Working class insecurity and Build Back Better

Insecurity is the longstanding curse of the working classes. President Biden’s Build Back Better (BBB) is the most recent effort to use government to reduce it. The causes of working-class insecurity in 2022 of course are complex. Changes in American society since the 1980s are shaking the post-World War II economic foundations and status hierarchy of working America. Industries that were the “commanding heights” of the U.S. economy and paid the highest wages like steel, automobiles and railroads are struggling to maintain jobs while the newer technology industries are booming. Factories have moved from the high-wage Midwest to the South and overseas. Service industries are growing faster than manufacturing and like the tech industries require different skills. Women and people of color have gained jobs and status. Unions have lost ground in the private sector. Social Security and Medicare that working people depend on, have been tarred as “entitlements” and their long-term affordability questioned deliberately by reactionaries with the aim of making younger people doubt if they will be there for them. Such threats to the security of ordinary people have given rise to a major party led by demagogues who spin tales that offer immigrants, non-whites, and government itself as scapegoats.

Build Back Better (BBB) is an effort to contain the dangers posed by insecure and angry working people and by disadvantaged groups with similar grievances. Its environmental investments would create new jobs to cushion potentially wrenching changes in large parts of the economy, especially the energy sector. Expansive childcare and preschool programs, family and medical leave, and more affordable health care and housing would ease related insecurities. These efforts to make change less threatening for working people, however, are opposed as too expensive and “socialistic” by reactionaries who the media inaccurately calls “conservative.”  

The arguments used to attack Build Back Better are astonishingly similar to those made more than 100 years ago. Reforms to enhance the security of working people during the presidencies of Theodore Roosevelt (1901-1909) and Woodrow Wilson (1913-1921) and during Franklin Roosevelt’s New Deal in the 1930s were lambasted as unaffordable and “socialistic.” Reducing working class insecurity, it was said would saddle the country with public debt and create a dependence on government that would sap the nation’s virility. 

There have long been two views about how government should relate to middle class and less affluent working people. The view supporting BBB as well as Social Security, Medicare and other social insurance programs is that modern government can help working people to be more secure and productive, and less susceptible to demagogues peddling anti-democratic solutions if the risks of unemployment, poverty, poor health, and old age are cushioned by government-backed programs:  The other school says that working people will slack off unless they are forced by insecurity and coercion to work. Reactionaries bolster the latter position by pitting white workers against others, disguising their foundational view that insecurity and dominating task masters are needed to keep working people in line. 

Americans underestimate the risk to free government that an insecure and angry working-class implies. A foreign leader who was clear-eyed about this was Germany’s aristocratic Otto von Bismarck, chancellor from 1871 to 1890. He warned Germany’s privileged classes of the political dangers of ignoring the insecurity of workers. Working people were supporting Marxist parties in the Reichstag (parliament) and Bismarck told the elites that it would be easier to manage the working class politically if the German government required mandatory unemployment, sickness, and old-age insurance. 

Bismarck summed up his views in an observation in 1884 that is perfect for today. “The real grievance of the worker,” he said “is the insecurity of his existence; he is not sure that he will always have work, he is not sure that he will always be healthy, and he foresees that he will one day be old and unfit to work. If he falls into poverty, even if only through a prolonged illness, he is then completely helpless, left to his own devices, and society does not currently recognize any real obligation toward him beyond the usual help for the poor, even if he has been working all the time ever so faithfully and diligently.”

The upper classes opposed Bismarck’s concessions to workers the way Republican senators overwhelming rejected BBB. Similarly, Republicans in 1935 blasted Social Security as “socialistic” and fiscally irresponsible, calling President Franklin Roosevelt “a traitor to his class.” As Talleyrand said of French royalists 30 years after the French Revolution, Republican reactionaries in 2022 have “learned nothing and forgotten nothing.” 

Kaisers Wilhelm I and II helped Bismarck get his path breaking social insurance program through the Reichstag. He had helped them win Prussian-led wars in the 1860s and ’70s that created a unified modern Germany, and Wilhelm II apparently shared the Iron Chancellor’s paternalistic impulses. He expanded Bismarck’s popular social programs even after the Iron Chancellor left office, adding legislation limiting working hours and protections for women and children in the workplace to the earlier reforms.  

Americans 100 years ago travelled to Europe to study Bismarck’s reforms and knew that they were being copied. Great Britain in 1911 was the last of the important European countries to adopt its version. One of the reasons David Lloyd-George, the future British Prime Minister took extraordinary political risks to get labor reforms through the recalcitrant House of Lords was that British military leaders wanted them. The generals told Lloyd-George that British recruits were smaller and less healthy than their German counterparts and attributed this to the fact that Germans could take off work when they were sick and had government-mandated health insurance. Moreover, German employers who had first opposed the reforms, had become converts by 1911. 

The United States came closer than Americans realize to adopting European-style unemployment, sickness, and old age insurance in 1916 and ’17. The Labor Committee of the U.S. House held hearings on the matter and the committee’s Democrats and Republicans voted unanimously (12-0) to set up a commission to study social insurance for the United States. (See the House Labor Committee of the U.S. Congress, April 6 and 11, 1916, Commission to Study Social Insurance, 306 pages, HD7123.A5 1916b). The whole House eventually voted 189-138 to support the proposal on Feb. 5, 1917, only a few weeks before the U.S. entered World War I making social insurance built on the German model impossible.  

Democratic administrations since then like Biden’s in 2021/2 have made piecemeal efforts to help working people feel more secure with programs like Social Security, Medicare, and ObamaCare, all passed over reactionary opposition. It is amazing to see, however, that in April 1916 Republicans as well as Democrats were unanimously disposed to favor comprehensive, government sponsored social insurance so that working people could lead more secure lives.

Paul A. London, Ph.D., was a senior policy adviser and deputy undersecretary of Commerce for Economics and Statistics in the 1990s, a deputy assistant administrator at the Federal Energy Administration and Energy Department, and a visiting fellow at the American Enterprise Institute. A legislative assistant to Sen. Walter Mondale (D-Minn.) in the 1970s, he was a foreign service officer in Paris and Vietnam and is the author of two books, including “The Competition Solution: The Bipartisan Secret Behind American Prosperity” (2005).