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Old 20-11-11, 12:21 PM
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Default Making Hard Work Fashionable Again

Making Hard Work Fashionable Again
—By Kevin Drum| Mon Nov. 14, 2011 6:12 AM PST


Zach McCullough/the99percent.com

Tyler Cowen writes this weekend that he's temperamentally attached to the traditionalist vision of hard work leading to great wealth. But, he admits, that vision is "showing some wear and tear," which is why the Occupy Wall Street movement is attracting so much support.

Tyler notes three specific problems with this vision: It doesn't distinguish between wealth gained from real production (Model Ts, iPods) and wealth gained from lucrative but socially worthless activity (creating subprime CDOs); it's been undermined by bellicose conservatives who insist on risibly pro-rich policies even when there's no evidence they work; and it's not clear that this vision actually motivates a real-life dedication to responsibility and hard work as much as it used to.

Tyler's first two points are ones that are frequent subjects on this blog. But his third point rings true too, and not just because there's been a steady change in perception, though it's that too. It's the fact that hard work pays off very, very differently for different classes of people these days.

Take me. When I graduated from college and joined the business world, it was clear that hard work could earn me a lot of money. It would mean promotions, it would mean job offers from other companies, it would mean stock options, and more. And it did. I was a tech writer first, then a product manager, then a director of marketing, then a VP of marketing, and finally a divisional manager. My income multiplied nearly 10x over the course of 15 years, and it would have multiplied more if I'd had the ambition to stay where I was and keep moving up the ladder. (Instead I moved into the lucrative world of political blogging.)

But if you work in, say, an Amazon fulfillment warehouse, what does hard work get you? Not nothing, certainly. You probably get to keep your job, for starters. You might get small but steady raises. You might even rise into a supervisory position. Compared to a clock puncher, maybe you'll make 30 or 40 percent more. If you're really lucky, half again as much. And that's it. With rare exceptions, that's about the best you can hope for.

This has always been true, but it's even more true now than in the past. College graduates—the kind who write op-eds and blog posts about the virtue of hard work—are sincere in their promotion of an ethic of work. And they aren't wrong. But they do overrate how much difference it makes for most people. Especially in an era where working- and middle-class wages have been stagnant for over a decade, the rest of the workforce just isn't buying the Horatio Alger story anymore: Working hard barely even gets them a small annual raise these days, let alone the chance for significantly higher wages. So it only barely seems worth it. That's why I suspect Tyler is wrong to say this:

In the future, complaints about income inequality are likely to grow and conservatives and libertarians won’t have all the answers. Nonetheless, higher income inequality will increase the appeal of traditional mores—of discipline and hard work—because they bolster one's chances of advancing economically. That means more people and especially more parents will yearn for a tough, pro-discipline and pro-wealth cultural revolution. And so they should.

It remains to be seen how many of us are up to its demands.


Upper-middle-class parents may well yearn for this. But then, they already do, in deed if not in word. For everyone else, increasing income inequality will likely have just the opposite effect. As those Horatio Alger tales seem increasingly fanciful, and as dreams of even modest wealth become ever more obviously out of reach to the average person, it's going to get harder and harder to keep up the pretense that discipline and hard work are really the key to great wealth for anyone not in the upper middle class to begin with.

There's no easy answer to this. The world is going to keep getting more complex, and the rewards to education and skills are going to keep increasing. But that doesn't mean there's nothing we can do. Maintaining the conviction that hard work matters is obviously important. But we live in a media-saturated age where making every kid read "A Message to Garcia" is nowhere near enough to accomplish that. The reality of the world is simply too hard to camouflage, which means that if we want working- and middle-class high school grads to believe in the vision of hard work and wealth, real life has to match the vision at least tolerably well. This in turn means reducing the amount of absurdly undeserved wealth that goes to casino operators on Wall Street. Ditto for the wildly disproportionate salaries paid to CEOs. It means that even if most middle-class workers are never going to become rich, they should at least see their wages rise steadily through their lifetimes. It means that politicians have to stop handing out massive goodies to the rich for no good reason, and they have to stop insisting that these goodies be paid for by raiding the "unaffordable" benefits of the middle class.

None of this is easy. But the truth is that it's increasingly impossible to sell people transparently self-promoting fairy tales that plainly don't reflect how the real world works. If you want them to believe that hard work and discipline are important, then hard work and discipline have to really be important. Not just modestly helpful. Not mere drops compared to the obviously undeserved piles of so many of the superrich. If we want people to believe, we have to believe too. We have to believe that America should be a country where everyone prospers, not just the cognitive elite and the super lucky. Until we all believe this—until conservatives believe this—the notions of responsibility and discipline that conservatives talk about so much are probably going to continue fading. In recent decades they've simply dedicated too much of their lives and too much of their energy to patent unfairness to be surprised any longer that belief in being fairly rewarded is on the wane.

That's the lesson of Occupy Wall Street.

Making Hard Work Fashionable Again | Mother Jones
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Old 20-11-11, 12:56 PM
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Amazon fulfillment warehouse
I love that term.
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Old 20-11-11, 07:02 PM
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Originally Posted by contracycle View Post
Tyler notes three specific problems with this vision: It doesn't distinguish between wealth gained from real production (Model Ts, iPods) and wealth gained from lucrative but socially worthless activity (creating subprime CDOs)...
Hah! So you know that subprime CDOs are a socially worthless activity? How? Last time I checked, everyone loves risk management... Tranching was and is a very socially useful activity. As to Mortgage-Backed-Securities, they were "invented" in the late 60s and came to some notoriety in the late 70s. It's not exactly new stuff...

You see? That's because of that kind of problem that it does pay for activists to have some understanding of finance and why it makes it worthwhile to have some ex-bankers/traders among them...

Quote:
This has always been true, but it's even more true now than in the past. College graduates—the kind who write op-eds and blog posts about the virtue of hard work—are sincere in their promotion of an ethic of work. And they aren't wrong. But they do overrate how much difference it makes for most people. Especially in an era where working- and middle-class wages have been stagnant for over a decade, the rest of the workforce just isn't buying the Horatio Alger story anymore: Working hard barely even gets them a small annual raise these days, let alone the chance for significantly higher wages.
These guys aren't listening. As Nassim Taleb pointed out, "hard work will get you a professorship or a BMW. You need both work and luck for a Booker, a Nobel or a private jet."

Quote:
For everyone else, increasing income inequality will likely have just the opposite effect. As those Horatio Alger tales seem increasingly fanciful, and as dreams of even modest wealth become ever more obviously out of reach to the average person, it's going to get harder and harder to keep up the pretense that discipline and hard work are really the key to great wealth for anyone not in the upper middle class to begin with.
Why do you think that in Northern England or in the Black ghettos, there are people unemployed for 3 generations? They figured that living on the dole was better than trying to work in a system which doesn't attribute a big price to said work.

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... and the rewards to education and skills are going to keep increasing.

Arg! I like this guy's overall point but he keeps getting the specifics all wrong. It's already the case that education is a flimsy protection against economic adversity. As some economic professors put it, the real dividing line is the "digitalisation". If your work can be digitalised/outsourced, you're facing an uphill battle. And that can happen to educated jobs just as well. Certainly it does. It's even a new sociological category - the highly skilled, overqualified and still in 'precarious' jobs...

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None of this is easy.
It frankly shouldn't be that difficult. If we are 99%, we ought to beat them at the ballot box on a pretty regular basis.

Quote:
Until we all believe this—until conservatives believe this—the notions of responsibility and discipline that conservatives talk about so much are probably going to continue fading. In recent decades they've simply dedicated too much of their lives and too much of their energy to patent unfairness to be surprised any longer that belief in being fairly rewarded is on the wane.
Tell them that. They got a totally skewed vision of how things work and of 'personal responsibility'. And they are somehow convinced that, the more the difference between the 1% and the rest is big, the more it is an incentive for people to move off their asses and work harder/innovate etc.

It's going to be a tough discussion until we can shove some graphs out there and get people to get the basic stats of their lives outcomes.
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Old 20-11-11, 07:02 PM
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Originally Posted by Zichao View Post
I love that term.
You have a dirty mind...
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Old 20-11-11, 08:45 PM
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Originally Posted by Gilles de Rais View Post
You have a dirty mind...
You certainly do. Personally, I was imagining some sort of pillowy, lotus-eating nirvana...
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Old 20-11-11, 08:55 PM
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Nice try but it won't fly... We know you too well...
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Old 21-11-11, 09:56 AM
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Originally Posted by Gilles de Rais View Post
Hah! So you know that subprime CDOs are a socially worthless activity?
Yes. Becuase they have amplified, not abated risk and exposure.

Quote:
You see? That's because of that kind of problem that it does pay for activists to have some understanding of finance and why it makes it worthwhile to have some ex-bankers/traders among them...
Yes. I see that they understand it perfectly well.

Quote:
These guys aren't listening. As Nassim Taleb pointed out, "hard work will get you a professorship or a BMW. You need both work and luck for a Booker, a Nobel or a private jet."
Bullshit. If that were true, many more people would have them than do, and those who have them mostly wouldn't.

Quote:
Why do you think that in Northern England or in the Black ghettos, there are people unemployed for 3 generations? They figured that living on the dole was better than trying to work in a system which doesn't attribute a big price to said work.
Assuming there I any work to be had, which there often isn't. Either way, its not in their power to determine, however hard working they may be.

Quote:
Arg! I like this guy's overall point but he keeps getting the specifics all wrong. It's already the case that education is a flimsy protection against economic adversity. As some economic professors put it, the real dividing line is the "digitalisation". If your work can be digitalised/outsourced, you're facing an uphill battle. And that can happen to educated jobs just as well. Certainly it does. It's even a new sociological category - the highly skilled, overqualified and still in 'precarious' jobs...
And I've already explained that it's a faulty argument. What job is there that can;t be automated sooner or later? This kind of analysis is just as useless as it was when the Luddites were smashing machines.

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It frankly shouldn't be that difficult. If we are 99%, we ought to beat them at the ballot box on a pretty regular basis.
Only if the things we vote for are enacted, which they are not.

Quote:
It's going to be a tough discussion until we can shove some graphs out there and get people to get the basic stats of their lives outcomes.
Theres no shortage of data, or of understanding. There is a shortage of action, which is why we are obliged to take matters into our own hands.
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Old 21-11-11, 12:58 PM
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Originally Posted by contracycle View Post
Yes. Becuase they have amplified, not abated risk and exposure.
Then the problem is leverage and taking on risks you do not understand. It has nothing to do with CDO technology or securitisation, in and of itself. These are socially useful. I'd be far more in agreement if he had picked HFT as a socially useless activity. And hence my problem - they can't see the differences between the two.

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Bullshit. If that were true, many more people would have them than do, and those who have them mostly wouldn't.
I leave asides the implication that "ooh, those upper middle class, they don't really work hard" and concentrate on the other bit. What Taleb is saying is actually what your OP is saying: Rewards are skewed and, for the top prizes, the role of luck is vastly underestimated. But, if you're a poor kid and work hard during your school years and get a decent diploma and get a bit of career, sure, you can get a BMW too. Or you can create your own little small cash intensive company and get a BMW that way too. However, in either cases, it'd take a lot of luck to get from that to the private jet bit...


Quote:
Assuming there I any work to be had, which there often isn't.
Well, as immigrant workers tend to prove, work was available (the past tense is not a typo), if you're willing to be paid little enough. That's the point where people note that they might get £75 a week if they work 40 hours and £65 if they do nothing. It's not exactly surprising that people opt for doing nothing.

You can try to combat that by lowering the £65 handout but it has consequences or by pushing up the £75 work pay but it has consequences too, although that is, by far, the better option.

Quote:
And I've already explained that it's a faulty argument. What job is there that can't be automated sooner or later?
"Low" skill services work and consumer-driven high skill service work. You can't automate your hairdresser and you can't automate Jeremy Clarkson or 'Strictly'... But even if you disagree with this, that's not the point. The point was that a diploma ain't the ticket to a stable life it used to be.

And that is actually rattling the middle classes pretty effectively.


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Only if the things we vote for are enacted, which they are not.
Because we barely scrap together 51-53% of the votes, that's why.

Quote:
Theres no shortage of data, or of understanding.
If so, how come things designed for the 99% don't gather more than 52% at the ballot box?
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Old 21-11-11, 02:25 PM
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Originally Posted by Gilles de Rais View Post
Then the problem is leverage and taking on risks you do not understand. It has nothing to do with CDO technology or securitisation, in and of itself. These are socially useful. I'd be far more in agreement if he had picked HFT as a socially useless activity. And hence my problem - they can't see the differences between the two.
This is irrelevant. You can do bullshit activity with anything you have to hand. The point is the bullshit activity.

Quote:
I leave asides the implication that "ooh, those upper middle class, they don't really work hard" and concentrate on the other bit.
My sympathy for execs recieving six figure salaries for two days a week is limited.

Quote:
What Taleb is saying is actually what your OP is saying: Rewards are skewed and, for the top prizes, the role of luck is vastly underestimated. But, if you're a poor kid and work hard during your school years and get a decent diploma and get a bit of career, sure, you can get a BMW too.
Only if you are lucky and get chosen to the right employer. Otherwise you just end up working the same kind of jobs you would have had had you not been educated. And this is the point: if "working hard" really made a difference, then you should be able to start in a shit job, work hard, accumulate some wealth and better yuour circumstances. But that doesn't happen becuase so much of the wealth we create is siphoned off.

Quote:
Well, as immigrant workers tend to prove, work was available (the past tense is not a typo), if you're willing to be paid little enough. That's the point where people note that they might get £75 a week if they work 40 hours and £65 if they do nothing. It's not exactly surprising that people opt for doing nothing.
that wa snot throughout the country; emigration has been fairly concentrated.

You can try to combat that by lowering the £65 handout but it has consequences or by pushing up the £75 work pay but it has consequences too, although that is, by far, the better option.

Quote:
"Low" skill services work and consumer-driven high skill service work. You can't automate your hairdresser and you can't automate Jeremy Clarkson or 'Strictly'... But even if you disagree with this, that's not the point. The point was that a diploma ain't the ticket to a stable life it used to be.
Sufficient robotics will be quite sufficient to replace most of those jobs, and if all we have left is entertainment, then eithwer have a society of mass poverty and a tiny minority of starsm, or we have a proper leaisure society with wide affluence. And the former is far more likely.

[quote]And that is actually rattling the middle classes pretty effectively.[quote]

What middle classes? This myth keeps shambkliong around no matter how often its staked through the heart.

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Because we barely scrap together 51-53% of the votes, that's why.
Nonsense, a majority is a majority. This makes no sense.

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If so, how come things designed for the 99% don't gather more than 52% at the ballot box?
For a lot of reasons which we have never had any joy in tryign to discuss.
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Old 21-11-11, 02:54 PM
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Originally Posted by contracycle View Post
This is irrelevant. You can do bullshit activity with anything you have to hand. The point is the bullshit activity.
Huh? I am just saying securitisation is not socially useless so I don't trust this guy to say where we should draw the line.

Quote:
And this is the point: if "working hard" really made a difference, then you should be able to start in a shit job, work hard, accumulate some wealth and better your circumstances.
And the counter point was that "working hard" starts earlier - It starts at school. You have to get a diploma that gives you a chance at a good paying job/career. By the time you starting work, it's too late.

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Sufficient robotics will be quite sufficient to replace most of those jobs...
Future tense. We're talking past and present...

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and if all we have left is entertainment, then either we have a society of mass poverty and a tiny minority of stars, or we have a proper leaisure society with wide affluence. And the former is far more likely.
Well, I hope we actually get the latter... and now that we finally have a crisis, I think it's at a do-able level of reform...

Quote:
What middle classes? This myth keeps shambling around no matter how often its staked through the heart.
Practical term to design people like my parents. They're not wealthy but they are not poor either - unless their pensions suddenly disappear. And I can tell you they're pretty crossed to see how much struggling our generation is going through, nearly no matter what diploma you got... especially when you got decent (but not uber-top) diploma...

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Nonsense, a majority is a majority. This makes no sense.
You clearly haven't been arguing with a bunch of football fans, who are in the minority, on what to put on the communal TV. A vociferous minority can easily override a silent majority. See ObamaCare for a practical example.

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For a lot of reasons which we have never had any joy in trying to discuss.
No. Your answer is "Oh, the Democratic function is entirely corrupt". I am more willing to consider that people are stupid/ voting on grounds other than their economic interest/ convinced by the 'personal responsibility' myth etc.

If you want to do more than maintain the status quo with a bit of trimming at the margin, you are going to need a far more powerful mandate than 48-52%. And that's the reality.
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