What should liberals be trying to accomplish? [View all]

[phantom power]

It has been the basic goal of 20th century liberalism to build and sustain a large middle-class, country by country, through protectionist trade policies, union organizing and, most importantly, investments in education, infrastructure and the social safety net. That focus worked--for a time. But the last twenty years of globalization have been changing all that.

...it used to be that Henry Ford paid his employees well, because paying them well ensured a good, stable middle-class market for the purchase of his cars. A modern Henry Ford need not pay his employees well, since the cost of overseas labor is incredibly low, and the biggest growth market for cars lies outside the United States, anyway. A modern Henry Ford no longer needs the American middle class.

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There's an implicit and uncomfortable moral argument to be made against latter 20th century Keynesianism as well: why, in fact, should an American worker make a good middle class income and drive a BMW, when a worker in Malaysia could do the same work for 1/10 the money while climbing out of abject poverty? The usual answer from Democratic politicians is rooted in nationalism and Americana, which is fine politics, but less than adequate morality. A more rational argument is that if you follow that process to its logical conclusion, there won't be a middle class consumer market for the product the worker is creating. But that's not so certain, either, as countries like China, Russia, Brazil and India (the BRICs) grow their own middle classes.

The reality of globalization is that almost all work that doesn't require either very specialized skills or face-to-face personal attention will eventually be fungible on a nearly limitless and desperate global labor market. Specialized skill jobs are few and far between; whole economies can't run on them. Face-to-face personal attention jobs don't typically pay very well.

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The pushback must be on a global scale if it is to happen at all. No one nation's middle-class can stand alone against the global labor arbitrage juggernaut. Liberalism must go big or go home.

http://digbysblog.blogspot.com/2011/12/what-should-liberals-be-trying-to.html