UNDERAPPRECIATED & OVER REGULATED?

A grim assessment from the Manhattan Institute’s Oren Cass. The possible causes and potential solutions.

Aired on March 11, 2019. 

TRANSCRIPT

> THE SHOCKING RESULTS OF THE 2016 PRESIDENTIAL ELECTION SEEMED TO HAVE AWAKENED AT LEAST SOME WITHIN AMERICA'S RULING ELITE TO THE PROFOUND ECONOMIC AND SOCIAL CRISES BLIGHTING MUCH OF THE NATION.

BUT HOW DID IT COME TO THIS AND WHAT CAN WE DO ABOUT IT?

IN HIS NEW BOOK, 'THE ONCE AND FUTURE WORKER,' AUTHOR OREN CASS ARGUES THAT DECADES OF BAD POLICY HAVE SACRIFICED THE AMERICAN WORKERS IN THE ENDLESS PURSUIT OF RISING CONSUMPTION.

AND SAID THE NOVEL SETS A FOCUS THAT IS THE WORK THAT IS CAPABLE OF SUPPORTING STRONG FAMILIES AND COMMUNITIES.

OREN CASS RIGHT NOW.

THANK YOU SO MUCH FOR JOINING US TODAY.

THANK YOU FOR HAVING ME.

TELL US, WHAT IS ITS FUNDAMENTAL ARGUMENT?

SURE.

THE BOOK IS ABOUT WORK AT THE END OF THE DAY.

AND IT'S ABOUT THE IMPORTANCE OF WORK, NOT JUST INDIVIDUALS, BUT ALSO TO THEIR FAMILIES AND THEIR COMMUNITIES.

AND THEN TO THINKING ABOUT WHERE DOES WORK COME FROM?

I MEAN ULTIMATELY, WORK OCCURS WITHIN THE LABOR MARKET, WHICH IS THIS SORT OF BORING SOUNDING ECONOMIC CONCEPT.

BUT AT THE END OF THE DAY, IT'S THE PART OF OUR ECONOMY THAT DETERMINES HOW MANY JOBS WE HAVE, WHERE ARE THEY.

WHAT DO THEY PAY.

WHAT DO THEY PAY.

AND THE POLICIES THAT WE CHOOSE HAVE HUGE INFLUENCE ON WHAT HAPPENS IN THE LABOR MARKET.

UNFORTUNATELY, REALLY GOING BACK TO THE 1960s, WE HAVEN'T CHOSEN POLICIES THAT PAID ANY ATTENTION TO THE LABOR MARKET.

WE HAD THIS IDEA THAT AS LONG AS THE ECONOMIC PIE WAS GROWING, AS LONG AS EVERYBODY COULD CONSUME MORE, WE'D ALL BE HAPPY.

AND IN A SENSE, IT WORKED.

CONSUMPTION DOES KEEP GOING UP FOR EVERYBODY.

BUT IF YOU DO THAT IN A WAY THAT IGNORES THE LABOR MARKET, THAT DOESN'T PAY ATTENTION TO WHO'S WORKING AND WHETHER THEY CAN SUPPORT FAMILY AND COMMUNITIES, YOU CAN END UP WITH BOTH RISING CONSUMPTION, AND AT THE SAME TIME, REALLY BAD OUTCOMES FOR A LOT OF FOLKS IN SOCIETY.

AND I THINK THAT'S WHAT WE'RE SEEING.

AND YOU CALL THIS FOCUS ON CONSUMPTION ECONOMIC PIETIES.

AND YOU CALL WHAT YOUR PROPOSING PRODUCTIVE PLURALISM.

WHAT IS THE DIFFERENCE BETWEEN WHAT YOU'RE PROPOSING, PRODUCTIVE PLURALISM AND THE ECONOMIC PIETIES?

SURE.

SO ECONOMIC PIETY COMES TO THIS IDEA OF THE ECONOMIC PIE WHICH WE'RE REALLY USED TO SORT OF HEARING AT THIS POINT.

ALMOST EVERY PRESIDENT, DEMOCRAT, REPUBLICAN, HAS USED THE TERM.

'THE WALL STREET JOURNAL' AND 'NEW YORK TIMES' WERE BOTH EDITORIALIALIZE USING THE TERM.

WELL TAKE FOR GRANTED OH, YEAH, IF THE ECONOMY IS THIS THING AND IF IT KEEPS GETTING BIGGER, WE ALL GET A BIGGER SLICE, AND THAT'S TERRIFIC.

TO STRETCH THE METAPHOR MUCH TOO FAR, THAT IGNORES WHO IS BAKING THE PAR.

AS LONG AS YOU ARE GETTING A BIG ENOUGH SLICE, WHO DOESN'T LIKE PIE THIS WE'RE ALL GOING TO BE VERY HAPPY.

THE IDEA BEHIND PRODUCTIVE PLURALISM IS TO SAY LOOK, ECONOMIC GROWTH IN A GROWING PIE IS HUGELY IMPORTANT.

RISING CONSUMPTION AND LIVING STANDARDS IS A GREAT THING, BUT IT'S NOT THE END ALL, BE ALL.

THE ACTUAL CORE FOUNDATIONAL THING WE NEED TO BE FOCUSING ON IS MORE ABOUT PRODUCTION THAN ABOUT CONSUMPTION.

AND YOU SAY THAT'S THE IDEA THAT'S KIND OF DEVELOPED OVER THE LAST HALF CENTURY.

THAT'S RIGHT.

I THINK YOU SEE IT EMERGING REALLY IN THE 1960s THERE IS A LOT OF INTERESTING ECONOMIC TRENDS, THE GDP IS HOW WE MEASURE THINGS CULTURALLY TO THIS IDEA THAT EVERYONE'S AN INDIVIDUAL WHO IS TRYING TO MAKE THEMSELVES HAPPY.

AND IF WE HAVE MORE STUFF, WE'LL BE HAPPIER.

FOR A VERY LONG TIME, THERE WAS A MUCH MORRE ROBUST SENSE OF WHT WE WERE TRYING TO ACHIEVE AS A SOCIETY THAT WAS NOT JUST ABOUT CONSUMPTION.

AND IT WAS REALLY THE GREAT DEPRESSION, I THINK, AND THE SO-CALLED KEYNESIAN EFFORTS TO GET OUT OF THE DEPRESSION, THIS IDEA THAT WE NEED TO ESSENTIALLY USE GOVERNMENT SPENDING TO SPUR THE ECONOMY.

THAT'S WHEN WE STARTED SAYING, WELL, LET'S MEASURE GDP, AND THAT'S WHAT WE MEASURE.

AND THEN THE OTHER REALLY CRITICAL FACTOR WAS WORLD WAR II, WHICH CAME RIGHT AFTER.

WHEN YOU'RE IN A WORLD WAR, GDP, WHO CAN MAKE THE MOST STUFF THE FASTEST, THAT'S PRETTY IMPORTANT.

BUT HOW DO YOU RESPOND TO THOSE WHO WOULD MAKE THE ARGUMENT AND HAVE ALREADY MADE THE ARGUMENT THAT, LOOK, THE SYSTEM ECONOMIC PIETY HAS CREATED SO MUCH WEALTH FOR THIS COUNTRY THAT EVEN THE POOREST AMONG US HAVE GOODS AND SERVICES THAT THE WEALTHIEST LESS THAN A CENTURY AGO COULD ONLY DREAM OF.

AND IF YOU MONKEY AROUND WITH THAT, WITH THE GOAL OF EXPANDING THE PIE, YOU'RE JUST GOING TO MAKE EVERYONE POORER IN THE LONG RUN?

I THINK THERE ARE TWO THINGS I WOULD SAY.

ONE IS WE NEED TO BE CAREFUL HOW WE DEFINE WHETHER EVERYONE IS REALLY BETTER OFF.

THE FACT THAT YOU CAN GET A BIGGER FLAT SCREEN TV THAN YOU USED TO BE ABLE TO GET IS NICE, BUT IF YOU'RE LIVING IN A COMMUNITY THAT IS SEEING THE JOBS DISAPPEAR, IF YOUR OWN KIDS HAVE LESS OPPORTUNITY, IF YOU SEE YOUR HEALTH AND THE HEALTH OF THOSE AROUND YOU DECLINING, THAT'S NOT CANCELED OUT BY THE BIGGER TV.

WE'VE SEEN NOW REALLY GOING BACK SEVERAL DECADES IT TURNS OUT DECLINING HEALTH, FOR INSTANCE, PARTICULARLY AMONG LESS EDUCATED PREDOMINANTLY WHITE AMERICANS.

DECLINNG LIFE SPANS.

NATIONWIDE WE'VE NOW SEEN LIFE SPANS DECLINING THREE STRAIGHT YEARS.

GIVE US A SENSE OF HOW EXTRAORDINARY THAT IS, THE LAST TIME THAT HAPPENED WAS 100 YEARS AGO.

AND IT TOOK WORLD WAR I AND A GLOBAL FOOD PANDEMIC.

WHAT ABOUT WHEN PEOPLE SAY LOOK, STATISTICS SHOW IF YOU HAVE A COLLEGE DEGREE YOU WILL TEND TO EARN BETTER INCOME THAN IF YOU DON'T.

SO INSTEAD OF SHAPING THE LABOR MARKET OR THE POLICIES TO FIT THE EDUCATION AND KNOWLEDGE OF THE STRUGGLING AMERICANS, WHY DON'T WE RISE THEM UP IN EDUCATION BY FREE COLLEGE, FOR EXAMPLE, OR BY REEDUCATING WORKERS WHO HAVE LOST THEIR INDUSTRIES?

WHY NOT?

THAT TRADE-OFF YOU JUST DESCRIBED IS EXACTLY THE RIGHT ONE TO ASK ABOUT.

ARE WE GOING TO SAY ALL RIGHT, WE BETTER GEAR OUR ECONOMY AND SCOTTY TO THE PEOPLE WE HAVE, OR DO WE NEED TO FIND A WAY TO GEAR THE PEOPLE WE HAVE TO THIS IDEA OF THE ECONOMY IN SOCIETY?

AND IT'S NICE AND COMFORTING AND REQUIRES NO TRADE-OFFS FORBE ANYB IF WE LEAVE OUR EDUCATION SYSTEM COULD TRANSFORM EVERYBODY INTO PEOPLE WHO GET AHEAD.

WE HAVE NO IDEA HOW TO DO THAT AND NO EVIDENCE THAT WE CAN.

IF YOU LOOK AT THE K THROUGH 12, WE HAVE DOUBLED WHAT WE SPENDER PUPIL OVER THE PAST 40 YEARS.

TEST SCORES HAVEN'T MOVED.

IF YOU LOOK UP INTO HIGHER EDUCATION, CERTAINLY WE ARE PUSHING MORE PEOPLE IN, BUT THE SHARE THAT ARE ACTUALLY COMPLETING A BACHELORS ISN'T MOVING VERY MUCH AT ALL.

IN FACT, MOST AMERICANS DON'T EARN EVEN A COMMUNITY COLLEGE DEGREE.

EVEN THOSE WHO EARN A COLLEGE DEGREE, MORE THAN A THIRD END UP IN JOBS THAT DON'T REQUIRE A DEGREE.

WE'RE ALMOST OUT OF TIME.

WE BASICALLY JUST TOUCHED ON EDUCATION.

GIVE ME ANOTHER ONE THAT IS CRITICAL FOR US TO MOVE AWAY FROM THIS ECONOMIC PIETY INTO WHAT YOU'RE LOOKING AT.

SURE.

I THINK WHEN WE TALK ABOUT TRADE AND IMMIGRATION AND THE WAY WE APPROACH GLOBALIZATION, WE HAVE TO LOOK AT IT WITH A MUCH MORE CRITICAL EYE.

IN THEORY GLOBALIZATION CAN BE A WONDERFUL FORCE.

MORE TRADE, MORE IMMIGRATION CAN BE VERY GOOD FOR THE ECONOMY.

BUT IF YOU THINK IN TERMS OF WORKERS INSTEAD OF IN TERMS OF CONSUMERS, YOU REALIZE IT'S NOT AUTOMATICALLY A GOOD THING.

THAT BALANCE REALLY MATTERS.

IF WE'RE GOING TO DO MORE TRADE WITH OTHER COUNTRIES, WE NEED TO BE MAKING MORE THINGS FOR THE WORLD, NOT HAVE THE WORLD MAKE MORE THINGS FOR US.

IF WE'RE GOING TO BE HAVING HIGH LEVELS OF IMMIGRATION, IT NEEDS TO BE THE KIND OF IMMIGRATION THAT COMES TO THE PARTS OF THE LABOR MARKET THAT HAS SHORTAGES OF WORKERS, AND NOT -- IF WE BELIEVE ONE OF OUR BIG PROBLEMS IS RELATIVELY TOO MANY LESS SKILLED WORKERS IN THE LABOR MARKET, AN IMMIGRATION SYSTEM THAT ENCOURAGES MORE LESS SKILLED WORKERS INTO THE LABOR MARKET IS PUSHING IN THE WRONG DIRECTION.

OKAY.

WELL JUST SCRATCHED THE SURFACE OF WHAT YOU COVER IN YOUR BOOK.

IT'S A FASCINATING BOOK, 'THE ONCE AND FUTURE WORKER.'

OREN, THANK YOU SO MUCH.

THANK YOU.

IT WAS A GREAT CONVERSATION.

Funders

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