John McKnight

The Service Economy





We are becoming dependant on so-called professionals that invent new needs and make people believe that the satisfaction of those invented need is essential requirement for human progress and well-being. And slowly some of us become moronic subjects to external dominance.

Source: John Mc Knight, The Careless Society, Community and Its Counterfeits, 1995



The Service Economy Expresses the Highest Hope of Human Beings

There are at least six facts about a service economy that are important to people in the public welfare field. First, the service economy is an expression of the highest hopes of human beings. We no longer depend upon the sweat of our brow to survive. We don't have to spend all our lives in the mines, the fields, and the factories. We can care and serve; we are now a society where two-thirds of the people derive their income through service. Thus, the last century has seen the fulfillment of one of the great dreams of humankind.

Second, we need to recognize that the largest institution for producing human services is government. Government or government-funded programs have been the primary instruments for implementing the dream of a service economy. Yet that dream is being threatened across America by the popular tax revolts. Many people are rebelling against the dream by voting to shut off the major sector that produces services. It is a paradox. We dreamed of a society that could serve, but many Americans are now rejecting that dream.

Third-and particularly important for people concerned about the poor — much of the service economy is not place-related. The production of goods — growing wheat or making steel — can best be done in specific places. In the service sector there are fewer limits on the places where work can be done. For example, when I want to travel to Washington, I pick up a telephone in Chicago to make a hotel reservation. The person on the other end of the line asks me where I want to stay. After I say, "Washington," I ask, "Where are you?" She says, "I'm in Memphis." I ask what she is doing. She says, "I'm checking with our computer in New York." So from Chicago to Memphis to New York to Washington I reserve a room.

This phenomenon is characteristic of much of the service economy. There is no particular place that controls where the work is done — unlike a steel mill or a farm. Nonetheless, because we still think in terms of producing goods, we believe that people need to go where the work is. The service economy, however, presents a great opportunity to move work to where people who need work are located. There is no reason that the telephone operator in Memphis has to be in Memphis. She could be on the South Side of Chicago and the system would work just as well. Unfortunately, in most of our great cities, we have put our service industries downtown in the commercial district. As a result of modern technologies there is no reason for them to be there. We ought to be creating the incentives that would locate the jobs of the service economy in neighborhoods where people need work rather than stacking them up in skyscrapers in the center of cities and wasting energy to transport people there.

There is a fourth point about the service economy that is essential to the interest of lower-income people. Most people understand the development of the service economy as a shift from blue-collar to white-collar work. We assume that a white-collar worker needs more education than a blue-collar worker. However, a close look at the nature of the developing work in the service economy shows that that assumption is often incorrect. In fact, what is happening now in the service economy is a massive rationalizing and segmenting of work. The same thing that happened to automobile-making on the assembly line is happening to white-collar work.

Think about your own experience. The most visible example of this mass production system applied to service work is the franchise industry. Go to a fast food franchise. You ask the service employee for a hamburger. She turns around and picks out a green-paper-wrapped item marked "hamburger." She then turns to the cash register, which has a green key that says "hamburger." If she can't read "hamburger," she does know green. She punches the button and it shows the price, $0.75. You give her $1.00. She must be educated enough to be able to punch the buttons that ring up $1.00. The machine will subtract $0.75 from $1.00 and tell her your change is $0.25. Anyone who tells you that that woman, because she is in a service industry, needs to be better educated than the person who is working in a steel mill does not understand what is happening in America. Throughout America service work is being "assembly-lined," broken down into small pieces that are within the command of most people who have dropped out of high school.

This industrialization of the service economy means that if we're serious about producing opportunities for people who have been disadvantaged, the service economy is not a system that necessarily demands more education. Indeed, the managers of the service economy are creating a system that often requires less education than is needed by a farmer or a steel worker.

Fifth, we need to recognize that there is still a tremendous need for more service jobs. If some labor economists are right, between 1980 and the year 2000 we will have employed 15 to 20 million more people in service occupations. Put in terms of people, that means that we will effectively convert a million goods-producing jobs a year, for twenty years, into service jobs. Perhaps the greatest challenge for those two decades will be deciding what those jobs will be. Today our high schools, junior colleges, and universities are filled with people who expect to deliver services. But what services do we need?

Human Need Is the Raw Material of the Service Economy

This question leads to the sixth point about a service economy. Most of us believe that there is no limit to how much service we can produce. If service is an expression of care, then certainly it is clear that you can never care enough. We recognize that there is a limit to the goods we can produce because the raw materials are limited. The raw materials of the steel industry are coal, lime, and iron. We know these resources are limited. On the other hand, the raw material of the service economy is human need. Our deficiencies and unmet needs are the ore and coal of the service industry. Thus, the servers called teachers need students. But as their raw material declines, as the baby boom drops off, what are they to do? How can they justify their work in the same numbers as the child population decreases? One answer is to "discover" new needs, unperceived needs, unmet needs — or the need for "lifelong learning."

Consider American law schools. In the early 1980s alone they produced 127,000 lawyers, increasing by 25 percent the number of licensed attorneys. What is the need — the raw material — for their industry? What will all of these new lawyers say you need that you didn't know you needed?

The service economy presents a dilemma: the need for need. As a million people each year move from goods to service production, the service industry requires more raw material — more need. We can now see that "need" requires us to discover more human deficiencies.

I have recently observed two examples of this discovery of new human need. At a conference on service to the elderly, I met a person being trained as a bereavement counselor. She will receive a master's degree in order to help people through their grief after they have lost a loved one — for a fee.

How many people in the United States are feeling that they have a "need" for that bereavement counselor? Certainly people grieve; it is a hurt that people have suffered for eons. But does that grief constitute a need for service? Or does the bereavement counselor need that hurt more than the person in grief needs her help?

Another example is a person I recently met in a Canadian city. He is a recluse manager. This service was developed when a recluse died and no one found him until fourteen days later. A newspaper photographer took a picture of the room where he lived. People were shocked, and the result was the conversion of his death into a need. The local government created a committee of officials that decided to respond to the need his death created. They recommended that the city create a new service — recluse management. The committee also wrote a manual that now guides recluse managers. It tells the managers how to find recluses, how to observe them without their knowing they are being observed, and when to intervene in their lives.

Does the person in grief or the recluse "need" service? Or does the service economy need grief and recluses? Considering the gross national product as an indicator of the national wellbeing, the answer is clear. If kin deal with grief, it will never be counted as a product. If a bereavement counselor deals with the grief, our gross national product will increase. If an old man dies and is undiscovered for fourteen days, he is worthless. If a recluse manager controls his death, the service economy will count his death as a product of value.

In the city of Chicago, where I work, the neighborhoods are falling down around us. People need work and a decent income. While there is less and less money for the poor, there are more bereavement counselors and recluse managers — more and more servicers who need the poor. We may have reached the point where there are more people in Chicago­ who derive an income from serving the poor than there are poor people.

Welfare workers are caught in this dilemma. Do they need the welfare clients more than the clients need their service? In a service economy, the welfare recipient is the raw material for case workers, administrators, doctors, lawyers, mental health workers, drug counselors, youth workers, and police officers. Do the servicers need the recipient more than she needs them?

In terms of the gross national product, the answer is clear. The recipient is much more valuable in her dependency; she is a national resource. If she were a productive member of our society, the net loss to the gross national product could be very significant because she may never produce as much income as the income derived from her dependency.

Northwestern University recently completed a study in a low-income neighborhood where 60 percent of the people are dependent on welfare. In that neighborhood, for every welfare dollar a recipient received in cash income, $0.57 was spent for only one service — medical care. One dollar for the poor and $0.57 for doctors, nurses, and hospitals. Who really needs whom in that kind of economy? Those who provide services for that neighborhood may derive more income from welfare than those who receive welfare. That is not a poor neighborhood; it is a serviced neighborhood.

Institutions and Interests Promote Clienthood and Dependency

There is, of course, another way. We don't have to have policies that produce dependency. Instead, we need policies that recognize the importance of the right to work, the right to income, the right to real authority, the right to care rather than to be served, the right to tools that allow people to produce rather than to consume, the right to working neighborhoods, the right to working farms, and the right to be free from racism. These are the rights we really need — not more service. On the other hand, we must admit that we have failed to identify the enemies of those rights.

My father recently told me that during the New Deal when Franklin Roosevelt was president, most people understood this country as a place where there were interests that were the enemies of the common people. But, he said, today we identify the enemy of the people as poverty, sickness, and disease. My father insists that the enemy isn't poverty, sickness, and disease. He argues that the enemy is a set of institutions and interests that are advantaged by clienthood and dependency.

His wisdom reminds us of what we already know. Enemies of the right to work and the right to income are those professionals involved in increasing the demand for certification and licensure of work. Professional efforts to certify work in the service area are stealing jobs away from the poor by putting those jobs in an elite status, requiring the kind of training and education that most poor people do not have.

The enemies of the right to work and the right to income are the business leaders who continue to support and maintain large-scale unemployment and underemployment.

The enemies of the right to authority — the power of people to act and decide — are governmental officials and bureaucrats who are fearful of a transfer of authority. They want "participation" but oppose popular control.

The enemies of the right to popular tools are the technologists who create "megasystems" that provide work for a very few and increasingly produce goods that working people can't afford.

The enemies of the right to working neighborhoods are those banks, savings and loans, and insurance companies that literally steal the savings of poor and working-class people and use that money to make loans to foreign governments to build tanks or to corporations to build resort condominiums in distant states.

The enemies of the farm people are the agribusinesses of America.

The enemies of the "voice of the people" are the great television networks that have created a mindless uniquack that drowns out the voices of the poor as they try to speak to us.

The enemy of freedom from racism is all of us — all of us who have so quickly forgotten Dr. Martin Luther King's dream.

My father, that voice of older America, is right. The enemy is not poverty, sickness, and disease. The enemy is a set of interests that need dependency masked by service.

There is a clear need for public servants — not public servicers — and to engage in a new struggle to reinvent America. The incrementalism that we havre depended upon just isn't working anymore. We cannot delude ourselves. We must be true to ourselves and to those we represent.

We are in a struggle against clienthood, against servicing the poor. We must reallocate the power, authority, and legitimacy that have been stolen by the great institutions of our society. We must oppose those interests of governmental, corporate, professional, and managerial America that thrive on the dependency of the American people. We must commit ourselves to reallocation of power to the people we serve so that we no longer will need to serve. Only then will we have a chance to realize the American dream: the right to be a citizen and to create, invent, produce, and care.


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