Tag Archives: Brookings Institution

Meanwhile…

Public Policy and Governance, , ,

On the Late Show, Stephen Colbert has a recurring comedy bit he calls “Meanwhile.” Not part of the opening monologue, it’s a collection of brief–usually weird or ironic– items culled from the news of the day.

But “meanwhile” also has application to those of us who are fixated on contemporary threats to America’s Constitution and democratic norms. While we worry about the increasingly bizarre behavior of our fellow-Americans who live in a fact-free reality of their own devising, we ignore or just miss the daily challenges posed by technology–everything from the way social media is altering attention spans, to the mounting inability of the nation’s utilities to cope with the damage being done by climate change, to the rush to turn our highways over to self-driving vehicles.

That last item–the (debated) imminence of self-driving cars– is just one element of another under-appreciated threat: the loss of millions of jobs, and the issue of how we will handle the transition to a world where most labor (not just manual labor) is performed by machines. An enormous amount of research suggests that, sooner or later, AI–artificial intelligence–will replace a significant percentage of tasks that now require human performance.

It is easy to “pooh-pooh” those predictions, and to dismiss the likelihood of significant social disruption, by pointing out that someone will have to produce and program those machines, and noting that past technological progress has created as well as destroyed jobs. The cheery optimists insist that nothing is certain, so why worry? (Tell that to the estimated five million people who make their livings driving…)

The Brookings Institution has weighted in. In a paper aptly  titled “Preparing for the (non-existent) future of work,” the researchers write,

We analyze how to set up institutions that future-proof our society for a scenario of ever-more-intelligent autonomous machines that substitute for human labor and drive down wages. We lay out three concerns arising from such a scenario, culminating in the economic redundancy of labor, and evaluate recent predictions and objections to these concerns. Then we analyze how to allocate work and income if these concerns start to materialize. As the income produced by autonomous machines rises and the value of labor declines, we find that it is optimal to phase out work, beginning with workers who have low labor productivity and job satisfaction, since they have comparative advantage in enjoying leisure. This is in stark contrast to welfare systems that force individuals with low labor productivity to work. If there are significant wage declines, avoiding mass misery will require other ways of distributing income than labor markets, whether via sufficiently well-distributed capital ownership or via benefits. Recipients could still engage in work for its own sake if they enjoy work amenities such as structure, purpose, and meaning. If work gives rise to positive externalities such as social connections or political stability, or if individuals undervalue the benefits of work because of internalities, then there is a role for public policy to encourage work. However, we conjecture that in the long run, it would be more desirable for society to develop alternative ways of providing these benefits.

You can download the entire paper at the link.

The likelihood that much of world’s work will eventually be done by machines that don’t get sick, don’t need benefits, and can work 24/7 is part of what leads me to support a Universal Basic Income– an “alternative way” of providing a social infrastructure.

Analyzing America’s current polarization provides another argument for a UBI.   As political rhetoric makes clear, policies intended to help less fortunate citizens can be delivered in ways that stoke resentments, or in ways that encourage national cohesion.  Currently, we’re stoking resentments. (Consider public attitudes toward welfare programs aimed at impoverished communities, and contrast those attitudes with the overwhelming majorities that approve of Social Security and Medicare–universal programs to which virtually everyone contributes and from which virtually everyone who lives long enough  benefits.)

I’ve previously observed that we don’t hear angry accusations that “those people” are driving on roads paid for by my taxes.  Beneficiaries of programs that include everyone (or almost everyone) are much more likely to escape stigma. If work disappears for a significant percentage of our population, an approach that doesn’t require lawmakers to pick and choose who deserves help would be far less likely to tear the country further apart.

Of course, the armed and dangerous Americans who currently live in crazy-town may make attention to these “meanwhile” matters irrelevant. They involve questions of governance that they disdain, because they involve how best to achieve the common good, and they have absolutely no interest in helping anyone but themselves.

The Trump Court

Public Policy and Governance, , ,

I’ve been on the email list of the Brookings Institution for a number of years. It was–and is– an excellent source of thoughtful, balanced policy analyses, and it provided me with valuable background for my classes when I was teaching Law and Policy.

Over the years, I’ve become accustomed to the language and style of Brookings publications–very consistent with that of academic discourse and a variety of other highly credible, scholarly resources. (Not like the snark you often get here.) So I was bemused–to put it mildly– by the opening paragraphs of a recent essay. 

“We hold that Roe and Casey must be overruled. The Constitution makes no reference to abortion, and no such right is implicitly protected.” With those chilling words an illegitimately obtained Supreme Court majority tore up the lives of Americans & the Constitution in the Dobbs opinion authored by Justice Samuel Alito. The votes for this opinion were only available because Merrick Garland was wrongly blockaded at the end of the Obama administration and Amy Coney Barrett hypocritically jammed through at the end of the Trump one.

The Alito opinion comes in the midst of congressional hearings exposing the sickness of Trump’s style of governance—Trumpery, as we term it in a new book. The Dobbs opinion also exemplifies Trumpery, and its features provide a useful framework for understanding just how bad the opinion is. The Court should be known from here on out as the Trump Court.

Perhaps the single most defining characteristic of Trumpery is its disdain for the rule of law. The Alito opinion in the Dobbs case has that in spades. A central tenet of Supreme Court jurisprudence is stare decisis, the idea that once the Supreme Court has ruled on something, it is settled law and is entitled to permanence, even if later courts may disagree with it. That is particularly true where you have a decades long established precedent like Roe.

It is certainly true that past Courts have overruled settled precedents when it has become blindingly obvious that they are unjust and/or inconsistent with contemporary science and mores–Plessy v. Ferguson and Bowers v. Hardwick come to mind. But the thrust of the quoted paragraph is accurate; until the elevation of theocratic jurists intent upon the destruction of jurisprudence equating  liberty with a significant degree of personal autonomy, precedents were accorded a high level of deference.

The essay proceeded to compare the current iteration of the Supreme Court to Trump’s incessant assaults on democratic norms– assaults that the January 6th Committee hearings are meticulously documenting.

As we are being painfully reminded in the Jan. 6 hearings, that assault over time undermined and weakened the executive branch and Americans’ faith in it. Alito and the five justices who joined with him are sending the Supreme Court down that same slippery slope.

The authors make a point that I have made repeatedly in the wake of this deeply dishonest decision–it didn’t just take aim at abortion. It was a point that Justice Thomas acknowledged in his concurrence:

“in future cases, we should reconsider all of this Court’s substantive due process precedents, including Griswold, Lawrence, and Obergefell.” Americans’ right to contraception, to make consensual choices in the bedroom and to same-sex marriage are all up for grabs. How long before states are also free to re-criminalize premarital sex and interracial relationships?

There are other parallels: Trump was shameless, and the authors point out that–like Trump–Alito displays absolutely no embarrassment about the rampant dishonesty of his opinion, dishonesty that was necessary in order to reach a result he personally favored. Nor does this Court care about the social consequences of a predictably divisive opinion. Alito wrote “We cannot allow our decisions to be affected by any extraneous influences such as concern about the public’s reaction to our work.”

Of course, concern about public reaction is one reason for the doctrine of stare decisis, which aims to avoid abruptly upsetting long-settled rules and expectations. Intensifying social divisions was also a Trumpian trademark, and as the authors note, “this opinion smacks of a similar approach.”

It’s hard to disagree with the authors’ conclusion that this decision–one of this term’s string of shocking and damaging departures from settled jurisprudence– will decimate  what is left of the legitimacy of the Supreme Court.

Although it was news to Alabama’s current Senator, the U.S. has three branches of government. Unfortunately, none are currently functional.

We have a gridlocked Congress, immobilized by lawmakers putting fealty  to party over loyalty to country; an Executive whose agenda is obstructed by that Congress; and now, a rogue Court disdained and distrusted by a majority of citizens.

That’s a description of a failed state.

No wonder the language employed by Brookings these days is less restrained.

Majority Rule

Constitution, Personal Autonomy, Public Policy and Governance, , ,

Majority rule in our democratic republic is more complicated than we like to think.

For one thing, our particular form of government carves out matters that are specifically insulated from what the Founders called the “passions of the majority”–the individual liberties enumerated and “reserved to the people” by various provisions of the Bill of Rights. For another, in those areas where majority opinion is supposed to count, our mechanism for determining what a majority of citizens really wants  is the vote–and not every citizen entitled to cast a vote does so. (The differences between what popular majorities want and what gets enacted can often be seen by comparing polling and survey research with legislation passed by victorious candidates.)

And don’t get me started on the Electoral College.

Then there’s the distortion regularly provided by media–very much including Twitter and Facebook, etc. We too often assume that the loudest and most persistent voices reflect the opinion of majorities–and that is not a well-founded assumption.

Take, for example, the issue of vaccine mandates.

A recent report by the Brookings Institution’s William Galston suggests that requiring vaccination is a lot more popular than we might imagine if we only listened to the hysterical purveyors of misinformation and conspiracy theories. (Recently, those vaccine deniers were accurately–if intemperately–labeled “assholes” by the Mayor of West Lafayette, Indiana. I don’t know him, but I’m pretty sure I’d really like him.)

Galston did a deep dive into the data. Not surprisingly, he found that unvaccinated Americans were less concerned about COVID than those who’d had the sense to get vaccinated.

In the face of massive evidence to the contrary, more than half of unvaccinated adults regard getting vaccinated as a bigger risk to their health than is getting infected with the coronavirus. Only one in five of the unvaccinated say that the spread of the delta variant has made them more likely to get vaccinated. These data do not support hopes that the recent outbreak will suffice to increase vaccination rates enough to bring the pandemic under control.

The data also reflects surprisingly robust support for vaccine mandates.

Since the beginning in March 2020, government’s response to the pandemic has occasioned intense controversy, much of it along partisan lines. Although the level of conflict remains high, recent events have solidified public support for the most intrusive policy government can undertake—mandatory vaccinations. According to a survey conducted by the Covid States Project, 64% of Americans now support mandatory vaccinations for everyone, and 70% support them as a requirement for boarding airplanes. More than 6 in 10 say that vaccinations should be required for K-12 students returning for in-school instruction as well as for college students attending classes at their institutions. And the most recent Economist/YouGov survey found that more than 60% support mandatory vaccinations for frontline workers—prison guards, police officers, teachers, medical providers, and the military—and for members of Congress as well…

“Solid majorities of every racial and ethnic group support vaccine mandates, as do Americans at all levels of age, income, and education.

The data also supports the growing recognition by sane Americans that the GOP has  devolved into a cult of anti-science, anti-evidence, crazy folks: Only 45% of Republicans support vaccine mandates, compared to 84% of Democrats.

When I sent my children to school, I was required–mandated– to provide evidence that they’d been vaccinated, and thus did not threaten the health and safety of the other children with whom they would be taught. When I was young myself, Americans lined up with gratitude to receive the polio vaccine that would allow them to avoid the alternatives–death, or imprisonment in iron lungs.

When providing for “the General Welfare” requires rules–mandates– a majority of us understand that such mandates not only do not infringe our liberties, but actually give us more liberty–allowing us to go about our daily lives without the danger of infection (or the need to wear a mask).

Vaccine mandates are supported by medical science, by law, by morality, and by a majority of Americans. We periodically need to remind ourselves that “loudest” doesn’t equate to “most”–and that a fair number of the hysterical people shouting about “personal freedom” can’t define it and don’t want their neighbors to have it.

 

 

The Robots Are Coming…

Public Policy and Governance, ,

When I opened my email a few days ago, the first thing that popped up was an article from the Brookings Institution titled “The Robots Are Ready as the Covid-19 Recession spreads,” predicting that a coronavirus-related downturn will increase the rate at which American industry invests in labor-replacing automation.

As I have previously argued, jobs don’t matter simply because most of us need to put food on the table. Having a job–even a job we dislike–gives most of us a sense of purpose and identity. (There is a reason so many people die shortly after retiring.)In “The Truly Disadvantaged,” William Julius Wilson noted the significant differences between neighborhoods where residents are poor but employed and neighborhoods where residents are poor and jobless.

The longterm trend was worrisome well before the advent of the Coronavirus: American economic mobility and job creation had already begun to slow, largely as a result of policies favoring larger firms over the entrepreneurial start-ups that were once responsible for the creation of most new jobs. Numerous studies have documented what Brookings calls “a steady and significant increase in consolidation” Thanks to anemic anti-trust enforcement, the number of so-called “mega-mergers” has increased, and as the market power of these huge companies grows, competition decreases. The under-enforcement of anti-trust laws has reduced entrepreneurship, increased predatory pricing practices and economic inequality, and resulted in the concentration of economic growth.

Rather than the vigorous competition that characterizes healthy markets, we have increasingly moved from capitalism to corporatism, or crony capitalism, in which government shields favored industries and companies from competitive pressures rather than acting as the guarantor of a level playing field.

Until recently, people expressing concerns about job losses have focused their criticisms on the outsourcing of manufacturing to low-wage countries, ignoring what is by far the biggest contributor to job loss–  automation, and the replacement of workers by machines.

A 2018  study by Ball State University found that just since 2000, nine out of ten manufacturing workers have been replaced by automation. That same year, the Pew Research Center asked approximately 1900 experts to opine on the impact of emerging technologies on employment; half of those questioned predicted the displacement of significant numbers of both blue- and white-collar workers by robots and digital agents, and predicted that those displacements will lead to serious consequences: larger increases in income inequality, masses of people who are unemployable, and breakdowns in the social order.

Forecasts varied widely. One analysis, by the Organization for Economic Cooperation and Development, predicted that ten percent of the jobs in advanced economies will be automated, while scholars at Oxford University warned that 50% of American jobs are at risk. Obviously, no one can say with confidence how many jobs will be lost, or which workers will sustain those losses, but technologies now in development threaten millions.

Think about the numbers. There are 3.5 million professional truck drivers in the United States, and another 1.7 million Americans drive taxis, Ubers, buses and delivery vans for a living. Self-driving cars, which are already being road-tested, could put them all in the ranks of the unemployed.

Think skilled workers are immune? Think again.  Reports show accelerating automation of jobs held by skilled knowledge workers engaged in data-driven decision-making. Between 2011 and 2017, Goldman Sachs replaced 600 desk traders with 200 coding engineers. Even medical professionals are at risk: in 2017, Entilic, a medical start-up, reported that its AI algorithm “outperformed four radiologists in detecting and classifying lung modules as either benign or malignant.” In 2016, the World Economic Forum projected a total loss of 7.1 million jobs to automation, including jobs in advertising, public relations, broadcasting, law, financial services and health care.

Automation will obviously create jobs as well as destroy them, but that will be cold comfort to that 55-year-old truck driver with a high-school education–he isn’t going to move into a new position in Informatics.

What does the current pandemic have to do with this longterm trend? According to Brookings:

Robots’ infiltration of the workforce doesn’t occur at a steady, gradual pace. Instead, automation happens in bursts, concentrated especially in bad times such as in the wake of economic shocks, when humans become relatively more expensive as firms’ revenues rapidly decline. At these moments, employers shed less-skilled workers and replace them with technology and higher-skilled workers, which increases labor productivity as a recession tapers off.

America wasn’t prepared for a pandemic, and we won’t be prepared for the civic unrest exacerbated by widespread joblessness. We are going to require skilled leadership, and that leadership will not be provided by the Party of the Past, led by a mentally-ill ignoramus.

 

All Cost, No Benefit

Local Government, ,

Every city of any size, and every state, has a government agency charged with “economic development.” Economic development is almost always a euphemism for luring new employers to the city or state.

A productive discussion about what a genuine effort to improve the local economy should and should not entail is considerably overdue. Such a re-examination remains unlikely, but here and there, investigations of current practices do remind us that not everything we call an “incentive” deserves the name.

Which brings us to Wisconsin, Scott Walker and Foxcomm. A report from the Brookings Institution recently described that embarrassing boondoggle:

In 2017, the state of Wisconsin agreed to provide $4 billion in state and local tax incentives to the electronics manufacturing giant Foxconn. In return, the Taiwan-based company promised to build a new manufacturing plant in the state for flat-screen television displays and the subsequent creation of 13,000 new jobs.

It didn’t happen. Those 13,000 jobs never materialized, and plans for the manufacturing plant have been consistently scaled back. Even if the project had gone through as planned, there is no way the Foxconn subsidy would have made money for the state, or provided earnings benefits for residents that exceed its costs. It now appears that few of Foxconn’s promises will be fulfilled, even though local governments have gone into debt over the project.

The Foxcomm “deal” was widely panned at the time, but as Brookings reports, criticisms of that effort were mostly based on the enormous size of the incentives being offered, not on the underlying concept. But since 1990, even the average size of these business incentives has tripled, threatening public services and the social safety net.

Even when the incentive being offered is comparatively modest, however, research doesn’t confirm the underlying assumptions of the approach. At least 75% of the time, the incentives don’t really affect the relocation decision one way or the other.

They’re all cost and no benefit. Furthermore, even when incentives do tip a location decision, they do not pay for themselves. They may create new jobs, but frequently they also bring in new workers from outside the city or state, which raises costs to public services that offset at least 90% of any increased revenue…On average, only 10-30% of new jobs go to state residents who are not already employed.

Are there incentives that would work? Brookings says there are, and offers the following checklist:

Do the incentives target the right businesses?

Will the business provide multiplier effects? When the business buys from local suppliers, it helps increase jobs at those companies. Workers employed at the business, too, will buy from local retailers, increasing those jobs.

Is the business “traded”—i.e., selling its goods and services outside of the state or community? Incentives to non-tradeable firms will just displace jobs at other local non-tradable firms.

Is the real job multiplier accurately calculated? Multipliers can be overstated if they ignore the increased local costs that accompany business growth.

Is the business locally owned? Locally owned firms spend more of their revenue locally, benefiting the hometown economy.

Do the incentives target the right areas?

Incentives should target economically distressed local areas, with more available labor that is not employed. That way, the share of new jobs that go to local residents can be two to three times as great, compared to already-booming areas.

Do the incentives target high-tech businesses in an area with an above-average high-tech base? High-tech businesses have additional multiplier effects because they support and spawn other local firms whose workers and ideas flow from one to another. But this only works when the area has a sufficiently large “cluster” of tech firms to build from.

Are they the right type of incentives?

Are they structured so cash incentives occur upfront? Upfront incentives are more cost-effective in affecting business location decisions, because they are more relevant to business decisionmakers who focus on the short term.

Do they include enticements/requirements to hire locally? For example, customized training programs can encourage firms to hire the local unemployed.
Do they include a healthy share of customized businesses services, or is it all cash giveaways? Business services such as job training, business advice to smaller businesses, and new transportation infrastructure can have job creation effects per dollar that are five to 10 times greater than tax or cash incentives.

Do the incentives avoid robbing Peter to pay Paul? If governments pay for incentives by decreasing public spending on education, training, or infrastructure, the negative economic development effects of those budget cuts may exceed any benefits from the incentives.

Finally, is there a decent model to accurately assess the impact of the incentive?

There are practical ways to evaluate incentives. We can compare assisted with unassisted firms, or assisted areas with unassisted areas. There are good estimates of how many location decisions will be swayed by a cash incentive package of a particular size, and how many jobs per dollar will be created by a high-quality customized job training program. State and local government researchers can combine these evaluation approaches with models of local labor markets and fiscal impact to see whether a specific incentive package’s benefits are likely to exceed its costs.

Finding the right answer depends on asking the right questions–not on constantly sweetening the pot.