Generation 1099

The standoff in Wisconsin between archaic public employee unions and the Tea Party Movement is creating a lot more heat than light.  As so often happens in our politics, we aren’t talking about what’s really going on.  The TP’ers rail about government spending and the unions blather about corporate power, but both seem blind to the tectonic shift occurring beneath them.  We are seeing the dawn of a new era of greater personal independence, wealth, and also risk.  Say goodbye to Employment as we once knew it.

Welcome to Generation 1099.

Our culture is built around employment.  Healthcare in the US is funded by insurance subsidized by employers.  We tell our children to study hard in school so that they can get a good job when they grow up.  When we meet someone we ask them “what do you do [for a living]?”  Losing a job, regardless of the circumstances, carries an odor.  Even though any one of us (who doesn’t work for the government) knows our job could evaporate at any time, there’s still that smell.

The unstated agreement when our ancestors left behind their Jeffersonian rural lives for the greater wealth and opportunity of a Hamiltonian city (suburb, really) was that employment could provide us with the same dignity as owning our own land.  On our little green patch of suburbia we would keep some vestige of the independence – the sovereignty – that my grandparents knew on their farm.

With a decent education and a steady job, you could be almost as free as our grandparents.  Government had little purpose apart from providing police, schools, and roads (on which to drive to work).  We could pretend that little had changed from the farm.

But employment as we have understood it for a hundred years is fading away.  It is being replaced by what Bush II’s speechwriters called “The Ownership Society.”  With each passing year, fewer and fewer us are formally employed and more of us work for ourselves (almost 1/3 of the workforce already), either as full-blown entrepreneurs or as independent contractors.  It may feel scary, but on the whole, this could become a very, very good thing.

It could lead us to an era of broadly shared wealth beyond most people’s imagination in which a culture dominated by a massive middle and upper-middle class earns money more or less at their own pace, owning their own businesses or working as contractors.  It could make the supposed Golden Age of the ’50′s look like drudgery.

Or not.  It could, if we screw this up, devolve into a sort of hell.  There are two political constituencies poised to make the nightmare scenario come true and, you guessed it, they are squared off against each other in Wisconsin right now.

The Unionocracy wants to stop the future from coming because, frankly, it did pretty well under the old model.  The ownership society will heavily reward differentiation – unique skills or technical knowledge.  Whole new industries will spring up and disappear in short timeframes.  Working in this environment will require not just higher education, but constant education that continues throughout a career.  With the right model this could be good for most union members, but the end of the road for the fat union bureaucracy.

“Labor” in the sweaty old sense of the word isn’t going overseas anymore.  It’s just going away.  It is being automated out to the margins of the economy.  Unions do not want to imagine, much less welcome this future even though they hardly represent any true “labor” anymore.  They are an irrelevant institution fighting a pointless struggle to stop this shift.  They can’t win, but they can make it politically impossible for us to adapt to meet this future successfully.

Inflexible work rules, pointless employment protections, and relentless bureaucratic resistance to adaptation will not stop the future from coming.  They will just prevent us from realizing its benefits.

The extreme fringe of the right is no more excited about this prospect than the AFL-CIO.  This new model will require a much more robust social safety net, one that extends beneath nearly everyone, not just the poor.  Healthcare will have to be completely divorced from employment.   Greater government involvement in education will have to extend from early childhood beyond college, making affordable, meaningful training available throughout life at a reasonable (which means subsidized by all of us) cost.

Instead of the Tea Party fantasy of a government that fades away, this will mean that we’re all much more closely tied to a much more nimble government regardless of class or race.   The Jeffersonian Dream will have to fade.  The alternative?

If the TP’ers have their way, we will still see the end of employment as we know it, but it will be replaced by the “disowned society.”  Without a net, the dislocation caused by this economic shift will swallow the middle class.  The only way to bridge the divide to Generation 1099 without government help will be to have significant reserves already on hand – to be relatively wealthy already.  The costs of education, healthcare, and increasingly frequent gaps in employment will overwhelm all but the rich and the rich will not be immune themselves.

Even the wealthiest will see their capital erode.  You can see the hints of this future in the asset bubbles that are tightening into shorter and shorter cycles as more concentrated wealth sloshes around at the top of the global economy competing for ever declining real returns.  Having more money doesn’t help if there’s nothing for those dollars to buy.  You can only eat so much cake.  Failure to adapt to this shift will make us all poorer and destroy a fantastic opportunity for a brighter future.

Wisconsin Democrats need to come back to the capital and face the future.  Instead of trying to protect 19th century labor unions, let them start thinking of ways to make government more nimble and adaptable.  And let’s see Republicans stop foaming about their dark, sometimes bizarre phobias and start proposing ways to make education relevant in an ownership society.  Let’s look for ways to make healthcare available and affordable without tying it to employment.  Let’s look for ways to eliminate tax penalties on contractors.

There is hard, vital work to do in building a model for government that can help us bridge the divide to Generation 1099.  If we’re going to argue, let’s argue about what matters.  Let’s not let Glenn Beck or the AFSCME – both of them trading on fear – ruin our future.

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