Michael Cianchette is a Navy reservist who served in Afghanistan. He is in-house counsel to a number of businesses in southern Maine and was a chief counsel to former Gov. Paul LePage.
This column is brought to you by the letter K.
No, not a “strikeout” reference related to President Donald Trump’s numerous lawsuits. Not a Kosher reference as we move into Hanukkah, nor some roundabout reference to “black ink” related to retailers following Black Friday.
Rather, it describes what might be our post-COVID economic recovery.
The idea of a K-shaped recovery suggests those on top will do well coming out of the pandemic, while others will have a negative trajectory. One line goes up, the other goes down. Like a K.
It’s not crazy. After all, the major stock market indices are now hitting record highs. Large companies with a strong e-commerce presence — Amazon, Walmart — are having marked earnings growth. Meanwhile, small businesses — without scale, heavily hobbled by public health measures — are doing their utmost to simply survive.
Some will. Some won’t.
These ripples flow across the economy. Reports from Augusta indicate the amount of road miles travelled by state employees dropped precipitously as the workforce pivoted to a “work from home” model in the midst of COVID.
Many of those employees — the so-called “knowledge workers” — can probably continue on with this approach indefinitely. However, those in more “hands-on” positions do not share in the luxury.
It’s awfully hard to plow a road while sitting on your couch.
Stepping back, COVID has highlighted many of the fault lines in our society and our economy. The challenge of child care chief among them.
For better or worse, public education is a major part of our childcare solution. When kids can go to school, their parents can go to work. However, with schools changing to a “hybrid” model where kids only physically attend part time, havoc and inequality ensue.
If mom and dad are those state employee “knowledge workers,” it probably works, albeit imperfectly. The third grader can be on the computer completing assignments while mom does her Zooms and dad writes reports.
But if dad is a Maine DOT driver, and mom is a clerk with the courts? It isn’t quite so easy. The same holds true with the private sector.
It is even worse in a single-parent household. If dad has to go to a construction site, and Sally the seven-year old is supposed to attend school remotely … what do they do?
This brings us back around to the changes in our social structure. There is a lot of talk about household income inequality in the United States. But one of the greatest demographic differentiators is marital status. In 2017 income terms, the top 20 percent of households were married 76 percent of the time. The bottom 20 percent were only married 17 percent of the time. Two incomes will almost always leave you better off. Particularly when it comes to raising children.
You can extrapolate this out. People often marry others in their own social circles. The guy at a great college preparing for medical school might marry the woman working to become a lawyer. Both are likely to have higher earning potential on an individual basis, while adding them together will push their household leaps and bounds ahead of the single mom working retail.
So, while we might be facing a K-shaped economic recovery from COVID, it is simply accelerating long-standing demographic and social trends. To say nothing of technological advances eliminating the need for lesser skilled jobs. Maybe there will be a day in the years ahead where you can drive a truck — or 10 — from your couch.
These challenges won’t simply be solved by tinkering around with tax credits or promises to wipe out student debt for those “knowledge workers.” They require real policy debates coupled with wholesale reimagining of safety net structures. And it requires a cultural conversation on the importance of strong family structures.
But if the future of America is to be something other than a strikeout, it is time to get to work. 2021 is a good time to start.