Tuesday, December 31, 2019

A land on fire

Paul Krugman and the Ruling Class

Liberal America's favorite economist, Paul Krugman, had a few apt observations to make about politics and power in the US of A.

"The first thing you need to know about the very rich is that they are, politically, different from you and me,” Krugman explains. “Don’t be fooled by the handful of prominent liberal or liberal-ish billionaires; systematic studies of the politics of the ultra-wealthy show that they are very conservative, obsessed with tax cuts, opposed to environmental and financial regulation, eager to cut social programs.”

“The rich often get what they want, even when most of the public want the opposite,” Krugman asserts. 

“Why do a small number of rich people exert so much influence in what is supposed to be a democracy?” Krugman asks. “Campaign contributions are only part of the story. Equally, if not more, important is the network of billionaire-financed think tanks, lobbying groups and so on that shapes public discourse.”
Krugman continues, “And then there’s the revolving door: it’s depressingly normal for former officials from both parties to take jobs with big banks, corporations and consulting firms. And the prospect of such employment can’t help but influence policy while they’re still in office.”
Ideas promoted by the ultra-rich, according to Krugman, dominate the political discourse in the mainstream media — which is another reason why they often get their way.

So at long last it is recognised what Marx long ago learned:
 “The ideas of the ruling class are in every epoch the ruling ideas, i.e. the class which is the ruling material force of society, is at the same time its ruling intellectual force. The class which has the means of material production at its disposal, has control at the same time over the means of mental production, so that thereby, generally speaking, the ideas of those who lack the means of mental production are subject to it. The ruling ideas are nothing more than the ideal expression of the dominant material relationships, the dominant material relationships grasped as ideas.”

The Nature of Work is Changing

It ought to be possible for workers to have flexible work without denying them basic rights. Gig work – part of a casualised, precarious and on-call jobs market – is growing at a giddy rate. The sector has more than doubled in size since 2016 and now accounts for 4.7 million workers. Uncertain work is becoming the norm.  In part this is due to new technology: people are using apps on their mobile phones to sell their labour. The core business model relies on near-instant recourse to a large pool of on-demand workers looking for their next gig. With the result that unemployment statistics look better than the way Britons feel. It is an environment of overwork, marked by intense bursts of exhaustion. One gig-economy firm even tried to market burnout as a lifestyle by claiming its workers were “doers” for whom “sleep deprivation is their drug of choice”.

 Nothing can disguise the fact that the gig economy’s rise has been accompanied by a fall in the fortunes of working households – which now comprise 58% of those below the official poverty line; the figure was 37% in 1995. In a seminal paper, Alex Wood and other researchers at Oxford University found that half of the gig work in the UK is in our streets, supplying food or couriering parcels or offering taxi rides. Unions say that Uber drivers in the UK earn an average of £5 an hour, well below the legal minimum wage of £8.21 for employees aged over 25. They can work up to 30 hours a week before breaking even. Hundreds went on strike in May to protest against poor pay and conditions.

The other half of gig work is remote – providing digital services, such as data entry and programming, on platforms such as Upwork, Freelancer and Fiverr, which act as auction houses for human labour, where people place a bid to do the work on offer. Those in richer nations can find themselves undercut by those in poorer places. In 2017 US freelancers using Upwork netted $27m – only a little more than those in India. Many of the world’s biggest firms use these apps to outsource work to lower costs. Microwork, where tasks are broken down, is dominated by Amazon’s Mechanical Turk division. Two-thirds of its US workers earn less than the federal minimum wage.

In his book Humans as a Service, the Oxford academic Jeremias Prassl says the gig economy’s problems – for workers and markets – are driven by firms “presenting themselves as mere intermediaries rather than powerful service providers … [to] shift nearly all of their business risk and cost onto others”. The simplest illustration of this is Uber’s claim that its drivers are not employees – at a stroke this potentially avoids VAT liabilities of £1.5bn. That sort of cash could have been used to pay towards a health service dealing with the fallout from insecure jobs with unpredictable shifts. A landmark study tracking people who lost their jobs in the recession of 2010 found that those who ended up with poor-quality work – with low pay, low autonomy, and high insecurity – had higher chronic stress levels than those who had remained unemployed.

Consumer rights are being rewritten – often to the customer’s detriment. People using popular takeaway apps such as Uber Eats and Deliveroo can order from thousands of restaurants without being aware of their poor hygiene ratings. Such practices undermine the trust needed for the market economy to function smoothly. Hidden beneath the claims of autonomy is the fact that the platforms exercise firm control over most aspects of how, and to what standard, work is done. The technology can monitor whether a freelancer is working for the whole time billed. It can detect whether a gig-economy driver brakes too hard. Too many low rankings might see a worker kicked off a platform. Productivity becomes the way to measure human value. Firms can cherry-pick workers – usually those without children or in good health. What happens to those who have lives that don’t match the gig economy’s demands?

In the gig economy, employees are no longer protected by a legal system that was designed for a different age. At present there are three categories of employment status in the UK: employee, worker and self-employed. Only the first category is entitled to full employment rights, including redundancy payments, parental leave, and protection against unfair dismissal. The second category ought to have their minimum wage and trade union rights protected, as well as paid holiday entitlement. However, gig-economy firms assume their workers to be self-employed, and fight trade unions such as the Independent Workers’ Union of Great Britain (IWGB) who claim otherwise. In almost every case workers in the gig economy have proved that they are in fact employees. It is absurd that judges must protect workers from forced self-employment. Britain does have labour laws, but they are not fully applied. This allows gig firms to fight claims individually and then just pay off the worker who wins in court without applying the ruling to the wider workforce. The Conservative government offers only cosmetic changes to the rules governing the gig economy. It would be better to regulate platforms properly. For example, the IWGB suggests that Uber’s licence to operate in London could be made conditional on respecting drivers’ employment rights.

The gig economy is erasing what was for many the traditional goal of working: to buy free time. Instead we are being seduced and coerced into thinking that it is good to commercialise our leisure time and possessions. Time to spare? Exchange it for cash by delivering pizza. Your apartment free for a week? Rent it out for extra cash. This will not make us happy. We ought to work and have careers that enable us to focus on our relationships and have soul-enriching pastimes. It cannot be socially good to consider leisure time as a lost commercial opportunity. Unless we can turn away from such thinking, we shall see ourselves acting less like humans and more like companies.


Robots and People

While fears that robots will replace human workers haven’t come to fruition, there are growing concerns that keeping up with the pace of the latest artificial intelligence technology is taking a toll on human workers’ health, safety and morale.

Warehouses powered by robotics and AI software are leading to human burnout by adding more work and upping the pressure on workers to speed up their performance, says Beth Gutelius, who studies urban economic development at the University of Illinois at Chicago and has interviewed warehouse operators around the US.

It’s not that workers aren’t getting trained on how to work with robots safely. “The problem is it becomes very difficult to do so when the productivity standards are set so high,” she says. Gutelius says that the aspiration for symphonic human-machine operations is not always working out in practice. “It sounds quite lovely, but I rarely hear from a worker’s perspective that that’s what it feels like,” she says. Gutelius co-authored a report published this fall that found new warehouse technology could contribute to wage stagnation, higher turnover and poorer quality work experiences because of the way AI software can monitor and micro-manage workers’ behaviours.
Much of the boom in warehouse robotics has its roots in Amazon’s $775m (£591m) purchase of Massachusetts start-up Kiva Systems in 2012. The tech giant rebranded it as Amazon Robotics and transformed it into an in-house laboratory that for seven years has been designing and building Amazon’s robot armada.

Amazon’s Kiva purchase “set the tone for all the other retailers to stand up and pay attention”, says Jim Liefer, CEO of San Francisco start-up Kindred AI, which makes an artificially intelligent robotic arm that grasps and sorts items for retailers such as The Gap.
A rush of venture capital and private sector investment in warehouse robotics spiked to $1.5bn (£1.1bn) a year in 2015 and has remained high ever since, says Rian Whitton, a robotics analyst at ABI Research.

Canadian e-commerce company Shopify spent $450m (£343m) this fall to buy Massachusetts-based start-up 6 River Systems, which makes an autonomous cart nicknamed Chuck that can follow workers around a warehouse. Other mobile robot startups are partnering with delivery giants such as FedEx and DHL or retailers such as Walmart.
Amazon this year bought another warehouse robotics start-up, Colorado-based Canvas Technology, which builds wheeled robots guided by computer vision. Such robots would be more fully autonomous than Amazon’s current fleet of caged-off vehicles, which have to follow bar codes and previously mapped routes within warehouses.

The tech giant is also still rolling out new models descended from the Kiva line, including the Pegasus, a squarish vehicle with a conveyor belt on top that can be found working the early-morning shift at a warehouse in the Phoenix suburb of Goodyear, Arizona. A crisscrossing fleet of robots carries packaged items across the floor and drops them into chutes based on the zip code of their final destination.
A recent journalistic investigation of injury rates at Amazon warehouses from The Centre for Investigative Reporting’s Reveal found that robotic warehouses reported more injuries than those without. Reveal looked at records from 28 Amazon warehouses in 16 states and found that the overall rate of serious injuries was more than double the warehousing industry average. Amazon has countered it is misleading to compare its rate with rivals because of the company’s “aggressive stance on recording injuries no matter how big or small”. The Reveal report also found a correlation between robots and safety problems, such as in Tracy, California, where the serious injury rate nearly quadrupled in the four years after robots were introduced.

Monday, December 30, 2019

Shop-workers squeezed

UK retailers have shed more than 140,000 jobs this year as shop closures and retail business failures made 2019 one of the most challenging years in a generation.  38,100 of the jobs lost this year were down to retail chains going bust.  Another 26,500 roles were shed through company voluntary arrangements (CVAs), a controversial insolvency procedure that has been used by the likes of Sir Philip Green’s Arcadia group and Debenhams to shed loss-making stores. Another 78,600 jobs were axed through cost-cutting programmes by large retailers or small shops simply shutting for good. Marks & Spencer is among the big names closing stores while House of Fraser, which is part of Mike Ashley’s Frasers Group, has also been shutting outlets. 
A total of 143,100 jobs were lost in 2019, according to CRR’s calculations, up by more than a fifth on 2018’s 117,400.
More than 2,750 jobs were lost every week, according to a detailed analysis by the Centre for Retail Research (CRR) published today. 16,073 shops closed around the UK in 2019, or around 61 every working day. It predicts the picture will worsen in 2020.
A separate study looking at how the UK labour market had changed over the past decade said the rise of online shopping had eliminated 289,000 “traditional” high street roles. Eight out of 10 of these entry-level retail jobs – positions like sales assistant and checkout operator – were held by women, according to the RSA Future Work Centre.
Alan Lockey, who heads the thinktank, said: “The carnage on the high street has hollowed out many jobs traditionally held by women, but areas of growth related to e-commerce, such as van driving, are going more to men. This is having a profound effect on individuals, families and society.” Lockey said the decline of the high street was the most dramatic factor affecting the UK’s jobs landscape, even though austerity, which had eliminated 109,000 public sector administrators, also loomed large.
Today one in every five pounds spent at the shops is online – more than double the level at the start of the decade. The resulting shift in labour markets are stark. There are now 166,000 fewer check-out staff, shelf fillers and sales assistants than at the start of the 2010s, according to RSA’s analysis of official employment data, while the pool of bank and post office clerks has shrunk by 65,000 as branches closed. By comparison there are 102,000 more van drivers and 161,000 more administration roles.
Despite the reckoning taking place the retail sector remains the UK’s biggest private sector employer with a workforce of around 3 million. Its decline contrasts with a wider picture showing record levels of employment as former shop workers find alternative work in restaurants, hotels and as care workers. The RSA study showed a near 78,000 rise in the number of care workers. 
“The employment figures show that over the last decade the economy has been good at creating jobs but low skilled workers in the retail sector have been pushed from pillar to post. The alternative jobs they are getting are often low paid and do not provide good security, leading to working poverty,” Lockey added.


Now in their 25th day, France’s nationwide strikes against the government’s pension reform plans are the longest in more than 30 years. How are strikers coping after nearly four weeks without pay? The strikes led by French rail and transport workers are poised to become the longest of their kind in the country’s history. The last time workers at the national rail company SNCF went on strike for this long was in December 1986. That walkout, too, spanned the winter months. With no retreat in sight from either the government or the unions, today’s strikes could soon beat that record, forcing strikers to find creative ways to cope.

“They’re losing money. The most committed make arrangements and set money aside in advance, but it’s hard, especially for those with low salaries,” said Fabien Dumas, secretary general of the SUD-Rail union. SUD-Rail is one of the leading rail-workers’ unions along with the left-wing CGT, and insists that it will pursue the strike until the government withdraws its pension reform plans.

To make that possible, it’s relying on everyday solidarity. Collection jars are a regular sight at strike marches. But the bulk of fundraising today is done online. A crowdfunding campaign launched by SUD-Rail has raised more than €43,000 to date. Other unions, including the CFDT and UNSA, have also launched independent crowdfunding campaigns.

By far the most successful of the crowdsourced strike funds, though, is the one launched by members of the CGT’s Info’Com (information and communications) branch, which has so far raised upwards of €1.5 millionThis “solidarity fund” was originally created in 2016, during major strikes against labour law reforms passed by President Fran├žois Hollande’s government. It is now serving as a de facto centralized fundraiser for those striking against pension reforms: Of the nearly €1.9 million raised since the fund was created, more than €1.2 million has been for the current pension reform strikes.

Most of that money has in turn been redistributed to those on the picket lines. Romain Altmann, secretary general of Info’Com CGT, says the funds have been disbursed according to “criteria defined by strikers and unions”. Altogether, the branch’s crowdfunding page says it has disbursed just over €1 million to striking workers since 2016. Info’Com CGT published a report in 2017 tallying all the funds raised and distributed to that date.

On Tuesday, the branch disbursed €250,000 to striking employees of Paris’s transit authority, the RATP. (All but two Paris metro lines – the driverless 1 and 14 lines – have been shut down or operating on a very limited schedule since the start of the strike on December 5.)

Such crowdfunding efforts are all the more crucial for strikers because most French unions do not maintain a formal strike fund. The CFDT, France’s largest union (and second-largest among railworkers), boasts that it is the only union in the country to have one. Financed by members’ dues, the fund allows striking members to collect just over €7 per hour while they’re on the picket lines.

While lower than France’s current minimum wage of €10 per hour, this hourly compensation is a unique boost to striking workers, and demands significant resources from the union. The CFDT fund, which also supports workers litigating labour law cases against their employers, holds more than €100 million, according to a union official who asked to remain anonymous.

Still, the CFDT official told FRANCE 24 that this has been a trying holiday season for those on strike.

“They know full well that this will have an impact on their wages,” he explained worrying that some workers would be “eating cans of cassoulet” (a bean dish) in place of a traditional holiday meal.

Other union leaders echo his concerns. SNCF employees who have stayed off the job since December 5 have by now lost an entire month’s paycheck, a SUD-Rail official told Franceinfo. RATP workers will see the pay cut at the end of January.

The losses are partially compensated by the “13th month” of pay that some French workers receive under collective bargaining agreements negotiated between unions and employers. RATP employees, for example, received this additional month’s worth of pay at the end of November, just ahead of the strike. SNCF workers, for their part, received their year-end bonus in mid-December.

“The strikers are doing what all French people do when they have a difficult end of the month,” says Thierry Babec, general secretary of Unsa-RATP. “Some of them have considered taking out loans or cutting into their overdraft” to finance their strike, he says. Some are also returning to work.  One railworker conceded, “We have a few colleagues who are going back to work, but they say they will resume the strike later. They're just pausing for a few days.” A fresh day of national protests has been called for January 9.

In the meantime, it’s not hard to understand why many have returned to work, despite the apparent success of some crowdfunding efforts. Even the sums raised by the most successful campaign, if paid out in full to striking workers, would represent a tiny fraction of their losses in pay – losses that can range from roughly €60 to €100 per day, according to a CGT spokesperson.

Altmann, of Info’Com CGT, stands by “solidarity funds” like the one launched by his branch. He emphasizes that “this money does not come from the CGT, it comes from donors”, and says those donors include many people “who couldn’t go on strike for financial reasons – women working part time, for example, or pensioners”.

Altmann says that even if the sums raised by crowdfunding are “a drop in the bucket” compared to workers’ losses in pay, they show “remarkable national solidarity” with the strikes. Still, he admits that the benefit is largely “symbolic” when those on strike face “tens of millions of euros” in lost pay.