The California Budget Project’s report, A Generation of Inequality: The State of Working California, 1979-2006, has already started to grab public attention, such as a front-page article in the SF Chronicle.
It’s about time. Although neoliberalism has been hurting working Californians since 1979, it’s been in the last few years that the situation has become dramatically worse. Low wages, poor job growth prospects, and soaring costs of living are killing the California Dream for millions of residents of this state.
Below I offer an overview of the report, and some suggestions on what we can – and should – do about the growing crisis.
The CBP has identified several major factors that illustrate the widening inequality in California:
- 70% of job creation in California since 1979 has been in high-wage or low-wage jobs. The middle-income folks have faced stagnation or declining incomes.
- Wage gains are not only unevenly shared, but inflation and the soaring cost of living has hit low- and middle-income workers harder than their counterparts in other states.
- Workers are getting fewer benefits – health care has been slashed, as have pensions.
- Young Californians – those born since 1979 – have fared poorly in the state’s job market, and since 2000 those with college degrees have had *fewer* job prospects than those with only a high school diploma, though the latter group is still facing poor prospects of their own.
California is becoming a place where only the rich can afford to enjoy basic economic security – whereas everyone else must face high housing costs, rising energy, food, and health care costs with shrinking wages and poor job prospects.
It’s apt that this report focuses on 1979 to the present, as that corresponds to my own lifespan. Parts of this report ring all to true to my own cohort. Take my high school class, which graduated from an Orange County school in 1997. Today most of us work either in financial services, high-tech, or education, with many of the grads who did not attend college working in the service sector.
This is not a recipe for economic security. Those who work in financial services are facing the specter of widespread job losses as a 25-year long asset bubble starts to unwind. Those who work in high-tech already faced a bust in 2000, and know all too well how easily their jobs can be outsourced. Those of us who work in education are dependent on government funding, which Republicans are seeking to cut at every opportunity. Those who work in the service sector find their employment to be unsteady and their wages wholly inadequate to the cost of living in California. And most of us who attended college are saddled with student loan debts, cutting into our incomes even more deeply. And that’s just from a suburban high school – Californians from poorer backgrounds obviously have fared much worse than we.
Meanwhile the situation continues to worsen. The bursting of the housing bubble has already caused the state’s unemployment rate to rise every month in 2007. Gas prices have retreated somewhat from their spring highs, but remain around $3/gal in the state, still an unsustainably high level. At the same time Republicans successfully gutted state mass transit funds, effectively shackling Californians to their cars and to the oil companies. Arnold’s preferred health care plan would merely saddle these struggling families with hundreds of dollars a month in premiums, while still not actually delivering them affordable, comprehensive health care.
This report illustrates a state in crisis, lurching toward catastrophe. 28 years of neoliberalism has put us on the edge of a precipice. How do we deal with it, then?
Do we follow the advice of conservatives like Joel Kotkin, who in the SF Chronicle article about the CBP study called for more of the same – less regulation and taxation of business, implying though not saying that this will also require further cuts to vital public services? That would be like turning to the folks who broke Iraq and asking them to fix it.
Instead we need to revive the old progressive, New Deal era emphasis on economic security. Some believe that progressive politics remains amorphous and without a core agenda. Economic security, I believe, MUST be that agenda.
We must build a diverse coalition of all ethnic and racial backgrounds, of middle- and low-income households, to challenge the neoliberal economy. Instead we must demand and put into action policies that will help even out the balance in California, and save the state from impending ruin.
We need, at minimum, the following:
- Universal health care. Providing cost certainty to families, as well as health, is vital to providing for our future security.
- A redefinition of the California Dream – a new urban strategy for California life, providing for affordable housing, sustainable transportation, and better use of our resources. We must stop subsidizing suburban sprawl, one of the culprits behind this inequality, and instead redirect our energies to building up our cities.
- A new, long-term source of good jobs for California’s low- and middle-income families. The Green Jobs initiative pioneered by Rep. Hilda Solis could well be the prototype for this, providing for a clean environment, sustainable practices, and jobs for ALL Californians, across class and racial lines. California can become a leader in 21st century manufacturing, building on local resources to provide a sustainable and clean range of products for America as we face the dual shocks of climate change and peak oil.
- Root-and-branch reform of agriculture. Californians have already become major leaders of the Farm Bill reform movement and we need to ramp this up significantly. Agriculture is the backbone of California’s economy and, of course, of civilization itself. We need to shift CA ag toward sustainable, organic, healthy practices, linking city and country in a new network of local food production and consumption that provides income and jobs for rural counties and affordable, quality food for the cities.
- Educational reform and affordability. The cost of higher education – including technical and vocational training – has soared, and these costs represent a massive drain on earning power for working families. We need to put into place a plan to forgive ALL student loans, and redeem the promise we made in 1960 to give Californians free higher education. This will spur entrepreneurial activity, as well as ensure that the young can help pay for the needs of aged.
All of those solutions will help Californians of all backgrounds and class status. We cannot follow in the footsteps of those who will tell us that in the hard times that we now face, we must choose who to include and who to exclude – a choice that always seems to come down to race.
This is the challenge we face as California progressives. And these can be the solutions that we offer. This can be our opportunity to build a prosperous and secure 21st century state.
