You can stop looking for one of those "new ideas" everyone seems to be hunting for in American politics. It's about to hit us over the head, whether we want it or not.
Right now the idea is trapped in a yawn of a phrase -- "human capital" -- but that should not deter anyone from appreciating its power. What it means is that the prevailing wisdom is nonsense, that we certainly cannot revive our economy or our national defense merely by pumping more investment into microchips or megabombs, robots or rocketry.
Consider some simple facts of "human capital":
* American productivity still relies as much, if not more, on people -- you remember them -- as on machines. Traditionally, about half of our productivity growth comes from increases in individuals' skills and knowledge.
* Despite our lengthening unemployment lines, we are suffering from shortages of critical workers, from machinists to engineers. The result: bottlenecks, higher prices and lower quality in both domestic and defense products.
* This problem will worsen dramatically in coming years when greatly accelerating technological change confronts a work force which, for the most part, couldn't find its way home in the Techno-Era around the corner.
* We have no choice but to equip ourselves for the future that's upon us. We have to retrain the millions whose current jobs can be kissed goodbye and who will be needed for new work. We have to boost the skills of the still-employed and pound knowledge into millions of adults who are functionally illiterate. We have to ensure, once and for all, education, training and job opportunities for women, blacks and Hispanics, who will make up the overwhelming majority of new workers.
In short, we have to invest in people or we'll get precious little out of the machines. That fact has been dawning on many people.
MIT's Lester Thurow, an adviser to the Democratic National Committee: "The economy is not going to thrive unless there is a major effort to upgrade the American labor force from the top to the bottom."
The Pentagon's Defense Science Board: A "major contributor to the increased lead times and costs currently afflicting the defense community is a continuing shortage of skilled labor."
The House Wednesday Group, a caucus of moderate Republicans: An unreleased Army training study in 1977-78 "found that 17 percent of the tank commanders in Europe and 21 percent of those in the United States 'did not know where to aim when employing battlefield gunnery techniques.' " Similarly, the survey uncovered men in charge of firing surface-to-air missiles who couldn't "differentiate between the silhouettes of Soviet and American planes."
The National Alliance for Business, on the need to train on-the-street youth, disproportionately black and Hispanic: "If you look out a decade at the demographics, it is clear that we will be doing all this out of economic necessity rather than out of any moral concern . . . ." Forget justice; think profits.
Yet so far there has been little but rhetoric. That can't last -- unless America wishes to sit back and watch its inevitable decline. Without serious action, that's what's ahead. Bet on it. The forces at work are unstoppable.
Start with the displaced workers from Akron or Detroit or other decaying cities who've begun their migratory treks for work elsewhere, reminding some Sun Belt folks of "The Grapes of Wrath." We can expect more warnings like the one issued recently by the Texas labor chieftain who told the cars and hitchhikers from Michigan and elsewhere to stay out, that "jobs are no longer available in Texas," that they are not wanted.
We can expect these episodes because the ranks of such modern-day Okies are going to expand as technology and foreign competition continue to do their nasty work -- with the displaced largely unaware of and unprepared for the jobs for which they will be needed.
Management analyst Peter Drucker, for example, anticipates that through the 1980s and 1990s, 10 million to 15 million manufacturing jobs will disappear from the American landscape. Even if he is only half right -- and some think he is entirely right -- you can wave farewell to 5 million to 7.5 million manufacturing jobs, starting yesterday.
In other words, brace yourself: The economic, social and political panic created in 1980-81 by the loss of a mere 300,000 auto industry jobs will multiply 16 to 25 times -- unless the dispossessed are redirected toward and retrained for new jobs.
That millions of new jobs are being created -- in addition to the existing ones tragically going begging in hard times -- there is no doubt. A survey last year by the American Electronics Association, for example, estimates that 671 of its member companies will create more than 140,000 paraprofessional spots (engineering aides, laser technicians, drafters, assemblers and the like) and over 113,000 professional places (chiefly engineers, computer analysts and programmers) by 1985.
The National Tooling and Machining Association projects a shortage in three years of more than 240,000 machinists, those people who make the tools and other devices needed to make everything else.
Millions of slots will emerge in the design, production, installation, operation and servicing of the robots that are going to populate American industry. While as recently as 1979 we had only 2,000 of these technological wonders, business leaders expect robot ranks to multiply a hundredfold -- to at least 200,000 -- just eight years from now.
Other jobs will open in fiber optics, which has the capacity to revolutionize communications by making the copper wire obsolete, and in genetic engineering, which, for starters, will change the face of agriculture and medicine. And this is to say little of the explosion of computer applications we can anticipate in the office as well as the home -- in banking, insurance, health, education, communications and other service fields.
There will be far too many new spots, of course, for all to be filled by the displaced, even if they acquire the skills and knowledge to do so. But what seems little appreciated is that the Techno-Era's employes will have to come chiefly from the people already working, and that this will hold true for well into the next century. There simply isn't anybody else. Just as economic survival dictates technological advance, so demography is destiny.
What the demographers' population figures tell us is that with much of the post- World War II baby-boom generation now into its thirties, our labor force growth rate is slowing dramatically. In fact, unless we suddenly import large numbers of highly skilled individuals from abroad, more than 90 percent of the American work force in 1990 and more than 75 percent in the year 2000 will be composed of those working here now. The largest need, then, will be to train and retrain today's workers.
The figures also tell us that the ranks of young workers, aged 16 to 25, are shrinking -- by about 16 percent in this decade -- and that an increased portion of this smaller youth force will be black and Hispanic.
That means, for one thing, that it will be the military against business, the Joint Chiefs versus McDonald's, in a rivalry for the young. Something will have to give. More women in the military? A draft? More grandparents behind fast-food counters?
Martin Binkin, a senior fellow at the Brookings Institution who specializes in military manpower issues, remarks: "The decline in the number of youths unquestionably is going to contribute to, and provide added pressure in, the debate on renewing conscription in coming years." At the same time, according to The Wall Street Journal, Burger King has already begun recruiting employes among the elderly.
The increased portion of minorities among scarcer youth (and in the prime-age labor force as well because of retirement patterns and other factors) will produce another intriguing clash: prejudice versus pocketbooks. Will fear of deep American decline finally move us to do what speeches about dreams and justice have not? In the words of Robert B. Hill, former research director of the National Urban League:
"If America wants its Social Security checks to keep being paid in coming years, it had better ensure full opportunity and productivity for minorities and women."
Definitely women. The population tallies tell us that the primary source -- indeed, two-thirds -- of new workers in this decade will be women. While about half of adult women already work, we can reasonably expect that number to climb to 60 percent or above by 1990.
Will we at last break down job barriers against women? Will sufficient day care facilities finally be provided? More flexible work hours?
As the Bureau of Labor Statistics remarks in its understated manner: "Given that much of the increase in female labor force activity will probably come from mothers, employers may have to review their personnel practices (such as provision of day care) to attract these workers."
Okay, those are some of the inescapable needs ahead and the people available to meet them. What, specifically, will a national "human capital" drive require? How do we, for example, redirect and retrain millions of displaced workers?
It would be folly to do it by expanding the maze of 22 separate training programs already on the books -- from Trade Adjustment Assistance to aid for redwood forest lumberjacks. That would just bury the effort beneath confusion, fragmentation, bureaucracy and the political pork barrel. What's needed is a single, fresh approach.
Try this one: an Individual Training Account (ITA), jointly funded by employer and employe, that guarantees retraining -- and, if necessary, help with the movers -- to any worker whose job goes poof. Say the company and individual each put up $500 a year, up to a total over six years of $3,000 each, and that each would get back the cash plus interest if it is not used by retirement.
The money would finance retraining vouchers to be used, as with the GI Bill, at any institution the displaced worker chooses. Moreover, as with Individual Retirement Accounts (IRAs), these Individual Training Accounts would inject an additional pool of capital for executives to finance more new technology and jobs. No bureaucracy. No money directly to vocational schools or businesses or other institutions. No overhead. A clean approach.
Before any workers are retrained, though, it would be nice if they knew where they were needed. Current federal job-vacancy information is so incomplete, untimely and unspecific as to be virtually useless. That's why the Houston papers are such big sellers in Detroit these days -- for the help-wanted ads.
It's past time for Washington to collect useful information about job vacancies and to insist that the computerized job listings of each state finally be connected to each other, which, absurdly, they now are not.
What about immediate shortages of critical workers? Note that Atlantic Research Corp. of Alexandria is offering staff members a $1,000-a-head bonus to land new workers for hard-to-fill jobs, ranging from communications test equipment technicians to electronic engineers. More broadly, the National Science Foundation has forecast a 47 percent shortage of industrial engineers in this decade. In such areas as California's Silicon Valley, bidding wars for engineers, computer professionals and other skilled workers are so intense that they have spawned annual job turnover rates of 80 to 100 percent.
Clearly, Adam Smith's "invisible hand" has palsied: His "marketplace" is not filling these and other needs (shortages of machinists and engineers have been plaguing us for 10 or 15 years, with scarcely any relief from supply- and-demand curves). So, if you'll pardon the expression, we've got to give the marketplace another hand. We'll have to defbine more sharply our vital defense and domestic needs. We'll have to create special government and business fellowships to attract and hold on to top-quality teaching faculty, who are being lured away with fatter paychecks from industry. We'll have to give special cash breaks to draw qualified students to essential (and expensive) fields of study.
During World War II, the National Emergency Production Act financed the training of 7.5 million skilled workers, popularly symbolized by "Rosie the Riveter" at aircraft and shipbuilding yards. (Indeed, a large portion of today's skilled workers were trained then and are now in or heading toward retirement. To wit: Today's 300,000 machinists have an average age of 58.) There is nothing stopping us from meeting our less massive critical skills needs today -- except our will to do so.
Next, how do we boost the skills of the still- employed, from clerical workers to the executives whose weak thinking and rotten management are heavily responsible for our current predicament? Much of this training task is now paid for by business, as it should be. The private sector, led by the largest corporations, shells out an estimated $30 billion annually to train workers. But smaller employers -- who create most new jobs and hire the majority of American workers -- are least able to foot these bills.
What's mainly needed is to help the smaller guys invest in people as much as in machines -- while making sure taxpayers don't subsidize any corporation for doing what it should and would be paying for anyway. One possible approach: a training tax credit. It would apply only ttraining above and beyond what a business historically has done itself. (If you wonder how we keep the corporate folks honest, remember that they already report the highest training outlays possible to the Internal Revenue Service for tax-deduction purposes.)
In this way, only the training needed would be done. If the credit isn't used, there would be zero cost to taxpayers.
Finally, the issue of education, where we need an effort far exceeding our late-1950s response to the Soviet launching of Sputnik. We must, for one thing, develop students' critical thinking, their ability to analyze and organize and express information -- the essence of the liberal arts. We obviously must also sharpen their knowledge of math, science and specific technologies. These are all areas in which students are not exactly excelling these days, to put it mildly.
As the National Assessment of Educational Progress reports, "The gap between the number of highly skilled workers needed and the number of students prepared for higher-level jobs is widening. Clearly we are not cultivating the raw materials, our future workers, who will be vital both for economic progress and ultimately for economic survival."
So what are we doing about this? With many large school systems in or near bankruptcy -- particularly those with the heaviest concentrations of minority students -- we're slashing national aid for the disadvantaged, for math, for science and for other education programs. It's as if we were bent on making sure that essential instruction disintegrates further. That's a sure-fire formula not only for American economic and defense erosion but for creating a large and brooding underclass, permanently locked out.
It's also a sure-fire formula for intensified decay of hard-hit cities, whose best single shot at rekindling economic growth lies in their human capital. The industrial Northeast, with its troubled metropolises from Chicago to New York, still has an immense advantage over others in its vast pool of skilled labor -- if existing and future workers are educated and retrained for new jobs.
The education needs do not stop there. We have to attack the anti-blue-collar arrogance that discourages our children from learning skilled trades. We must overhaul a vocational education system that has failed miserably in important respects. William E. Hardman, executive vice of the National Tooling and Machining Association, remarks:
"Many of our vocational schools have better equipment than contract tool shops -- except they don't know what to do with it in most cases . . . . If our members had as much money as the vocational education system to spend on training for this purpose, we could no doubt end the skill shortage in four years and ensure that we never fall behind again."
Then we've got to reverse the decline in American teacher competence. Full fellowships to lure qualified students into teaching could be one step, intensive summer retraining institutes for today's teachers another. Retraining is essential, for example, if teachers are to teach the varied uses of computers; forget about having those shiny toys in schools if most teachers really don't know what to do with them, as is now the case.
All this by no means exhausts the issues wrapped up in the human capital agenda. But it should make one thing crystal clear: We are currently in the process of killing American hope for economic, defense and social renewal. One after another, we are cutting or ending programs that invest in people, from job training to public school assistance, from day care to college aid to basic research monies. If that were not enough, we are not even seriously addressing such crucial problems as helping the displaced workers lost in the confusion of change.
The supply-side crowd obviously thinks that people don't count as much as machines. If that mindset continues, the historians can start writing their books about the decline of America.