Globalization’s Middle-Class Squeeze

KEVIN CLARKE, Outsourcing Around (2004)

The economic growing pains induced by globalization had destabilized American manufacturing since the 1970s, but its pain reached the middle class later as white-collar jobs also began to be outsourced to less expensive workers in other countries. Here, Kevin Clarke, an editor at U.S. Catholic magazine, urges compassion in responding to the ill-effects of the global economy.

Most of us have already had the experience once or twice: Dialing a tech support number for our latest gadget or cellular provider delivers us into a fiber optic wonderland where we could be chatting with a service rep just as likely to be seated at a desk in Bangalore, Manila, or Limerick as in Anytown, U.S.A.

The surprise international calling plan used to provoke a head scratching, gee-whiz-what-will-they-think-of-next amazement, but these days the promise of a transglobal service industry has been transformed into the political “problem” of white-collar outsourcing. Democrats have been making political hay out of the telecommuting of jobs outside of the United States while exasperated Bush administration policy wonks try to explain to us thick-headed Americans why losing our jobs is actually a good thing. Gosh, when will we understand economics?

New technology, better education in the developing world, and last but certainly not least, profit optimization bring a new generation of U.S. workers into globalization’s crosshairs. White-collar workers who shrugged off the suffering of their blue-collar brothers and sisters over the last two decades now have a much different perspective on all that union grousing.

During the Reagan years, Americans were told not to worry about the bloodletting within our industrial labor base and the by now almost complete eradication of the nation’s manufacturing infrastructure as a new morning of service industry predominance was dawning in America. How globalized time flies. Now even those jobs within economic sectors purported to replace manufacturing don’t appear safe.

Previous rounds of outsourcing did not provoke the heated cries for intervention we hear today now that demographic samples among computer engineers and mid-management are exploring the dark side of globalization. I mean, it was one thing when some line workers at an assembly plant lost their jobs to teenagers in Mexico and China, but some of these guys have BMWs to pay off, for God’s sake. When will it end?

The short answer is that it never will. Capitalism is a force of incessant “creative destruction,” economist Joseph Schumpeter wrote in 1942, capable of provoking rapid and violent change in economic sectors and by extension among the lives of us mere mortals who inhabit them. This is actually good news, Schumpeter argues, since it means that, while many suffer, new opportunity and improved wages await those who survive economic restructuring. The problem is that while creative destruction can appear bloodless and rational from an academic distance, looking at the process through the filter of your last pay stub — something guys like Schumpeter are never forced to do themselves — the phenomenon is a lot more gory and unpleasant.

Fortunately, capitalism’s relentless creativity can be matched by some of our culture’s other relentless forces: Christian mercy and human empathy. It may be essentially beyond our power to stop economic “progress,” but that doesn’t mean we can’t shape it into something a little more humane as we experience it. That’s something America essentially failed to do when creative destruction swept through the ranks of its manufacturing workers.

Ultimately, no one can lay a geographically exclusive claim to a job or a standard of living. If workers in other countries are capable and qualified in our economically integrated world, then jobs will flow to places where they are frequently desperately needed. It is unclear if this kind of economic equilibrium-seeking could — or should — be interrupted.

What we can do, however, is try to imagine societal structures that mitigate the impact of job loss while preparing a new generation of U.S. workers with better educations and an improved industrial infrastructure. While economic upheavals continue, we can respond with strategies that protect human dignity, acknowledging that no one deserves to be abandoned on the other side of a cycle of creative destruction.

At the same time, we should build in protections against worker exploitation in the developing world. There’s no reason to reconstruct the 19th century in emerging economies as our globalization-empowered and -assailed world steps into, with some trepidation and no little tumult, the 21st.

Kevin Clarke, “Outsourcing Around: A New Round of Job Losses Reaches White-Collar Workers. Could Whiny Columnists Be Next,” U.S. Catholic 69 (May 2004): 33.

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