[Occupymendocino] Jobs Aren’t Being Destroyed This Fast Elsewhere.

[Richard Karch]

From Dr. Don McCain

The New York TimesMarch 30, 2020
Jobs Aren’t Being Destroyed This Fast Elsewhere. Why Is That?
It’s not too late to start protecting employment or to make medical care
for Covid-19 free.

By Emmanuel Saez and Gabriel Zucman

The coronavirus pandemic is laying bare structural deficiencies in
America’s social programs. The relief package passed by Congress last
week provides emergency fixes for some of these issues, but it also leaves
critical problems untouched. To avoid a Great Depression, Congress must
quickly design a more forceful response to the crisis.
Start with the labor market. In just one week, from March 15 to March 21,
3.3 million workers filed for unemployment insurance. According to some
projections, the unemployment rate might rise as high as 30 percent in the
second quarter of 2020.
This dramatic spike in jobless claims is an American peculiarity. In
almostno other country are jobs being destroyed so fast. Why? Because throughout
the world, governments are protecting employment. Workers keep their jobs,
even in industries that are shut down. The government covers most of their
wage through direct payments to employers. Wages are, in effect,
socializedfor the duration of the crisis.Instead of safeguarding employment,
 America is relying on beefed-upunemployment benefits to shield laid-off 
workers from economic hardship.

To give just one example, in both the United States and Britain, the
government is asking restaurant workers to stay home. But in Britain,
workers are receiving 80 percent of their pay (up to £2,500 a month, or
$3,125) and are guaranteed to get their job back once the shutdown is
over.
In America, the workers are laid off; they must then file for unemployment
insurance and wait for the economy to start up again before they can apply
for a new job, and if all goes well, sign a new contract and resume
working.
Even if unemployment is generously compensated — as it is in the $2.2
trillion bill Congress passed — there is nothing efficient in letting the
unemployment rate rise to double digits. Losing one’s job is anxiety
inducing. Applying for unemployment benefits is burdensome. The
unemployment system risks being swamped soon by tens of millions of
claims.
Although some businesses may rehire their workers once the shutdown is
over, others will have disappeared. When social distancing ends, millions
of employer-employee relationships will have been destroyed, slowing down
the recovery. In Europe, people will be able to return to work, as if they
had been on a long, government-paid leave.
The battle for the speediest recovery starts today. The next congressional
bill needs measures to protect employment for the duration of the
shutdown.
This does not raise insuperable technical difficulties. The bill passed
last week provides support for wages in one industry, airlines. Congress
could easily extend this program to other sectors. Some countries — like
Germany, with its Kurzarbeit system, a policy aimed at job retention in
times of crisis — already had the government infrastructure in place to
send workers home while the state replaced most of their lost earnings.
But
several nations with no experience in that area — like Britain, Ireland
and Denmark — were able to introduce brand-new employment guarantee
programs on the fly during the epidemic.
This situation for laid-off workers would be bad enough if it were not
aggravated by a second American peculiarity. As they are losing their
jobs,
many workers are also losing their employer-provided health insurance —
and now find themselves faced with the Kafkaesque task of obtaining
coverage on their own.
One option involves continuing to be covered by one’s former employer, a
program known as COBRA. It is prohibitively expensive: Participants have
to
bear the full cost of insurance, $20,500 per year on average. Another
option is to go shopping for a plan on the Affordable Care Act insurance
exchange, where one is faced with a bewildering choice between plans like
Blue Shield’s Bronze 60 PPO (with a deductible of up to $12,600 per year)
and Aetna’s Silver Copay HNOnly (with a $7,000 deductible and up to
$14,000 in annual out-of-pocket expenses). The last option is to join the
ranks of the uninsured, a catastrophic solution during a pandemic. 
The bill passed last week does nothing to reduce co-pays, deductibles or
premiums on the insurance exchanges; nor does it reduce the price of
COBRA.
The next bill should introduce a Covidcare for All program. This federal
program would guarantee access to Covid-19 care at no cost to all U.S.
residents — no matter their employment status, age or immigration status.
Fighting the pandemic starts with eradicating the spread of the virus,
which means that everybody must be covered.
The big battles — be they wars or pandemics — are fought and won
collectively. In this period of national crisis, hatred of the government
is the surest path to self-destruction.
Emmanuel Saez and Gabriel Zucman are economists at the University of
California, Berkeley.
https://www.nytimes.com/2020/03/30/opinion/coronavirus-economy-saez-zucman.html <https://www.nytimes.com/2020/03/30/opinion/coronavirus-economy-saez-zucman.html>
[1]

Comment by Don McCanne
Much has been written about how having an equitable, efficient,
comprehensive national health program (i.e., single payer Medicare for
All)
would have been extremely helpful combating illnesses caused by the
coronavirus pandemic. We would still have other problems such as the
pending permanent closure of a multitude of businesses that are not able
to
survive the shutdown that is occurring during this pandemic.
Emmanuel Saez and Gabriel Zucman are experts in income and wealth
inequality and the adverse consequences that occur when the one entity
that
could remedy these problems fails to act, and that entity is the
government.
In this article, they provide, as an example, an explanation of how in
other nations many of the businesses will survive because of
implementation
of beneficial government policies. They contrast that with the dire
prognosis in the United States which we can expect because of our failure
to enact and implement socioeconomic programs that would help protect all
of us, even during crises like the current pandemic. A recession would be
understandable, but our lack of foresight could result in a prolonged
depression.
The authors explain why our current health care financing system is not
satisfactory. They propose an emergency financing program, but it would
have been far better to have had a single payer Medicare for All system
already in place. The crisis is difficult enough without adding the
additional task of creating a massive new Covidcare for All program.
We are hardly into our national nightmare and yet the lesson for us is
already obvious. We need greater solidarity in working together through
our
government, and that includes following the Willie Sutton rule (go where
the money is) in establishing equitable, progressive taxes.
As Saez and Zucman state, "The big battles — be they wars or pandemics
— are fought and won collectively. In this period of national crisis,
hatred of the government is the surest path to self-destruction."


Links:
------
[1]
https://www.nytimes.com/2020/03/30/opinion/coronavirus-economy-saez-zucman.html <https://www.nytimes.com/2020/03/30/opinion/coronavirus-economy-saez-zucman.html>

-------------- next part --------------
An HTML attachment was scrubbed...
URL: http://lists.mcn.org/pipermail/occupymendocino/attachments/20200331/2833b73d/attachment.html