Beyond Mere Slogans, U.S. Needs a GI Bill for Displaced Workers

Suddenly, everybody is a Populist, worrying about the struggling American worker.

“Corporate profits are setting records and so are corporate layoffs,” laments Senate Majority Leader Bob Dole (R-Kan.) on the campaign trail, sounding like some kind of liberal Democrat as he complains that the buying power of the average hourly wage is worth 5% less than a decade ago.

Further out on the GOP’s right wing, Pat Buchanan, from whom Dole lifted the theme of the angry worker, demands the restoration of high tariffs and blasts corporate moguls for sending money and jobs abroad. And Labor Secretary Robert Reich, the liberal conscience of the Clinton administration, said we should think about giving big business new tax breaks in return for being nicer to its workers, with better benefits and fewer layoffs.

In their clumsy way, both parties are struggling with the wave of nervousness and anxiety that underlies the apparently healthy economy. But they aren’t coming up with any good answers.

Unemployment is low and inflation negligible, so why don’t people seem happier? Because wages and benefits last year rose by an anemic 2.9%, lowest since the government began keeping records. The ever-present specter of layoffs, forced buyouts, downsizing, strikes fear into the heart of even the most dedicated worker. Remember when a job with AT&T; Corp. meant a guarantee of lifetime work?

“The anxiety is there and it’s real and there is not much of a response on the part of Washington to this question,” said Jeff Faux, president of the Economic Policy Institute, a liberal think tank in Washington. The issue would normally be one for Democrats, but the “mood of anxiety is being picked up among the Republican constituency,” Faux said.

The Republicans can’t respond because they are mesmerized by the magic of the marketplace, convinced that all will be for the best in this best of all possible worlds where chief executives focus relentlessly on the bottom line.

Only the balanced budget matters, the GOP insists. And the president has accepted the same goal, but merely disputing some details. It’s a far cry from 1992, when Clinton campaigned on the theme that Americans were working harder for less, and promised investments in people, billions more in spending for education and job training. All those promises have gone up in smoke. Forget about increased spending--the existing programs will be slashed.

But both parties in their zeal are forgetting that the only way to get workers moving up the ladder to better, more secure jobs is to equip them with increased skills. The robotics technician, the computer systems analyst, the inhalation therapy technician, all have jobs and talents unknown a generation ago.

More education means a more sophisticated job mix for the economy. “Why is the new person coming into the job market at $6? We want to get him in at $10, or $15 an hour,” said Barry Rogstad, president of the American Business Conference, a trade group of high-growth firms.

“The only way to get higher wages is with higher skills: It is the No. 1 problem facing this country,” said Rogstad, who is working on tax proposals to reward the acquirers of new skills.

Today’s tax system permits a deduction for taking courses and studying, but only in connection with your current job. If a warehouse laborer wants to become a dental hygienist, she can’t deduct any of the tuition bills. A new, generous “human capital” deduction should reward workers for any training and education expenses just as business gets rewarded for buying new machines.

Tinkering with the tax code will help. Yet it won’t go far enough to solve today’s mismatch between jobs and skills. Maybe the time is right to put on hold the dream of the balanced budget, and look for a more noble goal.

Remember the GI Bill of Rights, which turned out to be the greatest weapon to fight poverty in our century. Passed by Congress in 1944 as the Serviceman’s Readjustment Act, it promised $500 a year in college money and $50 a month to live on while going to school.

Boys from the farm, kids from the gritty slums of the big cities, all from a background where nobody dreamed of going to college, swarmed onto the campuses. Nearly 8 million World War II veterans took up the taxpayer’s offer to become educated and skilled.

They became the workers, managers and entrepreneurs who led the country into a generation of prosperity. The taxpayers offered a helping hand again, on a lesser scale, for veterans of Korea and Vietnam.

Perhaps we can do the job again, this time for workers struggling in a colder, tougher and harder job market that offers scant promises of security. A new GI bill for displaced workers would mean a lot more than a sympathetic speech from some politicians.