Sunday, June 09, 2013

Reflections on "As Goes Janesville"

[I prepared the following paper for The Christian Scholars' Conference convened at David Lipscomb University, Nashville, TN, June 5-8, 2013.  This particular panel (including a representative from the United Auto Workers, GM, academics and the film maker himself) discussed Brad Lichtenstein's film, "As Goes Janesville."]

As Goes Janesville”—Reflections on the erosion of the American Middle Class

            Brad Lichtenstein’s powerful film, “As Goes Janesville,” displays the most recent results of an American economic policy now over 30 years old and continuing to evolve with devastating effect on our shrinking middle class.  By focusing on a group of select and representative persons, the film teases out the attitudes, struggles, losses, uprootedness, philosophies and policy agenda of those spotlighted. 

After 85 years of operations, at the close of the last Bush Administration and in the throes of the economic meltdown of 2008, the closing of the Janesville General Motors plant signaled a major shift in middle class options and opportunities previously afforded by employment in jobs that paid living wages.  Eleven thousand jobs were lost to a city of about 63,000 persons. 

The impact of the film emerges from the personal stories of laboring people and their families on the one hand, and business and political leaders on the other who see in the community and economic implosion “an opportunity” to reign in out-of-control labor costs, while attracting new companies and new jobs.  Ironically, but predictably, the group charged with "re-inventing" a local economy does not include representatives from the local workforce. 

The role of Wisconsin Governor Scott Walker and the citizens’ recall movement sparked by his policies and attitude toward organized public employees, especially teachers, plays an important part in the story line.  The juxtaposition of the opposing sides, interests and voices seem to confirm the opinion of one of the unemployed who concludes that “we are two different countries now.” 

The route to sustainable recovery in a city like Janesville is not self-evident and the journey promises to be difficult, and one filled with danger and surprise.  It does seem very clear that three decades shaped by the promotion and pursuit of “supply side” economic theory, with its attendant “trickle down” tax policy, in the face of an rapidly expanding underclass and the rise of an under-educated, younger workforce presents a rather daunting list of social and economic challenges. 

Driven by an investor culture in which more people than ever before find themselves financially entangled in the stock market via 401 k and mutual fund accounts, the primacy of “bottom line” corporate considerations tends to devour the expectations of working people.  The weakening influence and outright decline of organized labor and collective bargaining drive both membership and wages down below acceptable levels.  Hard-nosed labor negotiations between management and workers usually end with labor in a compromised or weakened position.  Out-sourcing and off-shoring jobs to serve the ever-present bottom line work against American workers. 

Tax policy, offered up with the promise of attracting new companies and new employment opportunities, has not worked well in Janesville.  According to the film, Governor Walker’s claim that “Wisconsin is open for business” has remained just that, a claim with few substantive results, except possibly a more favorable tax policy benefiting existing corporate interests in the beleaguered state.  The latest job creation numbers rank Wisconsin 47th in the nation.   

So, what may we conclude or suggest in view of the message of this provocative film? 

First, the loci of public and private investment need to shift.  Rather than continuing in our current default position when it comes to where we choose to invest capital, i. e. failing financial institutions and investment banks; the time has arrived where we might reasonably expect a larger ROI by investing in our people and their inherent wealth potential. 

For example, home foreclosures in the aftermath of the plant closing in Janesville reached into the thousands.  More aggressive investment in those homeowners, rather than in their bankers, seems indicated to this observer.  Rather than pouring capital in at the top, it needs to be worked into the soil of the local community.  Rather than cutting funding for public education, pre-school to higher education, as well as trades training and skill set retooling; our leaders should find creative ways to invest in our people, our greatest asset as a nation. 

Second, the nation needs to revitalize a public movement to recover and expand the middle class.  Already I am redundant, but the point here is to reimagine the purpose of collective efficacy and political functionality.  Tax policy must change.  At even the mention of progressive tax reform critics begin to decry the folly, read “horror” just here, of the “redistribution of wealth,” as if the recent, historic redistribution of wealth upward should not call for a countervailing point of view complete with its own version of horror! 

Existing tax loop holes, including off-shore, tax shelters and asset relocation strategies, must be closed and the newly captured funds re-directed to strategic initiatives to benefit middle income Americans, including our social and material infrastructure. 

For instance, funding community-based, public health initiatives that deliver better national wellness outcomes will open more options for employment in the allied health care industry for even unskilled workers while enabling the nation to consume a smaller percentage of GNP on illness care.  This is just one area in which useful and productive synergies could be achieved. 

Public school facilities should be re-purposed after hours for adult education and small business incubation.  Extension courses from local community colleges could be brought nearer consumers by locating in public school buildings after normal hours.  College and skills re-training classes should be matched with a new college/education loan and grant program to assist students in their efforts to re-tool for the current and coming American economy.  Grants for education should be devised, especially for hardest hit areas of economic decline. 

Companies employing unemployed or underemployed workers should be rewarded with larger hiring stipends or royalties. These rewards should be lengthened over 3-5 years to encourage employee stability and increased tenure.   

Local public works projects, such as the S. M. Wright Freeway redesign project, should include requirements to train and hire unemployed persons from the neighborhoods and communities benefiting from such projects, as is the case with this urban renewal effort in Dallas, Texas.

Third, financial incentives need to be deepened as part of a national recovery campaign that rewards producers and consumers of American goods.  American companies need to be assisted in their desire to locate production facilities in places like Janesville.  Giving American companies a leg up in targeted “hot spots” or national enterprise zones for economic investment and innovation should become a part of our recovery strategy. 

In the same manner that large agri-business companies are hedged in every farm bill by federally funded insurance programs against crop loss, so should struggling communities be hedged against the departure of companies.  Or, just as research and development funds are provided to large Pharm companies, so R/D funding should be made available to communities and small entrepreneurs.  Further, small business creation should be assisted, nurtured and funded more adequately and with more creativity. 

Finally, our nation’s safety net programs, designed to assist low moderate and very low-income folks avoid a complete collapse into poverty, must be strengthened.  Utilizing the capacity of current and emerging technologies, persons at the bottom of the nation’s socio-economic continuum should be able to receive an integrated, coordinated map out of poverty and into the possibilities of self-sufficiency, adequate education and full employment.  An honest assessment of the impact of these invested funds on local, state and national economies should be developed and appreciated.  In short, every dollar invested at or near the bottom of the economy is a dollar that is spent quickly and results in an important “churn” in the local economy. 

The complexity and the pain of our current situation require new solutions and the reworking of older, tired, worn remedies and responses.  Sadly, scalable solutions continue to elude us and may be nearly impossible to catch hold of given the public policy and political divide at work in Wisconsin, and not just in Wisconsin, but across the nation. 


Anonymous said...

Mutual funds are a pretty good thing to be entangled in over the long hall.

Larry James said...

My point was that all of us are conflicted when it comes to fair labor issues.

Anonymous said...

The question is not if Obama will survive the scandals, the question is if America will survive as founded.

Anonymous said...

We need intervention by God, to save us from the current administration.

Larry James said...

Anyone want to address the issues of my post?

Anonymous said...

I think the answer to your question is "no." Most of these anon's do not sign on to enter a meaningful discussion. They sign on to lob a grenade (which is by nature indiscriminate)and run away.

Anonymous said...

Most of LJ's posts are far left socialist, so gernade lobbing is appropriate.

Lorlee Bartos said...

Wow -- so worrying about whether the middle class can survive and whether people have jobs and food is left socialist. I thought it was just plain Merican.