are pretty much what you would expect from an elderly white dude. What is remarkable is that he has the honesty to reveal that lots of darkies turning up on the shores of Europe and the US was bad for the indigenous working class. Sadly, things might have been worse without those immigrants. Technological progress might have stalled and a 'stasis' of stagflation and negative real returns crippled the west.
Second thoughts
Like most of my age cohort, I long regarded unions as a nuisance that interfered with economic (and often personal) efficiency and welcomed their slow demise.
Now Angus believes they may have their uses- because resurrection after death is a real thing- right? Indeed, the Zombie apocalypse might be a good thing. My question is why not revive Guilds and Robber Barons living in Castles? If Unions can come back, why not also bring back the Spanish Inquisition?
But today large corporations have too much power over working conditions, wages, and decisions in Washington, where unions currently have little say compared with corporate lobbyists.
But if Washington uses its power to do stupid shit, it will soon end up with less. That might lead to a faster relative economic decline for the American worker.
Unions once raised wages for members and nonmembers,
there are many powerful Unions which can still do so. But can they also raise productivity? If not, this is a mere redistribution of economic rent. But all rent disappears in the long run even in non-tradables because ultimately they too are about productivity.
they were an important part of social capital in many places, and they brought political power to working people in the workplace and in local, state, and federal governments.
More especially public sector industries.
Their decline is contributing to the falling wage share, to the widening gap between executives and workers, to community destruction, and to rising populism.
The proportion of retired people in the US has risen from 10 percent in 1970 to about 18 percent now. Wage share was bound to decline.
Daron Acemoglu and Simon Johnson have recently argued that the direction of technical change has always depended on who has the power to decide; unions need to be at the table for decisions about artificial intelligence.
In which case China wins. Even the Iranians will have cheap, ubiquitous, 'out of control' AI powered drone swarms making our aircraft carriers and nuclear submarines obsolete.
Economists’ enthusiasm for technical change as the instrument of universal enrichment is no longer tenable (if it ever was).
Economists can do nothing about technical change. The question is whether America can keep its 'exorbitant privilege' and ability to set the rules for Intellectual Capital. Silly question. That cat is out of the bag.
When efficiency comes with upward wealth redistribution, our recommendations frequently become little more than a license for plunder.
Economists don't have any power. They can't license shit.
I am much more skeptical of the benefits of free trade to American workers
lots of well-paid American workers are protected from free trade- e.g. in defense related industries. But productivity still matters. If our weapons systems are overpriced or obsolete, we may have to abandon them and the workers who make them.
and am even skeptical of the claim, which I and others have made in the past, that globalization was responsible for the vast reduction in global poverty over the past 30 years.
It is obvious that countries which open themselves up to trade and fdi can grow rapidly lifting many out of poverty through urbanization, industrialization and technological innovation.
I also no longer defend the idea that the harm done to working Americans by globalization
Clinton and Bush could have extracted more of the gains from trade from China but America preferred to focus on killing Muslims.
was a reasonable price to pay for global poverty reduction because workers in America are so much better off than the global poor. I believe that the reduction in poverty in India had little to do with world trade.
It had a lot to do with trade liberalization.
And poverty reduction in China could have happened with less damage to workers in rich countries
those workers benefited by buying cheap Chinese goods
if Chinese policies caused it to save less of its national income, allowing more of its manufacturing growth to be absorbed at home.
But, they too have to save for their retirement. The alternative, I suppose would be to encourage migration from South East Asia.
I had also seriously underthought my ethical judgments about trade-offs between domestic and foreign workers.
This is because Angus 'underthought' economics. It is about productivity. He thought it was about saying 'the rich should give to the poor'. But any blind beggar can say that. It is not economical for guys with PhDs to devote their lives to virtue signaling.
Had the productivity of domestic workers gone up- even if this meant telling Trade Unionists to go fuck themselves- then there would be no need to fear foreign workers.
We certainly have a duty to aid those in distress,
No. Only those who can genuinely help could have any such duty.
but we have additional obligations to our fellow citizens that we do not have to others.
One obligations economists have is to explain that productivity is all that matters. Raising productivity involves changing what you do or how you do it or where you do it.
I used to subscribe to the near consensus among economists that immigration to the US was a good thing,
Deaton emigrated to the US
with great benefits to the migrants and little or no cost to domestic low-skilled workers.
Relative decline may have been inevitable for those with stagnant productivity.
I no longer think so. Economists’ beliefs are not unanimous on this but are shaped by econometric designs that may be credible but often rest on short-term outcomes. Longer-term analysis over the past century and a half tells a different story.
But that story is only about productivity. The less productive lost control of resources and declined in relative terms. But that has been true for tens of thousands of years.
Inequality was high when America was open, was much lower when the borders were closed,
But this had to do with World Wars and intense socio-economic change- e.g. the rise of the working woman.
and rose again post Hart-Celler (the Immigration and Nationality Act of 1965) as the fraction of foreign-born people rose back to its levels in the Gilded Age.
The foreign born actually have higher Union participation.
It has also been plausibly argued that the Great Migration of millions of African Americans from the rural South to the factories in the North would not have happened if factory owners had been able to hire the European migrants they preferred.
There's an element of truth in that. The odd thing is that 'ethnic' Unions- e.g. Polish dominated longshoremen- were actually more skilled, efficient and raised productivity. It seems immigrants believe in an American dream involving productivity not whining about the rich.
Economists could benefit by greater engagement with the ideas of philosophers, historians, and sociologists, just as Adam Smith once did.
No such Academic specialisms existed at that time. Hume wrote Philosophy or History in response to market demand.
The philosophers, historians, and sociologists would likely benefit too.
No. Having to study worthless shit and then teach that shit to drooling imbeciles turns you into a drooling imbecile. Concentrate on demanding the immediate ban of non-homosexual dicks. This is because dicks cause RAPE! Cancel them immediately.
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