Six ways the government could tackle economic inequality and job creation in the techno-turvy future.
Editor’s note: The following fireside chat, addressing the problem of jobs, was delivered by the President of the United States in 2021 and posted to YouTube and other channels.
On a Sunday night a week after my inauguration, I spoke to you about what we share as citizens of our Republic. As head of a new political party and chief executive of a national coalition, I urged us to put aside the partisan rancor and cultural skirmishing of recent years. Tonight, eight weeks later, I come to you a second time in the same spirit and by the same means, to tell you what we have been doing about jobs and what we plan to do in the future.
Today, many people worry that robots and other new technologies are taking our jobs, and they argue that the time has come to give every American an income sufficient to their basic needs. But our best advisers tell us the era when there are more people than can be usefully employed has not yet arrived. Unemployment is the lowest it’s been since 1969; as for a universal basic income, we can’t afford it yet. Now, no one denies that new technologies are transforming jobs. But in the past, technological revolutions have created new, better jobs. The urgent question today is whether automation is replacing well-paid work making and building things with uncertain gigs or badly paying service jobs.
Too many Americans know the answer to that question. Recent events have made a small number of us very rich while providing the rest with jobs we hate. Although wages are finally growing, that growth is still far too slow, and it comes only after 40 years of flat or falling incomes. Something is badly wrong with our economy. But the current challenge is the quality of our jobs, not their quantity.
Tonight, in the spirit of an earlier president, I announce a new New Deal, which will provide what all Americans want: work with meaning and an honest wage for honest labor in a new technological age.
First, we must understand where we are headed. Like a pilot in thick fog navigating with only antiquated instruments, we’ve been flying blind. It may alarm you to hear that the government has no idea how to measure productivity when so much economic activity is digital and many products and services are free. Experts tell us that data is the crucial intangible asset of the new century. But how is this data capital to be valued? And if data really are an asset, should we worry that a small number of companies control most of the data in the world? Right now, we don’t know the answers to these questions, but we have formed a new department within the Bureau of Labor Statistics, called the Poll/Bit Office, which will build tools to collect and analyze information about the economy.
Second, we must reinvent education at every level, because there is a mismatch between the skills Americans now possess and the jobs employers have and will want in the future. The problem cannot be solved by throwing money at schools, but money can help: My administration undertakes to make public education free in the United States, from daycare to graduate school. But we must also reimagine how we teach, because we know that in a time of rapid technological change, workers may have to change jobs several times in their lives. We must therefore teach children how to learn, by encouraging them to construct solutions to problems they find interesting. The Department of Education will give every child in public schooling access to a computer they can program, so that they acquire a sense of mastery over technology and forge an intimate understanding of the deepest ideas in science and mathematics. We must also cultivate in students creativity and interpersonal skills, areas where machines are still weak and may always be weak.
Third, we must find and fix the causes of the decades-long decline in American startups, because new jobs are created by men and women building new businesses that sell new products and services in new ways. We need to focus all our energies on helping those new businesses, not trying to preserve old ones. Government can help boost entrepreneurialism by providing tax and other benefits for inclusive innovation, which leads to affordable access to goods and services that create opportunities for excluded populations, and by reducing the regulations whose main function is to preserve the rents of incumbent companies.
Fourth, we must expand the Earned Income Tax Credit, which allows individuals and families earning low to middling incomes to keep more of their money. No one ever wrote a folk song about the EITC, but it is the best weapon we have to fight inequality, because it gives money directly to the Americans who need income most while encouraging them to participate in the workforce. Under this administration, more people will receive the Earned Income Tax Credit and they will all see more money in their bank accounts.
Fifth, we must spur overall growth by investing much more in research and development of healthcare and biotechnology, computer science and energy. Those investments will be made wisely, according to rational industrial policy, accepting that since markets are, in fact, shaped and created by government policies, we might as well be smart and farseeing about those policies. This administration will also put real public and private dollars to work rebuilding America’s crumbling infrastructure. Fixing our Internet bandwidth, roads, bridges, ports, airports, and schools will fund our future, but it will also lift workers out of the sidelines of the economy and into the middle class. Today, I announce a new Works Projects Administration that will put at least a quarter of million Americans to work.
Finally, we must pay for all these bold new ideas. We will need new policies that tax what economists call externalities, market failures that include pollution, carbon emissions, and gun violence, and we must tax less such good things as employment or investment.
The tradition whereby a president bids farewell to his audience by invoking the deity is of relatively recent origin, dating back to Presidents Nixon and Reagan. As many of you know, I’m not a regular church-going woman; I’m a scientist and a former university administrator, domains where God isn’t often called to our aid. But I have no hesitation in invoking a higher power to the great social problem of our time: how to unite the maximum liberty of individual action with a fairer participation for all in the benefits of combined labor. God bless you all, and God bless the United States of America.
Read the article on Wired here.