How to weave a 21st cen­tury safety net

The Denver Post - - OPINION - By Mark R. Warner Mark R. Warner, a Demo­crat, rep­re­sents Vir­ginia in the Se­nate.

Mod­ern Amer­i­can cap­i­tal­ism is not work­ing for many Amer­i­cans. That’s why, no mat­ter what your po­lit­i­cal lean­ings, fix­ing an econ­omy than can no longer be counted on the cre­ate steady, well-pay­ing jobs for all has to be our top pri­or­ity.

The pop­ulist tide we’ve seen all year is fueled by Amer­i­cans who con­tinue to white-knuckle it ev­ery day, be­liev­ing they are just one or two pay­checks away from dis­as­ter.

While there is no con­sen­sus on how to re­spond to a glob­al­ized econ­omy, here are a few ideas for equip­ping Amer­i­cans to help nav­i­gate the changes:

First, while much at­ten­tion has been given to the re­cent growth in gig- econ­omy start-ups, this work re­mains a rel­a­tively small part of a much broader uni­verse of free­lance, tem­po­rary and part­time work. About one-third of work­ing Amer­i­cans to­day are in­volved in some form of con­tin­gent work, and that’s ex­pected to swell to nearly 50 per­cent over the next decade.

Work­ers un­at­tached to tra­di­tional long-term jobs typ­i­cally have lim­ited ac­cess to so­cial in­sur­ance such as health care, dis­abil­ity in­sur­ance and re­tire­ment sav­ings, which pro­vide peace of mind and a safety net. Yet we have never made it easy for even suc­cess­ful in­de­pen­dent con­trac­tors, such as con­sul­tants and lawyers, to find or fund their own so­cial in­sur­ance.

So we should be en­cour­ag­ing more in­no­va­tion and ex­per­i­men­ta­tion around por­ta­ble ben­e­fits — a 21st cen­tury safety net tied to the in­di­vid­ual, not the job. This ap­proach could pro­vide greater in­come sta­bil­ity and pro­tec­tion for work­ers who hold mul­ti­ple jobs — whether across a sin­gle day or an en­tire ca­reer.

Sec­ond, the gov­ern­ment-driven, top-down pro­grams to train work­ers for to­day’s jobs sim­ply don’t func­tion well enough. The jobs avail­able to­day and the jobs ex­pected to­mor­row are high­er­skill po­si­tions that will re­quire tar­geted and con­tin­u­ous learn­ing to al­low work­ers to adapt to chang­ing tech­nol­ogy.

Congress should be talk­ing about ways to in­cen­tivize busi­nesses to pro­vide ad­di­tional train­ing, es­pe­cially for their lowerand mid­dle-skill work­ers. We should dis­cuss the ap­pro­pri­ate met­rics to make sure this train­ing ac­tu­ally re­sults in higher skills and bet­ter pay.

Third, too many U.S. public com­pa­nies to­day are pre­oc­cu­pied with short-term prof­its at the ex­pense of longer-term in­vest­ments. While we used to see 50 per­cent of cor­po­rate prof­its rein­vested in a busi­ness, to­day about 95 per­cent are re­dis­tributed as div­i­dends or stock buy­backs. This short-term fo­cus robs com­pa­nies of the in­vest­ments in cap­i­tal and peo­ple that make them a source of longer­last­ing, well-pay­ing jobs.

In­vestors, too, have in­creas­ingly dis­played this short at­ten­tion span. In the 1960s, the av­er­age hold of a share of public stock was eight years; to­day, it’s four months. If Wash­ing­ton is se­ri­ous about tack­ling tax re­form next year, we should be look­ing for con­struc­tive ways to en­cour­age more public com­pa­nies and their share­hold­ers to make longer-term in­vest­ments.

And while we’re at it, greater trans­parency around things such as stock buy­backs and ex­ec­u­tive com­pen­sa­tion would help re­store public con­fi­dence in U.S. busi­nesses, too.

Amer­i­cans want this econ­omy to work bet­ter for more peo­ple. They want to know how their jobs will pay for the eco­nomic se­cu­rity they have earned by fol­low­ing the rules. And they’re wor­ried about their kids and whether any young per­son en­ter­ing to­day’s work­force will ever have an op­por­tu­nity to catch up.

If the new pres­i­dent and the new Congress do not find new ways to work to­gether and demon­strate a real re­solve to be­gin tack­ling these chal­lenges, then we will have learned noth­ing from the elec­tion — and that will

be on us.

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