No Worker Left Behind
By Amy Willis
Is the average worker today no better off than only a few decades ago? How do we build a more inclusive economy? What role should the government play in this regard? As you can imagine, there was a lot of back and forth on these question in this week’s episode. Host Russ Roberts welcomed back MIT’s Daron Acemoglu to talk about his provocative recent essay, “It’s good jobs, stupid.”
Acemoglu says that “shared prosperity” should include some level of inequality such that groups aren’t consistently left behind, paired with wage growth and employment growth. And he says that redistribution is not the answer. So far so good, right? Yet Acemoglu and Roberts found little to agree on, even joking about it throughout the conversation. Who spoke more to you in this episode?
1- Why does Roberts believe that the case for wage stagnation is overstated? For what reasons does Acemoglu believe (strongly!) that the average person has been “left behind” for the last 40 years? Whose argument did you find more convincing, and why?
2- Acemoglu says the lack of shared prosperity is multi-causal, with three sets of explanations: globalization, automation, and institutional. What’s the difference between globalization and automation, which Roberts sees as the same thing. Roberts also notes that these processes have been going on for long long time, but their effects have only really been felt in last 50 years. Why? What are “reinstating technologies, as Acemoglu describes them, and how does he think they can reinstate balance in the economy?
3- Why is Acemoglu such a fan of minimum wages? Of the democratic process? How is democracy broken, according to Acemoglu? Why is Roberts not persuaded? Again, with whom do you agree more, and why?
4- The big area of agreement between Roberts and Acemoglu: concern for people at the bottom. How do each think ‘shared prosperity’ is best achieved? What should be the government’s role in ensuring shared prosperity?
5- Roberts and Acemoglu spend the last few minutes of the conversation discussing one of their areas of agreement- the ineffectiveness of our K12 educational system today. Acemoglu poses ‘The Big Question’ at the end: “How do you design a system that really doesn’t treat every course as if it’s preparing you for, you know, junior calculus in one of the state universities, while at the same time gives second chances and ability for social mobility to people who come from all kinds of different walks of life.” How would you answer this question?