Making Labor Less Expensive Helps Firms Hire

The Goal Of Long-run Economic Growth Without Asset Price Bubbles Is Not Only Achievable, But Is Something We Should Expect If We Put A Sound Regulatory Framework In Place And If Policymakers Remain Vigilant.

As An Economic Historian, I Appreciate What Manufacturing Has Contributed To The United States. It Was The Engine Of Growth That Allowed Us To Win Two World Wars And Provided Millions Of Families With A Ticket To The Middle Class. But Public Policy Needs To Go Beyond Sentiment And History.

If You Think About It, Candidate Obama, Sen. Obama, Was Running On Sort Of Long-run Economic Issues, Like Restoring Prosperity To The Middle Class, Dealing With The Perennial Problem Of Health Care In The United States. He Talked A Lot About The Budget Deficit, About The Need To Transition To Clean Energy.

A Natural Way That An Economist Approaches A Problem Is To Say, Here's Where I Think The Economy Is Going; This Is What We Need To Deal With The Problem.

In The Four Decades After World War Ii, Manufacturing Jobs Paid More Than Other Jobs For Given Skills. But That Is Much Less True Today. Increased International Competition Has Forced American Manufacturers To Reduce Costs. As A Result, The Pay Premium For Low-skilled Workers In Manufacturing Is Smaller Than It Once Was.