No offense to practitioners like Stevenson, but economics has long been burdened with the moniker “the dismal science.” The term derives from the 19th century Scottish thinker Thomas Carlyle, who applied the core economics concept of supply and demand in a polemic about slavery as well as horrific working conditions—including child labor—in British factories.
From an economics perspective, the relationship between supply and demand explains to a good degree why, in the example Carlyle focused on, British workers in his day were so badly abused. There was a far greater supply of available, unskilled workers than the existing demand for their labor, i.e., jobs, making them expendable and making it unnecessary to pay them well. That reality, combined with the lack of labor protections founded in law—as well as a lack of morality on the part of factory owners—led to the exploitation so memorably described in books like Oliver Twist and Hard Times by Charles Dickens. In the contemporary U.S., overall conditions for workers are better now than in Dickens’ time—but that’s an awfully low bar to clear.
Speaking of history, this is not the first time a brutal global pandemic has reset the relationship between employers and employees. To be sure, a disease that causes mass death is just about the farthest thing from an overall positive development for humanity. Nevertheless, sometimes a positive development does emerge out of a tragedy. We can examine the bubonic plague, more colloquially known as the “Black Death,” along such lines.
It was called the Black Plague because black boils emerged all over the bodies of its victims. In 1347, a ship carrying infected sailors arrived at a Sicilian port. Within the next five years alone, the plague had killed at least one out of every three Europeans—twenty million people. Worldwide, anywhere from 75 to 200 million people perished overall out of a global population of only 450 million, one of if not the worst pandemic in known history.
The plague also delivered the final death blow to the European medieval social and economic order, smashing the feudal and manorial system that had been in place in Western Europe for centuries after the fall of the Roman Empire. Under that system, serfs were bound to the land they worked from birth—as were their descendants—and lived completely under the control of the lord of the manor. They weren’t slaves who could be sold or separated from their families, but they had no freedom to speak of either.
Serfs believed—or more accurately were indoctrinated with—the notion that God had sanctioned this hierarchy, as well as their place at the bottom of it. The Roman Catholic Church was instrumental in inculcating this fiction. If you didn’t like your lot in life, well, hey, that’s the way The Man Upstairs wanted it. It’s scary enough to get angry about your job when Jeff Bezos is the one setting the rules—and I’d imagine it’s even more galling to watch him, after he’s screwed you over, profited handsomely from your labor, and thanked you for being so helpful, use said profits to punch his ticket into space (and earn frequent space traveler miles to boot). Now ponder how scary it would be for workers to argue about working conditions when they sincerely believe the guy who created the system can send them to hell for a period lasting, well, all of eternity. And that’s without even needing a rocket to get them there.
Two related shifts resulted from the plague. The first took place in the minds of the people. I teach European history, and here’s how I present it to my students: for centuries, lords, nobles, dukes, kings, popes, and bishops had all told serfs that society had to be organized a certain way—with them holding all the power—and if you question it, God will punish you. So the serfs obeyed. They did what God wanted them to. And they got hit with the bubonic plague anyway.
Remember also that during the plague the serfs and lower classes in general, unlike the wealthy, lacked the resources to isolate themselves by leaving an area where infections were spreading. So they bore the worst of the plague’s impact. I ask my students to imagine all this happening, and then ask themselves, if they were serfs, how they’d feel. I’ll ask you, dear reader, to do the same. Do you think you might say something along the lines of: “you know, that whole social structure ordained by God mumbo jumbo might just be a crock of fucking horseshit those rich dickheads conjured up to turn us into their bitches.” Or other similar sentiments.
Following the plague, there was significant social unrest. As in so many other times of crisis or tragedy, European Christians scapegoated Jews, falsely blaming them for spreading the disease—resembling the hate and violence Asian Americans face today, during the COVID-19 pandemic. On Valentine’s Day in 1349, upward of two thousand Jews were rounded up and burned to death in Strasbourg, with the remainder expelled from the city. There was extensive fighting in Mainz, where Jews organized a self-defense force and actually killed 200 Christian attackers. In the end, however, all 3,000 of the Jews in Mainz were massacred. Overall, more than 350 distinct mass killings took place, with 150 smaller and 60 larger Jewish communities across Europe destroyed.
Part of the unrest also related to the changing nature of socio-economic relations, in particular as relates to work, which represents the second of the two shifts I mentioned above:
As the plague wore on, however, depopulation greatly reduced the workforce and the serf’s labor suddenly became an important—and increasingly rare—asset. The lord of an estate could not feed himself, his family, or pay tithes to the king or the Church without the labor of his peasants and the loss of so many meant that survivors could now negotiate for pay and better treatment. The lives of the members of the lowest class vastly improved as they were able to afford better living conditions and clothing as well as luxury items.
Once the plague had passed, the improved lot of the serf was challenged by the upper class who were concerned that the lower classes were forgetting their place. Fashion changed dramatically as the elite demanded more extravagant clothing and accessories to distance themselves from the poor who could now afford to dress more finely than in their previous rags and blankets. Efforts of the wealthy to return the serf to his previous condition resulted in uprisings such as the peasant revolt in France in 1358 CE, the guild revolts of 1378 CE, the famous Peasants’ Revolt of London in 1381 CE. There was no turning back, however, and the efforts of the elite were futile. Class struggle would continue but the authority of the feudal system was broken.
This brings us back to supply and demand. The depopulation of Europe, disproportionately resulting from the deaths of serfs and workers, reduced the supply of labor at a time when demand for that labor was rising. That made labor more valuable, and gave workers new leverage. Plenty of nobles couldn’t find people to work their land—and they certainly wouldn’t stoop to working it themselves. Forget making them serfs, nobles were lucky in some cases to even get people to become employees (although one might also think of the end of slavery along these lines, the continued power of white supremacy prevented most freed Black Americans from improving their situation to a similar degree).
Look below at the correlation between the drop in Britain’s population and the boost in the purchasing power of workers’ earnings. As truly horrific as the bubonic plague was, most of those who toiled for a living and actually made it through with their health intact probably found themselves better off in economic terms.
The so-called Spanish flu that struck in 1918 produced a parallel result for U.S. workers, according to a research report produced by the St. Louis Federal Reserve Bank: “Cities and states having greater influenza mortalities experienced a greater increase in manufacturing wage growth over the period 1914 to 1919.”
Fast forward to our current pandemic. As COVID-19 began to spread rapidly around the world, and many of the largest economies shut down, a number of analyses offered prognostications regarding what past pandemics might teach us about the near future. Some predicted that the end result might be a rebalancing of the power differential between capital and labor that resembled in part what happened after the bubonic plague—although thankfully far fewer people have died this time, at least thus far. Others rejected the likelihood of a labor shortage. It’s worth noting that the first one I linked to in the previous sentence—which got it right—was written by an economist, while the author of the second one is a medieval archaeologist. Not always so dismal is economics.
The most recent U.S. jobs report, which covered June, provided the best evidence yet that workers are finally gaining at least some ability to dictate the terms of their employment. About 850,000 American jobs were created in June—the best month in just about a year. Wages climbed 0.3% over the month, and the total growth in wages year over year clocked in at 3.6%. Furthermore, those earning the lowest wages saw the largest gains.
To be sure, these improvements began before June and are not solely a result of the pandemic—for example, demographic changes have meant lower growth in the labor force in the last few years. Either way, it is real:
“Companies are going to have to work harder to attract and retain talent,” said Karen Fichuk, who as chief executive of the giant staffing company Randstad North America closely tracks supply and demand for labor. “We think it’s a bit of a historic moment for the American labor force.”
The pandemic—and in particular the pro-worker policies pushed hard by Democrats in 2020 and, with even greater success, after Joe Biden and Kamala Harris took office in January along with slim majorities in the House and Senate—has had a major impact. President Biden, in remarks he made after the June jobs report was released, specifically highlighted the role of his American Rescue Plan—passed in March through the reconciliation process without a single Republican vote.
So, the American Rescue Plan is strengthening our financial position, and it grows our economy. It’s continuing to grow our economy. And the strength of our recovery is helping us flip the script.
Instead of workers competing with each other for jobs that are scarce, employers are competing with each other to attract workers. That kind of competition in the market doesn’t just give workers more ability to earn higher wages; it also gives them the power to demand to be treated with dignity and respect in the workplace.
More jobs, better wages—that’s a good combination.
Biden is right about flipping the script. Republicans, of course, hate it when workers have choices, and aren’t forced to beg for scraps. They bleated about how increased unemployment benefits were causing a labor shortage. Republican governors even cut those benefits off in their states months before the extra money—being paid by the federal government—was due to expire. Yet this jobs report, which covers the period before the cutoffs took effect in any of those states, showed boffo job growth, and wage increases for workers at the lower end of the wage scale are significant and widespread. Clearly, the enhanced benefits were not the problem. As John Jay College economist Michelle Holder put it, “We don’t have a shortage of people to work. What we don’t have are decent jobs.”
Separate from legislation, earlier this month the Biden White House issued an executive order that would, among other actions, encourage the Federal Trade Commission (FTC) to restrict or outright ban employers’ ability to impose noncompete clauses, another way to give employees more leverage. The order would also aim at stopping companies from colluding with one another to reduce compensation for workers in a given field, and would urge the FTC to limit “unnecessary” requirements that people working in particular professions get licenses or certifications, so that workers could more easily move from one state to another and continue to work in their chosen field.
Here’s White House press secretary Jen Psaki, speaking about her boss’s motivation for doing what he’s doing: “he believes that if someone offers you a better job, you should be able to take it. It makes sense.” Sure does. Neil Irwin of The New York Times characterized the executive order as “the most concerted effort in recent times to use the power of the federal government to tilt the playing field toward workers.” Trump had the opportunity to do something along the same lines as well, but he chose not to. It took a Democrat.
The law of supply and demand, as well as other factors that have weakened the power of unions and workers in general, has meant that capital has typically had the upper hand over labor, certainly since Ronald Reagan took office in 1980. For a long time, workers had few choices, and that was not something to be proud of—even if the twice impeached Florida retiree (h/t Speaker Pelosi) and his party like it that way.
As we know, it’s been standard operating procedure for Republicans long before Trump to divide workers by race—playing and preying on white anxiety—so that the multi-racial working- and middle classes don’t come together around their shared economic interests. Despite what Republicans claim, it’s still Democrats who are the real party of the working class.
Nevertheless—as, for example, workers at Frito-Lay can tell you (thankfully, their strike appears to have won real improvements in their working conditions)—there are still plenty of additional areas where Biden and congressional Democrats (Republicans sure won’t help) could do more to support and protect workers going forward. This is especially true for undocumented workers, who were disproportionately concentrated in jobs that made them vulnerable to COVID-19, such as meat processing plants among others.
Politics is about values. Progressives value work, in all its forms, and we believe in a capitalism where workers earn not only a living wage, but truly fair compensation, along with reasonable and humane working conditions, and a voice in the process by which the business that employs them makes decisions that affect their lives.
It shouldn’t have taken a devastating pandemic that killed 600,000 Americans—and four million human beings across the world—to give workers a measure of the leverage they need. That it did stands as a searing indictment of contemporary American capitalism. Changing our laws to provide workers more leverage on a permanent basis must be one of the very highest progressive priorities. Our values dictate no less.
Ian Reifowitz is the author of The Tribalization of Politics: How Rush Limbaugh’s Race-Baiting Rhetoric on the Obama Presidency Paved the Way for Trump (Foreword by Markos Moulitsas)