Capitalism Happens: Why Unemployment Shouldn't Be a Moral Issue

Last Updated Jun 15, 2011 12:08 PM EDT

Last week the government announced the unemployment rate has risen to 9.1 percent, but the nation's problem with unemployment runs a lot deeper than any mere number. Being unemployed is a moral issue in the United States.

Society tends to think if you are unemployed you must have done something wrong. That attitude means Americans have a very fundamental misunderstanding about how capitalism works.

In Sociology: Exploring the Architecture of Everyday Life, David M. Newman writes:
Poverty provides scapegoats for society's institutional problems. The alleged laziness of the jobless poor and the anger aimed at street people and beggars distracts us from the failure of the economic system to adequately address the needs of all citizens.
As a result, people don't like talking about being unemployed. If you're out of work, you feel like it's your fault. No matter how angry you may be about it, there is a very deep sense of shame (I speak from experience).

This scapegoating is also evident when we talk about other people not having a job. If someone lost her job, she is treated as having a contagious disease. We try to inoculate ourselves by thinking of all the reasons this can't happen to us: "That industry has been in trouble for a while." "She should have changed jobs when she had a chance." We want to convince ourselves we don't face the same risk factors.

The lies we tell ourselves about unemployment
I read a story recently about hiring managers and what they thought of people who had been laid off in our current economic crunch. There was a general tendency to believe people were laid off on the basis of merit. That the good workers were the ones who still had jobs because managers let the bad performers go first.

This suggests these HR types believe other companies operate on a logical, rational basis that they know isn't the case in their own workplace. If you have any experience with layoffs, regardless of whether you were let go or not, you know they are based on factors that seldom have anything to do with individual performance.

The business of journalism being what it is, I have become something of an expert on layoffs. In one instance a magazine I was working on was shut down even though we were exceeding all expectations. Another magazine owned by the company had screwed up so badly the company had to cut a lot of expenses fast. So the newest publication was shut down. Boom: Out on the street.

Another time, I had to lay off people who I knew were good at their jobs. I've been through four or five layoffs (on one side or the other). That's enough that I no longer think being laid off is a reflection of my worth as a human being. Indeed, at one company where I was laid off, I actually consoled my boss because he was taking the whole thing so personally. I knew it was just numbers.

Unemployment as a moral judgment
With one notable exception, America seems to have viewed unemployment as a moral judgment for much of its history. (I blame the Puritans. Why not?) That exception came 82 years ago. During the Great Depression people came to understand that unemployment is just something that happens. Companies great and terrible went out of business for reasons that had nothing to do with the quality of product or management.

For a while, many Americans stopped thinking capitalism was a fair system, rewarding the hardworking and punishing the indolent. In that interlude a guy with no money wasn't a bum but just another person who got caught in the whirlwind. Not everyone felt that way, but more did than didn't. (See Studs Terkel's Hard Times: An Oral History of The Great Depression for details.)

But then came the war, the post-war boom, the '60s, etc., etc., and we forgot. We returned to thinking rich people were smarter and better than the non-rich. And while we all know people who got to where they are through the sweat of their brow, we all also know people who got there by gaming the system and others who didn't get squat despite working as hard or harder as anyone else.

Not a crime to be poor....
There is an old joke that goes, "It's not illegal to be poor in the U.S., but it might as well be." As a society we do not treat the poor well, to put it mildly. Some places require urine tests for welfare recipients, some require people on welfare or unemployment to go to special classes to learn parenting skills or how to behave in the workplace.

Then we wonder why "these people" have no self-respect. From what we now know of Lehman Brothers et al., don't you think society would have better served by requiring bankers to get drug tests and maybe some education about morality?

I have had educated people tell me homeless people live "that way" because it's easier than getting a job. I think of that every time I see someone pushing a shopping cart of cans and bottles up a street in order to get a nickel for each one. I think of it every time I give someone a few bucks. It reminds me to look them in the eye and ask how he or she is doing. Begging for money has got to suck. It causes most people to stop thinking of you as a person. Either you are a nuisance or something to get away from as fast as possible.

One of the reasons for the Great Recession was forgetting about the Great Depression, what caused it and what happened after. (Google the Glass-Steagal Act and see what you find out.) Probably the biggest thing we forgot is that the invisible hand of the market place distributes goods and services, not justice.

Capitalism happens.

Photo: Library of Congress
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  • Constantine von Hoffman On Twitter»

    Constantine von Hoffman is a freelance writer and writing coach. His work has appeared in outlets such as Harvard Business Review, NPR, Sierra magazine, Brandweek, CIO, The Boston Herald, TheStreet.com, CSO, and Boston Magazine.

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