KENNEDY: Whistling in the dark

May 6, 2017

Sheila Suess KennedyWe Americans tend to be nostalgic for the “simpler” times of an imagined—or at least airbrushed—past. (In Stephanie Coontz’s felicitous phrase, we are nostalgic for “the way we never were.”)

We should certainly learn from the past, but we need take care that a fixation on the world as we think we knew it doesn’t prevent us from seeing a future for which we seem dangerously unprepared.

Take just two recent preoccupations of business reporters: the imminent phenomenon of self-driving cars and the ongoing collapse of brick-and-mortar retailing.

A recent article in the L.A. Times estimated that self-driving vehicles will eliminate the jobs of 5 million people nationwide, 600,000 of them in California alone. These are people who make their living driving taxis, buses, vans, trucks and e-hailing vehicles. According to Lawrence Katz, a Harvard labor economist, those people constitute 3 percent of the national workforce.

Not so incidentally, most of them are men without college degrees, a demographic that has already been hit hard by the loss of 5 million manufacturing jobs since 2000.

Add to that looming threat the cratering of traditional retailing, as more and more Americans shop online. Empty storefronts are already proliferating in the strip malls that line our highways. I have been unable to locate reliable estimates tallying the loss of clerking and sales positions, but that number is obviously high and likely to go higher. Warehouse positions and online “customer service” jobs are unlikely to replace them all.

Economists have pointed to an inconvenient truth that politicians prefer to ignore: Trade does not lead to a net loss of American jobs, although the nature of those jobs and the skills they require do change. Automation is what is relentlessly driving job losses. We no longer hire people to pump our gas; a single secretary handles jobs that used to require three or four; automated checkouts are everywhere from the drugstore to the parking garage. In many cases, these innovations create new jobs—again, requiring new and more demanding skills—but in many cases, they don’t.

And what do we do about workers who simply cannot be retrained, either because they are too old or lack the requisite capacity?

The American economy is clearly heading for incredibly turbulent times, and I haven’t even mentioned the likely impacts of climate change (the existence of which ideologues and elected officials prefer to deny). According to NASA, those of us in the American Midwest will experience extreme heat, heavy downpours and flooding affecting infrastructure, health, agriculture, forestry, transportation, air and water quality, and a range of risks to the Great Lakes.

A lack of action now to mitigate climate change will also fuel significantly increased migration in the not-so-distant future. A major report recently issued by Columbia University, the United Nations and CARE International predicts that, by mid-century, large numbers of people will be fleeing rising seas, droughts, floods and other effects of changing climate. If we can’t even cope with the relatively modest influx of Syrian refugees, how will America react to the potentially huge numbers displaced by climate change?

We are already seeing the social cleavages produced by these and other seemingly inevitable economic changes. The rise of populism, increasing racial resentments and anti-immigrant rhetoric, the widening divide between flourishing cities populated with skilled workers and emptying rural areas pock-marked with abandoned factories and stores should be a wake-up call.

We need to ask ourselves why America’s government is ignoring that call.•


Kennedy is a professor of law and public policy at the School of Public and Environmental Affairs at IUPUI. She can be reached at skennedy@ibj.com.


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