The World is Flat - Friedman Thomas (читать книги без сокращений .TXT) 📗

Good Fat Cushions Worth Keeping

While many of the old corporate and government safety nets will vanish under global competition in the flat world, some fat still needs to be maintained, and even added. As everyone who worries about his or her health knows, there is “good fat” and “bad fat”-but everybody needs some fat. That is also true of every country in the flat world. Social Security is good fat. We need to keep it. A welfare system that discourages people from working is bad fat. The sort of good fat that actually needs to be added for a flat world is wage insurance.

According to a study by Lori Kletzer, an economist at the University of California, Santa Cruz, in the 1980s and '90s, two-thirds of workers who lost jobs in manufacturing industries hit by overseas competition earned less on their next job. A quarter of workers who lost their jobs and were reemployed saw their income fall 30 percent or more. Losing a job for any reason is a trauma-for the worker and his or her family-but particularly for older workers who are less able to adapt to new production techniques or lack the education to move up into more skilled service jobs.

This idea of wage insurance was first proposed in 1986 by Harvard's Robert Lawrence and Robert E. Litan of the Brookings Institution, in a book called Saving Free Trade. The idea languished for a while until it started to catch fire again with an updated analysis by Kletzer and Litan in 2001. It got further political clout from the bipartisan U.S. Trade Deficit Commission in 2001. This commission couldn't agree on anything– including the causes of or what to do about the trade deficit– other than the wisdom of wage insurance.

“Trade creates winners and losers, and what we were thinking about were mechanisms by which the winners could compensate the losers, and particularly losers who were enjoying high wages in a particular job and suddenly found their new employment at much lower wages,” said Lawrence. The way to think about this, he explained, is that every worker has “general skills and specific skills” for which they are paid, and when you switch jobs you quickly discover which is which. So you might have a college and CPA degree, or you might have a high school degree and the ability to operate a lathe. Both skills were reflected in your wages. But suppose one day your lathe job gets moved to China or your basic accounting work is outsourced to India and you have to go out and find a new job. Your new employer will not likely compensate you much for your specific skills, because your knowledge as a machine tool operator or a general accountant is probably of less use to him or her. You will be paid largely for your general skills, your high school education or college degree. Wage insurance would compensate you for your old specific skills, for a set period of time, while you take a new job and learn new specific skills.

The standard state-run unemployment insurance program eases some of this pain for workers, but it does not address their bigger concerns of declining wages in a new job and the inability to pay for health insurance while they are unemployed and searching. To qualify for wage insurance, workers seeking compensation for job loss would have to meet three criteria. First, they would have to have lost their job through some form of displacement-offshoring, outsourcing, downsizing, or factory closure. Second, they would have to have held the job for at least two years. And third, the wage insurance would not be paid until the workers found new jobs, which would provide a strong incentive to look for work quickly and increase the chances that they would get on-the-job retraining. On-the-job training is always the best way to learn new skills-instead of having to sign up for some general government training program, with no promise of a job at the other end, and go through that while remaining unemployed.

Workers who met those three conditions would then receive payments for two years, covering half the drop in their income from their previous job (capped at $10,000 a year). Kletzer and Litan also proposed that the government pay half the health insurance premiums for all “displaced” workers for up to six months. Wage insurance seems to me a much better idea than relying only on the traditional unemployment insurance offered by states, which usually covers only about 50 percent of most workers' previous wages, is limited to six months, and does not help workers who suffer a loss of earnings after they take a new job.

Moreover, as Kletzer and Litan noted, although all laid-off workers now have the right to purchase unsubsidized health insurance from their former employer if health coverage was offered when they were employed, many jobless workers do not have the money to take advantage of this guarantee. Also, while unemployed workers can earn an additional fifty-two weeks of unemployment insurance if they enroll in an approved retraining program, workers have no guarantee that when they finish such a program they will have a job.

For all these reasons, the Kletzer-Litan proposal makes a lot of sense to me as the right benefit for cushioning workers in a flat world. Moreover, such a program would be eminently affordable. Litan estimated that at an unemployment rate of 5 percent, the wage insurance and health-care subsidy today would cost around $8 billion a year, which is peanuts compared to the positive impact it could have on workers. This program would not replace classic state-run unemployment insurance for workers who opt for that, but if it worked as projected, it could actually reduce the cost of such programs by moving people back to work quicker.

Some might ask, Why be compassionate at all? Why keep any fat, friction, or barriers? Let me put it as bluntly as I can: If you are not a compassionate flatist—if you are just a let 'er rip free-market flatist—you are not only cruel, you are a fool. You are courting a political backlash by those who can and will get churned up by this flattening process, and that backlash could become ferocious if we hit any kind of prolonged recession.

The transition to a flat world is going to stress many people. As Joshua S. Levine, E*Trade 's chief technology officer, put it to me, 'You know how sometimes you go through a harrowing experience and you need a respite, but the respite never seems to come. Look at the airline workers. They go through this [terrible] event like 9/11, and management and the airline unions all negotiate for four months and management says, 'If the unions don't cut $2 billion in salary and benefits they will have to shut the airline down.' And after these wrenching negotiations the unions agree. I just have to laugh, because you know that in a few months management is going to come right back... There is no end. No one has to ask me to cut my budget each year. We all just know that each year we will be expected to do more with less. If you are a revenue producer, you are expected to come up with more revenue every year, and if you are an expense saver, you are expected to come up with more savings every year. You never get a break from it.“

If societies are unable to manage the strains that are produced by this flattening, there will be a backlash, and political forces will attempt to reinsert some of the frictions and protectionist barriers that the flattening forces have eliminated, but they will do it in a crude way that will, in the name of protecting the weak, end up lowering everyone's standard of living. Former Mexican president Ernesto Zedillo is very sensitive to this problem, having had to manage Mexico's transition into NAFTA, with all of the strains that put on Mexican society. Speaking of the flattening process, he said to me, “It would be very hard to stop, but it can be stopped for a time. Maybe you can't stop it totally, but you can slow it down. And it makes a difference whether you get there in twenty-five years or fifty years. In between, two or three generations-who could have benefited a lot from more trade and globalization-will end up with crumbs.”