Journalist Don Peck has just written one of the most important books yet published on the Great Recession. Entitled “Pinched: How the Great Recession has narrowed our futures and what we can do about it,” the book does not delve into what caused the downturn, like the countless other books already published on the subject. Rather, Peck wrestles with how the Great Recession is affecting Americans today and how it is already reshaping our future. Indeed, Peck argues that the bigger effects are still to occur.
Peck’s main thesis is that major periods of economic deflation and inflation put a stamp on a society. This one, without intelligent responses on our part, is likely to produce: even greater inequalities in wealth and income, a reduction of men employed in the workforce, increased bread-winning roles for women, more tensions about race issues and immigration, later marriages and parenthood, the economic weakening of cities without unique and competitive assets, potentially ineffective political leadership, a protracted recovery and many other sobering challenges.
Some in the workforce find themselves in “occupational ghettoes” where it is hard to find and step onto the next rung to upward mobility. Working poverty will likely become even more common. And moderate income families are starting to resemble inner city households, rather than the middle class – joblessness, family conflict, drug and alcohol abuse, divorce, single-parenting.
Unlike the Great Depression, this economic era may actually drive us apart, culturally and politically, as well as reinforce current trends toward widening economic segregation. It could even encourage mass radical movements. At this point, these are more likely to be of the right-wing quasi-populist sort than left social movements.
But who knows? Mass apathy and weakened links of solidarity may be much more likely, given present trends.
The book’s final chapter offers, humbly, a manifesto for action.
He calls for further short-term economic stimulus by government combined with plans for significant federal deficit reduction during the medium-term.
Public subsidies should be provided for businesses to hire the long-term jobless. Bigger investments should be made in public works. Regulatory reforms that would speed the process of research and development through commercialization should be developed and applied. We must get a handle on health care costs. The wealthy should be taxed at a higher rate. Career academies should be established in order to smooth the transition from secondary schools to a job. Another experiment (“wage insurance” to “top up” the salaries of those persons who took a job that paid less than their previous employment) should be explored.
Peck regards our present situation as dire, not desperate. Avoiding the latter danger is a function mainly of our coming together again as a people that are committed to each other. The proposed programs just listed would help immensely. But even more important is timely cultural change; a renewed societal commitment to strong, intentional public solutions is critical.
In other words, Americans and their leaders would do well to recognize and remember the importance of Benjamin Franklin’s famous admonition that they hang together lest they hang separately.
Bill Schweke is a Senior Fellow at the Durham office of CFED.