24 May The Work Ethic and Demographics; Pardon Me*

The Work Ethic and Demographics

Many Americans believe that younger generations don’t have the same work ethic as their elders. They don’t put in the effort, or the hours, of older generations in trying to achieve the American Dream. They’re not as motivated for success. They have higher expectations and lower ambitions, valuing play-time more than work-time. Their reduced drive erodes American industry. It makes America poorer. Countries like China are headed in the opposite direction. They’re getting richer because Chinese people work harder. They place greater value on the work ethic. That’s why China has seen such tremendous growth over the past 20+ years and why it now is the second largest economy in the world, a center of manufacturing and technological innovation. It owes that success to its work ethic.

Really?

No, not really.

China is a socialist country controlled by the Communist Party. The Party does not promote free speech or the Rule of Law and does not practice capitalism or encourage free enterprise. Instead, the Party promotes a well-ordered society that responds to the interests of the State. The Party therefore has sole responsibility for determining workers’ rights, including the hours they work. The substantial majority of Chinese workers consequently are governed by China’s national “standard working hours system” which mandates a 40-hour workweek with 8-hour days, 5 days/week. Work in excess of “standard working hours” requires State-mandated overtime pay. Exceptions to the 40-hour workweek can neither be contractually agreed nor changed locally. Any exception requires central government approval. That’s what is meant by centralized control.

The Communist Party has mandated an exception to “standard working hours” in the technology sector to complement its “Made in China 2025” strategy. That exception is called “996,” referring to a 9 am-to-9 pm work schedule 6 days/week. One of its chief proponents is Alibaba founder and Communist Party member Jack Ma who, in a recent speech to Alibaba’s employees, told them that “it is a huge blessing that we can work 996.” Not all workers agree. Excessive hours frequently result in a variety of physical and psychological illnesses, with many workers burning out after a few years. But in the monolithic Chinese technology industry workers are driven to comply. In addition to the risk that their “social credit score” will suffer under China’s social ranking system (quite a significant risk), there are few alternative employment opportunities. To protest 996, anonymous Chinese activists have created a webpage called 996.icu (standing for “intensive care unit”) as well as 955.wlb (standing for a 9 am-to-5 pm 5 days/week with a “work-life balance”). Perhaps what Jack Ma meant was that younger generations don’t have the same work ethic as their elders?

American-style capitalism is founded on and turbocharged by a Calvinist work ethic. American businesses maximize profits by creatively melding capital with the American work ethic. One consequence is that Americans with full-time jobs work an average of 47 hours/week, more hours than workers in almost all other industrialized countries. In fact, at least 134 other countries (including China and European countries) have enacted laws that put a ceiling on the length of the workweek. The U.S. has not … and the productivity of American workers has increased fourfold since 1950 … because of America’s work ethic. Americans believe their hours create an appropriate work-life balance and, in part for that reason, the average workweek of Americans has been trending higher since WWII. There are a host of statistics that further illustrate American productivity gains and showcase the fruits of American-style capitalism. The problem for America is not that workers are abandoning the work ethic. The work ethic in America remains strong particularly among ridiculed younger generations. China’s recent ascent owes its success not to an enhanced work ethic, but to putting its rural poor to work. Its greatest resource – in fact, every country’s greatest resource, labor, has gone from subsistence agricultural fieldwork to more-highly-compensated factory and office work in the cities. A growing urban workforce has created a rising Chinese GDP and increasing prosperity for Chinese workers. But that has little to do with socialism/communism/a Chinese work ethic … and everything to do with demographics. Populations in both China and America have been growing. Hence, GDP and national wealth have grown. That population growth, however, is coming to an end, in both China and America (as well as in Europe). It cannot be replaced by a redoubled work ethic.

Births in the U.S. are now at a 32-year low. The fertility rate – the number of children the average woman will have in her lifetime – is 1.72, well below the replacement level of 2.1. The average European fertility rate is 1.58. China’s is 1.62. Although the reasons for the decline in births in China are different from those in the U.S. and Europe (due to its now-abandoned one-child policy), the outcome for the U.S., Europe and China is for declining wealth and GDP unless a way is found to increase the working-age population.

“Demographics is destiny” is a slogan often used to advocate one of two opposing immigration policies, each intended to address declining populations. In one, the slogan denotes opposition to immigrants who dilute national character, either racially or religiously or culturally. In the West, this often is expressed as a preference for a Caucasian majority undiluted by African, Asian, Middle Eastern (whether Arab or Jew), and/or Hispanic immigrants. In China, it refers to more than a mere a preference for Han Chinese who comprise 92{29ea29b64b10057f61377b2c087cd5b7537a0cd24da4295a308b0bf589469f35} of China’s population … with China’s immigration policy therefore limited to ethnic immigrants. Populist parties in the U.S. and Europe advocate tough immigration restrictions to prevent dilution of their perceived racial/religious/cultural identity. Stark examples of anti-immigrant policies and practices are found in Hungary, where the government has built a border fence to exclude migrants and engaged in a pattern of immigrant abuse that reportedly includes caging and starvation, and in Poland, where the policy is “Poland for Poles” and the government has advocated the “re-Christianization” of Europe, legislating subsidizes to encourage an increase in Polish-born children.

“Demographics is destiny” also is a slogan used by advocates of increased immigration whose focus is on avoiding the economic consequences of a declining population that will lead to a workforce too small to support aging workers. Liberals in American believe that, because the U.S. is and always has been a melting pot, immigrants admitted to the U.S. would continue to identify with American culture and narratives in ways that enable easier and more durable assimilation. They see America as very different from Europe and China in this regard.

Demographics denied leads to a declining standard of living. It cannot be addressed by a more enthusiastic work ethic. The conundrum for each of the U.S., China and Europe is to find a solution.

Pardon Me

Under Article II, Section 2, of the U.S. Constitution, the President has the power to grant clemency to any person convicted or accused of a Federal crime. Pursuant to Article II, Section 2, President Trump thus far has pardoned 9 individuals and commuted the sentences of 3 others. The NY Times reported on Saturday that Trump has asked for files to be prepared to enable him to pardon several members of the U.S. armed forces who have been accused or convicted of war crimes. Although assembling pardon files normally takes months, the Justice Department reportedly has been ordered to complete its work before Memorial Day so that the President can issue pardons then.

Article II, Section 2, is a Constitutional mechanism for Checking and Balancing overreach by America’s Legislative and Judicial branches of government. It affords the President discretion to correct excesses errors made (1) by the Federal courts (for example, where a conviction may have created an excessive penalty or a miscarriage of justice) or (2) through legislation passed by Congress that impacted punitively on a given defendant (for example, in sentencing or in light of subsequently-discovered evidence). A President’s power to pardon is unfettered. Although past Presidents on occasion have pardoned friends and business associates, in the absence of a Justice Department finding of excess there is no precedent for a President using Article II, Section 2, to sweepingly pardon political allies, friends, business associates … and war criminals. That is, until now.

Before the possibility of pardoning war criminals arose, the President most recently had granted a pardon to Conrad Black, a personal friend who had been convicted of fraud in 2007 and served three years in prison after years of appeals to the Supreme Court and the 7^th Circuit Court of Appeals. Black, a former newspaper publisher and author, wrote a laudatory biography of Trump in 2018 entitled “Donald J. Trump: A President Like No Other.” Black’s two co-defendants, Richard Boultbee and Peter Atkinson, who were convicted by the same jury, at the same trial, of the same fraud crimes as Black, did not receive either a pardon or a comment from Trump. Trump did not rely on a recommendation from the Department of Justice with respect to either Black, Boultbee or Atkinson, which is the normal process when a President is considering issuing a pardon. Instead, Trump offered a list of celebrities who vouched for Black’s character.

In addition to considering pardoning American war criminals, Trump reportedly offered to pardon Kevin McAleenan, the acting Homeland Security secretary, against any violation of the law committed at the President’s suggestion if he illegally blocked entry to the U.S. along the Mexican border. That offer of a reward for violating Federal law sends a powerful message to Trump’s supporters as well to those who might consider ignoring the Rule of Law. Similarly, in November 2018 Trump said he would not rule out pardoning his former campaign manager, Paul Manafort, who among other things so far pled guilty to conspiracy to defraud the U.S. and witness tampering and been found guilty by a jury of tax fraud, failing to disclose foreign bank accounts and bank fraud. “It was never discussed,” the President said, “but I wouldn’t take it off the table.” Previously, on June 4, 2018, Trump had tweeted: “I have the absolute right to PARDON myself….” He is the first President to have thought so and, more importantly, is the first President to have said so. The latter sends the most powerful of messages.

President Trump’s pardon of Black is not the first time a President has pardoned a friend and it will not be the last. That pardon, however, together with the other pardons already granted and Trump’s offer of additional pardons to those who support his suggestions policies agenda, undercuts the principle cherished by the Founders and ensconced in the Constitution … that Americans live by the Rule of Law and not by the Law of Rulers (see “The Rule of Law” in the April 5^th TLR).

Finally (from a good friend)

*┬® Copyright 2019 by William Natbony. All rights reserved.