Multipliers

1 comment August 29th, 2011at 07:40am Posted by Eli

Very good, long story in this week’s NYT Magazine about the decline of manufacturing in the US.  There’s a lot of interesting stuff in there about lithium-ion batteries and the future of the electric car business, but the biggest takeaway for me is that because “industrial policy” is a dirty word, we now have an economy structured around industries like software and finance that don’t employ nearly as many people as manufacturing, so that even if GDP does start growing, it won’t translate into nearly as many jobs as it should.

It’s kind of like basing a stimulus plan on tax cuts for the rich, in other words.  Or basing an election campaign on appealing to independent voters instead of the base.

Entry Filed under: Economy,Unemployment

1 Comment

  • 1. Taylor  |  August 29th, 2011 at 12:21 pm

    Correct, we have apparently moved from an industrial economy to an information economy, which unfortunately requires a lot less labor. Moreover, the labor it does require is the kind where you just sit and type for hours and hours and don’t actually, you know, LABOR on anything, which then contributes to the whole populace being out of shape, as well.

    Look, as someone about to go for a communications master’s degree, I value information, but even I can see it’s no proper basis for an economy, especially a consumer economy.

    Unless we’re selling some very high-priced information products back to the developed world in exchange for their cheap-ass labor, WE are the ones getting screwed here (except for those who own businesses; they have been enjoying insane profits as they pay workers a dollar a day rather than $7.50 an hour).


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