And for our legislators, quit favoring capital over labor in taxation if your goal is jobs. However, if your goal is to make money when you leave Congress, don't change a thing.
From Real Time Economics:
The White House’s annual Economic Report of the President pushes a raft of proposals designed to make the U.S. economy stronger and more productive in the long run. Some of them run the risk of making a subset of U.S. workers, who have been front and center for the White House lately, more vulnerable in the short run.
The report, released Monday by the White House’s Council of Economic Advisers, puts a heavy focus on technology investment (alongside research and development, a patent-system overhaul and more) to boost productivity. It frames an entire chapter about productivity gains around the larger debate about widening income inequality, a concern that has propelled the White House’s movement to raise the minimum wage and boost other programs designed to help low-wage workers.
Boosting productivity through technology has long been a double-edged sword for some American workers. Modern factory floors require fewer people to produce more goods. More robots and fewer humans now roam through warehouses. Call centers rely increasingly on computers to field calls and process payments. The displacement of lower-skilled workers in those roles has been a leading factor in the widening inequality seen since the 1970s.
Nobody would argue seriously against the benefits of technology to the overall economy in the long run. But are White House officials worried about the risks to low-wage workers?
“I think you absolutely have to worry,” Jason Furman, chairman of the White House Council of Economic Advisers, told reporters Monday. “Technological change offers an enormous opportunity for our economy. But it also, if done the wrong way, could lead to a big increase in inequality and potentially even a reduction in absolute wages for some.”
“I think it also contains the solution to the challenge if done the right way,” he added.
The productivity of U.S. workers has grown for decades, despite the challenges of globalization. The trouble for the economy is that the gains of that improved productivity have accrued disproportionately to higher-income Americans, as the White House showed here:
