21st Century jobs policy

Jobs is the area where our vision of future success and the policies we are pursuing to realize that vision are most stuck in the past. Both across the country, and even more so here in Michigan.

MIT’s Erik Brynjolfsson and Andrew McAfee are doing the cutting edge work on the implications of smarter and smarter machines doing more and more of the work humans use to. For more on their work check out this You Tube video or this interview from Slate entitled Robots are stealing your job: How technology threatens to wipe out the middle class. 

They describe where we are heading as the Great Decoupling. Where all the traditional metrics of economic success do well: GDP, productivity, corporate profits. But workers don’t. Where jobs and wages grow far slower than the traditional growth metrics. A world where technology advances enable companies to do well, but not more and more workers.

New York columnist Ross Douthat tackles the policy implications of an economy that structurally struggles to produce enough jobs, particularly good paying jobs, in a must read column entitled When Work Disappears. Douthat previews the debate about job policy we should be having now––and ultimately will have––for  a world where machines are constantly destroying jobs and occupations.

Douthat lays out the thinking of many economists and technologists who believe the Great Decoupling is the new reality. They are thinking about a world where more and more of us work less and less, if at all. Their policy advice is not to fight that trend but rather to go to some system of guaranteed income for people whether they work or not. Big expansion of government redistribution. There is a sense that trying to keep people employed is a drag on the economy rather than using machines to do the work it can do better and cheaper .

Douthat writes:

In effect, these forays are opening a window into tomorrow’s policy debates, and raising the question of whether 21st century public policy should even really try to slow the decline of workforce participation — as opposed to welcoming that decline as a sign of liberation, and perhaps hastening it for the sake of efficiency as well.

I think it’s important to concede up front the possibility that Wolf and Avent could be right about where we’re going. My doubts about the basic-income prescription notwithstanding, in the event that do we end up with an ever-growing share of the population consisting of what Tyler Cowen calls “zero marginal product” workers, whose continued employment is effectively a drag on productivity relative to the machine alternatives, ideas along those lines could end up being the only plausible policy response.

Douthat explores what he sees as the negative consequence of paying people not to work. Basically the negative consequences––and there are  many––of societies where folks, particularly men, don’t work. He writes:

And while a sufficiently generous basic income would no doubt raise living standards and reduce deprivation at the bottom, the experience of Appalachia, among other blasted social landscapes, suggests that it’s very easy for the absence of work to intertwine with social pathologies in ways that government assistance can’t necessarily ameliorate. The workless society could be a place where the “potential for a more enjoyable life” is available to all … but it could just as easily be a society with more alcoholism, more drug addiction, more obesity, lower lifespans, more social isolation, and less human flourishing overall.

Wow! What a difference in how to construct policy going forward. The debate Douthat previews has the virtue of being anchored in the economy of the future. It starts with the new realities. Rather than trying, as both parties are, to resist or ignore these new realities. Policies designed to create lots of jobs, particularly good paying jobs, anchored in an economy driven by factories and farms can’t work. Globalization and technology have eliminated both as a source of mass middle class employment.

We need a new public conversation/debate about jobs and income in the context of what is possible in an economy that is constantly being reshaped by globalization and technology.


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Lou Glazer

Lou Glazer is President and co-founder of Michigan Future, Inc., a non-partisan, non-profit organization. Michigan Future’s mission is to be a source of new ideas on how Michigan can succeed as a world class community in a knowledge-driven economy. Its work is funded by Michigan foundations.

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