Opinion

Gregg Easterbrook

Rethinking hiring and employment

Feb 10, 2011 15:18 UTC

In all respects save employment numbers, the United States economy is back to normal. Real growth in 2010 was 2.9 percent — not spectacular, but any developed nation would take that figure. The adjusted U.S. GDP just rose back above its prior peak of late 2007 — meaning U.S. economic output has never been higher than right now. Sales numbers are good across most industries, corporations are sitting on ample cash, banking and equity liquidity is fine, no primary resource is scarce and the index of Standard & Poor’s 500 earnings per share is at an all-time high.

That’s a healthy economy — except for unemployment. Job numbers have improved somewhat but are nothing to write home about. Even considering that hiring usually trails a recovery by several months, unemployment numbers are spooky. President Barack Obama just implored the U.S. Chamber of Commerce to “hire and invest”.

Let me propose an uncomfortable notion. Namely: two mainly unrelated phenomena happened at once, the recession and a job contraction. Though the former triggered the latter, they actually had little to do with each other. The job contraction would have happened regardless.

That’s why the end of the recession — and federal stimulus spending — hasn’t cured the jobs problem. And until we accept that the surge in unemployment is mostly something that would have happened even if the autumn 2008 financial-markets meltdown never occurred, we’ll continue to be puzzled about why jobs have not bounced back though growth has.

Workplace productivity has improved markedly in the last generation, and it’s led to the point where far fewer people are needed for many kinds of output. Twenty-five years ago, about 150 hours were required to manufacture an automobile. Today the average is down to about 80 hours, and it’s still declining. The car produced today is of much higher quality than the car produced then, meaning used cars last longer and don’t require replacement as often. The net is a huge decline in automotive assembly employment, while cars, as products, are the best they have ever been.

Obama, don’t fear change in Egypt

Feb 1, 2011 21:11 UTC

EGYPT-USA/Egyptian president Hosni Mubarak has announced he will not stand for reelection in the fall, Reports are that Egyptian president Hosni Mubarak will not stand for reelection in the fall, and one reason for Mubarak’s decision is that President Barack Obama privately urged this course.

That’s a step in the right direction — but President Obama needs to go much farther. He should publicly, and enthusiastically, back the protesters who are demanding a new dawn in Egypt.

Yes, many things could go wrong if there is sweeping change in the world’s oldest nation. But many things could go right, too. America’s highest ideal is freedom. The United States strongly supports freedom for itself, for Europe, for China and Japan. Why not for Egypt?

Obama must say ‘no’ to federal spending

Jan 26, 2011 03:58 UTC

obamaSOTU2011President Barack Obama’s conciliatory tone in his State of the Union Address was exactly what the country needs at this moment. And once again, Obama showed he is the best political orator since Ronald Reagan.

On tone and feeling – which matter a great deal in politics – the president deserves high marks. So too do members of Congress who for once behaved in a bipartisan manner, not like squabbling children.

Substance? That’s another matter.

In the address there was a lot of talk about jobs and innovation, both obviously important: but issues that no president controls. There was talk of better access to high-speed Internet and of regulatory and tax-loophole reform: not one single person opposes either. There was dream-world talk of high-speed rail and energy in the year 2035. But there were precious few specifics regarding what will be done right now to address runaway federal debt. And runaway federal debt, which suggests the U.S. future may be less bright, is a major issue holding the economy back.

Undisciplined spending in the name of defense

Jan 20, 2011 11:00 UTC

AUSTRALIA-FIRES/Defense Secretary Robert Gates just proposed cutting the military and security budget  by $78 billion over five years — perhaps only a downpayment on coming further reductions. Secretary Gates’s list of proposed cuts includes high-profile projects and weapons. But he does not mention the National Geospatial-Intelligence Agency, an exemplar of undisciplined spending in the name of defense.

Never heard of the National Geospatial-Intelligence Agency? You’re not alone. A fair guess is that nine of 10 Washington pundits and political insiders don’t know the NGA exists, while perhaps one in 100 can describe its function.

The National Geospatial-Intelligence Agency has 16,000 employees — nearly as many as Google  — and a “black” budget thought to be at least $5 billion per year. The NGA is building a new headquarters complex with the stunning price of $1.8 billion, nearly the cost of the Freedom Tower rising in Manhattan. That new headquarters, near Fort Belvoir, Virginia, will be the third-largest structure in the Washington area, nearly rivaling the Pentagon in size.

Cars on the catwalk

Jan 12, 2011 19:46 UTC

Every year at New York’s Fashion Week, models strut in dresses that are flamboyant, expensive and wildly impractical. The concept cars on display annually at the North American International Auto Show are the same, only made of metal rather than fabric.

Hardly anyone ever wears the dresses flashed during Fashion Week, except perhaps on television shows. Hardly anyone ever drives concept cars. Marketability is not the point. The point is to generate excitement about product lines, drawing buyers to department stores, or automobile showrooms, to purchase the sensible wares.

That the models standing next to the concept cars at the auto show are in some cases wearing attire from Fashion Week completes the circle nicely.

American exceptionalism and the DMV factor

Jan 6, 2011 17:48 UTC

Everyone’s mad at public-employee unions. Republicans in the House and Senate are denouncing them. Republican governors such as Chris Christie of New Jersey are blaming unionized public workers for state budget woes. Even new Democratic governors including Andrew Cuomo in New York and Jerry Brown in California are saying public employees are overpaid, or retire too early with too-lavish pensions, or both.

Some public employees do make too much or hold featherbedded jobs, while the California situation — $325 billion in unfunded state and local retirement liabilities, often for $100,000-a-year-plus pensions for government workers who retired in their 50s — ought to outrage anyone.

But what’s really going on here is the DMV Factor.

When does the typical person come face-to-face with a government worker who belongs to a public-sector union? Not at the Department of State or the Department of Agriculture. Unless you have a child in public school, your most likely face-to-face encounter with a government employee is at a Department of Motor Vehicles.

The wonder of the universe

Dec 22, 2010 19:24 UTC

SPACE-HOLE/

Tuesday morning, I rose at 2 A.M. and stood for an hour in the freezing cold to watch a total eclipse of the full moon, occurring on a solstice: a conjunction that last occurred in 1638, and won’t occur again until 2094. Standing there, I wondered if this exceptional moonglow would give me a superpower — nothing to report yet. The sense of awe I felt right away.

The more astronomers look out into the universe, the more vast and majestic it is understood to be. As the holidays arrive, and the year comes to a close, it is well to ponder this.

Many generations ago, our ancestors gazing up at constellations and eclipses believed the cosmos bounded by such stars as could be seen unaided by the eye. Just a century ago, even after people considered themselves advanced owing to developments like powered flight, it was not known that any other galaxies existed. Our Milky Way was considered the totality of creation.

The good and bad of 2011

Dec 15, 2010 17:54 UTC

With 2011 around the corner, what big developments might be expected in the coming year? Here are a few possibilities, bad and good:

Bad: Freshwater shortages. China is depleting its aquifers at an alarming rate in order to grow rice, the most water-intensive cereal. Freshwater supplies are approaching critical in much of the Middle East.

Discussion of climate change has focused on rising temperatures, which in and of themselves aren’t a threat and have some positives (such as lowering winter heat demand). As UCLA geographer Laurence Smith shows in his important new book The World in 2050, nearly all our globe’s surface freshwater is in glaciers and snowpack. Warming is causing “more of the world’s water to leave the mountains to run to the sea,” warns Smith, and “no amount of engineering” can reverse this loss in the short term.

Tax cuts and giveaways won’t save the economy

Dec 8, 2010 03:05 UTC

“If we don’t take meaningful steps to rein in our debt, it could …  jeopardize our recovery.”

–President Barack Obama, January 2010.

“Next year [I will] start presenting some very difficult choices to the country” on debt reduction.

–Obama, June 2010

Bartender, giveaways for everyone!

–Essentially what Obama said, in so many words, December 2010.

Barack Obama pledged to reduce the national debt during his presidential campaign, but instead has added $2.7 trillion to that debt so far – more than the entire national debt in the year 1975. Throughout 2010, he repeatedly promised there will be no more treating the Treasury as a cookie jar. Now, suddenly, there will be $900 billion in new giveaways, financed entirely by borrowing.

What we should be taxing: greenhouse gases

Dec 1, 2010 21:30 UTC

CLIMATE/

Bravely, international diplomats, United Nations officials and environmentalists are meeting in Cancun this week to demand that other people use less fossil fuel. Bravely they met in Copenhagen a year ago to make the same demand, after also bravely meeting in Bali, Montreal and similar resort locales in prior years.

I will skip the obvious point about the greenhouse gases emitted by the jets and limos that bring the participants to these annual confabs, where preaching-to-the-choir is the order of the day.

Most of what happens at the annual international conference on climate change has been decided on in advance, so the greenhouse emissions could be avoided by a tele-meeting. But then the delegates won’t get a paid trip to Cancun!

  •