Beyond Unemployment Insurance in the Face of Structural Job Loss: Whoever Said It Would Be Easy?

steel-mill“The long memory is the most radical idea in America.” –Utah Phillips, as recalled by Amy Goodman

I was reminded of Utah Phillips’ observation as I sat down to write this essay on how we approach public policy for dealing with unemployment during a time of mass unemployment. I intended to start off the essay by recalling the title all of a book I read in around 1990. But, when I went to Amazon.com to look for the book, I found it wasn’t listed. I figured that it had gone out of print.

Fortunately, my memory – or at least a radical part of it, as I can barely remember my own name when I wake up in the morning – had something of a radical idea: the book I had in mind was And the Wolf Finally Came, by Thomas P. Hoerr (circa 1990). It’s a book about several decades of ups and downs of steelmaking in Pittsburgh. The author recounts how Pittsburghers had grown accustomed to those ups and downs, and how as one source told the author, “the wolf finally came”; that is, those troublesome ups and downs got replaced by much more troublesome down, period.

Hoerr’s recounting provides a pointed reminder of how unprepared public policy makers can be for—to borrow a word from Jarrod Diamond—Collapse!; and so, how unprepared they can be for Transformation! and for Learning! I should add that Mancur Olson’s “logic of collective action” predicts foot-dragging by groups who disproportionately benefit from “keepin’ on keepin’ on” with established technology instead of adopting—and adapting—to new technology, the adoption of which would usually entail rearranging relations of power; see Olson’s The Logic of Collective Action; or chapters 2 and 3 of his The Rise and Decline of Nations, which summarize the first book.

The question that links all these points is, what if the current economic “downturn” is really Hoerr’s wolf finally coming… for the whole US economy? If that’s the case, then unemployment compensation, the primary public policy tool, becomes obsolete, immediately. That’s because unemployment compensation was conceived as a temporary solution to a temporary problem, getting people through the down part of one cycle to the up part of the next cycle; and not coincidentally, in that very way to facilitate the capitalist practice of accounting for labor as a variable cost, always to be minimized, rather than as a fixed or resource cost, to be sustained. But Hoerr’s wolf leaves permanent, structural problems in its tracks.

What to do? No country can keep paying people to not work for what could easily become an oxymoronic “permanent interim” period: no one could. Think of buggy-whip makers, after the (“horseless carriage”) wolf finally came to places where horse-drawn carriages and related products had been made.

The only viable public policy option is Change! And the only potentially workable approach to such policy is Transformation-through-Learning! One workable approach to that would entail changing over to the sort of future-responsive social learning program envisioned by Donald N. Michael in his seminal book, On Learning to Plan—and Planning to Learn (JosseyBass, 1973); later reissued as a second edition, with the leading “On” omitted (Miles River Press, 1997).

But learning is never easy; even acknowledging that learning “just might possibly maybe, sort of, somewhat… well… necessary” can seem to be, and can in fact be, frightening—personally, professionally, financially, and other ways as well. Dreams dissolve, along with institutional premises upon which they had been premised. Some people get blamed, and no one knows when more constructive activities have finally supplanted the so-called—and in my view, inappropriately dismissive—“blame game” (it’s unfortunate that the two words rhyme).

Those sufficiently courageous to acknowledge that learning is needed must then deal with the even greater difficulty entailed in actually doing the learning. And that includes exposing oneself to not-yet familiar evaluation criteria applied by not-yet familiar people in not-yet familiar institutional settings, with outcomes extending from something seen as “success” to something seen as “failure”, and including unsettling outcomes that a person had previously felt insulated from—all demanding even more courage.

But, we must find the courage to learn if we are to fend off Hoerr’s wolf, even if we must risk failing to do so. That’s because we certainly can’t do any better in our Transformation-through-Learning! than we do in our learning itself. Hoerr’s wolf sees right through grade inflation, ego inflation, expensive marketing campaigns, and other forms of individual and institutional self-validation.

How can we attempt to do this? By way of example, let me suggest a way that the US government could leverage General Motors—long perceived as unwilling and/or unable to learn—into learning. (I mean, GM can’t expect the government to give it all the billions it has requested, with no strings attached—can it?) The government could hold hearings that would focus less on how GM’s new plan “restructures” and “cuts costs”; and instead focus on whether, how, and how well GM’s new plan incorporates learning from their most recent, wretchedly mistaken plans.

Somehow, some of GM’s top managers came up with those wretchedly mistaken plans, and some other group signed-off on adopting them. GM officials must somehow persuade representatives of taxpayers that they have searched out and identified that “somehow” and learned how to avoid it (and how to recognize and avoid situations like it) in developing their current plan for which they would like to borrow a few billion bucks.

Here are some of the questions I’d ask them to discuss.

  1. Starting two plans ago, with the plan on which the most recent, failed plan was based, how was the set of candidate goals developed? How were goals selected from those candidate goals? How were goals prioritized? What variables were used? How was disagreement regarding goals selected and/or how those selected goals were prioritized handled? How often did the CEO end up on the losing side, and what portion of total dollars decided about did those “losses” represent?
  2. How were outcomes projected and evaluated? ? How were contingencies handled, and how were unanticipatable contingencies distinguished from anticipatable contingencies incompetently handled?
  3. How does each executive interact with his or her subordinates, and how would each executive characterize his or her subordinates’ interactions with their subordinates – down to and including the people who actually make automobiles for GM? How were the implementation and operation of these plans considered in development of these people, and so, in output projections and evaluations? Are employees still wearing “Golden Handcuffs” to reduce risk of losing their jobs? What provision, if any, did the executives make for feedback – whether favorable or unfavorable – and for incorporating learning based upon it into the plan?
  4. How did GM decide that this plan was “done”?
  5. [Responses to questions 1-4 would provide a benchmark for GM’s approach to learning to change.]
  6. Regarding the current failed plan, how did the process through which the current plan was generated differ from what was just reported about the immediately previous plan? Which elements changed; which did not? How were such distinctions reached?
  7. How is the change from the most recent past plan to the one now being submitted today different from the change from the first of the plans discussed above to the most recent past plan?
  8. Finally, to lend some solidity to all these more obscure procedural matters, approximately how would GM spend each marginal $1/2 billion? What specfic substantive and financial benefits would each marginal $1/2 billion expenditure contribute to the success of your plan.

letcherThis approach would afford at least a glimpse into GM’s decision-making process, including how and even whether GM is able, willing and inclined to learn as well as how well GM actually goes about learning and building what it does learn into decisions it takes and actions it undertakes. Hopefully, but far from certainly, such a glimpse would help to inform taxpayers’ representatives of GM’s prospects—which is to say, whether loaning GM the money would turn the company around, or merely give Hoerr’s wolf a really big meal.

Robert A. Letcher, PhD
June 10, 2009

Robert A. Letcher, Ph.D describes himself as “an academic with a disability instead of a portfolio, a writer, and a Qigong practitioner who tries to help people learn”.

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