Thursday, May 28, 2015

What happens to America when the last job is gone?

When services like schools and hospitals are no longer local, what happens to America?

What happens to America when the last job is gone?

Pedestrians walk by the abandoned Packard plant in Detroit. (AP Photo/Carlos Osorio, File)
Pedestrians walk by the abandoned Packard plant in Detroit. (AP Photo/Carlos Osorio, File)

Since it's the slowest news day in the history of mankind, I thought I'd riff on the two most interesting -- and important -- op-eds that I've read in the last week. They made me think of Pittsburgh; I lived and worked in southwestern Pennylvania right after I graduated from college and spent a great deal of time then in Pittsburgh, but had not been back there much until I traveled the city in 2010 reporting on Glenn-Beck-fan-turned-cop-killer Richard Poplawski for my book The Backlash.

I had carried memories of my first stint there in 1981-92, rounding a steep hillside to see belching flames from a handful of barely surviving steel mills, glowing against the metallic blackness of a December night. Thirty years later, the mills had vanished but the skies were illuminated now by neon -- for the University of Pittsburgh Medical Center, a behemoth that seems to have large (untaxed) facilities on every single block. This, interspersed with glassy sheen of ever-growing University of Pittsburgh and Carnegie-Mellon, had saved the flame of Pittsburgh from extinguishing.

Eds and meds. That's what had preserved the Steel City, proving the Rolling Stones right, that you can't always get what you want -- high-paying union factory jobs -- but you can get what you need. You can outsource every factory in the U.S. of A., but not local schools and hospitals.

Or can you?

Consider the education market. The rise in online education, specifically massive open online courses, is expanding the number of students a top university can educate. The Wharton School of the University of Pennsylvania, one of the top business schools in the world, recently announced that it would offer four of its “foundation” courses online for free through Coursera; students can receive a certificate of verification for $49 for each course completed. A certificate might not be as valuable as an M.B.A. from your local university but it could be in 5 to 10 years.

What will happen to enrollment at lower-ranked business schools when students have the opportunity to take courses à la carte at Wharton for less than the cost of their monthly cellphone bill? The best schools will attract more and more students, while the middle- and lower-tier institutions will mostly struggle, leading to less local demand for college administrators, tutors and faculty.

Health care jobs might seem very different at first glance. Every city, large or small, will always need emergency room staff and obstetricians within a reasonable distance. But this could be less true for orthopedic surgeons and cardiologists, who power the high-margin services that pump significant sums into local economies. What will happen when more employers follow the example of Walmart, which announced last fall that it would send employees in need of transplants or heart or spine surgery to one of six leading medical centers around the country, rather than to their local hospital?

Walmart is making this move because there is notorious variation across the country in health care costs. Getting the same service in one city can be a lot more expensive than in another. Walmart believes it will save money by funneling its employees to the very best facilities, where higher volumes should generally drive lower costs. If this trend accelerates, it will hurt local hospitals and leave them with fewer profitable service lines. It will also certainly mean fewer jobs at these facilities.

Thus while the number of education and health care jobs could indeed grow significantly in the coming years, that does not directly imply job growth in small and midsize cities that depend on these sectors.

To put this more succinctly, we're screwed. To me, this is the fundamental challenge of American socirty in the 21st Century. It's no secret that jobs are the No. 1 priority for American voters -- it's what citizens tell the pollsters, in survey after survey after survey. Presidents are re-elected or not re-elected based largely on whether voters think the employment picture is getting better or worse. 

And yet we live under a system -- unfettered capitalism, in which the No. 1 priority is NOT to create jobs; rather, the goal is to maximize profits for owners and shareholders, while creating jobs is merely a byproduct. And it's less of a byproduct with each passing year, thanks to technology and outsourcing. At the risk of oversimplifying a complex labor situation, this system generally worked to the benefit of all for large chunks of the 20th Century, when capitalists who ran auto companies or steel mills made more money by selling more cars or steel -- which could only be done by hiring more people. Everybody wins...whoo-hoo!

But now there's no way -- nor, quite honestly, should there be -- in 2013 to force companies to hire Americans when they can make so much more money using robots or low-paid workers overseas. Over the last generation, we've survived because while making things can now take place globally, services -- school teachers, nurses, fast-food workers -- still had to be offered locally. If that system collapses, I'm not sure if Americans are ready for the massive social upheaval that may follow.

Yesterday, Frank Bruni -- who after a slow start has become one of the more interesting voices on a diminished New York Times op-ed page -- went back to a former stomping ground, Italy, which has suffered from even greater economic stagnation, and been plagued -- hard as this is to believe -- by much greater political corruption than the United States. He filed an unsparingly bleak report.

But the arias have been different this time around. The whole mood has. Ask Italian students what awaits them on the far side of their degrees and they shrug. Ask their parents when or how Italy will turn the corner and you get the same expression of bafflement. You hear more than you did 10 or even five years ago about migrations to Britain, to the United States. You hear less faith in tomorrow.

I’ve been startled by it. Also spooked, because I arrived here straight from our government shutdown, and I’ve observed Italy’s discontent through a filter of America’s woes, processing it as a cautionary tale. Italy is what happens when a country knows full well what its problems are but can’t summon the discipline and will to fix them. It’s what happens when political dysfunction grinds on and on and good governance becomes a mirage, a myth, a joke. Italy coasts on its phenomenal blessings rather than building on them and loses traction in a global economy with more driven competitors. Sound familiar? There’s so much beauty and promise here, and so much waste. Italy breaks your heart.

Hopeless, depressed, and morbidly pessimistic -- this is the Italy that Frank Bruni sees, and the America that he fears. I agree with where he's coming from, and yet I also can't help but think there are outcomes that are far worse. What will happen to America when most of the jobs are gone? I'm starting to fear that Italy may be the best we can hope for.

About this blog
Will Bunch, a senior writer at the Philadelphia Daily News, blogs about his obsessions, including national and local politics and world affairs, the media, pop music, the Philadelphia Phillies, soccer and other sports, not necessarily in that order.

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