At a little past noon on October 7, 1978, Frank Schiff of the Committee for
Economic Development addressed a conference on Work Time and Employment
convened by the U.S. National Commission for Manpower Policy. Assembled at
the Capitol Hill Quality Inn in Washington, D.C., the conference attendees
were indeed a quality collection of noted academics, high level civil
servants, and influential spokespersons for business and labor. Schiff was
responding to a paper on "Policies to Reduce Fixed Costs of Employment" that
had just been presented by Robert Eisner.
Speaking of the goal of accomodating individual preferences for worktime and
leisure, Schiff remarked, "To achieve this goal, Professor Eisner places
major stress on employment subsidies and tax credits, essentially to offset
the effect of public policy and institutional work arrangements that create
a bias against flexible work arrangements. This is clearly one possible
approach, but it should be emphasized that it is by no means the only way to
deal with the problem. Other possible options include direct efforts to
reduce the existing institutional biases against flexible work time patterns
-- for example, by relating the cost of particular fringes more to hours
worked than to the number or employees, or by relevant changes in the
computation of experience ratings."
Schiff's remarks were, admittedly, not delivered in scintillating prose and
the topic may seem somewhat obscure and technical. One slight amendment
would clarify what Schiff was saying: instead of referring to the "biases
against flexible work time patterns", Schiff could have better identified
the problem as "public policy and institutional biases *in favour of*
overtime and unemployment." In spite of that small point of obfuscation,
Schiff's comment stands out from the 445 page conference report as such
profound good sense that it no doubt was quickly and profoundly forgotten by
all and sundry in attendence. Perhaps even by Schiff.
In the 18 years since that prestigious Washington, D.C. conference, much has
changed but the institutional bias in favour of overtime has remained.
Perhaps the best known effort to redress the imbalance was a bill to
increase the overtime penalty of the FLSA from time and a half to double
time, introduced by Democratic congressman John Conyers in the late 1970s.
The logic against Conyers bill, however, was impeccable: it was countered
that the measure would increase labour costs and therefore wouldn't achieve
its intended job creation effects. Conyers' bill went nowhere.
But to give a bit more context on the timing of the Work Time and Employment
conference, it should be remembered that in July 1978, the Bonn Summit of
the G-7 had taken place at which President Jimmy Carter affirmed the U.S
government's top priority of fighting inflation. The next year, 1979, Paul
Volcker was appointed chairman of the Federal Reserve Board of Governors.
The fight against inflation uber alles had begun in earnest. Because
unemployment was seen as an indispensible tool for fighting inflation
(NAIRU), the idea of removing institutional biases in favour of unemployment
never caught on.
Let us return for a moment to that October day in 1978 and indulge in a bit
of economic science fiction. Imagine that Frank Schiff's comment about
*removing the institutional biases* had seized the imagination of the
conferees. Imagine that reporters from the major news media were in
attendance at the conference and Schiff's offhand suggestion became the
subject of front page feature stories and soul-searching editorials. Imagine
that a national debate broke out in the United States about the nature of
work and the illegitimacy of government regulations that prolonged work
beyond the desires of individuals. Imagine the emergence of a mass
labor/civil rights movement demanding the freedom to work for as many or few
hours as one desired and insisting on the repeal of all legislation that
enforced excessive work. Imagine the victory of this labor/civil rights
movement.
What would our social, economic and political landscape be like today -- 18
years later -- if Frank Schiff's spark of common sense had fallen on the dry
tinder of citizenship rather than on the damp soil of econometocracy?
Regards,
Tom Walker
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