OK, so I’m still catching up on my reading.  Between the novels and technical reading that I do (about 150 journals and four books a month, plus tables of contents of a hundred or two other journals), I try to read non-fiction.  And, I don’t always get to the books when they first come out.

But, I just skimmed (that means I read >90%) through a book…”the Great Stagnation” by Tyler Cowan.  (Available as a book or as a Kindle edition.)  Tyler Cowan also has a TED talk out there.    His premise is scary.   Up until 1974, America became the economic powerhouse, because we chose to solve the easy problems.  (He calls it going after the low-hanging fruit.) We exploited the rapid growth in a college-educated populace.  We exploited cheap fossil fuels.

Our new inventions are not.  They are really not monetized.  (Facebook, Twitter, and other social media).  They don’t employ anyone, really.  The automotive industry employed millions, Twitter has 300 employees or so, and Facebook less than 3,000.  So, there is not much economic activity to help grow this country or increase our wealth.   We have confused our standard of living (which is decaying rapidly) with our wealth.

As you can see from this graph, our per capita income has not kept pace with the rate that existed from the end of WWII to 1974.    A typical household should be generating $90K a year, not the $ 50K that obtains.

He attributes the change to our economic focus towards education and health care.  These items cost a lot of money and are hard problems to solve- and don’t generate great revenue.   Our life expectancy has not kept growing.  Our high school graduation rates actually peaked during  the 1960’s.

Our “things” have not improved greatly-we have only improved them at the margins.  For example, we’ve tinkered with  our cars (better stereos, GPS), but we don’t have flying cars or cars that automatically drive themselves.   (The one exception has been in the communications [sometimes called ICT- information/communications technology] sector, but that does not fill the economic gap found on the above graph.)  Globalization didn’t start in 1974, so he doesn’t think (nor do I) that this is a prime cause or force.

He feels that one of the bigger problems is our (America’s) lack of regard for science and scientists.  (Now, you can see why this resonates with me.)  He compares this attitude with German culture, one that reveres science and technology and production; we revere talentless folks on reality shows and singers.

But, I know it’s more than that.  Since 1974, our corporations have been employing fewer workers for the same output.  (I understand productivity gains- but, just wait a moment or   so for me to finish my thought…)   And, the average wages have stayed the same or decreased.  While the wages for top executives have skyrocketed.  And, corporations have been amassing more cash.  For what?  Where are the new plants?  (Don’t get me started that we have not built one new refinery in forever- as our demand for fuel skyrocketed!) The new inventions?  At the expense of their workers.   Which is exactly why the Middle Class is disappearing.

But, there is hope.  A great number of America’s innovations and developments were spurred on by the Great Depression.  Perhaps, because we needed to change things- drastically.  Perhaps, because our government used stimulus funds to help create new things.  (I know that World War II helped create a new economic condition for us- at least as much as Roosevelt’s New Deal- but it did not lead to great new innovations- unless you consider the atomic bomb a great leap forward.)

So, now, in this “Great Recession”…what new innovations and ideas will you be developing?   And, whatever your politics- there are two additional questions (each of which will appeal to the different parties.) Why are you not asking our government to hire folks and not fire them?  Why are you not questioning why- at the lowest tax rates paid by the wealthy (clearly NOT job creators) and corporations- are businesses not participating and leading the recovery?

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