consumption and the postwar neglect of employment, to pretty dishonest presentations of the evidence on minimum wage and immigration, examples cited as evidence are cherry-picked and unconvincing. To the extent that intellectuals should agree on how the world is even as they disagree on how it should be, a fair representation of the evidence is required.
Promoting a pro-work supply-side and deregulatory agenda is an interesting, but ultimately self-limiting, endeavor.
At the end of the day, promoting a pro-work supply-side and deregulatory agenda is an interesting, but ultimately self-limiting, endeavor. Cass is only able to consider policies that hurt foreigners and coastal professionals, not those that hit millionaire business owners, the C-suites, or the stock market. The book stands as a compelling exhibit of Corey Robin’s dictum that regardless of the particular domain or policy prescriptions, the basic conservative animus is restoration of privilege lost to subordinates. Even while giving up the free market, National Conservatism cannot give up the rule of the wealthy. The privilege redeemed by Cass’s book belongs to the white male industrial worker, against depredations of developing countries, migrant workers, more “feminine” occupations, and the environmental claims of future generations, but never against his employers, landlords, or creditors.
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January 23, 2020
14 Min read time