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In an American novel, I found this sentence, but I don’t understand the exact meaning of "living in refusal". The man here, who in the past worked as an engineer, is a Jew living in the USSR, and he lost his previous job because of discrimination.
He had applied for a job as an elevator operator in a hospital, but he was waiting to hear about that. Such menial jobs were quickly filled by Jews living in refusal, all of them with specialist degrees.
3As Daniel says in his answer, living in refusal is a phrase coined to describe the situation in the USSR. The word refusal has been around for hundreds of years, but it refers to the action of denying a request, not to an ongoing state that results from that denial. – Tᴚoɯɐuo – 2018-11-01T10:52:02.077