If the question at the top of this opinion piece reads as flippant, that’s because it is. How else to respond to Columbia economics professor Glenn Hubbard than with flippancy born of mystification?
In an opinion piece of his own titled “The Trump Economic Awakening,” Hubbard chose to speak for all Americans in platitudes: “They want an economic awakening, a new way forward that uses traditional economic policies to achieve Mr. Trump’s goal of more jobs for Americans whose fortunes have been harmed by technological change and globalization.” Where to begin?
Are the most advanced locales in the U.S. and the world the ones most bereft of technological change, meaning technological advance? Hopefully the question answers itself. While some truly do like to “get back to the land,” the reality is that those in search of opportunity go to where life is evolving the fastest. Meaning they go to where technological change is most apparent. How interesting to ask Hubbard to name the locales that are both magnets for human capital while also slow-rolling the arrival of technology. Backwards sells while revealing abundant opportunity? Please tell us where.
As for globalization, it’s funny and interesting at the same time that Americans in general, and economists like Hubbard in particular, never write of the Arkansans harmed by economic activity in Tennessee, or Arizonans harmed by workers in Utah. They don’t precisely because there’s no harm.
Jobs aren’t finite as Hubbard’s analysis imagines, rather they’re limitless. All the addition of people and machines do is raise the odds that the individuals who comprise any “economy” will get to specialize, work more productively, or frequently do both. The more productive we are, the better our pay. Which is a reminder that “globalization” is just a globalized version of what takes place daily in the United States, and that raises neither a human nor economist eyebrow. It’s called progress, which is all that work divided is.
If Hubbard really wants to see an enraged electorate, let’s wall the U.S. off to the rest of the world. Jobs will still be plentiful, but the pay associated with the work will plummet. So will living standards. So will specialization.
Just as Spokane’s economy is in no way harmed by technological advance in Seattle, neither is what’s happening in Shanghai the problem for Flint. But government planning is. Hubbard typically wants a lot of the latter. To aid Americans allegedly harmed by modernity and work divided, Hubbard calls for the “permanent expensing of business investment” in concert with an increase in “support for science and defense research,” along with a plan to “build on this research by constructing applied research centers around the country.” Translated, Hubbard wants industrial policy.
Except that economic progress cannot be planned. By definition. If actual producers actually knew what the future of commerce would be, the future would already be here. Since it’s not, how dangerous for Hubbard to be calling for the federal government to extract precious resources from the private, market-disciplined sector in favor of command-and-control resource allocation of the kind dreamed up by economists and politicians. In calling for industrial policy Hubbard is calling for reduced economic vitality, which has to be a redundancy of some kind.
If per Erich Segal, “love is never having to say you’re sorry,” then being an economist “is never having to suffer your errors in thought.” But the people really do suffer, while economists just pivot to their next solution to make up for the previous harm. Better to just skip the economic policy, and move to Flint. The results will be the same.
