What the Election Can’t Change

Everyone is expecting a big Republican sweep here and across the country. More than likely a lot will change. And have real impact on people’s lives. But what won’t is the basic trends in the economy. Neither Ds nor Rs can change the reality that machines are increasingly able to do work that humans used to and that people – at all skills levels and in all industries – across the planet will increasingly compete with us for jobs.

So anyone who hopes that a combination of less government and weaker unions the Rs are offering as a solution to the economy will get us back to the economy of the late 90s or whenever in the past we think things were good is going to be disappointed. That economy is gone forever. The mega forces that are altering the economy – globalization and technology – are far more powerful than politics/policy. The era – in large part invented here – of a broad American middle class anchored by high paid factory jobs is never coming back. The fact is that what made us prosperous in the past, won’t in the future!

At the turn of the last century something like half of Americans lived and worked on farms. For more than a century, on a bi-partisan basis, we have tried to prop up the agriculture economy. We are still trying. It is probably the most heavily subsidized sector of the economy. The result: fewer than 2% of Michiganians and Americans work on a farm. In good times and bad times, when the Ds and when the Rs were in charge of Lansing or Washington, farming declined as a share of the American economy. Pro-farm policy was trumped by larger forces. One of the most important of which was machines doing the work humans used to do.

The same is true for factory jobs. In the Fifties something like one third of Americans worked in a factory. Today it is around 10%. All the projections are that as a share of the American workforce factory jobs will continue to decline. Michigan, which has historically been far more concentrated in factory work, is now around the national average. Just like in agriculture, in good times and bad times, when the Ds  and when the Rs are in charge of Lansing or Washington, factory work has and will continue to decline as a share of the American economy. Elections cannot change that trend.  Globalization and technology are the cause, not bad policy!

The loss of factory jobs is part of a larger trend: the decline of good paying, low education attainment  jobs. A broad middle class built on high paid blue collar jobs is gone forever. Neither party, no matter what their platform, can reverse that new reality. The challenge for policy makers is do they spend their time and resources trying to reverse irreversible trends – which is what most voters want – or do they focus on better positioning their constituents for the economy that globalization and technology are creating.  Tough choice. But what is clear is that the first path has no chance of succeeding, the second might.

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