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August 23, 2007

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Adriana Gomez

To all the previous posters who mentioned that Reich was not far wrong for a book written in 1991, I absolutely agree with you! Reich brings up a valuable point: we needed more policies back then to help the bigger, needier portion of our workforce, prosper. As the borders of the economies of different nations start to fade, there comes more competition for every field of specialization. The ones to take the hardest hit are those that work in “routine production services” and “in-person” services.

With the growing workforce competition, those that have “unskilled” jobs are suffering a lot and the growing gini coefficient in this country has proved it. Today, the gap between the rich and the poor has grown tremendously. Reich mentions the possibility of the “symbolic analysts” being exposed to a better chance at an education and the fact that more people need to resort to a better education to improve their conditions and thus giving all a chance to enter the competition with the rest of the symbolic analysts.

Perhaps today the progressive tax is “less progressive than it was a few years back,” as Dr. Olney says. This is still a really good suggestion to try to shrink this gini coefficient. Reich also called in some other really good suggestions that are pretty much within the ball park of where we are today. Affirmative action in schooling is one way that education is becoming accessible to everyone. With today’s redistribution of wealth, the problems of the poor are being addressed, though perhaps not entirely, they are being dealt with so as to invest in the children of the poor. I absolutely agree with Reich on these suggestions not only because they improve the conditions of those who have need, but because with a growing efficiency of resources (proper use of the labor force rather than huge amounts of unskilled laborers used to cheap labor) improves the status of EVERYONE. This growth in efficiency will lead to an increased standard of living, because I believe that education goes a very long way in expanding our production possibilities frontier and everyone’s well-being.

Helen Louie

Like everyone else, I am amazed by how accurate Reich was in his prediction of the world. I believe because of the accuracy of his predictions, his prescriptions become very convincing. Moreover, he proves his claims and argument extremely well.

Reich’s categorizes American jobs into three categories, the “symbolic-analytic” service jobs, the routine production service jobs and the “in-person” service jobs. He believes that with the decrease of borders, the first type of service jobs is becoming more useful and the other two are decreasing in use. Therefore, the only way to help the United States and have Americans be on the same boat again is by having the top 20% of the population (the ones in the first type of jobs) to help the other 80%. I agree with Reich’s argument here because of the current situation in the United States. However, I do not know if his prescription is attainable, especially since it involves the top 20% funding the projects. His argument makes a lot of sense, because the top 20% would not want to pay straight towards helping the 80%, thus there would be the progressive income tax. On the contrary, the top 20% would not approve of the increase of taxes. And since the 20% have most of the power and influence in the government today, it would be hard to increase taxes.

I agree with Glory and the Starbucks example because the “in-person” service employees are contributing to the global market because they are helping in the performance of the “symbolic-analytic” service employees. I also agree with Ziwei, Serena and Miranda that education alone would not lead to greater increase in the symbolic-analytic jobs because those types of jobs are hard to obtain and very competitive. For example, in Taiwan, a lot of people are motivated towards higher education and want jobs in the “symbolic-analytic” field, but there simply are not enough of those jobs for everyone. Reich does prescribe to apply these skills from the first category of service jobs to the other two, however, like Irina states, he does not say how.

Evan Fleming

Robert Reich’s Work of Nations provides a groundwork for what he thought the future of the global economy would look like during a crucial political and economic transition in our world’s history. Many who have contributed in the response have already alluded to the year Reich published this piece, and how much of what Reich predicted at this time has turned out to take full effect nearly 17 years later. However, putting this year in a historical context we must remember that with the end of the Cold War, the falling of the Berlin Wall, the increasing integration, expansion and development of countries within the European Union, and the economic boom that was beginning to take place within the US, came a very positive outlook for the state of our global economy. Economies across the board became more inclined to participate in free international trade instituting anti-protectionist policies, and this in turn provided a greater dependency and stronger relationships between countries for foreign exchange of goods. Reich’s prediction wasn’t as far-fetched or lucky as it may seem looking at the political-economic landscape of the world in 1991.

I think one of Reich’s strongest arguments rests in the fact that the idea of a national boundary has become less of a reality and more of a myth. Thomas Friedman, from the New York Times, argues that in the new era of globalization, so many people now have the communication, and innovation tools to compete, connect and collaborate from anywhere. These people, most likely representing the labor class referred to by Reich as “symbolic-analysts”, have used their increased intellectual capacity to take advantage of the many benefits that the world economy has come to offer. The remaining 4/5ths of the American laborers are put at a definite disadvantage because they are obviously not granted the opportunities and global exposure that those identified as symbolic analysts are.

However, Reich’s sound approach to foreseeing what the fundamental challenges for integration of American workers in the world economy does leave a few important things out. First from an economic standpoint with an increasingly globalized economy we must take into account the affects of outsourcing, and dealing with economies of scale. He doesn’t provide any analysis for what kinds of implications the shrinking world has on international labor and the shifting of jobs individual specialized jobs from one place to another.

The second weakness in Reich’s argument is that he fails to mention the affects that political/public policy have had on the amount of opportunity for American workers as participants in the global economy. Government decisions at a higher level have affected the stagnant growth of the domestic economy which in turn has weakened the competitiveness of the US labor force. My argument is that the government in general has not contributed to ensuring the well-being and assimilation of Americans into the global society. The problem is self-perpetuating because the lack of awareness and political participation from Americans has left the government to operate at will and avoid the worry of accountability and instituting fair public policy law. The problem can best be explained by Tocqueville where he states that the narrowmindedness of individuals in their pursuit of wealth, undermines any and all possibility for trying to help the 4/5ths of workers in the routine production and in-person service labor strata better themselves. Despite the fact that we have added substantial value to the world economy, as a society, we have become too preoccupied with ourselves and by getting ahead that our progress into being avid contributors to global production has been slowed and this is where I think the major problem lies.

Jennifer Miller

Reich does a superb job of outlining the historical progression of corporate America in relationship to national identity, and the intersection of the decline of nationalism with the issues of rising in inequality in the U.S.
As others have mentioned his “prophetic” descriptions of globalization are right on point, and unfortunately so are his detailed projections regarding inequality.
Reich’s work reminds me of ideas outlined in the book “The World is Flat” by Thomas Friedman. This book describes how technological advances have led to global competition (a flattening of the world) among educated workers, at a pace in which the U.S. is now falling behind. Both Reich and Friedman are proponents of nationalism in a sense of increasing U.S. brainpower in order to keep the U.S. in its position as a global leader. I would agree that succeeding in the global economic game is important, but I would argue that doing so in with a goal of maintaining the role as a world superpower is not sustainable for the U.S.(or for any nation).
I agree with Ziwei and Serena that Reich's emphasis on education to increase the population of "symbolic analysts" is a limited solution to address inequality. Particularly due to the existence of inequality within capitalism (which Zewei mentioned), in which there will always need to be a lower paid “routine producer" class. Reich takes for granted that exporting these type of jobs is an equitable endeavor. He does not include in his analysis the problems associated with the exportation of inequality in a global economy. A larger population of well-educated analysts in the U.S. might have some positive implications for the U.S.; but a larger number of "routine" working poor (living in the steadily increasing number of slum neighborhoods) in foreign and developing countries is not a solution to inequality. This just transfers the inequality across a global scale, and does not address the need of foreign routine workers to have living wages, humane conditions and worker protections.

Roushani Mansoor

To me, Robert Reich’s book The Work of Nations has been the most rewarding and practical work we have read in this course. This thoroughly articulate and logical book has implication not only for the specifics of organization theories, but also for the understanding that social, political and economic theories cannot exist separately in isolation from one another. He argues that as economies develop further, they will move to the idea of a borderless economy where the notion of national products, national technologies and national corporations will become increasingly meaningless. This shift has enormous political implications- that the traditional idea of national solidarity and purpose can no longer be defined in purely economic terms- “That the strength of the American economy is synonymous with profitability and productivity of American corporations is an axiom on the brink of anachronism”.
What is ingenious about Reich’s thoughts is their practicality. Without discrediting the brilliance of previous thinkers, they have not grounded their theories in reality. All theories are perfect on paper, but they cannot survive with real forces existing today. For example, Milton Friedman looked at government economic involvement and concluded that it generally had disastrous consequences in the market. He then prescribes to remove government from all aspects of the economy and let the market hit its troughs and crests. However, Friedman overlooks the fact that the majority of free-market economies operate in democratic nations, or at least nations in which the leaders are elected by the populous. These government officials cannot let the economy rip and expect to be reelected. Reich, on the other hand, sees that all these forces- political, economic and social- coexist and interact, thus complicating matters. He acknowledges the growing economic divisions among Americans- “America’s problem is that while some Americans are adding substantial value, most are not. In consequence, the gap between those few in the first group and everyone else is widening.” Reich offers realistic recommendations to fix this disparity from investing in education at all levels to instituting a progressive income tax. Whether by choice, practicality, experience or all three, Reich grounds the majority of his argument and his prescriptions with evidence from America. Instead of attacking vast institutions such as the market economy, Reich focuses on making slight adjustments to help the institution perform better while someone like Djilas is the opposite. Djilas argued for the overhaul of the Communist system in the Soviet Union and Yugoslavia, an idea that was not welcomed nor appreciated. In contrast, Reich maintains that the American government should not think of these forces in isolation, but allow them to engage one another.
I think the majority of commentators before me all see how valuable Reich’s argument is. Maybe as a realist, I enjoyed reading someone who could place his argument in the entire continuum of time, the past, present and the future to prove its validity. I must comment on the weaknesses Evan points out. He points out that Reich does not mention the issue of outsourcing for the American economy. First, outsourcing was not as big of an issue in 1991 when Reich wrote the book as opposed to know. There was no way for Reich to have known what an issue outsourcing would have become. Additionally, if we continue with the outsourcing logic, while unspecialized jobs are being given to cheaper, foreign labor, there will always be jobs that cannot be done over the phone. Everything from Glory’s Starbuck’s barista to doctors and lawyers, the types of jobs available in the U.S. will change making our economy much more specialized and professional based. The second fault seen in Reich’s argument is that he fails to mention the lack of opportunity for American works to participate in the global economy. Reich did not need to mention this fact- in 1991 and now, the U.S. is the world’s biggest importer of foreign goods. How can that be if the government supposedly does not make available opportunities to interact in the global economy? Up until now, American workers did not have to participate in the global economy- they were at the forefront of this global economy. Now with other nations catching up to the U.S., it is necessary to reevaluate our position within the international community.

Kinzie Kramer

I appear to be on the same wavelength as everyone else, as I am thoroughly impressed by Reich’s ability to predict what I believe to be the current economic situation. I think his biggest strength is his focus on the importance of human capital- that “in the high-value enterprise […] growth depends on the cumulative experience of key employees” who “have accumulated the most valuable skills in problem-solving, problem-identifying, and strategic brokering” (111). The focus on human capital is evident in every chapter of his treatise, and is the link that makes the whole book come together convincingly,

Professional service is what matters now, and those “fortunate enough to have had an excellent education followed by on-the-job experience doing complex things can become steadily more valuable over time.” These fortunate people are the assets to industry now. They can travel anywhere, be present anywhere virtually (conference calls), and have the ability to fit in to any industry anywhere (if they are good at their job).

These people, possessing great human capital, make the global web and diffused ownership/control possible. They are not the big bosses of a pyramid vertical structure, but the “team captains” that operate in a more horizontal environment, bouncing in and out of different companies providing their services and making themselves a valuable asset that a company will try to hold onto. These people smoothed the transformation of the corporation to where it is now: “the core corporation is no longer even American. It is, increasingly, a façade, behind which teems an array of decentralized groups and subgroups continuously contracting with similarly diffuse working units all over the world” (81). The top players know how to hop from group to group and essentially made the economic system that exists today.

On a side note, one last question that I have concerning Reich is his opinion of currency. In “The Three Jobs of the Future” chapter he states that “In a few years, there will be virtually no way to distinguish one national economy from another except by the exchange rates of their currencies- and even this distinction may be on the wane” (172). He seems to have predicted the collaboration of 13 European states to give up their individual currencies to embrace the Euro (the Euro was introduced as an accounting currency in 1999 and launched as the official currency in 2002, and Reich’s book was published in 1992). Is this just mere coincidence, or does Reich think that eventually there will be one currency worldwide?

Samira Ghassemi

Reich introduced his readers to a well-put analysis of how the U.S. accumulated wealth and the mentality that this country once had, and now dissipating. The United States, as other countries in the early 20th century and well before then, were more concerned with accumulation of wealth for its own country, but now that is not the case. Investments and shareholders of different companies and industries have breached overseas and as Reich put it, “transformations of economies and technology are blurring lines between nations.” Globalization, though he had not used this word due to the development of this terminology was well after publishing The Work of Nations, has shaped a new idea of nationalism where the “idea of security against foreigners outside” is diminishing as we are now concentrating more on world wealth than individual prosperity.

Reich seems to believe that education can solve almost all problems, and to obtain that we must have a greater funding mechanism to allow for those who do not have the opportunities of better education. He proposed four distinct resolutions that all pertain to higher qualitative education: more on-the-job training programs, free daycare for single mothers, adult education/remedial courses, and intensive preschool programs. Where will the money come from for these great solutions is part of the problem. Discussion of reallocating our budget and the idea of the symbolic analyst producing a trickle-down effect onto the poorer society has not been in effect. In regards to increased costs of education I agree with Reich, that due to this effect in a nation where the disparity of income of having a post-secondary degree is so large than without one, those who are financially instable and deprived stay poor and uneducated. Those who write off “fat checks” may show mere empathy in a charitable way – but like the saying goes “give a man a fish, he eats for a day, teach a man to fish, he eats for a lifetime.”

Reich also is very optimistic in regards to what we refer to as globalization today. His stance of education is again noted when he focuses on the supply of cheap labor within the US, but with outsourcing, our supply of production workers and in-person service people that were poor are getting poorer. I agree with Connie that we need to educate those “underprivileged workers” to become more like a symbolic analyst, but I too can not agree that the US will be full of symbolic analysts – as to the information spillover that occurs. Instead of nations worrying about this absolutist dilemma, Reich beautifully states his pro-globalization notion that “everyone on the planet benefits from smaller and more powerful semiconductor chips, regardless of who makes them.” We shouldn’t fear ‘the outsiders,’ but to learn from and work with them.

Joyce Yawa Amoah

Robert Reich is certainly not the first to write about the flight of the rich from the urban centers to the suburbs to live in gated communities. This trend has been developing over the years gradually as racial intolerance and economic gap in America heightened. However his Work of Nations sheds light on the future of globalization on the American economy especially the job market Robert Reich makes a very convincing argument about the cosmopolitan nature of the top 20 percent of the labor force who now live in gated communities with their private club amenities and schools while the 80 percent of the labor force are facing precarious economic situations.

According to Reich, this widening gap between the top one-fifth (symbolic-analytic services) and the bottom four-fifth of the labor force is due to globalization. And that the economic well-being of Americans no longer depends on the profitability of their corporations instead it depends on their skills; their ability to add value to the global economy. The global economy according to Reich rewards skill and specialized labor or symbolic –analytic service. The days of high volume are gone – mass productions with high volume of factory workers are gone; we now live in an era of high-value- custom made and tailored production “value production” (7, p81) . This shift from union workers calling the short to creative specialized workers is what drives the global economy.

Globalization has created a vast pool of cheap routine workers at the disposal of transnational corporations (TNCs). These TNCs take full advantage of the global routine work pool by transporting production units to any part of the globe where they can find cheap labor. Unfortunately the American routine worker no longer has monopoly over assembly line production work. Their skills are cheaper and easily duplicable in this era of globalization. The global job market is to the advantage of the creative specialized worker with transportable skills.

What is the solution? I think Reich makes a strong argument by proposing that government provide opportunities for all Americans to become symbolic analysts by investing in education at all levels; and by instituting a progressive income tax. Producing more symbolic-analyst in America will certainly make Americans more competitive on the global job market. That is what Berkeley education is all about.

Noah Castro

To a certain extent I agree with Reich's overall analysis of industrial development, but I don't agree with his response to it. Many posters have already pointed out that what he is elaborating on is what has become known as globalization and as I was reading “The Work of Nations” I couldn't help noting its resemblance to Tomas Friedman's recent book, “The World is Flat”. Both authors suggest that as global industry has become more integrated it has become more defined by the individual and subsequently the responsibility of governments and /or “imagined communities” (Anderson) to ensure the success and wellbeing of their member citizens has faded away. Reich thinks that this is a good thing and that it should make the US government's role very clear. Since national economies/industries no longer exist and commercial trends/regulations have become globally standardized through the workings of corporate enterprise, government is free of those burdens and should invest everything in providing quality education with emphasis on “symbolic analysis” and by so doing empower its citizens to occupy leading positions in the rapidly emerging global society. I think this is a very segregated and somewhat narrow minded perception of world integration. The author makes interesting points about social inequality yet he still advocates the mainstream paradigm that increases it; the notion that being a winner is the only way to avoid being a loser. Reich claims that the US is and will continue to be better off than the rest of the world because, unlike many other countries that score higher indicators of average educational/intellectual capacity (sign of more equitable social distribution), the united states will always harbor the “creme de la creme”. I am against this because it deprives the average Joe of his right to be mediocre.

Tessa Berman

One of the most interesting facets of Reich’s argument is the role of states he envisions in the evolving economy. The very title of his book, The Work of Nations, implies that despite the declining importance of state identities, it is nonetheless the job of federal governments to deal with the divergence of national economies. His prescriptions for leveling the economic playing field, such as subsidized day care, adult education, and preschool programs indeed all rely on government spending, to support the newly differentiated economic units, primarily corporations. Indeed, it would seem this creates a functional disconnect between peoples’ economic roles and the social support mechanisms which sustain their ability to participate in the economy (what Polanyi would refer to as disembedding). This is a curious dynamic, given Reich’s allusion to Adam Smith in the title of his book, as The Wealth of Nations was premised on the assumption that nation-minded economic solidarity (in terms of employment statistics) was the basis for the desirability of liberal free market economics. Mandating that it is the state’s role to increase the competitiveness of workers in the global economy is essentially a way of sustaining the current economic system without addressing its inherent inequalities. What Reich fails to address in his argument is the possibility (and indeed probability) that the diverging sectors of the economy are created in relation to each other. While he admits that the ‘symbolic analyst’ relies on the ‘in-person service workers’ and to a lesser degree upon the ‘routine producers,’ he fails to draw the conclusion that the former ‘high value-added’ job cannot exist without the latter two. Therefore, enabling people to join the ranks of the ‘symbolic analysts’ will require an equivalent number of people (whether in the domestic or international economy) to work jobs supporting this privileged class. Given the international character of the modern economy, this economic differentiation is often observable between nations as weaker governments are less able to support the development of their citizens through meaningful employment.

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