This isn't all bad. Conditions in stores, restaurants, and hospitals are often better than in factories. Jobs are more stable because labor in these businesses is mainly a fixed cost — an assembly line can be idled at a moment's notice, but a store needs salesclerks even when business is down. Goods made abroad are cheap, which helps consumers. The health and education sectors now have almost 30 percent more workers than they did in 2000, and that means, in part, more and better services in these areas.

The downside is that because many of these jobs aren't unionized, wages are lousy. The only thing that reliably bolsters service wages is the federal minimum wage: when it rises, as it did from $6.55 to $7.25 in 2009, service jobs above the minimum are forced up as well (to maintain the spread). And when Congress doesn't raise the minimum, real wages decline with inflation.

Is it any surprise that today our leading reactionaries come from retail behemoths like Wal-Mart? Is it a shock that Target was among the first companies, in the wake of the Supreme Court's Citizens United decision, to write a huge check to a political campaign? That fast-food chains are tenacious opponents of a higher minimum wage? That hotel owners from New Orleans to Santa Monica have fought against "living wage" laws? Having thwarted the unions, they now target the government — its taxes, its regulations, and above all, its wage standards.

So: most of the nation's remaining jobs are in services, where pay depends largely on acts of Congress. Houses are no longer valuable commodities. Private pensions are largely kaput, and many 401(k)s were also wiped out in the crash. What's left to protect economic security for ordinary Americans?

The answer, of course, is Social Security and Medicare. They remain by far our greatest social-policy achievements. Today, a 60-year-old man in the US has an expected life span of 20 more years — well above what was the case 50 or even 40 years ago, when Social Security didn't relieve poverty and Medicare was just getting underway. Improved medical care is surely part of that. But income security is also an important factor. People who are not poor live longer than people who are.

And Social Security prevents poverty. It's wealth, exactly like a big bond that you can't sell. If the monthly benefit is $1000 and the interest rate is two percent, the bond is worth $600,000 — and that's a bond you own, right now. You don't have to save for it: you've paid for it, up front, via the payroll tax. And there's more. As health-care expert Harold Pollack has pointed out, Social Security's Disabled Adult Child program is an insurance policy worth more than $400,000, protecting you if you happen to have a mentally or physically disabled loved one — something that could be only a car crash away.

Medicare has also been a huge success: popular, efficient, and less costly per "unit of care" provided than private medical care. Medicare is a big insurance policy you've already paid for, in full, that takes effect at 65 — an age when private insurers wouldn't touch you. That's wealth, too, a huge buffer between sickness and bankruptcy.


THE BANKRUPTCY LIE

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