From the riots in Baltimore to the ballooning food stamp rolls, we witness in human terms the feebleness of the economic recovery. In front of the government and candidates for office should be the question, how to find good paying jobs and lifetime careers for people who have been socially promoted through public schools and maybe even college and now find themselves unemployed or under-employed? There are 92,000,000 unemployed adults in the country, many of them young, who have just dropped out of the economy. They may have few skills that employers need. Or they just never did very well in obtaining contemporary work skills, so they are not competitive with, say, highly motivated tech workers from overseas. At Microsoft the bosses expect excellence, not just good-enough. If you don’t make the cut, the job goes to someone in India or from India. Either way, many Americans lose.
Or, again, we encounter the really nice, smart, self-directed young person who was told to follow his or her bliss and then took the college courses that sounded cool, rather than those that would prepare them for the hard-knocks-life after school and when the tuition loans come due. They are looking around now, stuck and bewildered.
Those in the tech world, such as our former colleague Bret Swanson, writing for the U.S. Chamber of Commerce foundation, are absolutely right to insist that the slow growth economy will not lift the society as a whole. What Mitt Romney and the GOP was trying to say in 2012 was that encouraging entrepreneurs would create the new businesses, and hence opportunities, to help tighten the labor market and raise wages. Speaking yesterday at Heritage Foundation’s Resource Bank conference in Bellevue, WA, venture capitalist Matt McIlwain of Madrona, LLC in Seattle described the folly of enacting “net neutrality,” effectively a government take-over of the Internet. The free Internet may have killed some jobs, but it also has been the greatest source of new jobs in the past generation. Imagine if the government had regulated it as it has done the phone companies!
The Wall Street Journal editorial page today (behind a pay-wall) is also right in observing that the people making money in this economy of low interest rates and high regulatory barriers to innovation are largely in the financial world,lawyers doing mergers and deal makers with government contacts.
Such is the real rigging of the the economy, and it causes the very inequality that the left uses to demand more leveling. In reality, the real problem with inequality is not too many real business people getting rich, but that we have a lot of people who are not getting ahead because they have arrived in their ’20s with slim prospects or have lost jobs and are unable to match the requirements of new ones. Yes, there are minimum skill jobs opening in food, entertainment, health services (from massage therapy to senior care)–in short, anything that can’t be handled cheaper and better by lower price workers overseas or by a robot in America. But there aren’t enough of those jobs.
It is conceivable that the technology of the future is arriving at such a speed that a smaller and smaller share of the population will be required to produce wealth. So what happens to everyone else? In ancient times the problem was the reverse. Greeks, Romans, and medieval aristocrats needed slave or serf labor to produce enough surplus to make a leisured living possible for the cultivated few. Soon now the few may produce so much surplus that they need to find ways to keep all the others busy. Inactivity breeds decay, not to mention dissatisfaction. We need superior ways to create jobs that require people to fulfill them, are cost-effective and advance the civilization.
We have had economic turmoil before and survived well. One thing that is sure, however, government cannot be where the jobs operate if the prosperity is to be lasting–and demoralization of the young ended.