How to Unf★ck Employment
Channel: New Economic Thinking
Date: 2022-09-07

Competition isn't for everyone. The salaries of high-end professionals are often artificially protected by public policy, without benefit to the public.

In this fifth episode of #UnfckAmerica, Dean Baker reviews the issue of employment and wage disparity.

Over the past forty years, US trade deals have been negotiated to expose manufacturing workers to international competition and put downward pressure on their wages, while protecting high end professionals from both domestic and foreign competition. This has increased wage disparity and inequality between low and highly educated workers in the US.

Dr. Baker compares the salaries for high end professionals (physicians, lawyers, dentists, etc.) on the income distribution. Barriers to entry like licensing regulations have been put in place to protect high-earning medical practitioners from both domestic and foreign competition. Insurance regulations allow specialists to set their own compensation. Lawyer incomes benefit from unnecessary complexity in legal processes, tax codes and intellectual property laws. These are all state policies that have protected the earnings of highly educated professionals.

By contrast, manufacturing jobs have declined in the US, and there has been downward pressure on the wages of less-educated workers. Much of it is due to the increased competition brought about by foreign trade deals negotiated over the past few decades. This was a conscious policy choice. The absolute decline in incomes in low-wage sectors was already predicted by the famous Stolper-Samuelson theorem in international trade theory.

Learn more at http://unf-ckamerica.com

☆ How to Unf★ck America ☆

This series is all about solutions.

Over the last four decades, the US economy has done quite well for the top 1%, but it has been stagnant for most Americans. This was not an accident, nor the natural workings of the market and certainly not an inevitability. US policies have been deliberately structured since 1980 to redistribute income upwards. In other words, the system has been rigged.

Dean Baker shows us how public policy can be deployed to #UnfckAmerica. Over six episodes, Baker illustrates how even minor changes in public policy can help change our trajectory dramatically. It just takes the political will to recognize that the current situation is not insurmountable, and that change is achievable.

Credits: Dean Baker, Matthew Kulvicki, Nick Alpha, Gonçalo Fonseca, Kurt Semm