America’s shipwrecked working class

It has been a bumpy 50 years for blue-collar America. Not only has labour’s share of US national income steadily dropped barring a few brief patches, chiefly the 1990s internet boom, but its life expectancy has also been falling. Having secured the country’s first avowedly pro-union president since Lyndon Johnson, a turning of the corner ought to be in sight. The fact that it is not is less a reflection on Joe Biden than on the biases of the system he heads.

His party is nevertheless on the hook for its failure to deliver. By 2024 Democrats will have controlled the White House for 20 out of 32 years. Yet the federal minimum wage is stuck at $7.25 an hour, which is half what my teenage daughter gets paid to babysit. Canada and the UK both have a 50 per cent higher floor. Alone among developed nations, the US fails to guarantee parental or sick leave. The shrinking corners of America that are still unionised are mostly in jobs where they are least needed, such as the police and prisons.

Democratic rhetoric is strongly pro-working class. The party’s actions are another matter. Last week, Biden arm-twisted Congress to pass a bill that banned the nation’s railway workers from striking in spite of the fact a majority of their unions had rejected a deal offered by the railroad companies.

Their grievances are less about money than work-life balance. Railroads have among the leanest workforces in the US, having shed about a third of their payroll in the years before the pandemic. Fatigue and strain are rife in jobs that entail multiple consecutive shifts, often far from home. Their workers would have settled for seven days of paid sick leave. They got one.

The larger motive for Biden’s move was understandable — a strike would have snarled up US supply chains and steepened the risk of a recession. Yet it was also the first big test of Biden’s pledge to be “the strongest labour president you’ve ever had”.

In 1981 Ronald Reagan showed he meant business by firing striking air traffic controllers. Here was Biden’s chance to make an equally robust statement in the other direction. “Our nation’s rail system is literally the backbone of our supply chain,” Biden said. Not enough of a backbone to treat its workers with dignity, it seems. Railroad companies have been making enough profits to carry out regular share buybacks.

By contrast, Biden took a big risk to forgive student debt — roughly $400bn of which will be cancelled in the coming years. Analysts are divided on whether the action was legal: Biden’s executive action will be tested in the courts. There is little doubt, however, that it was fiscally regressive.

Graduates, even indebted ones, on average earn far more than non-graduates. Though the relief was confined to those earning less than $125,000 a year, that is still double the median income. Many of the beneficiaries are only just starting out on fast-escalating income ladders.

Why would Biden do that? There is no doubt the US has legions of debt-saddled former students with degrees that cannot land them jobs to pay what they owe. A carefully targeted forgiveness would have been fair.

The larger answer for such a sweeping cancellation is that Democrats are the party of graduates. Regardless of your ethnicity, the more letters you have after your name, the likelier you are to vote Democratic. Just as Republicans repay their donors with tax cuts, Democrats repay their base with debt forgiveness.

The only ones missing out, it seems, are the “poorly educated” whom Donald Trump famously proclaimed to love. Though Republicans offer blue-collar America only trickledown economics, that is only slightly better than the promises Democrats struggle to keep.

As a result, working classes of all colours have been steadily drifting towards the Republicans. More Americans with household income below $50,000 voted Republican than Democratic last month. The pattern has become clearer in each of the past three elections. It spans all racial groups, including African-Americans.

This trend is deeper than whether Trump or Biden is on the ballot in 2024. It spells a future in which Democrats are the party of the campus with a cultural agenda that alienates a rising share of uneducated whites and non-whites, and Republicans who are skilled at harvesting blue-collar resentment of elites who pay little more than lip service to their needs.

One party is dangerous. The other does not really seem to mean what it says. America is ripe for a third party — and a fourth. Maybe one day US democracy will offer a better choice.

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