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Tyler Cowen [Email him] is an economist at George Mason University, a New York Times columnist, the author of countless books,

and, most influentially, the main man at the popular Marginal Revolution blog. He’s a bright, tireless guy. So for years I’ve been pointing out to him the lack of realism in many of his assumptions about how the world works.

This hasn’t made him terribly happy. Thus, for example, Cowen’s 2009 post Why Steve Sailer is wrong—where he took a terrible drubbing in his comments from those better informed than himself. Nevertheless, losing a lot of arguments has slowly pushed Cowen toward a somewhat more pragmatic, more Sailerian perspective—exemplified by his newest and most-talked about book, The Great Stagnation.

(To be precise, The Great Stagflation an electronic file somewhere in length between a magazine article and a real book. It’s available from Amazon for the Kindle or the PC for $4.)

Cowen writes:

“Median wages have risen only slowly since the 1970s, and this multi-decade stagnation is not yet over. Typical individuals in earlier generations reaped much greater gains than ours, as their living standards doubled every few decades. … A lot of the prosperity of the ‘noughties’ was built on debt, inflated home prices, and economic illusions.”

This slowdown in growth since 1973 for the typical family has been hugely costly. Median income is currently around $54,000, but, Cowen says, “… if median income had continued to grow at its earlier postwar rate, the median family income today would be over $90,000.”

The economist offers three main reasons for this stagnation, all three of which I’ve been discussing for years. Cowen sums them up in a single concept:

“All of these problems have a single, little noticed root cause: We have been living off low-hanging fruit for at least 300 years. Yet during the last forty years, that low-hanging fruit started disappearing, and we started pretending it was still there.”

According to Cowen, <st1:country-region
w:st=”on”>America has benefited historicallyfrom three main kinds of “low-hanging fruit”:

Cowen’s first explanation for <st1:country-region
w:st=”on”>America’s traditional well-being—“Up through the end of the nineteenth century, free and fertile American land was plentiful and there for the taking”—is a rewrite of Benjamin Franklin’s 1751 argument for limiting immigration,On the Increase of Mankind.

Moreover, improvements in transportation, especially the automobile, continued to make a huge amount of suburban land conveniently accessible in the 20th Century. The last year of the long postwar boom was 1973 in large part because the energy crisis that began then made the half-century old American economic model of spreading out further across the suburban landscape less of a sure thing.

Cowen’s second contention is that technological progress, outside of electronics, has slowed dramatically from its peak in roughly 1880-1940, which saw the introduction of electricity and automobiles.

This one is harder to measure, but I’ve been arguing much the same for about 15 years. The founding fathers of science fiction, Jules Verne, H.G. Wells, and Robert A. Heinlein, envisioned human progress as acontinuation of the trend that began with the development of the steamboat around 1807: going faster. The faster we go, the more land per person is conveniently usable. Thus, Heinlein, who began publishing science fiction in 1939, extrapolated to a future of flying cars and outer space settlement.

The future ain’t what it used to be. Dude, where’s my flying car? (By the way, my father’s first job was designing one piece of a flying car. The concept was that you drove it out to a straight stretch of highway in the country, bolted the wings on to the roof and the propeller onto the crankshaft, and up, up and away you went. Only a small number of these flying cars were built before the government declared it unsafe.)

Lately, though, people have actually been going slower. No human being has gone the 25,000 mph it takes to get to the moon in almost 40 years. You can’t even fly to Europe supersonically on the Concorde anymore. As Cowen notes: “It would make my life a lot better to have a teleportation machine. It makes my life only slightly better to have a larger refrigerator that makes ice in cubed or crushed form.”

Granted, developments in electronics have greatly reduced the cost of amusing ourselves. But, the Internet hasn’t directly created a lot of good-paying jobs the way the car business once did. Facebook and Twitter are world famous, but Ford and General Motors they aren’t: they only employ a couple of thousand people between them. According to Cowen, “… a lot of the internet’s biggest benefits are distributed in proportion to our cognitive abilities to exploit them.”

And that brings us to his third low-hanging fruit that doesn’t seem to be around much anymore:

“Smart, Uneducated Kids”

Cowen writes:

“In 1900, only 6.4 percent of Americans of the appropriate age group graduated from high school. … This rate peaked at about 80percent in the late 1960s and since then has fallen by about six percentage points. [Link added.]

Sure, we have plenty of “uneducated kids”. In fact, in recent decades, we’ve been bringing them in from South of the Border in vast numbers. Yet, apparently, we don’t have many “smart, uneducated kids”. Cowen writes:

“… there is no evidence of convergence of minority-majority graduation rates over the last thirty-five years, once you includeincarcerated populations in the totals.”

This public university professor notes:

“In contrast to earlier in the twentieth century, who today is the marginal student thrown into the college environment? It is someone who cannot write a clear English sentence, perhaps cannot read well, and cannot perform all the functions of basicarithmetic.”

Cowen goes on to point out:

“We’re facing a fundamental skills mismatch, and the <st1:place
w:st=”on”>U.S. labor market is increasingly divided into a group that can keep up with technical work and a group that can’t.”

This is much like that line from the great management guru Peter Drucker that I quote:

“But the immigrants have a mismatch of skills: They are qualified for yesterday’s jobs, which are the kinds of jobs that are going away”

Unfortunately, there are a few points where <st1:city
w:st=”on”>Tyler’s thinking, while improving, still needs more sophistication.

Cowen focuses a little too much on wages adjusted for inflation. He misses the bigger picture: the relation of income to the true cost of middle class living. The Consumer Price Index tends to systematically underestimate this by not adequately counting the full impact of homeownership and higher education.

It’s crucial to remember that the cost of living isn’t just the cost of entertaining yourself. Much of this debate getssidetracked into unproductive comparisons of imponderables: Is the median person really better off today than in 1965 because now he has YouTube?

There’s no question that endless electronic entertainment has gotten cheaper. Unfortunately, the Consumer Price Index underestimates the rise in key elements of the cost of living egregiously.

The big issue from the fundamental point of view: the cost of sustaining your family into future generations. That’s the cost of middle class respectability. That word “respectability” sounds trivial and old-fashioned. But it means something very important and enduring: the ability to marry. In America, the cost of marriage and children is, typically, the price of a house with a yard in a satisfactory school district.

You’ll notice that one of the chief complaints of the young men protesting in the streets of Egypt is that they can’t afford to get married. Well, that’s a big deal here, too.

Allow me to reminisce about how just how remarkably affordable family formation was during this halcyon postwar period of rapidly improving standard of living. I was born in the San Fernando Valley in northwestern Los Angeles in the latter half of the Baby Boom. My father, a junior college graduate, was a mid-level engineer at Lockheed Aircraft Company in Burbank. My mother, a high school graduate, had been a secretary at Lockheed during WWII. After marrying my father, she kept house and engaged in charitable work.

In 1951, my parents bought a new house on a culdesac carved out of a beanfield for $17,000. As freeways were built, their house became effectively closer to destinations such as downtown and LAX.

In the latter 1960s, local public schools were fine, but my Catholic parochial school was absurdly cheap at something like $15 per month.

I don’t recall exactly the tuition at the Catholic high school I attended from 1972-1976, but $600 per year sticks in my head. Tuition today is $11,200, but the school is much harder to get into because of the decline of the public schools in the Valley. In the mid-1970s, I recallbeing shocked to learn that our archrivals in debate, Harvard-Westlake, the most exclusive prep school in Los Angeles, charged an exorbitant $1,800 per year. Today, tuition at Harvard-Westlake is $29,200.

Nearby UCLA was fairly easy to get into in the 1970s, but I went to private Rice University in Houston. I remember that the cost for 1976-77 was $2,300. (I assume that was just for tuition, but, who knows, it might have included room and board as well.)

I then earned an MBA at UCLA. The tuition was so nugatory that I have no recollection of the amount, other than that at our graduation, the class speaker asked for a round of applause for the taxpayers of California for footing the bill.

As you may have noticed, life is different today. Americans tend to marry later, have fewer children, and live more stressed out lives because they need both parents to work to afford a house in a “good” school district (a good school district is the kind with smart children).

What role does mass immigration play in this? A fair amount, especially in driving up home costs in the remaining good school districts.

And why shouldn’t all our technical progress make the cost of generational sustainability easier?

From an economist’s point of view, the question ought to be the opportunity costs of mass immigration. Does mass immigration make the median American citizen better or worse off, all else being equal? The economic concept of ceteris paribus allows you to leave Facebook out of the equation. (Like most things, Facebook wasn’t invented byan illegal immigrant.) Framed correctly, the question is obviously much less of a slam dunk than the typical economist assumes.

I write a lot about immigration for a simple reason: it is the policy factor that American politicians have the most control over.

We don’t know how to “fix the schools”

We don’t know how to pass laws to create more innovative technology.

But we do know how to curb mass immigration. It ain’t that complicated. Elites just haven’t wanted to fix this problem—because it’s not their problem; it’s the average American’s problem.

Cowen shies away from mentioning immigration much in his book. But, overall, he’s making progress. I give him a C+.

[Steve Sailer (email him) is movie critic for The American Conservative.

His website www.iSteve.blogspot.com features his daily blog. His new book, AMERICA'S HALF-BLOOD PRINCE: BARACK OBAMA'S "STORY OF RACE AND INHERITANCE", is available here.]

(Republished from VDare by permission of author or representative)
 
• Category: Economics • Tags: Unemployment 
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The Democrats’ loss of the Massachusetts Senate seat long held by Teddy Kennedy has driven Washington, which had spent most of the last couple of years worrying about subsidizing Wall Street and socializing health care, into finally starting to think about jobs.

It’s about time. The March issue of The Atlantic features Don Peck’s long, well-researched, and deeply depressing cover story How a New Jobless Era Will Transform America. Peck reports:

“[Men have ] suffered roughly three-quarters of the 8 million job losses since the beginning of 2008 … In November, 19.4 percent of all men in their prime working years, 25 to 54, did not have jobs, the highest figure since the Bureau of Labor Statistics began tracking the statistic in 1948.”

The implications, as Peck explains, are baleful:

“… this era of high joblessness is probably just beginning. Before it ends, it will likely … leave an indelible imprint on many blue-collar men. It could cripple marriage as aninstitution in many communities. It may already be plunging many inner cities into a despair not seen for decades.”

Despite the gravity of the unemployment problem, there has been almost zero discussion in the Main Stream Media of the role of immigration policy in how we got here—and how changes in immigration policy could help get us out of this jam.

After Senate Majority Leader Harry Reid (D-NV) responded to Scott Brown’s election by announcing he was fast-tracking a bipartisan jobs bill, eight Republican Senators released a joint letter to Reid with their suggestions. Sen. Jeff Sessions, who did so much to save America from the Bush-Kennedy-McCain amnesty bills of 2006 and 2007, and his seven colleagues recommended a half-dozen commonsense steps for reducing unemployment among American citizens by moreeffectively enforcing laws against illegal immigration.

Keep in mind, these Republicans’ letter didn’t even mention anything about legal immigration—such as imposing a temporary moratorium until the employment problem clears up.

Of course, none of the Patriotic Eight’s illegal immigration reforms made Reid’s bill, which turned out to be the usual Official Bipartisan Consensus of spending increases and tax cuts. (As of Sunday morning, that bill’s progress had stalled due to squabbling.)

And almost none of the press coverage about unemployment mentions immigration.

For example, Ed Rubenstein has been tracking on VDARE.com foryears the closest the federal government will come to measuring the impact of immigration on jobs: the ratio of Hispanic to non-Hispanic jobholders. Last Tuesday, Ed reported that Hispanic employment is up 22.4 percent since January 2001, while non-Hispanic employment is down 2.5 percent.

How often have you ever heard that figure echoed in theEstablishment press?

Or consider how immigration is the missing element in Peck’s article in The Atlantic on the impact of unemployment. Peck, the deputy managing editor of The Atlantic, clearly did an admirable amount of work on the topic. For example, many of the points Peck makes about how long term male joblessness will exacerbate dysfunctional family trends that were well under way during the Housing Bubble are outstanding, if I say so myself.

In fact, I more or less have said so myself many times in articles on affordable family formation on VDARE.com.

According to Peck, high unemployment means marriage rates will decline further:

“Studies have shown that even small changes in income have significant effects on marriage rates among the poor and the lower-middle class. ‘It’s simply not respectable to get married if you don’t have a job …’”

But although I’ve been remarking on this for years, I certainly wasn’t the first to notice it.

Ben Franklin was.

Affordable family formation—the observation that America has been a relatively happy place because marriage and children were made affordable by our historical legacy of abundant, and thus cheap, land plus scarce, and thus well-paid, workers—is the oldest social science theory in American history. America’s most valuable thinker, Benjamin Franklin, devised it in 1751 in his essay Observations Concerning the Increase of Mankind:“When families can be easily supported, more persons marry, and earlier in life.”

Unfortunately, it’s also perhaps the least knownbreakthrough in our intellectual history. Franklin’s greatinsight about the fundamental cause of Americanprosperity—our big, empty continent—has been shoved down the memory hole, in part because Ben stated clearly its logical corollary: limiting immigration would increase the happiness of Americans.

While marriage today remains restricted to those who can afford it, fertility, as I’ve also pointed out, does not. Peck notes:

“Childbearing is the opposite story. The stigma against out-of-wedlock children has by now largely dissolved in working-class communities … Christina Gibson-Davis, a public-policy professor at Duke University, recently found that among adults with no college degree, changes in income have no bearing at all on rates of childbirth.”

This ongoing disconnection of marriage and baby carriage is very bad news. Peck says:

“By the time the average out-of-wedlock child has reached the age of 5, his or her mother will have had two or three significant relationships with men other than the father, and the child will typically have at least one half sibling. This kind of churning is terrible for children …”

W. Bradford Wilcox, head of the U. of Virginia’s NationalMarriage Project, asserts:

“We could be headed in a direction where, among elites, marriage and family areconventional, but for substantial portions of society, life is more matriarchal.”

“Matriarchal” is a euphemism for the kind of familial disorder that plagues black America, the Caribbean, and Sub-Saharan Africa.. Kathryn Edin, a Harvard professor of public policy, worries:

“These white working-class communities—once strong, vibrant, proud communities, often organized around big industries—they’re just in terrible straits. … I hang around these neighborhoods in South Philadelphia, and I think, ‘This is beginning to look like the black inner-city neighborhoods we’ve been studying for the past 20 years.’”

Could white working class areas in the U.S. go part way toward the social decay of black slums?

Judging from Britain’s experience, the danger is real. The severe unemployment seen in Britain in the 1970s and 1980s appears to have helped midwife the emergence of a white chav culture ofillegitimacy, binge drinking, and burglary that flourished through the English boom of the last decade. The recent media tizzy in the U.S. over the hit MTV reality show Jersey Shore, which showcased the proudly moronic Staten Island equivalents of chavs, suggests that our culture could be ripe for a similar degradation.

Edin argues:

“When young men can’t transition into formal-sector jobs, they sell drugs and drink and do drugs. And it wreaks havoc on family life. They think, ‘Hey, if I’m 23 and I don’t have a baby, there’s something wrong with me.’ They’re following the pattern of their fathers in terms of the timing of childbearing, but they don’t have the jobs to support it. Sotheir families are falling apart—and often spectacularly.”

Peck concludes:

“We are living through a slow-motion social catastrophe, one that could stain our culture and weaken our nation for many, many yearsto come. We have a civic—and indeed a moral—responsibility to do everything in our power to stop it now, before it gets even worse.”

So, in light of how severe the situation is, can we now, finally, talk about immigration?

Apparently not.

A quarter of a millennium after Franklin explained theeconomic impact of immigration, Peck is intellectuallyshackled by the code of silence prevailing around the topictoday. He only mentions immigration twice in his tenthousand-word article.

  • First, he cites sociologist William Julius Wilson’s research on the disastrous ramifications of black men exiting the work force. (In1960, 90 percent of black men were employed versus only 76 percent in prosperous 2000.)

Peck paraphrases Wilson on how new competition for jobsworsened black behavior:

“… downwardly mobile black men often resented the new work they could find, and displayed less flexibility on the job than, for instance, first-generation immigrant workers. As a result, employers began to prefer hiring women and immigrants, and a vicious cycle of resentment, discrimination, and joblessness set in.”

Presumably, Prof. Wilson can afford to mention the I-word because he’s 74-years-old, tenured at Harvard, and black.

  • Secondly, toward the end, Peck himself cites Harvard economic historian Benjamin Friedman worrying that “When materialprogress falters … anti-immigrant sentiment typicallyincreases …”

In other words, Peck (and Friedman) appear to think that the point of Americans having jobs is that then we can afford immigration.

American public debate is so stultified by this immigration omerta that a couple of allusions to immigration over 10,000 words might be considered progress toward a new era of intellectual realism.

But Peck himself claims we’re facing a “New Jobless Era”. How long does it have to go on for before our political class can bring itself to consider some new (or at least repressed) ideas?

Ask The Atlantic

[Steve Sailer (email him) is movie critic for The American Conservative.

His website www.iSteve.blogspot.com features his daily blog. His new book, AMERICA'S HALF-BLOOD PRINCE: BARACK OBAMA'S "STORY OF RACE AND INHERITANCE", is available here.]

(Republished from VDare by permission of author or representative)
 
• Category: Economics • Tags: Unemployment 
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Steve Sailer
About Steve Sailer

Steve Sailer is a journalist, movie critic for Taki's Magazine, VDARE.com columnist, and founder of the Human Biodiversity discussion group for top scientists and public intellectuals.


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