Shorter, shared workweek could end unemployment: covered by EI
Best-kept secret of Canadian employment insurance policy should be extended to all public and bailed-out private enterprises.
by Wayne Roberts
March 6, 2009 — Unlike most people, Thomas Homer-Dixon doesn't think today's world economic crisis is very complicated. He thinks it's very complex, which makes for a world of difference in understanding which government anti-recession programs will fail (most of them) and deciding which ones can help.
Homer-Dixon, who chairs a centre for global systems analysis at the University of Waterloo, is one of the world's leading thinkers in the field of "complexity theory," and the author of several international bestsellers, including The Ingenuity Gap and The Upside of Down. He brings a missing dimension to thinking about remedies to the looming economic collapse that that's so far been excluded from public and media debate. "If ever there was a case of experts not knowing what's happening, it's this economic crisis," he says.
Hang in for the introductory lecture on Chaos Theory 101, and you'll be able to follow and lead the economics debate in fresh ways.
Homer-Dixon is the first to admit he has no straight-ahead answers to a downturn that's much more challenging that the Great Depression of the 1930s, to which it's often unthinkingly compared. "We've never seen a collapse on this scale before in an environment of such enormous complexity and such a huge number of unk-unks," he says, in a reference to the term used during his days working with Pentagon analysts who referred to unknown unknowns.
The way in which a relatively small proportion of mortgage defaults in one country during the fall of 2008 precipitated the collapse of a global economic house of cards expresses a telltale, if seemingly illogical, sign of complex systems in crisis — a very small cause leading to a very huge result, like the final grain of snow or shift of wind that produce a mountain avalanche.
But in Homer-Dixon's view, that small cause, and even slightly bigger versions of that small cause — the breakdown of integrity in the global financial system, or the inequality that put home purchases beyond the reach of typical families, for example — is only a small part of an overall mix of "cascading failures."
His list of factors converging into a catastrophic perfect storm include intensified inequality, increased global warming, rising resource prices, and the "sheer productivity of capitalism — in many ways the deepest of all causes," he says, since it produces chronic gluts in desperate search for markets. Together, they overloaded a rigid and "tightly coupled" global financial system that spread uncontrollable wildfires.
"Multiple stresses that reinforced each other" led to "a collapse of assets greater and faster" than anything witnessed during the simpler days of the Great Depression, he says. That's why simplistic and one-dimensional rhetoric from politicians and pundits about fixing the problem, putting the pieces back together, and managing the crisis betrays a failure to understand what's going down, he says. "Complex problems require complex solutions. It's the law of requisite variety. We need a repertoire of responses as complex as the environment. We must move from management to complex adaptation."
Just as bodies under stress require core strength in the lower abdomen, economies and societies under shock require sources of core strength, what hip policy experts increasingly refer to as "robustness" and "resilience." Government policy makers need to focus their view on the prize of supporting resilience in the population. Failure of governments to be on constant alert for the pitfalls of economic giantism or to be on guard for stresses in social resilience "is like not requiring cities to be earthquake-proof," he says.
"Resilience means helping people to take care of themselves better in tough times," rather than relying on specialization and expertise, he says, a guideline that puts a community's ability to feed itself and care for each other at the top of his to-do list.
Here's how I simplify Homer-Dixon's analysis, in ways that he may or may not agree with.
When public money is used to keep enterprises afloat, the public has a right to demand that public benefits be spread among the general public. In my opinion, a longstanding (if best-kept secret) of Canadian employment insurance policy should be extended to all public enterprises and bailed-out private enterprises, including car companies and banks.
Canada's federal government allows workers at a company facing lay-offs to opt for everyone sharing the layoff by working a four day week, and everyone sharing the employment insurance by being covered on their one day a week of unemployment.
This measure does not cost the employment insurance system a dime, since five people taking a payout for a day is the same as one person taking a payout for a week. It allows a workforce to stay intact for better times, maintains morale among workers and within a community, and protects younger workers with families, a group unlikely to enjoy high seniority.
This simple measure would abolish unemployment overnight, maintain purchasing power in the community, and buy people the time to become more resilient and self-reliant in their own lives, by gardening, cooking from scratch or insulating their walls, for example. It would even give people some time to sleep, the least acknowledged of the crucial determinants of health and well-being.
Only the epidemics of workaholism and every-man-for-himselfishism have kept this obvious low-pain remedy off the agenda for so long.
Having bolstered purchasing power in the community-at-large, the multiplier effect of that purchasing power needs to be captured for public benefit by requiring all government and publicly-bailed-out institutions to purchase local and local-sustainable food, recognizing that the food industry already produces almost as many jobs as the auto industry and can directly employ local people.
Since one job for a local farmer commonly leads to five jobs producing farm inputs or off-farm processing, this doable measure is an employment bonanza that also yields major health and environmental benefits.
This also fulfils Homer-Dixon's call for self-reliant and unplugged systems that remove essentials of life from the vagaries of uncontrollable forces.
This depression does not have to hurt. Get beyond the complications into the complexity, and discover what Homer-Dixon calls "the upside to down."
Wayne Roberts is the author of The No-Nonsense Guide to World Food.
Links and sources
See also: Share a job and keep it, by The Chronicle Herald, February 17 2009
Posted: March 05, 2009
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