Jobs: Coming or Going?

It's labor day, a day we celebrate the  labor movement and the social and economic achievements of American workers. It constitutes a yearly national tribute to the contributions workers have made to the strength, prosperity, and well-being of the US (from wikipedia). As Obama has said many times, a job is something that everyone needs. It is about pride and self image as much as it is about money.

But we've been losing jobs in the US for years as the manufacturing based economy recedes and relocates and the new industries we are all hoping for are not creating jobs fast enough to replace those that are lost. 

The central question, it seems, is whether these new industries will employ people in the same ways and at the same rate as the lost industries. I fear that they will not. And I am certain that they will not employ unskilled labor at the same rate as the industries we have lost. Software engineers, designers, writers, analysts, etc should be in strong demand for as far as my eye can see. But those who do not have specific skills are in for a much tougher job environment and have been for quite a while. 

I am not sure exactly what to do about all of this other than work like hell to make sure as many of our young people have access to the kind of education that will give them the skills to do the work of the future. As you all know, I am working on that. And so are many others. The good news is that many people realize that's what we need to be doing.

But will that be enough? I don't know. I am not sure anyone does.

Here's what Andy Kessler thinks

Here's what Mark Sigal thinks

Here's what my partner Albert Wenger thinks (he thinks a lot about this issue)

I am curious what you think. 


Comments (Archived):

  1. Dale Allyn

    I think about the same thing, Fred. If we have our heads buried too deeply in the tech industry it’s easy to overlook so many other areas where good people need jobs. Some are not suited to tech-based employment; for some it is too late, but they still have many life expenses. Solutions must be circumspect and broad-based, not focused on a few pet-industries. Americans come in all flavors (aptitudes) and they deserve to work for a comfortable living.And now look what we’re (or is it “they’re”) doing to jobs and employers via the healthcare fiasco. We have a lot of people in Washington (and some state governments) not bringing their A-game, if they even have it. It’s up to us, because they are showing no signs of understanding or sophistication in seeking out sustainable solutions.(Edit: typo – dropped word)

  2. Avi Deitcher

    Did you see Greg Bauges’ post, on how software engineers are like the autoworkers of our generation? He claims even software engineering will eventually be commoditized.

    1. fredwilson

      i can see how that is possible

      1. William Mougayar

        A big part of US/Western countries corporate IT is run that way from India where they have 3 million IT jobs and adding about 250,000 per year.

        1. Cam MacRae

          My last bitch and moan call was answered in the Philippines, not India. Make of that what you will.

          1. Avi Deitcher

            Speaking of bifurcation, at the high end, it is very much domestic. I fly ~150k miles per year on United. I call the Premier line, say my membership ID, and my call is answered in under 30 seconds in the USA. But that is worth it for them.

          2. Cam MacRae

            United? You’re a better man than me!

          3. Avi Deitcher

            I hope not because of flying a bloody airline!I believe I am a good businessperson because I move the needle on growth, revenue, operations, profitability.I believe I am a good man because I take good care of my family, and am honest and ethical in business dealings.All the rest is just where I spend too much money for my own good (maybe except hockey).

          4. Cam MacRae

            Well, flying 150k miles on said airline suggests a highly developed capacity for patience and equanimity. I stand by my assessment!

          5. Avi Deitcher

            LOL! Yes, it does!Actually, I used to do Continental. Back in my Wall Street days, I flew a lot as well, once flew United to Japan… and swore never to fly them again. Then CO-UA merged.FWIW, they have improved quite a bit since then…

          6. Dale Allyn

            Except the crowded lounges since the merger. They are working out some of the boarding kinks though… finally.

          7. Aaron Klein

            Glad they have improved. I’m a Delta guy, only put up 80K a year but that’s enough to get first class upgrades 75% of the time.I am head over heels with that airline. And every experience with United has been awful…but I’ve avoided them like the plague in the last year.

          8. Dale Allyn

            We get locked in to airlines if flying often or far. I’m a UA guy, too, with well over a million miles with them (maybe approaching 2M now). Hubs matter. Routes matter. etc. But getting a call answered and problems resolved quickly is very important.

          9. William Mougayar

            Of course…China too is in it, Eastern Europe, Argentina, etc..But the bulk of these jobs are in India, maybe 80-90%.

    2. Dale Allyn

      It absolutely seems possible, even likely.

    3. takingpitches

      Thanks for the link. The discussion in the comments is fantastic.

      1. Avi Deitcher

        I wish I remembered where I saw it. Someone tweeted it…

    4. Cam MacRae

      Already happening — that’s more or less why I gave it away.

      1. Avi Deitcher

        “gave it away”?

        1. Cam MacRae

          Ah. Colloquialism: Quit.

          1. Avi Deitcher

            Ah, I didn’t know that one.So.. what did you go to?

          2. Cam MacRae

            Optimization 😉

          3. Avi Deitcher

            Consulting for optimization?

          4. Cam MacRae

            Yes and no. Academic. Quite temporarily, let me assure you.

          5. Avi Deitcher

            Is the temporary situation… optimal? :-)Forgive me, I had to…

          6. Cam MacRae

            It is if we let t = now()Also, forgiven. Naturally.

    5. Dave W Baldwin

      I know I’m the antagonist here regarding the machine, but that post is correct where we need to increase more than 10 fold quickly those that are trained in the tools of dev. The ability of ML is going to get where ML truly happens and eliminate the need of 1,000 programmers. To laugh at that is nothing but dangerous vanity.We need to increase the number of humans that understand enough to be on top of this development, which will go far between 2017-2020. BTW, that’s when they can really go to town with all the data being stored currently.

      1. Jeffrey Hartmann

        Completely agree here, as machines get more capable our need for many skilled workers disappears. This will touch all jobs, software developers and taxi drivers alike. I think we really need to foster an environment where starting and building companies and projects have much less friction, because capable machines will really turn current industries on their heads and traditional jobs will drastically change. I’m personally very excited about this though, it will be painful but it will be much more transformative than the industrial revolution.

        1. Dave W Baldwin

          Yup. At the first Artificial General Intelligence Conference in Memphis, some guys were talking about the taxi drives being put out of business. I replied, telling them to remember the distance of time between the driver and those who program being replaced by the higher thinking machine may not be as big as they think. I was amazed. You could tell in their eyes they realized they were thinking in a condenscending way…

        2. Dave W Baldwin

          …and foster the notion to younger and older what we can do with machines that begin to truly do more human like cognitive. There is so much more we can do working in tandem.

    6. robertdesideri

      Yep. The lesson is don’t get stuck low in the stack. Commoditization is an economic trick for extracting value. Nothing new. Close to home, look at the coder kids who join startups, work for a bit, the company closes, they have to move on. They learn they’ve been commoditized pretty quick, they see how the founders may have at least walked away with some recognition or acquihire. So they try to climb into being founders. Which should be respected. However, founder is a tougher role. The odds of achieving successful product / market fit before end-of-runway speak #truth. Lots of commoditization out there, sometimes you just don’t see it until it’s too late. Sometimes you see a commoditization opportunity and pounce, get funded and have a shot at moving up the stack personally. Being a commoditizer is the role you seek if rent extraction is your goal. There’s not many commoditizer slots open, you have to invent your own. Such invention is at least a logic + math exercise after seeing the opportunity. The only means for a software engineer to escape drowning in the commoditization stream is to become a commoditizer herself, learn to swim, always be moving up the stack. And life goes on.

    7. ShanaC

      I can see that happening already

      1. Avi Deitcher

        Love to see examples you have seen first-hand, if you can share.

        1. ShanaC

          his examples are enough, but truthfully, there are examples in machine learning on a research where over time the computer writes its own code

  3. ShanaC

    Complicated. One of the most interesting aspects that I’m seeing is it is very hard to become full time, even for roles like analyst.I’m oddly angry about it – since there is still labor discrimination for if you haven’t. Entry level roles have effectively disappeared for impossibly low or no wage internships.I’m actually not sure what will happen to millennials as a result.

    1. Avi Deitcher

      Shana, it is *very* expensive to hire someone: HR, regulations, healthcare, etc. etc. If the overhead is, say, $15k/ year for someone, and the person is earning $100k, it increases their cost by 15%; if they are earning $30k, it increases it by 50%! No longer worth it to hire many lower level people.I don’t know if that is happening where you are dealing, but people I speak to who run businesses that live and die by their profits deal with this every day.

      1. Dale Allyn

        ^ this

      2. Anne Libby

        This isn’t a new truth, though. When I started my career long ago, the rule of thumb was that overhead was about 50%. If anything, I’d guess that overhead has come down…

        1. Avi Deitcher

          50%? Wow. Rule of thumb I always used in the 90s was ~30%, but that was for high paying jobs.

          1. Anne Libby

            Part of the overhead — this was a large bank — was real estate. And most of the jobs were lower paying, tellers and such.That bank is now gone (eaten by Chase) and I’m sure that the OH is far lower today…

          2. Avi Deitcher

            The pro-rated share of that employee’s real estate?

          3. Anne Libby

            Yes, overhead included “everything” as we measured it. (So I also assume, security, data processing, etc.) It was a rule of thumb we used — this was in a client services and operating group, not a strategy or finance group. Someone in that food chain probably had a finer point on their pencil for that one.

          4. Dale Allyn

            Not so low, really, but distributed a bit differently. It depends on the industry (and location, state regs, etc.), but in the U.S. we find employee benefits at around 25% to 28%, plus seating environment (if a tech seat, there’s desk, chair, computer, monitors, etc some of which turn at approximately 24 mo. cycles); then add other costs associated with bringing remote workers in to face-to-face meetings (offset by lower month to month costs of hiring remotes), etc. Thirty-five to thirty-eght percent is a practical range.

          5. Anne Libby

            Thank you!

          6. LE

            ” And most of the jobs were lower paying, tellers and such.”Psychology of that was that banks were a nice place to work and seemed important and respectable so by having that environment you could get away with labor of a higher quality than the local plumbing supply warehouse could (trying to pay the same wages). So the nice environment saves you on labor.I noticed this in college as well. When I worked in some fancy office buildings and noted that my dad actually paid better (with his shitty wholesaler messy office) than the law firm did because of the work environment and faux respectability and fresh carpet smell saved them on labor costs for the low end jobs.

          7. Anne Libby

            The other thing that working in banking offered — back in the day — was not the promise of a 7 figure salary.But there was a sense that the job as a teller, or running a machine in a check processing unit, or clipping coupons on bonds, was on a possible runway to a more senior level job at some point down the road. This has changed…

          8. LE

            “was on a possible runway”That was always the case and is still the case with any large business.Because when you run a small business you find that part of the reason you have a hard time hiring vs. the lesser paid jobs at big companies is because people perceive they can “move up in the organization”. In other words if you work for a small restaurant you feel you can’t go very far. But if you work for Friendlys you can dream about being a district manager or regional etc. Or Starbucks. So Starbucks can generally hire better people than a small coffee shop (always exceptions and of course there are people who would rather work for a small coffee shop because they don’t have other aspirations.)

      3. LE

        Remember my dad’s model of cost effectiveness of labor in the 70’s when things were really shitty. He said that someone who demanded to be paid at the top end of their value was the one he laid off when things got bad. The ones that were paid less he kept because the cost hadn’t reached the tipping point. So someone who was always pining to be paid 100% of their value didn’t survive in that economic environment.

        1. Avi Deitcher

          I love it. Thank you for sharing.

      4. ShanaC

        i’m fully aware of the expense. I also think that ifa) you want to have people/businesses buy your stuffand b) you want to basically prevent your business from losing core knowledgeyou should pay up.a) because when you avoid paying, you avoid the income transfers that make the economy go aroundb)loyalty is basically gone, so why expect your trade secrets to remain secrets

        1. Avi Deitcher

          Oh, I agree, which is why I like high-value / high-cost employees, but if the cost is enough, the return might not be worth it.

    2. Avi Deitcher

      To follow up: I once worked a summer building a house. Electrical engineering student building a house by hand. Not Habitat or anything, just everyday job. The builder and I agreed to a rate, he paid me, it was done (and brutally hard work… and lots of fun). Same summer I worked airline security twice a week.I couldn’t do that today. I suspect that the total cost of overhead would be *more* than I was paid. It just isn’t worth it for him anymore.Which, I suspect, has a big part in manufacturing moving overseas. That and the tax repatriation issues. If Google has $1BN in cash sitting in an Irish bank, they could choose to bring it back Stateside and get hit with $350MM in taxes, or invest it in R&D there. US engineers may or may not be better than Irish engineers, but *that* much better?

      1. JLM

        .As a kid, I worked in construction every summer from the time I was 13 years old until I left for the Army. I also worked in restaurants, as a lifeguard, shoveling snow, cutting grass.I studied engineering in college and applied myself on the advice of a convicted murderer I spent a summer digging ditches with. This fellow was 55 years old and had served 25 years in Florida for murdering a white man who had attacked his wife.He was my poet laureate and muse when after a day spent digging ditches he would say to me: ‘Hey, college, how does your back feel?”Of course my back was killing me. And then he would say: ‘College, this is the best job I’ve ever had and the only job I can get.”Late at night when I couldn’t keep my eyes open I would hear that voice and I would get a cup of coffee, wet my eye lids and drive on.The perfume of sawdust, the shrill sound of wood being cut, the symphony of a nail gun — I loved them all. I do to this day.They all inspired me to study and not have to do that kind of work. Today, I consider it a privilege to build something with my own hands.Work is a sacrament. And a great education.JLM.

        1. Avi Deitcher

          “Work is a sacrament.” Could not agree more.

    3. JLM

      .I know what will happen and it is not pretty — they will continue to vote for people who will enslave them to a life of poverty because they are essentially stupid and live with an unbridled sense of unfulfilled entitlement.When they grow up and vote for their own economic interests they can begin to expect better personal outcomes. Until then, more of the same.They deserve better but they are doing it to themselves.JLM.

      1. PhilipSugar

        You know I was stuck at an Airport on my trips this week. Two young people were discussing politics.I said we won’t discuss politics but lets talk about what decisions I make when deploying my capital to create jobs, and what I expect for a return given the risk.They were dumbfounded. We really need to have this discussion rather than the class warfare discussion we have going on. I really can’t recall a single politician that has actually created a job.And that is the farce. Politicians say I want to create a jobs. The only way you truly create a job is if you take money out of your own pocket and pay somebody before they actually are productive enough to create enough value to pay for themselves.And alas they everyone is a winner upbringing has come back to truly punch this group right in the face.

        1. Anne Libby

          Yes, and beyond “everyone is a winner” (though there’s that) there’s also a sense of having to jump through hoops (i.e. the unpaid internship, volunteer work, various other HS resume building-activities, SAT prep, getting into college, etc.)By the time you’re 22 and out of college, you’ve paid a lot of what you may think are dues.And you may not have ever worked for money.

          1. PhilipSugar

            If you have done all of that, you have learned everybody is not a winner, because you have worked like hell to win.Unpaid internships are immoral. I have paid interns when I could not pay myself.

          2. LE

            “Unpaid internships are immoral.”Well you know I disagree (as I’ve said elsewhere) with you on that one.All through my life I’ve done things where I’ve given away things for free which have led to making contacts and being able to charge for the same thing later on.Here’s a story. My wife’s nephew was not at a party yesterday because he was working as a lifeguard (paid) at a pool in Delaware. All that is fine (the job, the pay etc.) But I’d much rather have him be working for you and not getting paid where you might give him some of your wisdom or he might learn something that he wouldn’t learn doing the same thing that he already knows how to do (sit at a pool and watch the kids play and do the skimmer thing). Or be exposed to something and say “hey I might want to do this after college” (he’s a senior this year).I’m not saying he should work for you for 2 years full time for free or anything like that of course. But I’m a big fan of this type of model of learning (which of course can be abused no doubt).

          3. PhilipSugar

            If I pay him $15/hr and expect him to work he is giving away his work for free.

          4. Anne Libby

            My point: paying one’s dues doesn’t end with college graduation.And agree with you on unpaid internships. A young person can learn work ethic, skills and some industry basics, and gain “connections,” at a fair wage.

          5. ShanaC


          6. Anne Libby


        2. Jeffrey Hartmann

          Bravo Philip, this is absolutely the attitude I believe leaders need to have. Take risks to achieve your goals, talk about expectations, and change the game you are playing when the measurements don’t meet your expectations. That is how things are accomplished. Not by placating a constituency with various layers of inaction wrapped in a bow, but decisive real action to accomplish the goals that they feel are important. Unfortunately our leaders are afraid to fail and afraid to experiment. We need to stop rewarding those that make us ‘happy’, but reward those whose action made a difference or who actually tried things and tirelessly chased their goals.

          1. JLM

            .I agree with you more than you do with yourself but even that is not enough.Politicians are purposely creating dependencies in order to garner votes — welfare state, unemployment, disability, subsidized housing, Obama phones.The list goes on forever.JLM.

        3. LE

          “everyone is a winner upbringing”Agree. Related to that is certainly the idea that you can do whatever you want to do without regard to economic realities.Or the fact that many parents offer no guidance at all to their kids as far as what the job prospects are in a particular area. (Many by the way still think law is a good career they haven’t gotten the memo on that).A relative of mine is an opera singer and his parents thought that was just a dandy thing to do (they are educated and are both teachers). He does ok but it’s very clear that the chance of him earning a good living (that will support a home in NYC which is where he needs to be) is pretty slim. And he is very talented, good looking (as is his wife they are stunning like models actually).Nobody actually sat down and figured out exactly how a career like that will play out. He is of that “you are special” generation.Guess what? It’s fine to pursue a career that you think will be enjoyable but in the end work is work and you have to take income potential into the evaluation process.

      2. kidmercury

        i think everyone is stupid, but i blame old people more than young people. libertarian candidates gain greater traction with the young than with the old who are most interested in voting for whoever will keep medicare and social security going, and whoever won’t rock the boat too much because they are too old for that.

        1. JLM

          .I do not disagree with you.Older folks have however paid to develop their sense of entitlement with real money. They will never really get back what they contributed.What is silly about this is that the solution to these problems is obvious — age effective dates, etc.JLM.

        2. pointsnfigures

          younger people are sucked into the vapidness of the Obama personality/popularity/paparazzi, without examining the outcomes of the ideas he espouses. So, I blame young people.( a bit tongue in cheek here, a bit)

    4. Tracey Jackson

      So true.

    5. Juvoni Beckford

      As a millennial, I had to know what I wanted to do by my freshman year of college. I can’t say all my peers for fortunate enough to know what they wanted to do. I wanted to be a developer and got a job as one now.I did not become a C.S major because the program at my school was underdeveloped. I transferred to the business school because they were much more active in helping students get internships and other resources. I instead minored in CS and taught myself the rest.I had 2 internships by senior year and helped to found a technology and business club at my school.I had a lot to talk about during job interviews. In fact I had 8 job interviews after college.One thing I did notice was that, employers were not looking for “New Students”, They were looking for “New Professionals”.To get a job out of college you have to be focused, proactive, and connected. This unfortunately doesn’t scale to all students.

      1. ShanaC

        Oh, I knew by the end, but not the bginning. I also knew that my college had serious problems of helping people who did not want to work in banking.I knew by my 3rd summer that I wanted to work in marketing, in fact by the time I graduated I knew more about certain aspects of theory of marketing than some of the people who interviewed me. My career office did know anyone doing digital marketing, so they left me on my own. Also by the time I graduated I was fairly well integrated here and knew a ton of people from NY tech world as a result.Did not lead to a job for over 9 months, and that was a paid internship.I can name a number of other friends who that happened to. If you want to do something off the beaten path for where you went, good luck

      2. ShanaC

        Another problem with this approach is, as I call it, The “yesperson” approach. I was working with someone recently who clearly went along this approach, and yet couldn’t identify that the role she was in and thecompany she was in was having severe problems to due inability to think outside of the now normal “new worker” training paradigm. She was more inclined to just say yes and keep her head down for her boss’s sake. The funny thing is, I see this regularly, particularly among those with a similar “new professional” approach

  4. Avi Deitcher

    We could have made the same argument about automobiles 100 years ago. Yet whole new industries no one could have imagined opened up, and we are vastly wealthier for it. As miserable as this recession is, the worst off are better than the majority at the turn of the 20th century.We definitely are losing lots of jobs that are never coming back – some that we don’t need to lose due to economic mismanagement going back quite a few years – but (assuming we don’t kill the growth engine in *both* tech and non-tech) there is a world of new jobs we cannot even begin to imagine out there.

    1. Dave W Baldwin

      Per my reply to @iMacPhail:disqus above, we need to get those that can tinker into the realm of tearing apart gears, motors and such at a younger age to where they will be ready to build that which will be a major part of the workforce when they are in their 20’s. Otherwise, we are just screwing an entire generation.

      1. Avi Deitcher

        Assuming those that can tinker aren’t all emotionally neutered by whatever prescription drugs we give them…

      2. Mac

        The ‘tinkerers’ have built great things throughout history. Unleashing, not restraining, the abilities and energy of each generations-coupled with a strong “growth engine”-has limitless possibilities.

        1. Dave W Baldwin

          Amen. We just need to encourage those who are moving thru puberty. They can understand ‘concepts’ in 5th/6th grade and can learn by doing in 7th/8th. I took care of Electronics and related for a teacher who’s wife was on her deathbed and passed at the end of last school year. Turns out we gained a Freshman from ‘Bama who is a thinker/tinkerer. In fact, he figured out on his own magnetic motors. His mom’s boyfriend, when hearing of what he was mapping out a the dinner table, went over to the computer and showed him the magnetic motor was not a new idea. Austin felt dismayed. I explained to him that is the way the big world works, many trying to get somewhere with shared concepts…and it’s okay. This year, in FTC robotics, I have a young man who will build the damn thing rather than sit around and talk about it. Just hope other adults don’t screw with me too much.

          1. Mac

            That’s just good stuff, Dave

          2. Dave W Baldwin

            Why thank you!

  5. LIAD

    …welcome to the flip side of optimisation/disruption/automation.this stuff cuts both ways.we can’t have our cake and eat it.

    1. Gøran Berntsen

      Asimov wrote about this 50 years ago:…”The world of A.D. 2014 will have few routine jobs that cannot be done better by some machine than by any human being. Mankind will therefore have become largely a race of machine tenders.”

      1. LIAD

        “Each country has its own ruling class. In capitalist countries, the rulers own the means of production and employ workers. The capitalist class is also called the bourgeoisie. Means of production are what it takes to produce goods. Raw materials, satellite networks, machinery, ships and factories are examples. Workers own nothing but their ability to sell their labor for a wage.Because they privately own the means of production, capitalists keep profits. They make higher profits by cutting workers’ wages and introducing new technology to speed up production.Under capitalism, the owner, or boss, gets richer as production increases. The working class gets poorer. But capitalists do not control the most important source of power. Production does not happen without the labor of workers. Workers keep the system running” <===until they invented microprocessors.

        1. Mac

          ….and, your alternative is WHAT?

          1. LIAD

            i have no answers today. i’m just here to stir things up a little

          2. Dave W Baldwin

            Push the building of more robot/machine and get more hands involved in all parts of the country/world.

    2. Dale Allyn

      It’s more nuanced than that. For example in California, we have a legislature that is committed to idiocy in that there seems to be no limit to what burdens can be piled upon employers “for the good of the workers”… to the point of breaking the employer altogether. The math simply does not work, but the elected official retains their job because they worked to crush “the man”. It’s absurd and frankly a little scary.

  6. Mac

    Growing up in the Deep South I watched a once thriving, world leading textile industry slowly disintegrate. I have seen families torn apart, hopes and dreams crushed, millions of dollars of capital abandoned, and thousands of good people lose their careers and incomes . Why?Was it because they were unskilled?…NoWas it a lack of technology?…NoWas it poor management?…NoWas it weak business models or an inability to scale?…NoWas it a lack of demand?…NoWas it a quality issue?…NoOne word. Anyone know the answer?

    1. Dale Allyn


      1. Mac

        Well done, Dale. The ‘Golden Fleece Award’ should be descending upon your head shortly.My point being that this continues to happen and the resounding ‘thuds’ will not just be heard in the private sector.

        1. Dave Pinsen

          Strong unions in Germany and its manufacturing sector is thriving. When you make high-end, quality stuff you can have high margins and there’s enough money for workers to get paid well.

          1. Mac

            Guess we didn’t do it right.

          2. Dave Pinsen

            Guess not.

          3. JamesHRH

            @iMacPhail:disqus Germans don’t do a lot of garment work. While not an expert on textiles, competition form lower cost labour pools must have played a part in this change.

        2. Dale Allyn

          And unfortunately, unions wield much too much political influence (including pressuring members), so that elected officials are beholding to destructive conditions and practices.

          1. Mac

            Unfortunately. It is a cycle that continues to strengthen.

      2. ShanaC

        i thought the south was a relatively right to work area, at least compared to the rust belt

        1. Dale Allyn

          Shana, since Mac referenced the textiles industry I didn’t add a caveat, but you’re right that there are some auto industry bright spots in the south which remain union-free.Unfortunately, unions are doing significant damage across the country in terms of unsustainable compensation packages; political influence fueling bad practices; and corruption and bloat in the leadership of some unions. There was a time when unions were valuable in protecting workers, but state and federal laws are in place for that now. Unions need to fade away and allow the markets to buoy.

    2. Kasi Viswanathan Agilandam

      outa sourcea

      1. Mac

        Kasi, you’re warm. But why “outa sourcea”?

        1. pointsnfigures

          South Carolina’s economy is coming back. Factories are being built there, and the port of Charleston has modernized.

          1. Mac

            Thanks for observing and commenting on that. Incentives similar to the deal that brought BMW here have paved the way, along with an expanding technology base and knowledgeable workforce. Charleston is one of the favorite destinations in the country as voted on by Conde Nast readers. It offers a very attractive lifestyle. Tech based companies and workers have been locating there at a rate that would surprise many. One of the reasons I chose it for my startup location.

  7. Carl Rahn Griffith

    Bifurcation.Beter get used to it.

    1. Avi Deitcher

      Explain please. Think I know what you mean… but spent too long training myself to assume nothing and ask (even dumb) questions rather than make dumber assumptions about what people mean…

      1. Carl Rahn Griffith

        Neo-fedual society – becoming very polarised in terms of quality of life. The haves/have-nots – not just in material terms (who cares about consumernomics crap/trinkets, but most importantly the delta between the have/have nots in terms of hope – that’s the very scary bit. And I know which camp I am in, nowadays…).There will always be a percentage of people with good earnings and in pretty safe professions and/or with ‘old money’ – in these hard times they can spend with gay abandon – hence why some fiscal economic data appears contradictory – people buying a few more hundred Porsche 911s adds up the same value as lesser folks buying thousands of Fords. There’s not enough granularity so the politicians and myopic economists herald a recovery. It suits them. Nonsense.There are so many bargains out there IF you have hard cash and feel pretty safe economically. Everyone else is highly vulnerable – everyone – and it’s not going to get any better. ‘Our’ industry is certainly not the saviour.Remember, a recession is when your neighbour loses his/her job. A depression is when you lose yours.There’s an awful lot of ‘I’m Alright, Jack’ sentiment out there. Borne from fear. A very ugly human trait…I still try to be an optimist – it’s the only way to stay sane – but I suspect we (ie, many of us) are f*cked…

  8. Mark

    Marc Andreessen is famously quoted for saying “Software is eating the world.” More correctly, I think the quote should be “Software is eating the middle class.” But even then, software isn’t eating anything. Software is the fork.IMO at some point we are going to have to cast off the notion that we must fill 40 hours each week with an effort to acquire capital. The basic minimal income model seems a likely future step, but tied to a consumption driven economy, it complicates things, and begs the question “Who is being subsidized?” TBH, I think we have already started implementing BMI. Walmart instructs its workers on how to collect government benefits.Education cannot save the middle class, because in many ways, this is an old problem in new clothes. Software is not eating anything. Software is just giving new life to an old economic model.

  9. tsella

    Alas, I would have to disagree with the statement of (software) engineers, designers, writers etc. being in strong demand for the foreseable future. Not in the USA anyhow. If anything, I forsee less demand in those areas, mainly due to erosion of such jobs to East Asia where the best of the best will be offered the chance of working with the brightest peers under the best terms.No longer will the USA will be granting student Visas to Chinese, Korean and Indian. USA youths will seek enrollment in Sungkyunkwan University and Tatung University. International business language will fast become Korean or Chinese.But with that, Made in America may well become commonplace again. Probably not for anything manufacturable by machines (or requiring machines – don’t expect humans to solder much longer..), but maybe for other manufacturing/skills.I see myself as an optimistic realist. You may find yourself in a more pessimistic outlook – see…. Disregard, if you will, the Transhumanism angle, and consider the numbers and criteria presented.

  10. Dave W Baldwin

    Going to rip off one of @jlm best posts regarding synced labor at its besthttp://themusingsofthebigre…It contains a video showing the product of the B-24.This is one of the best videos I’ve seen. Thing is, the world where the employer is going to get as much out of the employee at the lowest cost has always been around and will be moving forward. Doing the bitching from POV of either side doesn’t accomplish much.Yet, back to that video, there was a pride in all of the fingers and brains involved with that production, we need to encourage that today and tomorrow.On the note of Accelerated Returns, we have so many that want to act like they know everything but still can’t change a light bulb. We have to change the cognitive across the board pushing to fashion the tool that will produce something great vs. a play toy.Bless those that labor and let’s enable them.

  11. Kasi Viswanathan Agilandam

    off-topic …It is funny that Zamanta mistook ‘jobs’ in your title for ‘Steve Jobs’.But I am happy that it has brought 1-relevant post to’ jobs’ u r referring to … 33% on target 🙂

  12. JimHirshfield

    Who are these “unskilled” workers? Is there really such a subset of the workforce? I think it’s a case of skilled workers skilled in areas no longer in demand. These are capable workers though.

    1. Anne Libby

      Thank you, Jim.Last summer at an alumnae mixer for student interns in NYC, a young woman was horrified to tell me that she was not working in a vaunted “internship” but was living at home with her parents, and had a job at Target.When I asked what she was learning, she said, “I guess I’m learning a lot about Guest Services.” My response to her was that working with the public in a front line service role is one of the toughest things around, and that anyone with any sense who interviewed her down the road would see this experience as an asset.So, yes. What, exactly, is unskilled?

      1. Avi Deitcher

        Great story. If I didn’t have to support a family, I would love to spend 3 months doing exactly that. It would teach me a lot!

        1. Anne Libby

          Exactly. So, when (and why?) did we decide that, for some people, their work shouldn’t have enough value to support a family.(Gen X here: early on I worked retail, restaurants, babysat, etc…)

          1. Avi Deitcher

            I don’t think we “decided” anything, except when dealing with legally enforced (or effective equivalent) monopolies. What a teacher gets paid today is different in real terms than 20 years ago; same for a fireman, software engineer or VC.We recognize that the way to get the most wealth into the most people’s hands is to let people work this out between them, on their own, in billions (trillions?) of transactions every single day.We could enforce that Guest Services worker must earn $X, but that will lock a lot of people out, shut some businesses down (or at least their customer service), and cause tons of damage in ways we cannot predict. So we let people work it out on their own… and then leave and go somewhere else on their own.

          2. Anne Libby

            I’m speaking more colloquially — and I do come into contact with people who believe that some people’s work isn’t “worth” a wage that will support a family.

          3. Avi Deitcher

            Does it matter what they believe? I meet people every day who believe that all consultants are overpaid people who “take your watch to tell you the time.”You know what I call those people? “Non-qualified” (as in sales) and move on.

          4. Anne Libby

            Yes, it matters. As much — or maybe more — from the perspective of civil relationships and respect as anything else.

          5. Avi Deitcher

            Only if you actually rate your civil relationships based on your professional/financial ones. I know plenty of security guards and garbagemen I respect more than some high-earning doctors or lawyers.But, yes, I understand many do…

          6. Tracey Jackson

            They may have your respect but do they have decent benefits, job security, are they paid enough to support their families, do they have a way up. Good democrats respect all people indeed, but do we help them?

          7. Avi Deitcher

            Well, I don’t respect *all* people, but willing to start positively unless and until I am proven wrong. :-)Do they have? I don’t know, some do, some don’t. But how would you get it for them, without causing worse damage elsewhere?

          8. LE

            Fine but is that because you don’t respect the doctors or lawyers for some reason?And are you talking about people that are security guards or garbage men because of some extenuating circumstance that put them there (rough family life, health problems, unbringing etc.) or garden variety non motivated less intelligent types?

          9. Avi Deitcher

            All of the above. It is about the person.That having been said, someone who could be a brilliant doctor or jurist and is a garbageman, well, what a waste, think how she could have contributed to society!And there are plenty of doctors and lawyers I respect – for their professional contributions and/or for their ethical behaviour – and plenty I do not – for the inverse.Job or salary or wealth does not equal good personhood.

          10. laurie kalmanson

            WalMart paying people too little to live on and gaming the system so that people who work require public benefits means that we are subsidizing their profits.Public aid for people without jobs is simple decency.Companies that won’t pay workers enough to live on is Walmart having figured out how to steal from the rest of us when their workforce requires aid to supplement below subsistence wages.Unpaid internships are voluntary exploitation at the other end of the scale, with parents who have the means choosing to write the checks that allow profitable companies to employ workers without wages

          11. Anne Libby

            I also think that the unpaid internships are training young people to not value their own labor. It’s hard to hear young people in the tech community in NYC talking about doing contract work that they haven’t been paid for.

          12. laurie kalmanson


          13. LE

            Disagree with all of that regarding unpaid internships as well. Unpaid internships are a way to make connections and learn even if you are taken advantage of. Of course if you are a loser none of that will matter. But someone who can recognize opportunity can do much with an unpaid internship.As far as the fact that unpaid internships benefit people who can afford to do unpaid internships welcome to the world of “life isn’t fair”. Fred’s daughter, if she could get an internship with a major well known photographer, would greatly benefit from that. Fred has earned the right to have his daughter have that opportunity just the same that he’s earned the right to let her stay at his place in the Hamptons or take nice vacations. Or introduce her to people that can help her with her career.

          14. Anne Libby

            If an organization is connected enough to give you connections, they’re connected enough to pay minimum wage.I’d infer from what I read here that Fred’s kids have been raised to find their own way.And I know of — firsthand and otherwise — kids whose parents think that their kids shouldn’t have to find their own way. It’s not pretty.

          15. LE

            is connected enough to give you connections, they’re connected enough to pay minimum wage.That’s a wide generalization. And what definition are you using as far as “afford”? If I feel that I can give someone knowledge and connections and a leg up what is my motivation for taking the time out of my day (possibly ignoring more important things) in order to teach someone what I know? Just to feel good? For the betterment of society? Just because?Why not also a larger financial incentive. The incentive doesn’t have to be large relatively. People clip coupons or go for specials even when the money doesn’t make a difference. It’s an incentive which changes behavior.Further, the fact that someone can pay is not a reason they should have to pay. Fred can afford to pay people who comment on AVC who contribute to his success (by being loyal blog followers). But he doesn’t and it would never be expected that he should. If you want to be in entertainment and you can work for Oprah (or obviously a lesser person) what is the value of that? Or be one of Bill Gates’s “brains” or assistants?I’d infer from what I read here that Fred’s kids have been raised to find their own way.Perhaps they have. But that’s also because they have a huge safety net of parents who can afford to easily dig them out of any financial hole that they make by virtue of the fact of making bad whose parents think that their kids shouldn’t have to find their own way.That’s true. But that’s parents problem not a intern problem.It’s interesting that people are quite willing in the day of the internet to take all sorts of things for free. But when it comes to giving up something they have and not getting paid (that could be a huge benefit) the tune changes.

          16. laurie kalmanson

            Great post.The race to the bottom does not have a happy ending.

          17. pointsnfigures

            I reject the notion of a race to the bottom. It’s looking at the world with the idea that the pie is fixed and we all fight for every crumb we can. That’s not how it works if the economic incentives are set up correctly. The pie gets bigger, and everyone works to keep making it expand.There will ALWAYS be winners and losers and economic inequality. Most of the inequality in the US can be explained via one stat: immigration. Most immigrants come to the US with less-and the next generation is the one that makes it.

          18. LE

            “WalMart paying people too little to live on”Totally disagree with this one as well as the living wage for people working at McDonalds one that is similar which really pisses me off to no end. [1]Also keep in mind also that the profits that Walmart makes are also distributed to others (in the chain) who spend it, and support a family on it.[1] Walmart’s “crime” (if any) is selling people things that they don’t need which in a sense is the crime of business or a casino or lottery. Getting people to spend money they don’t have. Along those lines what about Nike selling people without a pot to piss in $120 sneakers etc. It’s the way of business.

          19. Tracey Jackson

            They also sell guns. I sold my stock based on that alone.

          20. baba12

            Very true, people believe it is ok to pay a 300% markup for a Apple product but don’t see value in paying the same for say heirloom tomatoes. So as a society we have our values flipped and the honey boo boo’s of the world are celebrated while we will trash Masterpiece theater and PBS as being crap.

          21. LE

            I don’t care what the markup is I just care that I receive value for the product that I am buying. In my brain that is, even if it’s totally fabricated. Because most things are and there is nothing wrong with that. Not everyone wants Consumer Reports “best value” type thinking.Along the lines with your tomato argument I was at the market last week and wanted to buy some Apples.So I ask the that’s all he ever wanted out of life guy working the produce section which are the “best Apples” to buy. (I was just going to pay for the most expensive ones but he was standing right there so I thought I would tap into his “wisdom”.) He responded with an answer that said something that sounded like the price related to availability not quality and gave me no clear indication of a reason I should pay more or less for a particular apple. So I just ignored what he said and choose the ones that were the deepest color of red and more expensive. I really wanted to be sold. [1]Apple (computer) on the other hand, or a car company, gives you a reason to part with your money that gives you pleasure in parting with it.[1] Otoh I was in a luggage store this weekend and the salesguy there gave me a whole spiel (when I asked) on the difference in the quality of luggage that they carried explaining which was the top of the line “used by Athletes and people who travel constantly highest quality” and what fell beneath it. He had obviously been trained in getting someone to part with their money which to me was good. Buying a product like that, if you understand the quality differences between products, is like an appreciation like art appreciation ( compare stitching, materials, zippers etc.)

          22. baba12

            “He had obviously been trained in getting someone to part with their money which to me was good”. If he went with his conscience and sold you the product that is/was right for you, he may end-up getting canned.If markets were transparent then yes you could live with letting markets decide he right prices. Unfortunately they have never been transparent and those who participate in them are not interested in making it transparent.Therefore you will have a constant friction to deal with.

          23. LE

            If he went with his conscience and sold you the product that is/was right for you, he may end-up getting canned.Well there is a fine line between selling tobacco to kids to make money (or drugs) and selling some rich lady a mink coat she really doesn’t need. The mink coat has value. You don’t tell her she is stupid. You play into what she thinks the mink coat is all about. I don’t want to hear that I’m stupid for wanting the car I always wanted as a kid either. Don’t ruin the fun.So you are underestimating the party in the brain that people have when they have been tricked into believing they have spent their money the right way. Not up to the salesman to rain on that parade. If it doesn’t feel right to him he should pick another job. Of course there are examples where business is done differently which has worked on a small scale (because it stands out) and it builds the reputation of honesty in the organization or individual that in the end works out for them. But most of the time it’s not up to the airline reservation agent to tell you that you should fly with the other airline because it’s a better choice for you.My wife was about to buy a $350 robot kit for my stepdaughter. I rained on that parade but she was quite willing to think she was doing the right thing by spending that money (regardless in truth whether in this case it was the right thing). And a salesman at the store that would have “sold the dream” to her would not have been wrong either.

          24. baba12

            would you be ok then as a software engineer or an investment banker to have people from around the world be allowed to work with no restrictions on immigrations etc. When your job gets nixed or you can’t get paid the same amount as you have, I bet you will want rules/regulations to protect that fiefdom.So far the white collar world in the U.S. and Europe has largely survived being displaced. But it is a matter of time before bankers, lawyers, accountants, quants are replaced by people elsewhere for a tenth of what they get here today.That has not happened at the same scale as it has happened with manufacturing and it won’t happen for a while as there are moats built and held strong by people in those industries.I wait for the day when I see The GoldmanSachs bankers forming a union and wanting their jobs to be saved.It has not happened as the bankers are well connected and have a lot of “fat” to manage to keep the machinery well lubricated. Folks in the manufacturing world did not have enough “fat” and are not smart enough to keep the machinery lubricated.

          25. Avi Deitcher

            Yep, I would be “OK” (in theory). In practice, hard for me to watch real people suffer… but it was hard for them to watch those hansom drivers be out of work when Henry Ford’s line started churning out automobiles. It was hard to watch the checkout clerks out of work as self-checkout appeared.But there is a stronger upside: If a LowCostIBank, Inc. can do an IPO for 1/10 the cost, they will offer to do it for 2% instead of the customary 7% and make a killing. Pretty soon, they all will (except for boutiques targeting complex deals). And lots of iBankers will be out of work.But the companies just got a lot more money to spend. That money will go towards real companies making real products and services, rather than lawyers and bankers. That means more investment and jobs elsewhere.One of my closest friends is my lawyer, but I would rather spend $1,000 on R&D or sales than on him.

          26. Donna Brewington White

            What a question Anne.Or that people who program machines are more valuable than people who program young minds.

      2. baba12

        what she and her parents should realize is, paying $100k for a 4 year degree in soft skills is not helpful at all. Nothing wrong with gaining soft skills but paying $100k for it makes it difficult to repay that loan ( assuming one took out a loan) as the jobs that will be available are low paying at best. What is “unskilled”? Unskilled is inability to navigate life with the tools ones has.

        1. Tracey Jackson

          But if you are skilled and there is no place to use it – then what? I think perhaps we confuse unskilled with undereducated. Painting a house is a skill, so is gardening. But many people don’t want those jobs and the truth is the people who work off the books get them.

          1. baba12

            Painters and gardeners are not paid a white persons living wage. If you are a good painter or a gardner and charged $20/hour, you would be outpriced of the market.We the people have created a lax system as it suits us fine to have low wages in certain sectors of the economy.If tomorrow you could hire a banker/lawyer/doctor/media personality who was not documented to work legally here and they charged far less than the prevailing rates I would guess there will be a huge outcry. It is a class structure that we support. The readers of this blog who are not likely to be un-documented workers who work in cafes, farms, meat packing, restaurants etc are all fine paying low prices for the services they get. But we folks would be shouting and screaming if our jobs as programmers, bankers, lawyers, accountants were being taken by un-documented lawyers, doctors, accountants, bankers. We have so far managed to keep it that way and we will do everything to keep it that way.Manufacturing shifted to low cost centers because the owners and a few managers could careless about their workers. THe top brass at The GoldmanSachs is not ready to outsource their management team to a low cost center as yet because they don’t wish to cut the branch they are sitting on.But in time it will happen or I hope it will happen. The hope is parity shall be achieved but it maybe a long drawn out process.

          2. pointsnfigures

            Goldman has a very different business model than a factory. At it’s core, investment banking is a people business, just like Venture Capital (and just like pit trading was)

          3. baba12

            yes it is a people business sure, but if I can find cheaper people I should be able to do so. Problem is the goldman sachs of the world want to de-regulate every other industry but theirs. I’ll reiterate again I don’t believe we have rules and regulations as a means to restrain businesses from creating wealth etc. We have rules and regulations only after business in it’s quest to create wealth finds ways to be unscrupulous to create more wealth. It then becomes the responsibility of a third party to be the enforcer of the rules and regulations we collectively agree upon.Markets don’t always work smoothly because they are not transparent and there are vested interests that would not allow that to be the case. I don’t see many free market thinkers advising companies to setup shop in the Somalia’s of the world where no rules/regulations exist they can do anything and everything and it would be fine. Yet so far there don’t seem to be any takers. Wonder why?

          4. SubstrateUndertow

            Goldman’s business model is to arbitrage the general public ignorance that exists around investment banking and the financial industry in general.

        2. Anne Libby

          Liberal arts degrees (literature, history, social sciences, the arts) offer a number of opportunities to learn critical thinking, analysis, discipline, and an ability to make a well reasoned argument. One can learn teamwork from sports or music. And so on.That said, I have no solution to the 6 figure invoice for college.

      3. ShanaC

        i hate to say it, but the people who got those jobs who graduated around that time are having a very hard time escaping from there. Employers got picky and they explicitly now ask for backgrounds in things that have nothing to do with the job (finance, example, as an example of finishing school for college in a marketing job)

        1. Anne Libby

          That’s why sales skills are important. Someone with the right positioning and hustle (and the right target employers/clients) is going to be able to tell a relevant story about any experience. An interview question I love to ask is, “Tell me about a time you disappointed a client/customer.” The young woman who spent the summer working at Target will have more than one story to tell, and also should be able to talk about how her response to a disappointment customer improved over the course of the summer. To me, someone who understands this is gold. If the company you’re trying to work at/sell to doesn’t get this, they probably won’t get you.

    2. Aaron Klein

      We’ve got a generation of them coming out of higher education.The very community college whose board I sit on has produced graduates with plenty of theory but zero real-world skills to do any meaningful work.Congrats on that degree in Feminist Studies and Environmental Justice. Now tell me what you’re going to do with that.

      1. JLM

        .”Would you like fries with that, sir?”JLM.

        1. Aaron Klein

          It’s true. I don’t know how many embittered Environmental Justice graduates McDonald’s employs, but I’ll bet it’s a lot.

          1. pointsnfigures

            I’ll be willing to bet it’s not that many. Job is beneath them.

          2. Aaron Klein

            At some point, you gotta eat.

          3. PhilipSugar

            No you work the system. But I love your truth. People hate when you smack them on the face with truth.Now here is truth from the redneck, hillbilly world.I was just at a Labor day party. One of my cousins through marriage just had a truck lifted more than my wife’s. He was so proud.He’s 20. What are you doing Dustin??? “I am a skilled pipe-fitter making $30 an hour plus they give me $600 a week since I am sleeping at the plant so I can fix something if it breaks in the middle of the night, plus I get OT”No living expenses skilled job, kicking ass. Yup, that is hard work and I certainly respect every minute of it, not enough of the “elite” do.

          4. Aaron Klein

            Love it. That is good, honest work.Nothing better than someone working hard to acquire skills, delivering more value to their employer than they take, and making BANK doing it.

          5. JamesHRH

            Phil, great story.Today, my wife was an invited guest in the Sarnia Labour Day parade – they put her right at the front behind the banner (she is GM of a refinery here).A city of 75,000 hosts one of the top 10 largest parades in the country: millwrights, boilermakers, pipefitters, carpenters, etc.Any short chat with a union leader will tell you that jobs are way down from 30 years ago.But the perceived esteem of the jobs seems to be down as well, which I don’t get. Any job done well is a day well spent. Any life doing useful work well is a life well spent.And these people make a decent living.Pretty interesting day.

      2. JimHirshfield

        True that.They’re unskilled.But they’re not workers (yet).My original content was in reference to a supposed workforce that’s unskilled. Politicians reference this cohort, and all I can picture is a group of dolts once employed as doorstops; a non existent group to make a point.

        1. Aaron Klein

          Well, my only quibble with that is that they SHOULD be workers. If we’re not producing productive working taxpayers, what is publicly funded higher education good for?I think your overall point is right. There are plenty of skilled workers who simply don’t have the right skills. Training them for the skills of the 21st century is critical.We’re doing that at Sierra College in a lot of cases. We’ve got one of the nation’s premier Mechatronics programs — the study of integrated electronics, embedded systems coding, pneumatics, hydraulics and sensors.Graduates can repair ATM machines, gaming machines, wastewater treatment systems, hybrid cars, etc. And we have a hard time graduating them because they get hired so quickly by employers anxious to find people with actionable skills.

      3. ShanaC

        i hate that. Really. I have an freaking at degree, and I felt extremely prepared to work when I came out. One of the strongest project managers I know has a degree in comparative literature with a speciality area in dramaDegree is not what matters, it is ability to think and express ideas.

        1. Aaron Klein

          Look, the simple fact is that most of those degree programs don’t generate that result. The curriculum isn’t designed to.Don’t mistake your level of innate talent for the result of a degree program not designed to produce those results.

    3. Mike Bestvina

      Spot on. We are training in “Arts” when there is no job growth there. Why is that in college I never, not once, had a course in Project Management? Why are all of these things considered “even higher” education when they are absolute footprint of the new age of skilled managers in America?

      1. JimHirshfield

        I think there’s a sense that colleges need to cultivate cultured thinkers. And that’s a good thing.Project management training falls into the category of trade skills, which many colleges avoid.

  13. Anne Libby

    What skill will be useful in the any new economy? It’s not a technical skill, it’s a people skill: sales. Those who have it will prosper in a range of fields. Those who don’t, will not.My bschool didn’t have a “sales” class when I was a student; I don’t think that they do today.Fred, will the software academies cover this topic? To me, it is key to successful to navigating the world of work during this discontinuous time. (And this is not unrelated to your point, @ShanaC:disqus …)

    1. JimHirshfield

      Good point. But one skill at a time.

    2. Avi Deitcher

      Add psychology to the list…

      1. Anne Libby

        Yes! Key in managing others, which I think will become more important, not less.

    3. Pete Griffiths

      Fairly recently I reviewed the course options of all leading business schools. For all practical purposes there are no classes on sales or sales management. It’s an appalling state of affairs.

      1. Anne Libby

        Weird, right? I had some wonderful marketing courses. And more practical non-credit courses in public speaking and such. Why not sales?

        1. Pete Griffiths

          I believe it is because it is not readily studied as an academic subject. These days there are tools and there is data that may be changing this but academia is till behind the times.

          1. Anne Libby

            I hope they catch up…

    4. ShanaC


  14. Kasi Viswanathan Agilandam

    “World is Flat but the currencies are not”.

    1. Carl Rahn Griffith

      The are: Fiat.Just one small letter substitution ;-)Flat Earth Society madness has been usurped by Fiat Earth Society insanity.And we’ve fallen off the edge…

      1. Kasi Viswanathan Agilandam

        what i meant was … the currency difference will shift jobs which can be commodized/manual intensive.

        1. Carl Rahn Griffith

          Cool. I believe currency – as it is – will become a totally arcane unit of measurement/commerce. It has to become secular.

    2. pointsnfigures

      Currency can be rendered flat via hedging. The overnight market for currency hedging is in the trillions of dollars.

  15. William Mougayar

    The US is still not graduating enough students in Computer Science, barely 50,000 per year.

    1. pointsnfigures… The STEM crisis is a myth. Interesting take. My own personal preference is to combine a STEM education with a good (non-politicized) humanities core that teaches good critical thinking skills.

  16. iamronen

    “a job is something that everyone needs. It is about pride and self image as much as it is about money.”I’m not convinced that is a valid truth anymore (nor that it ever was).a job is something that modern western industrialized society needs everyone to have – without it you are simply excommunicated from society (hence the temporary side effects of income, pride and self-image).what everyone (and society!) needs is to have the freedom to pursue purpose, meaning and inspiration.I don’t think the western economic mindset has even started to appreciate that it isn’t just the jobs that are going away (and not coming back), but that the social/individual ideals behind “jobs” are being challenged.Anyone who’s pride and self-image are dependent on their jobs is heading for a fall. I believe purpose is going to replace pride and and fullfilment is going to replace self-image.Losing jobs-as-income is just the beginning of something much bigger.

    1. Avi Deitcher

      I beg to differ (at least partially, and I don’t really beg…).I believe a person takes great pride and pleasure in his/her ability to contribute to society, essentially to make the world a better place. That is the heart of the work ethic.Ask me what I would do if I suddenly had a $100MM exit tomorrow? I would take a few months off to enjoy family and recover, and go work.It isn’t the job… it is the knowledge that you are improving the world in a measurable way.

      1. $28312048

        Ugh, that falls under purpose and meaning. That is what has purpose and meaning to you. Maybe not the next guy. The next guy may be fine building a refugee camp instead, or at least donating a few million to build one and enjoying Netflix from the couch.

        1. Avi Deitcher

          Well, I am arguing it isn’t completely subjective. I think there is something in man’s nature – I don’t care if you view it as evolutionary, or spiritual, or biblical, but I see it there – that gives him higher purpose and drives him when he does something useful.Yes, useful can be building a refugee camp (but I prefer the woman entrepreneur giving the refugees jobs so they can build their own homes), and, yes, donating a few million as well.

          1. $28312048

            It doesn’t have to be either/or and you don’t seem to fully grasp why refugee camps exist and in the very real, dangerous and fluid situations in what they pop up in. Life isn’t a Ron Paul Libertarian pamphlet. They aren’t just lazy bums lounging about. Building a home just to be looted and burned to the ground – or forced from it a SECOND time – is a rather pointless maneuver. I’ve read a lot of your posts, especially on this thread, and they seem to lack a lot of nuance, trumping ideology over how the real world works.What you are arguing is completely subjective, contrary to your claim. Your view of what is meaningful is meaningful only to you. The first hint of this is starting off your sentence with “I think…” and not “Scientific studies have shown….”

          2. Avi Deitcher

            I don’t want to get into an ideological debate here, definitely the wrong forum (as important as it is), and I don’t have the time.Why would you think a refugee is a bum? Considering how much of my family were refugees after WWII, I find that rather harsh.A refugee is someone who has been turned out of home, usually village or city, because of warfare or other disruption (earthquake). They need immediate help… but they would really like to rebuild, either back home or in a new home.Best thing my family ever got when running from Europe to North America wasn’t a camp, or even a home.. it was a job and a business in a new, safer place.

          3. $28312048

            I see you have bothered to skip over even reading my post. So, yes, you are right in that we cannot have any debate at all here because you are not even bothering to hear what the other person is saying – a common symptom it seems among the hardcore driven by ideology set. Nowhere did I say a refugee is a bum, in fact the opposite is stated. Nor did I need a summary of why refugee camps exist as I clearly already knew.For someone who doesn’t have the time, you are surely spending a large amount of time (and replying quickly!) to posts. I’m not sure you grasp just how much time you seem to have.And yes, this is not the place for an ideological debate. I was not seeking one, merely pointing out that your ideology is slowly disconnecting you from seeing the nuance of the world in action around you.

      2. iamronen

        I believe you believe thatI believe it may be true for you … for nowI believe that belief may change from within over the course of your lifeI believe you may fin that belief under attack from the outside worldI believe you are trying to impose that belief on others when you say “I believe a person…” … I believe that to be an error.

        1. Avi Deitcher

          I believe @iamronen is a budding poet….

  17. Krasi

    The first duty of a man is to think for himself.- José MartíI think most people would be fine and they do not really need the government to make any choices for them.

    1. Avi Deitcher

      I believe the corollary is..”And the first desire of man is to think for someone else.”I agree, but the government is nothing more or less than many people.

      1. Krasi

        Well, I do believe in real philanthropy, man-to-man, as individuals need to help other individuals.I don’t believe in government philanthropy, it is a bogus one, often at a gun point, and it doesn’t produce good result.I suggest reading “The Law” by Bastiat, it’s simply brilliant 50-page bookbtw, government is usually not more than a bunch of people

        1. Avi Deitcher

          “not more than”? Meaning it is usually less?

    2. Dale Allyn

      So long as the government steps aside and gives clear passage.

    3. Mac

      Bravo! Well said.

  18. pointsnfigures

    My friend is a labor economist at the University of Chicago, He has done a lot of research on employment, job design, and now what happens when companies merge.HR is the roughest part of running a company, startup or otherwise. That’s why great CEO’s get paid a lot of money.There is so much friction in the employment process, and so much government regulation. In states that are pro-union, like Illinois, it’s even worse. It’s hypercompetitive for all businesses out there these days. The average shopkeeper has to keep an eye on Amazon, and adjust their inventory to things people will actually need right now. Imagine what happens when a company like gets same day delivery down.Retraining is one solution-but for what? No one can predict the future. The more government spends (never invest since govt’s can’t do that) on education the more screwed up it gets.Even large corporations are avoiding the hiring process, and installing consultants into positions. Outsourcing in a different way. The hourly ticket is more, but the total cost is less and the marginal cost to add another worker is less.There is a fast food technology that is being proven out right now. It can make your burger and deliver it to you without the help of anyone. A ShakeShack without people. That’s where the world is going.The best thing people can do is get good information, and turn the economic incentives into work friendly. Once the incentives are turned that way, people will create or find things to do.In this case, it seems the more we do the more screwed up it gets. Better to get rid of all the taxes, and regulations and let markets decide.

    1. baba12

      Government is not in the business of creating jobs or cutting jobs. I don’t expect anything else from a University of Chicago professor, to blame regulations and government for what we have.Government has been all about creating an environment to allow innovations to happen.Amazon, Google etc wont exist if it was not for the government. You will not and should expect private enterprise to fund fundamental research, they don’t have the capacity nor desire to take on the risks. Sticking to jobs, even if there are zero regulations/rules such as they are in places like Sudan and Somalia, businesses are not creating jobs nor adding new ones and moving to those locales.In every field technology is interested in removing in-efficiencies and rules/regulations are not holding from job creation.The most highly regulated industry which happens to be Finance also would cringe at rules and regulations being removed that would remove the in-efficiencies that currently that industry thrives on.I’d like to see you live in a place with no taxes, rules and regulations and be in a truly free market environment. This is not a black or white society,we live in shades of grey and if you don’t buy into that philosophy, I’d say make a go of it in lands like Somalia. I doubt you would survive a year out there.

      1. pointsnfigures

        Amazon and Google would exist, absent the govt. Finance would be better off without the govt. I don’t know how much you know about the rules, regs, and taxes in Finance, but they are set up to benefit a few players at the expense of everyone else. So are Ag rules and regs, Education rules and regs, Communication rules and regs, Energy rules and regs.

        1. LE

          “Amazon and Google would exist, absent the govt.”He is no doubt referring to the fact that without the money that the government spent on research, and the reason for developing the internet, google and amazon wouldn’t exist.I go along with that argument. It’s one of the many benefits that are created as a result of the Russians, war, and all of that. And the reason it’s good men are the way they are. Without that conflict and narcissism much of the things we enjoy today wouldn’t exist because there wouldn’t be research that led to these discoveries. People need to work toward a goal.How many things can you name today that we enjoy that can’t in some way be linked to military spending?

          1. pointsnfigures

            There are plenty of them. Let’ s start with cars.

          2. LE

            Cars usage grew not only because of Henry Ford but because the government had a program to build highways which led to the suburbs where people needed cars. (I’m not for government spending etc in general but I acknowledge the good that has come out of it in many cases.)It is really difficult of course to narrow this down to one or even several factors. Many things come into play as far as what leads to what. (Defense, history of Silicon Valley etc.) And of course given enough time and research you can write things like this many ways depending on one’s point of view.

          3. pointsnfigures

            there were private roads before govt roads.

          4. LE

            Federal Highway Act, Eisenhower:…As only one example I remember when I95 was built through Philly (and wasn’t even finished). We moved (was the 60’s) to a suburb as a result of the easy commute to where my father’s business was at the time.No comparison to private roads at all. Back then, it was 25 billion dollars in the 1950’s.Will correct how I phrased “where people needed cars” to “where car ownership became both practical and necessary”.Not to mention of course that in war time the government spending money for airplanes or tanks (Ford’s factory made things for the war) as well as Boeing was a great benefit. Like a cost plus contract. Nothing like guaranteed income to allow you to expand and build your business.

      2. SubstrateUndertow

        Yes, everything complex enough to be of any interest or utility is anchored in an effective set of regulator and synchronizing feedback loops. That includes every aspect of functionally stable human culture.

    2. Jeffrey Hartmann

      I believe in the power of markets, and manipulation causes crazy stuff like our Healthcare industry and the mess that was the mortgage bubble. That being said, I think the problem though is not that we tax, and not that governments are big. It is that we measure them in the wrong way and we aren’t pushing for the hard goals. Governments are incredible at fostering technology that is not ready for prime when they make that a goal. Look at what happened when we had the reason to build nuclear technology. The manhattan project has completely transformed our capabilities, and no private investor would have every poured the resources into the effort required to make it happen. Governments need to foster and create the things that could make the future better for all of us. It needs to foster the smallest seeds so they can grow into giant trees. Now though Government is focused on keeping the current trees trimmed and healthy, not worrying about planting a forest of them. I say simplify taxes considerably, work on making things very positive for seedlings and have their burden increase slightly as the tree grows. I don’t think getting rid of Government and taxes and regulations is the answer, we just need them to focus on things that they are good at and to foster an environment where we can all grow tall.

  19. BobWarfield

    The apparent death of manufacturing in the US is relatively recent, caused by a variety of factors nobody likes to talk about, and fairly reversible:…Germany does a far better job with its Manufacturing Economy because of some interesting cultural differences:…Technology does have the ability to stimulate a very interesting Manufacturing boom, and I have seen firsthand a number of laid-off machinists who’ve used increasingly low cost “Hobby CNC” coupled with things like Kickstarter to start successful domestic manufacturing businesses:…Our biggest mistake is we are far too interested in subsidizing net job destroying big corporations with our lawmaking to facilitate practices that largely do not benefit net job creating small businesses.The push to increase visas when there is already a glut of STEM workers and wages have been flat since 2000 is just the latest example.

  20. BillMcNeely

    I think about a job everyday. Mostly because I have been underemployed for 21 months.But I have learned a lot about the American economy with my odd jobs.Such as Old school sectors such as the car industry. How even in a low front end margin business they are killing it . But they don’t like automation. and social media. and speaking off script. But it’s also its still possible for folks with little education who can’t read write or do math but can speak well can make make a great 5 figure or 6 figure salary.The retail industry. Some folks get the change. Nordstrom namely They are actively morphing social, mobile, the web and brick and mortar into a money making beast. Others don’t.I think at one interview I was told we don’t actively go out and hire creative people we just want people to execute the plays.Tech Sector. Although I have not successfully landed here yet. It’s incredibly open and full of wonder. Veterans have made some serious inroads into this sector as of late thanks to TechStars and I would love to see how programs like Incline could develop as training ground for vets to pick up coding skills. Tech Startups to Veterans: We Love You We Want Some More of Ya…We still need more financial literacy in this country. Folks come in to see me all the time with no money down on a car ( come with at least taxes that saves $40 a month), no idea what their credit score is, financing options are ( your paying 2% more through the car dealership).Speaking from a veteran’s perspective, I am still looking for a mission, for a purpose.

  21. jason wright

    people need to throw off their conditioning, tap their hunter gatherer instincts, and go get something started… locally.i hate the word ‘job’ and i hate the word ‘work’.in a peer-to-peer world we can achieve more.

    1. Dale Allyn

      But can we stop short of the Borg? ;)I don’t hate the word “work” because I love to “work”. Am I always productive? Nope. But I “work” every day, if I’m not out hiking in the mountains or pursuing photography (not much this year).I get your disdain for the word “job” in terms of emotional semantics, but it does serve a purpose in terms of communication. It can be synonymous with contribution or task in this context. I agree that labels shouldn’t matter as much as they do (if that’s an underlying message you offer).

    2. Carl Rahn Griffith

      It’s that command-and-control conditioning that many still expect to govern their lives. Government wants us to become more peer-to-peer but within their legacy framework.Doesn’t fit.

  22. John Revay

    American dream, Home ownership, Your children having a better future/opportunity than you did, Income inequality …….things on my mind over the last several years.

  23. John Revay

    “…..other than work like hell to make sure as many of our young people have access to the kind of education that will give them the skills to do the work of the future”It is scary the increase in the cost of a college education over the last decade, College administrators seems to be competing w/ other schools to get the most people to apply to their freshman applicant pools…that they keep spending huge sums on infrastructure and programs.#HavesandHaveNots

  24. JimHirshfield

    Coincidentally, came across this on Digg today:…”The STEM Crisis is a Myth” – very well written and compelling data in support of main point: there isn’t a shortage of engineers. I think he’s right. But I’d still advocate engineering/science education for my kids.

    1. BobWarfield

      He is absolutely right. I personally know a number of truly excellent software engineers who’ve experienced it firsthand right here in Silicon Valley. And you are right to want a good STEM education for your kids. What’s wrong is the push to keep expanding the visa situation.

  25. Thinker

    As an entrepreneur i think always about hiring people, maybe 5 maybe 20 people. But what if we just change our way of thinking and we start thinking about hiring 100,000 people or 500,000 people.We live in a global world and 500,000 employees is not a big number at all. The world population is 7 billion people, so we have just to think globaly.The question now is: Is there any business idea that can hire 500,000 people at one time?

    1. $28312048

      Sure, there are plenty of companies that have cropped up into super companies that employee many more than 500,000 employees. Walmart, Starbucks, etc. are relatively recent expansions. Its not like they’ve been around since the robber barons.The real question is: will you pay them a wage to live on or will you starve them and pass them off to the public dole to take care (while dodging taxes at the same time)?

      1. laurie kalmanson

        related: subcontractors…

        1. $28312048

          Now there is a group of people that need to unionize, stat!

    2. baba12

      Yes there is a business that can hire 500,000, it is called a militia to go out and capture resources.That you are talking about is a utopian view.Technology’s role through history has been to improve the human condition.Never has the role of technology been to create jobs. It is always been about removing in-efficiencies in the various processes we have in place.USV makes money for it’s investors but it does not hire tons of folks and will never hire tons of folks.Going forward there will be increased concentrations of wealth with larger numbers of people getting grouped as skilled yet poor.You are seeing that today. Silicon Valley VC’s of today are not in anyway or form interested in funding big ideas, they are not capable to do anything more than what they are doing currently.They definitely as not interest in an idea that hires lots of people, like say setting up artisnal cheese franchises to serve the super rich.Mr.Wilson writes ” am not sure exactly what to do about all of this other than work like hell to make sure as many of our young people have access to the kind of education that will give them the skills to do the work of the future”.A noble effort, but he is not willing to accept realities or he knows the realties and feels in some way he needs to fund efforts to educate and create jobs in the society he lives in.When Facebook adds 1 million new users at most they add 1 more job in their software engineering group. Instagram had 13 employees and sold to Facebook for $1Billion, assume that there were say 500 other investors, that wealth got distributed amongst those few folks only.Kodak on the other hand employed 140,000 people and is now going through bankruptcy. To expect that there shall be new industries that hire large swarths of society is foolish. At best it will hire a few people. Eventually there shall be bloody revolutions to deal with unless the rich are willing to be less greedy yes less greedy. I would like to see a VC say they invest in ideas that employ large numbers of humans, lol I must be stupid and naive to even imagine such things…

  26. Bridget Goodbody

    I like to imagine a world where the language of code is universally studied alongside, say, English and Art instead of, say, Engineering. Where the education conversation is separate from the-technology-sector-needs-engineers conversation. Or, at least, where humanities are fully integrated into the technology-sector-needs-engineers conversation. Seems like there are endless opportunities for tech to revolutionize industries….

  27. $28312048

    Whats a job if there is no security and an employer that is contantly jerking you around? This is no stranger to places like McDonalds and Walmart as it was to places like MSFT and a large swath of Silicon Valley. It is contempt for the worker that is the problem with this economy and the stagnation of wages that short sighted executives and share holders want to suck every penny out of while ignoring that these people are not just disposable workers, they are the customers that give any business value.

  28. JLM

    .When you ask a man or woman — “What do you do?” he/she answers with the nature of their work.I am a carpenter.I am a venture capitalist.I am a CEO of a public company.Our work defines us and we identify much of our own ego and id with our work. In some professions, we literally wear the badges of our work on our uniforms. I remember being a young Airborne Ranger Army officer and sidling up to the bar at a new Officers Club and watching the other bar flies “reading” my ribbons and badges.This is such an important defining element of our being that the current unemployment crisis is not just an economic crisis, it is a crisis of identity and personal worth. A man who cannot put bread on his family’s table through his own sweat is a wounded beast.We are at a 34 year low labor force participation rate and over six years of 7%+ unemployment with that being grossly understated by the faux calculus of the labor force participation rate. Real unemployment is over 12% and even U-6 and U-7 show how desperate the situation really is.We will not celebrate “labor” in this country until we have a business environment which again creates jobs, celebrates the creation of business and personal wealth and which rewards hard work.If we continue punitive levels of corporate and personal taxes and our profligate spending — who has actually done anything to curtail spending? who? — we will continue to have results which suck the life out of our collective psyche.A man or woman is their work.God bless everyone on Labor Day. God bless the laborers. God help the redistributers and the looters.JLM.

    1. Vineeth Kariappa

      Read Wealth of nations?

      1. JLM

        .Not in its original printing in 1776 but shortly thereafter.That would be a “yes”.JLM.

        1. Vineeth Kariappa

          Pretty sure i din read the 1776 edition either. Country A produces product A at a lesser cost than country B, which produces product B. Free trade. The world economy grows. But, to please citizens, the “govt” bails out loss making companies when there is no biz sense. The problem is with the people not the govt.

    2. Mac

      A purposeful life is a more meaningful life.

    3. Pete Griffiths

      But surely the critical question is whether any ‘business environment’ can ‘create jobs.’ To put it another way, if history has taken us to a point where global cost structures and global markets cannot support a US workforce with anything like a standard of living that is the envy of the world and high employment then we have a problem. My strong suspicion is that this is precisely the point we are at. Of course policies can make some difference but I suspect that within broad bands (eg capitalism vs communism) it is more marginal that we might like to imagine.

      1. JLM

        .Huh?Look at Texas v California, please.Without Texas jobs, the country would have created net ZERO jobs for the last five years.The Tx v Cali comparison could not be more stark and obvious.Governing philosophy and business environment are the essential foundation elements of the success.We are closing in on 10% of the Texas population are going to be California refugees within the next 3 years. You cannot swing a cat without hitting a former Californian.They are not using chemical weapons in California, they are using something almost as bad — deadly political and economic policies.JLM.

        1. Pete Griffiths

          You can arbitrage within the US but how do you think that will solve the US’s structural problem?Look at labor trends in advanced industrial countries since the industrial revolution please. 🙂

          1. JLM

            .The example I cite is exactly as you describe — internal arbitrage.What is applicable to the entire country is no taxes, low levels of regulation, lean government (Hell, the damn Lege doesn’t meet but every other year), responsive government and a serious energy policy.These are the tenets of basic governing philosophy which differentiates California from Texas but which are also universally applicable to the entire country.These policies work and work much better than the current national and California policies.They used to be the national policies once upon a time.Old ideas in new bottles?JLM.

          2. Pete Griffiths

            OK – let’s stipulate that by some miracle our structurally dysfunctional political system achieves the impossible and passes a coherent set of laws along the lines you propose. How will such laws alter the reality that for the first time in its history the US is facing competitors in the global marketplace that are punching at something approaching its own weight? Instead of facing small European countries broken down by war and with correspondingly small domestic markets the US is now facing the BRICs. These countries offer enormous natural resources, massive domestic markets, cheap labor, autocratic political systems and a fairly clear understanding of how to compete on a global stage. What policies, for example, can we adopt that will force open these domestic markets to goods that we actually manufacture as opposed to design? Is there some reason to believe that in the absence of regulation the freedom will somehow bring into being high valued added jobs that it is hard for our global competitors to replicate? What would these jobs look like? I don’t see it.

          3. JLM

            .Way too broad a subject for a comment but “yes” we can do it.Remember that much of what is global competition is driven by American companies operating globally. We are quite well positioned to compete.It is access to the American market which is not currently being leveraged adequately. It is still the largest and most important market in the world though it has a fairly small bit of the world’s population.Much of the jobs situation is simply policy driven — witness the dramatic transformation created by the necessity to have American content in foreign cars. Many foreign cars today are literally Made in America. Witness MB/BMW in the Carolinas and Toyota in San Antonio.We can do whatever we marshal the will to do. As Stonewall Jackson said: “You may be whatever you resolve to be.”JLM.

          4. Pete Griffiths

            a) US companies can do wonderfully on a global stage without that fact helping create jobs in the US. US capital knows no borders only laws and returns.b) the US market is indeed still the largest single market but not for long This is a huge structural change for us. Instead of us benefiting from our huge domestic market to achieve economies of scale then roll over competitors with smaller domestic markets (Europeans) we will face the same challenge. History suggests this is not an easy challenge to address.c) there will undoubtedly be cases where it is to the advantage of foreign companies to manufacture in the US. Ironically, in many instances, this results not from our manufacturing pluses (eg low US labor costs) so much as to bypass our protectionist policies.d) we are not the first hegemonic power to face significant structurally competitive threats. And I suspect that we will not be the first to discover that relative decline is not easily remedied by appeals to the force of will. This would be true even if we had a functional political system – and we don’t.

          5. Kenyan

            If you took the words in this post, but replaced the word “America” or “American” with “China” or “Chinese”, you would also be speaking truth. Quite funny.

        2. baba12

          Facebook and Google are not setting up their headquarters in Texas. This notion that if you have taxes or regulations businesses will move to other centers is wishful thinking. People are not moving to states with no income taxes, if that was the case the rich in NYC would all be residents of New Hampshire, Texas, Florida. Google would be headquatered in Dallas Texas.Long term Texas has a slight chance of being a net contributor to the GDP of the contributor. They depend on natural resources to provide for the infrastructure they have.The high tech hub in and around Austin and Dallas depend on the State University system to deliver quality graduates to work in the high tech world that is out there.There is seriously a disconnect between those who believe taxes and regulations are the cause for the problems we have and those who believe that we need to pay collectively if we want a thriving society.Private enterprise has never and should never be interested in creating jobs. The role of government is not to create jobs either.Government is what we decide we want to have collectively, this is not a dictatorship nor a monarchy.We have come to have rules and regulations after long drawn battles and yes they are battles. As for Texas being better for business great, Tesla is not setting up shop in Texas anytime soon. So maybe it is not all that bad in California as it seems to be.

          1. JLM

            .What is happening is that folks like FB, Google, Apple and others are setting up shop in Texas with their growth elements. The new jobs are being planted in Texas. This is a fact.I am not espousing the singular issues of taxes and regulation as being the sole pillars of the business environment. There are a myriad of factors of which they are foundation elements.The higher education support of the Texas system is not a small bargaining chip as MCC, Sematech and other industry consortiums demonstrated.Tesla may not be setting up shop in Texas but Toyota damn sure is.We don’t expect to win every great employer but we are winning WAY MORE than our fair share.The last folks to leave California, remember to turn out the lights.JLM.

          2. baba12

            sure you are winning but I doubt that long term you can finance the infrastructure needs of the state without taxes. It is good to be blessed with natural resources but when that resources gets depleted you better have something else to milk.The reason Toyota or any of the old car manufacturers have plants in the south is they are non-union states and good for the businesses, but the day the Toyotas of the world revert to exploitation as in the 30’s and 40’s you shall see them having trouble with their workforce.Toyota in Japan works with its labor unions and recently gave the highest bonuses to their workers there. Toyota would be fine setting up shop in a state which supports unions, but why leave money on the table if someone else gives it to you for free.I will go long on California over Texas any day. We shall see.

          3. JLM

            .Texas has plenty of taxes — property, sales, etc — it just doesn’t have a personal income tax as the US did not have until 1913.Toyota provides great jobs in San Antonio, Texas and has a myriad of applicants for every opening.Texas is a right to work state.Unions were great once upon a time but that time has now passed.JLM.

          4. PhilipSugar

            Seriously you ever worked with a Japanese Union versus a U.S. one???? You cannot talk that smack unless you have. Go to the Philadelphia convention center and try and get something done versus the ports in Tokyo.Seriously tell me you have before talking that smack because I have, and night and day is too strong of an analogy.

        3. BillSeitz

          A pretty even-handed look at Texas job situation from a couple years ago in the Economist:

    4. Jeffrey Hartmann

      I know we tend to disagree on occasion, but I think the problem with ‘redistributers’ as you call them is not the fact that they exist its just they have the wrong goal in mind and they are targeting the wrong game as it were. I would LOVE a system where instead of focusing on what we can give a man, we focus on what can we teach him so he can give to himself. Those who are highly taxed right now are also the ones who I believe shouldn’t be shouldering the majority of the burden. Those with the strongest shoulders should hold up the yolk for those who are weaker for sure, right now though the largest of us have the smallest percentage taken to help our fellow man. The world is so wrong when a small business owner pays a significant portion of their companies income to the government while a large corporation like GE might have a zero net tax rate. The problem isn’t the act of redistributing the resources to help us all have a better life, its that we aren’t using those resources to give a hand up or to improve the game for everyone and not asking the right persons/companies to share their strength.In my mind Government doesn’t need to shrink, it just needs to change the game it is playing. A new mission statement if you will. Encourage wealth creation by asking those just starting to shoulder less of the burden than the ones on the top of their game, focus on high risk/high payoff technology the private sector doesn’t tend to work on, and work on improving and protecting everyone by helping us all succeed.

      1. LE

        “The world is so wrong when a small business owner pays a significant portion of their companies income to the government while a large corporation like GE might have a zero net tax rate. “You have to recognize the following facts though.- An overwhelming number of small business owners are paying less than their fair share in taxes because it’s easy to write off as a business expense something that is really for personal use. So that laptop that you buy to use in your house or that trashcan that you buy at Lowes for your house for that matter. Not even talking about cash businesses where you don’t even report it you just spend it. Not talking about travel and entertainment red flags either.- Large corporations like GE, Apple or a Pharma company report record profits but that’ after they piss away all sorts of money on high paying jobs to the managers that work for them. Middle class incomes. Or the money they spend on goods and services that they buy which goes into the economy. Or private jets, fancy hotel stays etc.

        1. Vineeth Kariappa

          Their employees pay tax on everything. private jets, hotel stays supports the economy.

          1. LE

            In my example I want to make it clear that by saying “piss away” I actually mean that in a positive way.

      2. pointsnfigures

        “govt doesn’t need to shrink”. Government has to shrink. The govt isn’t some angel that is objective and creates miracles. It picks winners and losers, and creates rent seeking inefficiencies.

        1. JLM

          .The sheer size and breadth of government — Jabba the Hut proportions — is the root cause of almost every government ill.JLM.

        2. SubstrateUndertow

          As technology continues to accelerate there will simply not be enough traditional work/jobs to go around. That has been true globally for a long time!Technology is also accelerating the volatility and complexity of social and economic interdependencies.We have made little effort to develop a set of narratives and metaphors capable of effectively framing these accelerating organic social interdependencies.That is the real problem at hand. We can not engage in meaningful social debate by continuing to use linear 19th century language framing. We have simply not developed a shared language set of narratives and metaphors that is up to the task at hand.With an organic-process-literacy framing language we could get on with debating a new set of interdependent value equations and the new kinds of network-mediated institutional structures that could realistically support such organic economic interdependencies.Our new network based economy requires a new set of institution structures that support a distributive, cyclically-interderpenent set of economic value equations and the institutional mechanisms required to execute them.(Organic-profit networks)In an era of accelerating automation accompanied by highly volatile complex economic/social interdependencies the concentration of wealth, power, education or control is no longer a moral issue but an existential, cyclical network-economy, homeostatic, societal necessity.Under organic-interdependency conditions redistribution of wealth is not the problem. It is the foundational solution.EditThis has nothing to do with the left vs the right polemic!Organic interdependence is all about dovetailing that polemic into a dynamic cyclical-equilibrium(homeostasis).

        3. Aaron Klein


        4. kailash

          this is phrase of oppressive capitalists, “fittest will survive” who are the best manipulators otherwise coexistence is the accurate mantra as we are not living in forests.

      3. JLM

        .Government can be an effective instrument for change but not an effective instrument for support.I was educated as an engineer and financier at government expense in return for five years military service. I was a fair soldier and did exactly what they commanded me to do.A damn good deal for both of us.Since then I have paid millions in taxes, a damn good investment for both of us.JLM.

        1. Jeffrey Hartmann

          Absolutely, Government shouldn’t be in the support business. No one but the absolutely weakest (infirm, disabled, etc.) among us should ever have to depend on the Government for a hand out. But if we let them build the opportunities and help educate, we can have a society of contributors.

          1. JLM

            .Even in the harshest rhetoric no sane person would disavow the notion that we must support as a society those who cannot support themselves.We have added 14MM folks to the disability rolls at a time of incredible high unemployment.This merits investigation.JLM.

          2. karen_e

            The disability rolls story on NPR earlier this summer was absolutely unbelievable. It’s a classic failure of management – there is no one single group to blame. Better bring in the consultants.

      4. PhilipSugar

        The screw job is at the top and the bottom. Huge corporations outsourcing jobs to pay upper management stupid money because of investment banks using the federal reserve to make huge money, so they don’t care about stockholders.At the bottom, people that would rather sign up for SSD than work, and live in a state paid for hotel room and use food stamps to buy meals from anybody that accepts credit cards.The problem I see is nobody is willing to admit both at the same time. I do. If I say the first howling comes from the “right”, the second it comes from the “left”

        1. ShanaC

          i don’t think the bottom wants that. If only because there are people in my building on food stamps. He’s back in school. Took some time to figure it out, and a really nice person.In fact, that is true of the numbers of 10s of people I know who have been on foodstamps.And I guarantee at least one person on this site has been on medicaid. Life is complicated

          1. PhilipSugar

            Proved my point.

        2. Jeffrey Hartmann

          I totally believe the screw job is happening from both sides, but I have a theory about what is happening on the bottom. By Government, financial sector and corporate action we have created a series of policies that ‘hollow out’ the middle class. As the gulf between rich and poor widens, the hope that someone on the bottom has a chance to really better their situation becomes less and less realistic. We teach in our schools that anyone in America can be anything they want to be if they put their mind to it. While it is better than any other country in this respect, and I am proof this is true. I believe this statement is less true today than it used to be. Add on to that the bombarding of entertainment where people live in Elysium like excess because they ‘made it’, it can have a horrible effect on people’s psyche. When you kill peoples hope, it really has dire consequences. They often just give up and are defeated.We need to work to restore hope and build up our middle class again and make it strong. It gives an achievable goal for those on the bottom to reach for, not grabbing for lightning strikes from things like the lottery. I think entrepreneurship and the massive disruptive effects things like 3D printing and automation will have on the output of a single individual could really help in this regard if they are fostered correctly, even though they could be something that makes the problem much worse. Incentives to have larger companies to spend their hoards of cash on investment that could bring jobs to the US is something else that could really help.

          1. PhilipSugar

            I will grant you halfway.You can be anything you want to. My wife was abandoned as a child, she was very successful before we married.We have created people with a sense of entitlement.We also have created a disincentive for people like me to hire people or live someplace where we are taxed too much (in our opinion, which is the only one that matters, I tell employees this all the time, it doesn’t matter what you think, our customer’s perception is our reality. remember the customer is always right or they are not a customer, and CA doesn’t realize this, but TX does)

          2. alg0rhythm

            I’ll bet your wife didn’t go to a high school like Paterson or Newark, NJ, Philadelphia, PA. The tax code sucks but the actual rate is at a modern day low.

      5. Kirsten Lambertsen

        Very thoughtful comment. There might be problems with our gov’t, but they probably aren’t as simple as just shrinking its size.I know people who earned about $18k last year, and they had to pay taxes on it. Makes no sense.

      6. Donna Brewington White

        How about shrink AND change its game. Both are needed if government is to have any real relevancy.I like your ideas about teaching people. Teaching is a form of sustaining. This seems to be one of the greatest ways government could up its game. Also a very appropriate role for government to play. Government has been sleeping on the job in this respect.

    5. LIAD

      how i hoped fred would post something even tangential to the syrian situation so we could get your take on B.O

      1. JLM

        .Go read:”Tough Guys in Hermes Ties” — http://themusingsofthebigre…”Speeches by Guys in Hermes Ties” —http://themusingsofthebigre…We are on the verge of one of the most monumental cockups in the history of American foreign policy.JLM.

        1. LE

          but now the Big Red Car would rather undergo a cylinder boringIf car could talk it would simply say “I need that like you need a third asshole”.Interesting read. (Would suggest getting rid of the bold type for the copy and some of the headings though). Would also like to see the third blade on the hubcap in the red car illustration as well.From “the butler”:”When the President said that he could have been Trayvon Martin thirty years earlier”Yeah that statement was truly unique in it’s ability to be a good test of intelligence for anyone who bought into that. Like my liberal father in law.There is a yiddish saying. Roughly “if my bubba had baitsim she’d be my grandfather”. (If my grandmother had balls she’d be my grandfather).I’m not doubting this stuff does exist of course. I was down again in Phil Sugar’s wonderful tax free state. At the Apple Store there are Delaware State Troopers about 4 of them to guard the place. I walk in with an empty laptop bag, walk around and exit right by the troopers. They didn’t bat an eye. I’m sure if I was black they would have given me a look (why the empty bag?). Same as the car which I drive which doesn’t have a front license plate which is required. Never had a problem. I wasn’t dressed well either. I later walked into the luggage store and got immediate attention by the two blacks that were working there. There was a black man there as well and they paid more attention to me (and I was in dungarees and a tshirt).

          1. JLM

            .Haha, the third blades were broken off by vandals. You have good eyes as you are the first to have ever noted that.JLM.

          2. sigmaalgebra

            Hub Cap Annie in Memphis has a lotof old hub caps, and they sent meextra, correct, hub caps for my 1969396 Camaro and might have hub capsfor your car.

        2. sigmaalgebra

          I have a very different reading of Obamaand see what he is doing in Syria and therest of the Mideast as a good example.Here is my reading: He has wanted to be asuccessful politician so that he couldstay in office, maybe get a littlesomething done for the poor people he knewback in Chicago, and otherwise not havehorrible popularity. For actually doingsomething significant for the country, bebelieves that when nearly everyone wantssome thing done, then he will get out infront of the crowd and lead. Otherwise hehas little desire to do anythingsignificant for the country as a whole.Further he believes that he has littlepower to do much and, thus, doesn’t muchtry to do anything. Instead of doingsomething for the country, really he caresmore about his jump shot and golf game.Or, again, if the people, say, 60+%,really want something done, then he willstep out in front of the crowd and say”Let’s do it.”.Some things it looks like he wants to do,say, as the argument goes, ‘save theplanet’ from evil carbon and pursue clean,green, etc. energy, but, really, here heis just arranging campaign donations.He has some political tactics he believeswork: He starts with some headlines. (A)If they are bad for him, then he tries toput something else in the headlines as areplacement. E.g., he is eager to putsomething else into the headlines toreplace stories about Benghazi, Egypt aid,NSA spying on Americans, and people angrywith Obamacare. (B) If the headlines canbe good for him, then he tries to takeadvantage of them.In taking advantage, he believes that hecan pick an issue and a position on itthat only about 10% of the voters agreewith but agree with strongly, makestatements supporting this position, winsome lasting support from this 10%, letthe issue age and do nothing, and notincur any significant enmity from theother 90%. E.g., after one of theshootings, he wanted to ‘get the guns’.As in his statement to the SF Chronicleearly in 2008, he was going to use carboncap and trade to bankrupt the US coalfired electric generating plants, then, bya US DoE report, 49% of our electricpower. Let me check — right, somehow theelectricity is still on.More generally, whenever he makes astatement, he is sure he has a way to backout.Now we come to Obama’s biggest concern:He very much does not want to be thetarget of any blame. None. Zip, zilch,zero. No blame for Obama. If he isparanoid about anything, then it is aboutblame.He knows that in office he has to lookbusy, but, still, he wants no blame. So,really, he wants to do next to nothing butjust appear to be busy while making somestatements to get some long term supportfrom various chunks of 10% or so of thevoters. And he’s willing to do somethings for campaign donations.On Syria, some people, seeing bad thingsgoing on there, want the US to ‘dosomething’; various people make lots ofexcuses for just why the US should ‘dosomething’.Or, as the arguments go, Assad is evil,right? He gassed his own people, right(this point worked to help get Gulf War IIgoing)? Surely it is in the interest ofUS national security not to permit the useof chemical weapons, right? And the USneeds to help ensure stability in theMideast, right? So, then, of course, theUS should do something, right?So, faced with such arguments andheadlines, Obama decided to apply histactic: He decided to make somestatements to please people who wanted theUS to ‘do something’ in Syria, e.g.,Senator (didn’t actually sink a USaircraft carrier but never wanted to passup an opportunity for the US to fight in awar) McCain. So, people who want the USto ‘do something’ in Syria get pleasedwith Obama, maybe long term. Everyoneelse? If Obama doesn’t actually doanything, then they will soon forget!So, Obama sent some ships, talked about atwo day effort, had the DoD write anoptions document, had Kerry waste a lot ofjet fuel flying to various capitals forconsultations, is sending some more ships,released some ‘evidence’ on how evil (1000year old English morality play, anyone?)Assad is, had some photo-ops showing Obamain charge, in command, on the job, leadinghis long table of high advisors in intensenational security discussions, had a bigshow and tell for Congress at a bigauditorium in DC just before members ofCongress flew home for the weekend, etc.But, in my view, no way was Obama actuallygoing to do anything at all significantmilitarily in Syria with less than 60% ofthe voters screaming for action. 70%? 80%?No way. And no way will he do anything hecould get blamed for. Not a chance.So, he’s going to make statements toplease people who want the US to ‘dosomething’ but find ways to back down,back out. Maybe he will claim thatCongress won’t authorize action (morelikely if send up a draft bill that asksfor too much power, which Obama has nowdone). Maybe Congress will take so longthat there will be something else in theheadlines and people will forget aboutSyria. Maybe Obama will claim that Kerryhas negotiated, with his old buddy Assad,an improvement in the situation or thatRussia’s Foreign Minister Lavrovnegotiated a great deal. Maybe the Saudisdid. Maybe the rebels actually killAssad. Maybe some of the evidence thatthe chemical weapons were from Assad willbe questioned. Maybe he will claim thatthe new White House dog ate the DoDoptions paper! Maybe — the possibilitiesare endless.Somehow, Obama will find a way to backout, do nothing, have looked busy, havepleased a few people, and avoid anyblame, and that was his intention allalong.Or lots of people make good arguments thatas bad as Assad is the rebels are Al Qaedaand worse, and more generally there isjust nothing productive for the US to domilitarily in Syria — so, with thesearguments, why work hard and risk blame?Besides, as Obama sends ships to Syria,people with good arguments for why the USshould do nothing in Syria get vocal and,thus, give Obama more cover to do nothing,that is, make the arguments Obama reallywants made to let him do nothing and avoidblame.If Obama’s not going to work at all hardon Syria, why should the rest of us? Ofall the notes in music, by far the easiestto play is a rest; still many politiciansfind it difficult; but Obama is good withat least that note!Or, now playing in the White House, “Howto Be President without Really Trying, orHow Obama Relaxed, Worked on His Jump Shotand Golf Game, and Made the Job LookEasy.”. The job is difficult only ifactually try to do something; instead,there are ways to look busy, please enoughpeople, get campaign donations, donothing, relax, and avoid blame.The situation might be bad if the USactually needs a real president, e.g., toget the economy going and people back towork? Right: There’s the JOBS Act Obamasigned, but, as I recall, we discussedthat, and the SEC, recently and concludedthat essentially no jobs will be createdand that startups would be throttled.A lot of people elected Obama; that’s whatthey wanted; they got it.

    6. fredwilson

      The title of this blog is A VC. Say no more. I agree with you.

    7. Guest

      I say, “I’m solving why we buy” because the label “founder” says nothing about my passions or vision-execution.The problem with the way we’ve designed the values systems (mathematical, economic and psychographic) that define us and our identities has been:(1.) It’s about a noun — man / woman, carpenter / cook, VC / CEO.(2.) It’s about a quantity — “I earn (insert anywhere between $20,000 to $10,000,000). My shares are worth $quantity. I have N quantity children. I am (quantity) years old. I have a house with N quantity bedrooms etcetcetc.I pay $quantity in taxes which is a ratio of X:Y of my $quantity income.”(3.) It’s about a probability — “I am 30% likelier to get a job if I graduate from university. The probability of me getting that first graduate position is 1 out of 5000+ applications for that 1 position” etcetcetc.The greatest thing about our species is this:If the system isn’t working, we have the imagination, courage and execution to make better ones.The measurement of values in the business system is broken.That impacts on the way that information and policies get presented to decision-makers (from consumers to CEOs to Presidents/Prime Ministers).So…that’s the opportunity before us: measure values in a smarter way.

    8. iamronen

      you really must be careful with these generalizations.make sure you are not misleading is not “when you ask a man or woman” but should be “when I ask men and women in my life/community/culture/country”because THAT is what is shifting … all those accumulated habits/norms/patterns/expectations that cause these questions and lead to these expected answers.If you dig deep enough you may find that the problem is not how you measure yourself but that you measure yourself at all.I think its time to learn to live with a realization that jobs are not coming back and neither is economic growth AND that those are good things. They will ultimately force us to change … for the better.

      1. JLM

        .I doubt that I have disagreed more with a comment than yours. Well enough reasoned but I just don’t agree.I have lived through quite a few business cycles and have seen the merciless swing of the pendulum — logical or otherwise.This too shall change.We will return to growth but not until we have the will to elect leaders who will champion growth.Witness Texas if you doubt it. We are way out performing the balance of the country primarily because of the business atmosphere set by elected officials who have enacted fundamental governing policies which do not whip growth.The 1.6MM Californians who have moved to Texas in the last 4 years have voted with their feet on the different governing policies of that state.Change is the constant not the outlier. Always has been so.JLM.

        1. LE

          We are way out performing the balance of the country primarily because of the business atmosphere set by elected officials who have enacted fundamental governing policies which do not whip growth.As I would say taking advantage of the low hanging fruit of opportunity plays a large role in that. In other words there is a large amount of Oil in the state of Texas.

          1. JLM

            .The US has loads of oil and an abysmal energy policy.It is the energy policies which are the problem.Texas has loads of oil and great energy policies — very little Federal land because Texas was its own country before it merged with the US.JLM.

          2. LE

            I was responding to this part of your statement, emphasis in bold:We are way out performing the balance of the country primarily because of the business atmosphere set by elected officials who have enacted fundamental governing policies which do not whip growth.If that statement was with respect to the other parts of the country with loads of oil I would have less issue with it. It is very possible that Texas elected officials have done much more with the oil situation than in comparable regions. (In addition to as you mentioned “very little Federal land”. In your case Texas is that pretty girl or Capone’s “gun”.But I don’t believe that the “balance of the country” has anywhere near the oil available that a state like Texas has (except for a few of course but I’m no expert other than knowing that as one example Alaska has oil and that has helped Alaska greatly).ADD: My point being is that yes you can give credit to the pretty girl that has less of a problem landing a good job but you still have to realize she is a pretty girl and that (as Capone said) gets you much further.

          3. JLM

            .Austin has no oil of any kind whatsoever and is doing fine. It is not just the Oil Patch which is performing well under the enlightened policies of the Texas government and Rick Perry.JLM.

          4. PhilipSugar

            And the same people don’t explain why fracking has not had the same effect in PA.It is simple. Capital flows like water. Where you think you are being put upon you reduce capital flow.

          5. markslater

            calling the spade the spade. thankyou.

          6. PhilipSugar

            Explain why fracking in PA has not had the same effect?

          7. LE

            Not my area of expertise but I believe fracking has much more of a (perceived or real) environmental impact and it isn’t anywhere near as easy or mature an industry as drilling oil wells as only one reason.

          8. PhilipSugar

            It brings in a ton of money which is pissed away LE.

          9. JLM

            .Fracking is a “new oil well” rather than a “workover” technology.A drilling rig with a big hole in ground and not much pipe is needed rather than a workover rig with pipe in the ground. Not impossible but much more expensive.Fracking is a huge advance and will allow for the recovery of oil that was simply not recoverable before.JLM.

          10. PhilipSugar

            I am talking about the money that PA pisses away with fracking natural gas.

          11. kidmercury

            siding with JLM regarding the texas aspect of this beef. the whole country has natural resources, texas is just the only place with enough common sense to not regulate the opportunity to death. lots of gold in montana, good luck getting any of it thanks to the enviro-nazis and their misguided attempts at saving the world in that state. texas actually has less lucrative uranium deposits than those in new mexico and wyoming but since they have more entrepreneur-friendly laws the most advanced US uranium miners focus very much on opportunities in texas.

        2. iamronen

          If I am well reasoned but you just don’t agree then we have reached an excellent junction.Change is definitely the constant … but there have been changes taking place in the last 50+ years that seem to be heading in what seems to be a coherent direction.I do not know what’s happening in Texas but I assume that if there is a spike it will have to stand a test of time.How many more Californians (or migration from other states) can Texas absorb?Is Texas creating substantial change or superficial appeal?I am not looking at Texas or California or the business community or the tech community or the USA. I am looking from a more macro view (I think this is a view Americans have a hard time taking in).

          1. JLM

            .Yes, we Americans, the last global super power and the first guys to the moon, the world’s last best hope for freedom, the longest continuous democracy in the world — we desperately need help in taking a more macro view.We are an insular bunch, really.JLM.

          2. iamronen

            seriously … why are you offended?you said insular … not meI think that you have indeed sped into a future, in some aspects you have moved too fast for your own good …and I think there is a large and widening gap both within your country and between your country and many (if not most) other places in the world … so much so that yes you do have a problem witnessing and bridging this gap

        3. Igor

          Texas is doing well because of natural resources. One of the articles I read said that Texas would #14 oil producer in the world if it were its own country. Combine that with resurgence in oil serivce businesses in Houston and you’ve accounted for most job growth. With oil prices well over $100/ barrel there’s plenty of oil money to go around. In fact this is a lot like Putin’s Russia than rest of the US.Austin is doing ok because it’s riding the wake of the tech boom. However, it’s far far behind major tech centers – Bay Area and NYC. Both with very high taxes, btw, but doing just fine on tech front.The Californians are moving here to take advantage of the low real estate prices. Once again, this is just because we have lots of land and have plenty of space to build relatively cheap housing. The industries that benefit from this influx are retail, construction, and services. There’s little productive investment coming from these transplants.Texas has some of the worst income inequality in the country. This is only getting worse as Perry cuts spending on things like education, health services, and other programs to help the needy.Once the oil boom passes, we’re going to be screwed here in TX.

          1. JLM

            .”Once the oil boom passes…”Hey, Igor, have you been paying attention to the Middle East much? This is not a “boom”, it is a trend.The trend is your friend.The price of oil and our consumption of oil are not coming down any time soon, pal.Oil, tech, real estate — yeah, we can work with that. Thanks.JLM.

          2. iamronen

            your dismissive attitude is rude and undermines / weakens whatever potential debate you may have to offer.

          3. JLM

            .Sorry, Nancy, please accept my apology.JLM.

    9. jason wright

      “A man or woman is their work”so without ‘work’ people are nothing? that’s an awful lot of nothing out there.

      1. JLM

        .Yes, we are all intended to work.One’s work may be something other than a traditional job — Mother Theresa had her unique work.You must find your work. Without work one cannot function and make their way in the world.Do not over think it all. It is a very simple concept.JLM.

        1. jason wright


          1. JLM


          2. iamronen

            I’ve had “work” and I’ve had “calling” and they are very different things.They may be in alignment for you … but again, be careful when generalizing.

          3. JLM

            .A distinction without a difference.Yawn, excuse me.Angels on the head of a pin kind of thing.JLM.

          4. Vasudev Ram

            >Angels on the head of a pinHa ha, I just used that phrase in conversation with a friend a few days ago, though about a different topic. Didn’t know it was in common use. But after seeing you use it just now, googled and got this:

    10. hypermark

      So true, JLM about work and purpose. We have a limited amount of time on the planet, and what we build, and the value that we create is manifest.My big dilemma is that we like to sound bite complex systems down to one word answers. Big government. High taxes. Obamacare.But, this belies the messy truths that there are places in the country where the beat down is chronic and systemic, and for such cases, we have few answers.It belies the messy truths of checks and balances, as if the “market” solves all problems equally and based upon the invisible hand of self-interest.We seem quite adept at asserting what the wrong answers are, but are pretty feeble in coming up with real solutions.My frame of reference is the simple assertion that America always comes back. I agree with you, but let’s play the scenario where it’s a decade for the cycle to play through. What happens in that intervening period?We hate government regulation, but should be able to see how something like Glass-Steagall limited the potential for global meltdown from the depression until its repeal. We trust Mr. Market until our son or daughter needs medical care. Then, we want to make sure the doctor is qualified, and the care is not conflicted based upon greed or other agendas.We argue that government does nothing essential for business — save for getting out of the way. But, those who’ve seen re-development and master planning work in cities like New York or San Francisco, know it’s not as simple as the All or None.It’s ironic that the same people who see plainly the goodness of finding dollars and resources when there is a natural disaster, have binary perspectives when the disaster is economic in nature.We live in increasingly complex times, but pray to the god of black and white.

      1. JLM

        .Do not count me as one who is universally against regulation. It is the magnitude and whether we regulate first or last.G-S was a damn good law. Obamacare is a terrible law.America is going to endure a “lost decade” like the Japanese have endured almost three lost decades.Government involvement in the marketplace is the difference between a rifle and a shotgun. SBA funding good. Solyndra funding bad.One is a government guarantee program in which private industry picks the winners and the other is a huge, unproven bet on a “green” politicized industry.We have to learn discretion.JLM.

        1. hypermark

          You’ve been clear in the comments that your measuring stick is intent and outcomes over attributes, so we agree vehemently.Using your words, it’s the question of what constitutes discretion, and how we define the specific outcomes that we as a society should cultivate, **including** the incentives, safeguards and enforcement tools that need to be in place.It feels a bit like the social contract is broken, and while there is much to quibble about the old New Deal, what’s the New New Deal that should replace it?

          1. JLM

            .The social contract is broken until it is not as attractive to be on the dole as it is to have a job.JLM.

          2. hypermark

            I guess that that definition suggests that the primary problem is the welfare system of loafers and leeches.What about those that have a job and are also on the dole? Case in point, does senior management in TBTF banks have a social contract? Should they? Put another way, if banks are politically strong enough to negotiate guaranteed gains, socialized risk and no moral hazard, is that just good business? If Monsanto can create a condition where it’s near impossible (through cross-contamination) for a farmer to plant a seed that doesn’t step on their patents, is that good business?I guess my point is we that hold individuals to a standard that not only do we NOT hold corporations to, but rather, we celebrate their ingenuity in finding the loophole, exploiting the inefficiency and hiding behind “shareholder” value.I guess I see a more complex picture than welfare leeches, although obviously there are plenty of those, too.

          3. JLM

            .The nexus between business and politics will always be a bit murky if politicians can create a dependency class which becomes a voting bloc which inures to their benefit exclusively.Immigration is a perfect example of that sorry state of affairs in action today. Nobody actually cares about the immigrants or their impact on America, both sides are scrambling to lock down a voting bloc.The Obamaphone was simply redistribution which resulted in being able to create and access a category of voters beholding to their phone suppliers. So obvious as to make one want to puke. Give them a free phone, register them to vote, take credit for the phone and then call them up to vote.Your questions are a bit more intellectual and transcendental. Each demands a bit of discretion to handle correctly.JLM.

          4. Pete Griffiths

            That is indeed a sound principle. At the bottom of the barrel, however, it becomes tricky to implement. Assuming we want a person to be able have an income on which they can survive there are many jobs that are incredibly poorly paid – survival wages. I’m not sure how far below such a survival rate we would have to go to make the dole still less attractive. Do we want to starve people into a survival mode job? Just sayin’ – I don’t have an answer for this.

    11. ShanaC

      correct, but I contest that with the amount of free cash around on behalf on the fed, but where are the jobs

    12. alg0rhythm

      TRUE THAT! It’s terrible out there for most people, job choice wise. While American relative levels of wealth are high, the ladders are tall to the top, and filled with more traps closer to the bottom. There’s a lot of really terrible, easily disproven rhetoric that is conducted. (CUT TAXES NOT INCREASE REVENUE, EVER. EASY EXCEL MODEL PROVE THAT)*****Some how when I do a Fake Grimlock(TM) voice, it sounds to me like Grover..

    13. Guest

      This interview with Chamath Palihapitiya of Social+Capital VC fund by Robert Scoble suggests that the next generation will not be defined by their job titles or their academic credentials:*

      1. JLM

        .A damn good listen. Thank you for sending it my way. Smart guy.I do want to observe that much of what is spoken of these days is not tested by reality. As an example, CP says that college enrollments are down — not really true when looking at universities, colleges and community colleges.Most schools continue to have more applicants than they have openings.While recessions always drive people to school — can’t find jobs so they go to college? — the recent 2% drop in enrollment (projected BTW) is being absorbed at the community college level.There are several sets of rules — for the intelligentsia (which CP expounds upon very well), for the “normal” wage earner and for the manual worker.The intelligentsia may be defining themselves in other ways — in the future. Most folks reading may fall into this category.For many others, nothing much is going to change. They will still be tethered to the treadmill and they will still be going to work at “normal” jobs every day though these jobs may be using more and more technology.Much of what is changing in the world is simply the application of technology to what had otherwise been solid — perhaps pedestrian and mundane technology but still solid businesses.Take for example an investment like AirBnB, it is the application of technology to real estate, a solid and stolid business for centuries. It simply applies technology to an old economy business from the perspective of communication and process.The guys who invented that system, perhaps they are redefining themselves but every landlord and tenant is just changing the way they are communicating with perhaps a bit of reputation management.Old wine, new bottles. Folks still defining their existences and senses of self worth by what they do.JLM.

        1. Guest

          Thanks, JLM, you’ve obviously thought about these issues quite a bit.In centuries past, we were defined by our homage to feudal lords or our status as chattels.Then government census and social economics emerged and we became defined by a myriad of socio-demographic boxes.Then the Rationalists during the Enlightenment defined us as binary 1,0 atoms governed by the rules of probability.Perhaps in this generation, a new valuation system and view of us, our behaviors and our value will emerge:* — this is my work.

  29. Alan Warms

    The good news here is many folks including The Boston Consulting Group are predicting large scale reshoring of manufacturing back here as wages in China, etc rise. In conjunction with that, I think we should figure out a way to get large scale technical apprenticeships going – as they do in Germany. As opposed to sending everyone to college no matter what, lets bring back machining, tool and dye, carpenter, and other of these trades as something that folks who have proclivity for can go do – and make a great living. We need better options for folks who aren’t going to be knowledge workers and I think technical trades skills are the way to go here.

    1. Ana Milicevic

      You bring up a very good point – we do tend to talk about jobs in a somewhat binary fashion and the universal prescription (at least within my extremely tech-centric social circle) appears to be that everyone should learn to code ideally by pursuing a STEM higher education degree and be a software engineer. While I would be the first person to cheer an overall increase in tech literacy this does not scale (aside from a bevy of other practical considerations). The training & apprenticeship programs like the one in Germany you mention or the ones implemented in Scandinavian countries could provide this much needed bridge that will re-train otherwise capable workers for new skills they don’t yet posses. We will undoubtedly need new types of machinists who can calibrate, operate, troubleshoot, and perhaps maintain 3D printers, etc. And since the pace of change, emergence and adoption of new technologies is increasing this type of program could ensure that workers’ skills are indeed calibrated towards market needs.

      1. Dave W Baldwin

        The hard part is where this community learning (usually called tech) is. The problem becomes businesses in the area having sway, so most of what is taught focuses on the graduate being able to work at the community employer.Now, that is okay in the realm of specialites like welding (what you do here will also apply elsewhere) but moving over into true design/engineering can be dampened.Programmers need to know what to program, the metal worker needs to know what is coming in material make up, the more finance driven need to know something about valuations and most important, the kids need to learn together, hopefully evolving into doing a project that requires input and sweat from all angles. Then you’re setting up a chain that just may do something together as adults.

        1. Ana Milicevic

          “The problem becomes businesses in the area having sway, so most of what is taught focuses on the graduate being able to work at the community employer.”I don’t necessarily think of this as a problem. Communities that have a need for certain skills should be encouraged to develop them — this is where in my opinion the German and Scandinavian apprenticeship models truly shine.

          1. Dave W Baldwin

            Know where you’re coming from, but you need a balance. For example, you can think where ever in fly over will only need mechanics, welders and ag, then throw those that have higher aptitude in a specialized group and they leave at 18.Those that are into the heavy material (weight) need to also be aware of what’s coming with that material and what to start thinking about.

    2. laurie kalmanson

      this. the plumbing company i use sends professional skilled people who are a pleasure to work with. they do excellent work and they clean up after themselves. they are longterm employees of a company known for charging more and doing better work — the nordstrom of the, carpentry; all the skilled trades — honorable work.

    3. ShanaC

      Overdue in many fields

    1. ShanaC

      thank you

  30. EdReal

    Anyone “working like hell” to improve access to education because he believes educational outcomes are caused by bad schools and poor teachers is doomed to disappointment. Educational outcomes are gated first and foremost by cognitive ability, and ignoring that reality is wasteful and harmful to the very kids you’re trying to help.And immigration–both legal and illegal–is putting a tremendous stress on our educational system, particularly in regards to our ability to educate the kids on the lower half of the cognitive ability spectrum. To say nothing of their ability to find jobs at any sort of wage.I don’t know where our society will be long term, but in the immediate future we should stop bringing in new people–educated or not–and accept the fact that right now, we can’t turn a person with an IQ of 90 into a software engineer or a lawyer. If we accepted that reality, I think we could start coming up with solutions in both education and industry to get ready for the future.http://educationrealist.wor

    1. fredwilson

      That runs counter to my own experience with kids. Many kids from disadvantaged homes are way smarter than they seem at first blush

      1. EdReal

        Well, of course. It’s not as if all disadvantaged people have low IQs. That’s hardly the point. The point is whether you believe that *all* disadvantaged kids are “way smarter than they seem”.Is it your position that we can turn a person with an IQ of 90 into a software engineer or some other “symbol manipulator”, as Robert Reich calls them? Or is it your position that the only reason a person has an IQ of 90 is because he or she lacks access to great education?The former is not yet possible. The latter is simply wrong. IQ drives educational achievement, not the other way round. There are bright disadvantaged kids, but they are getting good test scores, in the main. Data shows this consistently.Your work increasing disadvantaged kids’ access to programming is admirable, but it will not solve the problem you describe in your post. Over half the population, both advantaged and disadvantaged, disproportionately composed of blacks and Hispanics, do not have the intellectual capacity to participate in the world you describe. Education won’t fix the problem you have described here, because education won’t address the problem of intellectual capacity. You can’t simply make IQ disappear because you don’t believe in it.I remember reading about your school, and even within the startup phase, you ran into exactly this dispute. You want to teach everyone. The guy whose proposal you adopted, the one who has actually been teaching computer science for 20 years, wanted entrance exams. This debate can’t be news to you.Maybe one day, a really rich guy will decide to run a private school that takes low ability kids and gives them a sense of purpose and competence for meaningful goals: becoming a home-health care worker, a manager at a 7-11, or maybe a truckdriver. Educate them in becoming well-informed citizens who vote, read the paper, have a sense of our history. Teach them what they can learn, rather than make them feel bad for not learning.

  31. zanon

    How about stopping the immigration bill and not letting in millions of illegal mexicans to drive down low-skill work, and hundreds of thousands of H1-Bs from India and China to drive down medium-skill work? When you have high unemployment, step one should be not to make it worse and open your borders.Albert has not thought about this as he does not see how his stated support for open borders conflicts with his stated support for the plight of the unemployed. Maybe you are the same, Fred?I think this is less hypocrisy and more cognitive dissonance and not wanting to look at the ugly, real-world side effects of “noble” ideals.

  32. Nathan Lustig

    I don’t see how we’ll create meaningful jobs in the future, but I don’t think it’s a problem that can be solved by the usual politics. Lowering the tax rate won’t do much. Neither will increased spending. The problem is much bigger. An economy at the heart of it is simply a social contract. But our social contract has not kept up with technological improvements.We’ve decided that tech only gives monetary value to the people who collect data and spit it out in another manner. Think finance, facebook and most tech companies. They may make our lives easier in the short term, but long term a small group gets the monetary benefits and the rest of us get what amounts to little more than candy.Until we decide that the inputs that run our tech, people’s data, have a real monetary value, we will see a shrinking jobs picture and an economy that has a small amount of big winners, a small middle class and a whole underclass of un/underemployed workers.I find Jaron Lanier’s work compelling in discussing this problem and recommend checking out his take on things.

  33. Pete Griffiths

    Topics such as ‘the future of work’ and ‘the role of leisure’ have been studied and debated for decades. It was the fond hope of some that with increasing productivity work and leisure would be spread around improving the quality of life of the toiling masses. The reality so far has proven to be more grim. Not only have technology and offshoring hollowed out whole sectors of our economy (following a trend that was earlier suffered in Europe) but this massive erosion has been accompanied by stagnating incomes even for those fortunate enough to be employed and exploding inequality of income and asset distribution. Couple that with a dysfunctional political system and you have a recipe for social unrest.I see no remedy but fervently hope we can find one. “Pessimism of the intellect, but optimism of the will.”

  34. Carl Rahn Griffith

    Today’s blog is also reflected in my own blog, today. Serendipity indeed…http://carl-rahn-griffith.t

    1. Matt A. Myers

      The most valuable point of having a day marked for a specific thing is to initiate thought and discussion over the topic. We need a Love, Kindness or Compassion day — and that doesn’t get converted into something like Christmas.

  35. kidmercury

    the employment problem is a symptom of other problems:1. obamacare, which is basically a tax on employers and thus a detriment to full-time employment2. debt. the larger issue that can only be resolved through debt cancellation.solve those two problems and everything else goes away. technology is not the problem, the story of history is one of technology creating greater productivity through gains in employment efficiency. debt and taxes are the only problems and addressing them is the only solution.

    1. Carl Rahn Griffith

      There’s only 2 things certain in life: Debt and Taxes.;-)

    2. Tracey Jackson

      We also don’t make things. Have affordable housing. Have really good public education. Value jobs that are not high end. We have lost the mid-sector jobs that people who did not want to be in charge could take and render services needed. We don’t even have Obamacare yet. This started way before Obamacare.

      1. pointsnfigures

        We are making things. Energy is becoming cheaper in the US due to fracking. Factories are being built here in places that have taxes and regs that encourage it. Companies are leaving my state of IL, and going to TX, TN, MS, AL, SC, IN, and now even WI.

        1. Tracey Jackson

          We’re erasing jobs as quickly as we make them. And the kids out of college are really suffering as well. I think there is a general malaise that comes from not feeling like you can do as well as your parents.

          1. LE

            “I think there is a general malaise”I think this is just a symptom of being essentially lazy and distracted by all things entertainment and fun actually and an obsession with pop culture.

      2. kidmercury

        the outflow of jobs is a function of taxes and debt because they decrease demand; increased demand results in more jobs. employers are already preparing for obamacare which is why the largest employers in the country are temp agencies and wal-mart (which employs mostly part-time workers).

  36. Tracey Jackson

    From the post war era up until maybe just ten years ago there were not just jobs for people who held big degrees or people who were willing to work minimum wages without benefits.Society was structured in a way it could absorb most of the people no matter what their skill set. There was a middle class. And they took pride in their work and could support their families.There were the jobs at the top for the people the better educated, perhaps more motivated and sometimes better positioned. And then there were all the jobs in between, bank tellers, people who worked at the super market, post men, endless jobs that have been erased.Schools in fact knew they were sending people out to be leaders and people out to fill in all the other spots. Remember when every big city had multiple offices for every airline? Those were jobs for the people who worked there to the people who cleaned the offices/Now those jobs are being erased daily if they are not gone. The whole chain is broken.And tech cannot fill them, they can only fill the top end for the most part. We are a self-service country with people working at the top and those who care for them. I looked out my door this am after reading this post, the hall was empty. There was a time when it would be filled with newspapers. Forget all the jobs from the writers, to the printers, to the truckers, but someone delivered them. Not a high end job, someone young most likely, someone who could save their money and go to college and advance to a mid level or even high end job and live a decent life. My grandfather delivered newspapers and sold shoe laces to put himself through law school. He went on to be hugely successful – what happens to that person today?You can’t have a two class society and survive for long without great problems , history has taught us that.It’s very troubling indeed.

    1. JLM

      .I empathize with everything you say but much of it is just the anthem of constant change. Change is the constant.There a number of jobs which are simultaneously entry level, professional and technologically challenging which are almost the exact same as their historic counterparts.Take as an example the average air conditioning repairman today who has to master a diagnostic discipline that is a bit technological but more exacting and conclusive or the A/V guy who comes to set up your home systems. They are tech tool pushers.,These are very good jobs and they were not here 20 years ago.Much of what has been exported has been exported because they could avoid environmental, hiring and work condition laws in the US. There is no excuse for this. Child labor, prison labor — unconscionable.Anyone in America who wants to go to college can do it. You may have to — like your grandfather — work you way through.JLM.

  37. mikenolan99

    It is interesting to note that in many countries, it is NOT customary to ask a person what they do for a living. Often, upon meeting new friends overseas, I would fall into that trap – and receive back a polite, but uncomfortable answer.I learned this lesson in Belize, a country we have visited dozens of times, and where my wife worked for many years. She explained it to me: some cultures value family and friends – their connections – over their jobs. Conversations start about who they are relative to their community, not relative to the market place.We in the US, especially those of us living well above the poverty level, identify with our jobs. As an entrepreneur, I feel this identity even stronger – I was my company. Even years after I sold our radio stations, I am introduced as the person who used to own Z99 or believe this spirit helps make the US the most entrepreneurial nation in the world, and at the same time devalues those who do the work our society values least.

  38. laude05

    In February of 2008 I posted the following on my blog and it seems more relevant now than then. The address at the bottom will take you to the complete post.According to the Princeton Review a SAT score of the mid to high 500 seems to be the lower range most colleges expect. While the article takes pains to point out that the scores listed in the chart are not “cut off” scores, students with those scores are most likely to be considered.All tests tend to have three major groupings, a small group with high scores, a large group clumped around the mean, and a group below average.If the reports are true and education is the key to jobs and financial success in the future, what happens to the large number of people who score below the “minimums” for college admission?http://allenandson.blogspot

  39. James Ferguson @kWIQly

    There is a pattern that may have been overlooked.We deliver tech. to relieve problems, successive tech relieves ever more refined problems. There is a point where relief of the initial “problem” is no longer relevant.So the car gets gets a drinks holder – this does nothing to alleviate walking and carrying.Meanwhile people buy tech. to exercise on and air fresheners to make it smell like outside.So maybe we should try to re-discover the outdoor stuff that we used to do to eat – but can now do for fulfillment.Must go (veggies to pick from the garden)

  40. RV

    This is definitely an uphill battle as the world flattens and American labor needs to compete globally. I agree it starts with education and job training and our existing system is not adequate. I think what you are doing with The Academy for Software Engineering is awesome! I hope this can be replicated along with the willingness to experiment with other new curriculums.

  41. Brian Kurth

    The advance of the digital age is similar to past shifts in technology over the past millennium that negatively impacted the global economy in the short-term but caused great growth in the long-term. It is what it is. I say we all spend less time talking about the shift itself and more time talking about HOW those caught in the middle can adapt — for example, the traditional marketing managers, the newspaper journalists and even recent law school grads who can’t find work at law firm. They’re not suddenly going to become developers skilled in Ruby and Python and the like. Instead, it’s time to go back to the basics: apprenticeship and mentorship. There is a WEALTH of knowledge across so many relevant occupations currently not shared with people who could do the work if shown how. For example, the new law school grad who can’t get a high-paying job at a firm? He or she, for example, could learn about compliance within the energy sector where there’s active talk about “The Great Shift Change” and how there aren’t enough people to whom the 50-somethings and 60-somethings in the industry can pass their batons. The former marketing & pr manager who got laid off from their 20-year career working for a large newspaper? They can research, recruit and attain a mentor to help them transcend into becoming a communications manager for a large NGO or non-proft. The laid-off record producer? She may want to work with an expert events producer who can help her shift into the areas in which she can still make money in the music industry — touring and merchandising. How? Through existing technology. LinkedIn works to a certain degree (incl. paying for its premium service for a time). And….I will shamelessly self-promote the SaaS Pivot mentoring platform (… on which corporate, university, trade association and entrepreneurial clients host their internal mentoring programs. Mentees can now research, self-select, request and book videoconference, phone and in-person mentorship sessions with fellow employee-, alumni- and trade association member-experts w/in their own organizations – across the globe. The knowledge transfer is occurring thanks to technology that didn’t exist 5 years ago. We are far from dead in the water. However, it DOES take the initiative of that laid off marketing manager or the recent law school grad who can’t find work to seek out a mentor. It also takes experts who are willing and able to “give back” and pass the baton of knowledge. I say we combine advancing technology with going back to the basics of tapping mentorship and apprenticeship and we’re golden.

  42. BillSeitz

    I don’t think old jobs are going to come back, any more than farming jobs came back after the (previous) Depression.

  43. Chris Mack

    I think fundamentally it’s just a goal mismatch.Public corporations, which wield immense power over a populations thoughts through media and advertising, and immense power over government through contributions and lobbyists value *profit* above all else because that’s what their shareholders demand.People, however, value love, friendship, fun, laughter as well as cash.Until the most powerful forces in this world start valuing the same things as people, we’ll always have a mismatch. An evolution to capitalism is required.I fear unskilled labour is going to have a really hard time for a long time to come. If you break it down, in general you have intelligent people and not-so-intelligent people. Define that however you like, it’s generally pretty accurate that a guy with an IQ of 80 is not likely to make a good programmer or analyst. Perhaps he’ll have the artistic IQ of Mozart, or the sporting IQ of Wayne Gretzky and he’ll find outlets for his genius that will provide quite well for him and his family. Barring that though, his only hope is in trades which will be needed until we start building robots to fix things.Smart people should, at this point, get skilled in one of the fields you mentioned unless they have a *very* strong predisposition/calling in something else. That kids are spending tens of thousands of dollars to go to university to get an arts degree and spend the next 20 years paying off their student loan is a tragedy.

    1. JLM

      .In most things in life, it is not the IQ it is the “I will” which determines success.It is not capitalism which must adapt. Capitalism has delivered the highest quality of life to more people than any other —ism.It is government, business and people who must embrace and adapt to capitalism.The work of a tradesman from novitiate to apprentice to journeyman to master craftsman is a worthy progression and profession.Skillful master craftsman enjoy a high standard of living and a high level of satisfaction. Work is noble and satisfying.In much the same way that an avocation — fly fishing, skiing, airplane pilot, surfing, painting, writing — can provide a font of satisfaction and a balance to one’s life between intellectual and physical, a life of working with one’s hands full time can provide a similar balance.The object of college is to create first a mind capable of critical thought. How that critical thought is applied may be many years in the future. To focus on an education which supports a means of making a living is also important.I have one child who wanted to study studio arts which I did not discourage. I encouraged her to also study graphic arts. She makes her living as a graphic artist but somewhere just beneath the surface is a lurking painter.She is taking business classes to buttress her opportunity to be her own artist/boss one day.Life is a grand adventure and anything is possible.JLM.

      1. Chris Mack

        Love your comments. One point – I disagree with your comment that capitalism has delivered the highest quality of life.All we’ve ever experienced in the West is a blend of capitalism and socialism. Some countries are more socialist than others, Canada for example is more socialist than the US. The Nordic countries more socialist than Canada. And all of those countries provide a higher quality of life to its citizens than the US (as measured by the UN, WHO and other supposedly independent institutions).Even if your statement were true, it’s not an argument against improving an existing system. Do you really believe Capitalism (in any current or past form) is the highest level of governance/marketplace that humans will ever be capable of? That would be a sad thought for me.I agree fully with your trades comments. That was my point. None of those trades or vocations are unskilled. They all require skill, and some require innate talent too. I believe there is a future in those jobs, I did not intend to discredit your daughter’s choices, it sounds like she has made a pragmatic choice whilst trying to also follow a passion which is to be commended.I agree that will is more important than IQ, however note that a different option set is open to those with a higher IQ. Note that a high IQ does not mean anything other than an ability to learn and spot patterns faster.

        1. FAKE GRIMLOCK


  44. Guest

    fredwilson — Maybe the production of Google Glass in the US will help?Robert Scoble blogged some rumors that Google’s reserving 6000 sqm of space in Best Buys with a view to making Google Glasses available for consumers there.If Glass takes off, Google’s patent for “Gaze Tracking System” may keep the advertising and search revenues flowing to enable more social enterprise-based initiatives by them?* http://bits.blogs.nytimes.c

  45. Adrian Bye

    quite a hot topic you raised today, fred :)we’ve made it through massive technological change points in the past, eg the steam engine, and the mechanical loom.however a good book to read is “collapse of complex societies”:…essentially he makes the point that when things progress far enough, we’re not able to innovate our way forward to keep everyone happy. when that happens, things break down.i don’t know what will happen, i do know that too many people today are very left wing, something we just can’t afford. they may be forced to change their positions in time.

  46. iggyfanlo

    First, great novel on this “Player Piano” by Kurt Vonnegut , 1952.Perhaps the important thing is separating our self worth from our jobs. I remember as a young thirty something being a managing director at Morgan Stanley in the 90s. People all want to hear what I said regardless of its value.Then I quit and took the plunge (thanks to god or some other outside force) into technology in 1999. It was the best business decision of my life.But almost everyone in NYC thought I was an idiot and at cocktail parties, rather than talk to me, they began “looking for the next conversation”; you know when the person you are speaking with looks over your shoulder to see who else they should talk to… Well I learned the lesson that your “work” whatever that entails needs to be meaningful to YOU.I don’t believe that this problem is truly solvable until we have a meaningful shift in our collective thinking around status of our jobs/work and that our worth is driven by external factors. Until then, conservatives won’t want negative to rates and liberals will want “subsidies or living wages” that continually fight market forces.

    1. Guest

      Pls see my comment below about value systems and how we’re defined (job title, $quantities, probabilities).I worked in CEO-Chairman’s Office of UBS investment bank so I have some sense of where you’re coming from.

      1. iggyfanlo

        You’re spot on. Struggling with want it would take to change human thinking and behavior. That’s something that probably won’t happen in the next 10-15 years.I personally think it’s one of those pillars that take a crisis to change them. All American pillars of society eventually fall1. Marriage and kids are the goal — NOT2. Home ownership is the goal — NOT3. College degree is the goal — NOT4. Your job defines you — we know this is NOT true, but its still end of those myths

        1. Guest

          It will happen within the next year.That values system based on goals and decisions defined by nouns(keywords)-quantities-probabilities which is holding our species back?I’ve spent the last couple of years thinking through a few hundred years of maths+economics+human-behavior and coded a better (patent-pending) system.

    2. ShanaC

      you have now become one of the cooler people on my list of stories. what was that like circa 1999?

      1. iggyfanlo


  47. Adam Kearney

    Chris Sacca discusses the complexity technology has played in creating the level of unemployment we have on PandoMonthly. He engages this very thoughtfully, telling his story as an investor and as a citizen who has road his bike across the entire country.…. (I linked to the exact time in the talk.)In a related conversation, David S. Rose of New York Angels spoke on a panel “Are Automation and the Coming Post-Scarcity Economy Making Humans Superfluous?” (video linked below). Here, he makes the argument that automation is replacing the service economy and we are headed towards a post-scarcity economy. He generally skips over our present and immediate future that leads us to a post-scarcity economy. Although, he has honest moments where he states clearly that things are already bad and will only exponentially get worse for individuals trapped in the service industry until technology is developed that cares towards there life sufficiency needs. http://www.totalwebcasting…. panel two, 348:15.There is a serious moral and political conversation that needs to be had publicly on this topic. Make sure this conversation reaches beyond this space into the world of action and thought, especially on a day such as this.



  48. LE

    I am not sure exactly what to do about all of this other than work like hell to make sure as many of our young people have access to the kind of education that will give them the skills to do the work of the future.One thing that people with money can do is spend some of that money in the economy (it’s not just about investment). So that private jet share or jet you buy will help support a mechanic that fixes the jet in a nice middle class job. Instead of that seat in coach which is much more efficient and requires less infrastructure.If money is getting concentrated in less hands (pyramid) then one of the things those less hands can do is spend a larger percentage of that money. [1]So in that sense Warren Buffet is doing at least one thing “wrong” by living in the same small house that he started with many years ago. [2] You of course have spent money (and have a few houses) so you’re no Buffet in this respect. (So has Henry Kravis and many others). Not only that but you dine out and travel frequently as well. So all of that is good. Not just about charity spending or helping in what seems like the obvious ways to help.Would be interesting if the government worked up some kind of (get this) tax break similar to what they do with companies with accelerated depreciation and section 179. That is, ways to get people of a certain income level to spend their money, other than just contributing it to charity. As if charity is the be all and end all of good and there is nothing more than that. Businesses definitely spend money because of tax breaks ask anyone who has rushed before the end of the year to buy something because of the tax savings (and it’s not all cannibalizing on a future purchase either.)The fact is every time you go out and spend money that you have (that is above and beyond what is prudent for long term survival) you are putting that money to good use.[1] I’m not claiming that it is anyone’s obligation to do this. Just a way to introduce my argument as a tax benefit for spending a percentage of your income as a tax benefit.[2] His house, I pay way more property taxes as many of us do.… I know people think he has a halo for living like this when it’s obvious he just doesn’t care about where he lives, nothing more than that. (Same with Steve Jobs). Flash: There is nothing wrong with liking nice things or living in nice places or enjoying the finer things.

  49. george

    I’m so glad you are focused on this; education and work skill alignment are essential to a prosperous economy and central to an advancing nation. I’m sure we all agree on this but the current economy is endemic about job creation and I think this is more about our lack of vision – no one has a master plan for where we want or need to go! We are splintered in thought and execution, what should we expect in the future? Probably just more of the same, tech growing and other sectors losing ground.I’m afraid, I see this as a growing systemic issue now, much unlike previous times, where the market was able to correct itself.

  50. Salt Shaker

    Students (and parents too, of course) are aghast when they shell out $100K+ for a college education and can’t find a job, or are forced to accept an unpaid internship to gain experience. It’s easy to conclude that our labor force is shrinking, yet little has been done to modify what is being taught at universities in light of the “new realties.” Doesn’t academia bear some responsibility here? Curriculums need to be modified to insure they have modern-day relevancy. Not sure many tenured profs today have the required skill set to achieve that goal. The price/value of a higher education will continue to erode unless college administrators strongly evolve, not just with their basic biz model (e.g., MOCS and online degrees), but in what’s being taught and why. As a first step, I’d start with insuring that all students, regardless of major, are taught better basic communication skills. I can’t tell you how frequently I’ve encountered a recent grad with frighteningly horrific writing skills!

  51. markslater

    the downside of what most of us do on this blog is that we disrupt industries, by fundamentally transforming the efficiencies associated.Where as the pre-existing industry’s value chain involved multiple points (aggregators, distributors, etc) – the new world we are building explodes these nodes. these nodes are serviced by human beings, the efficiencies we are creating are disintermediating human productivity. those people’s skills are obsolete, they fall down or off the ladder as a result.One part of me roots for the change, the other worries for the human cost.Look at the taxi and para-transit industry, look at the newspaper industry, look at real-estate, and on and on….the manufacturing jobs were long gone – not because of technology. But the technology you invest in and most of us work in is aimed at the vast services sector. There are over 500,000 taxi industry workers facing imminent ruin. Taxi’s aren’t like music or news either……they got MORE expensive not less!what other antiquated, semi-regulated and / or inefficient industries are there left? liquor delivery? Garbage? (definitely this one is on the beam to get exploded)



  52. Matt Zagaja

    I am a recent law graduate in the process of finding full-time work. Since graduation I have passed the bar exam in two jurisdictions and held three or four jobs. My hope had been to secure a job in the federal or state government, to as John Kennedy once implored a generation of people, serve my country, but the reckless and irresponsible method of deficit control called sequester has put a damper on those plans.Ironically re-calibrating my employment plans to find a job in the private sector has been even harder than finding a government job. Large law firms that engage in the kind of law I’m interested in (entrepreneurship and intellectual property) demand experience for their open positions and some are even laying off lawyers as partners continue to take home millions of dollars in compensation.After looking at jobs for a year or so the real problem becomes readily apparent: companies no longer invest in their workforce. Instead of spending their money to train inexperienced attorneys in the areas of law that they have need for, law firms are paying a premium to poach them from other firms that have already trained them. Other firms see this and you get a classic prisoners dilemma: a firm that moves money from compensation packages to training will have their freshly minted attorneys poached by higher paying firms.This appears to have lead to an increase in jobs in the field that we call recruiting. It amazes me how many undergraduates I know and even some law graduates that have made their entry level foray into the workforce in that field. Many older attorneys tell me they can barely beat away the recruiters that contact them via e-mail, phone, and other means while the same recruiters will not even consider newly minted lawyers like me. Instead of using their talents to help entrepreneurs build businesses colleagues now use them to help companies snatch away the talent they can find for other companies.And so this leads to two big ironies on this Labor Day: superstar lawyers have to work many more hours then they would like to provide value, and we have a demand for people to do a job that there is a supply of but no companies willing turn the supply to meet that demand. Classmates and those I know to be partners at big firms have to work nights and weekends to get their work done and meet their billable hour requirements. Yet if asked many would articulate a preference for making $60K instead of $120K or $140K if it meant they could have nights and weekends off. That is why after a few years in private firms many attorneys move to government legal positions or corporate legal positions where they can do exactly that.Of course this wouldn’t be so sad except for the fact that this has real consequences for people in the entrepreneurship and venture capital communities. The problem of patent trolls has become a pervasive plague on the innovation ecosystems that we are trying to build across the country. The economics are simple: it is so expensive to litigate a patent case that trolls with even dubious claims can extract large settlements or scare competitors into shutting down without even stepping foot in a courtroom. There are many lawyers, myself included, that would be happy to be trained to litigate patents and have experience with them, but not enough experience for established firms to be willing to take us on. If the firms were willing to bridge that chasm, the supply of litigators would go up and the cost of litigation could go down. Suddenly the equation would change: patent trolls would be forced to defend their questionable claims in court.However we know that this is not the only variable in the equation. Justice in this country moves slow and now even slower thanks to the insane fiscal maneuver known as sequestration. In a letter to Congress chief judges of America’s federal courts have noted:”These staffing losses are resulting in slower processing of civil and bankruptcy cases which impacts individuals and businesses seeking to resolve disputes in the federal courts. For example, in the bankruptcy court in New York, venue for many mega-cases involving thousands of jobs and companies with a vast impact on commerce and finance, staffing losses require the court proceedings end at 5:00 p.m. instead of continuing to conclusion as they have in the past – often late into the night.”The real consequence of saving money is that these clouds of uncertainty hang over innovators for a much longer time than they used to. As a result many give-up. It is penny-wise and pound-foolish.This comment is long, and at some point may require proofreading and its own blog post. However I wanted to share these raw thoughts after reading other comments suggesting that unemployed law graduates find jobs in other fields or they can just get training in other fields to explain that its not that simple. It is irresponsible and tragic for the public to have invested so much in our legal educations through government loan programs, public grants to law schools, and other things only to excommunicate us to other fields.

    1. William Mougayar

      Wow. That was well written. You’re definitely a great communicator. Where are you located? Email me and I will refer you to a startup Lawyer I know. wmougayar AT gmail .

      1. Matt Zagaja

        Thanks William. I appreciate the kind words and will inbox you shortly.

    2. ShanaC

      I see this across many fields actually. It also creates this question of when is it cost effective to start training talent, since this part of the winner takes all method is only as good as there is a great talent equilibirum. As soon as some lawyers (or x) phase themselves off (ie: retire, die) what then?meanwhile, if he’s around, reach out to me (shana dot carp at gmail). I know a guy who somtimes is on here who is very passionate about bringing the cost of patent litigation down



      1. builder man

        it name of game allways been

  53. Paul Sanwald

    I must say, TEALs, which I found out about through Fred’s post, has been a great experience so far. We’ve done training all summer, and my group is teaching a high school in Warren County, NC, in the spring.I’ve always encouraged young people to get into programming, it’s been a fantastic career for me and I couldn’t recommend it highly enough.unfortunately, it’s not for everyone. Not everyone has the kind of mindset that it takes, not everyone’s brain works in the peculiar way that it needs to work, and so I also do worry about the jobs part of the “software eating the world” thing.The other day I toured the floor of NYMEX, and was reminded how quickly an industry can transform, and transform many people (in this case, floor traders) out of a job.

  54. Semil Shah

    This is something I’ve thought deeply about, and studied, and is a topic that’s on my mind often. The long-run doesn’t matter, and recalibrating education is the medium-term answer — the trouble is in the short-term, that many jobs aren’t coming back and doubly corporations have the upper hand in terms of health insurance and the ability to fire, or fire and rehire at a cheaper, wage, etc.Bill Clinton had an interesting idea for a short-term solution. He felt that there were people who had the skills for jobs in the U.S., but the jobs were located in places where those people would have to relocate, and relocation could be a hard pill to swallow because of community disruption, committing to a higher standard of living, and in many cases, people who were underwater on their real-estate ownership. So, Clinton’s idea was to forgive these underwater investments when people could prove they would fulfill employment opportunities elsewhere and move.Clinton’s second idea was to provide government stimulus to narrow the immediate skills gap and job retraining. This would span programs for people from manual labor all the way to computer jobs. For instance, I’d guess a venue like Codecademy would fit Clinton’s idea for acting as a venue whereby the government would pay the company to give away teaching sessions to the unemployed who would meet certain criteria and then help place them into jobs.

    1. baba12

      I don’t think it is nor has it ever been the job/role of government to create jobs. It is more to put in place policies that help people create jobs.When the U.S. Government started the land grant universities system back in the 1860’s the mission was to provide federally controlled lands to states to create institutions of higher learning in the areas of science, engineering, agriculture and also the liberal arts. Until then higher education was privvy to the rich who could go to private schools like the Ivy league.There was a clear thinking in the government to start these institutions of higher learning. The goal has and always has been that through such institutions we get a skilled workforce, some of who will go on to invent /create new products/services that endup creating companies that employ others and pay taxes thus completing the lifecycle.It is only the last 40 plus years have the rich and the businesses started to get antsy about taxes and regulations.Prior to 1970 the rich paid on average 50-70 % of their income in taxes. They were fine paying and still maintained a wonderful quality of life.Technologies job then and as now has always been to find ways to make process be better. The government has never put restrictions on what technologies can be created.Retraining is meant to appease the masses. Most people beyond a certain age are not going to be retrained effectively. I’d like to see a lawyer get retrained to work as a carpenter when they are 55 years old and their law firm got outsourced.Codeacademy’s of the world may create a bunch of coders but the role of software is to improve efficiencies and cut costs. As software becomes better there shall be less of a need for humans to be programmers as well.Over time more work is/shall be done with less people.Would free market thinkers be willing to write themselves out of a job as software will make it possible if we don’t put in some regulations etc.Now Im off to celebrate labor day even though May day is the day for most workers in the world.

    2. evinayak

      So Bill clinton had two ideas and both involved tax payer money (forgive debt or fund the move) ..hmmm… and Bill C was ivy league, smart etc … hmmm…PS : I am NOT Republican !! 🙂

      1. Semil Shah

        Yep, any solution would either be really painful or involve some type of government stimulus.

  55. Hank Williams

    It is good to see that so many people have finally caught up to this issue. I wrote about this on my own blog in 2008[1] and then on Business Insider back in 2009[2] and was dismissed by many (including Henry) as being either alarmist or nuts for suggesting we have a serious problem on our hands. Now I think most economists actually agree there is reason to be concerned.My view is that we are heading towards what I call an automated economy. This is an economy where all the basic needs of life and survival (i.e. food, energy, clothing, transportation, manufacturing) are met by incredibly efficient technology and a very small number of “operators”. Everything eventually becomes software and while software engineers will be in demand we all know software has a massively asymmetrical benefit. Facebook serves billions of people with thousands of workers.The notion that infinite increases in productivity are beneficial is obviously wrong if you consider that following that curve, eventually you end up with one guy making everything. The problem with this may not be as obvious as it seems. The key issue is that jobs are nothing more than a tool for re-distributing wealth throughout society. There is nothing inherently good about work, or jobs or capitalism. It is a man made construct that has worked for a short window of our human existence.Capitalism is seen as a “fair” way to provide that wealth distribution while preserving individual motivation so that we can keep improving quality of life. It is an excuse for one person to not horde everything because he needs stuff from another. But once we lose jobs as a tool for wealth distribution, then capitalism as a structure becomes totally unworkable. This is fine except that the transition from a primarily capitalist society (we are already somewhat socialist as we must be) to an entirely socialist one will create social upheaval and disruption of a type that has only been seen in dystopian sci-fi films.One of my additional worries is that while the pie is shrinking, some groups, particularly people of color, are being disproportionately left out of this key part of the economy. And while I ultimately think these issues impact everyone evenly, the canary in the coal mine will be people of color which will create even greater social unrest and very nasty political dynamics.In short, I am a technologist. I love technology. But I am worried.[1]http://whydoeseverythingsuc…[2]http://www.businessinsider….

    1. ShanaC

      a) good to see you again hankb)I find that discontinuity continues certain kinds of entrenchment until things have to change, and such ends discontinuity.

    2. Matt A. Myers

      “The notion that infinite increases in productivity are beneficial is obviously wrong if you consider that following that curve, eventually you end up with one guy making everything.”Or a robot – or robots that make robots. A few movies about that.One person making everything isn’t inherently a problem. It would free up a huge amount of time for people, which then you need to facilitate doing activities – because if you don’t then they’re more likely to become bored, unhealthy, counter-productive.If everyone, except one person, had all of their time being available to do what they please – that would result in a much healthier, smarter society IMHO.

  56. lenellis

    Rather than worry about old skill sets, I think we should heed Wayne Gretzky’s advice and skate to where the puck is going to be. In this case we should try to figure out what the new skill sets are going to be. Here’s an obvious example: We’re going to need a lot of drone drivers–in the military, healthcare, mining & construction and elsewhere. The video-game generation has just the skills. We need to see these emerging skill sets for what they are or could be and, then, skate there.



      1. lenellis

        Open the pod bay doors, Grimlock.

  57. sigmaalgebra

    > I am curious what you think.Okay. Here at AVC over time I’ve addedseveral posts on technical subjects whereit is possible to have a relatively solidform of correctness and, due heavily to mygraduate studies at Johns Hopkins, where Iknew what the heck I was talking aboutAt various times, due to essentially theissue here, that is, people suffering fromthe economy, I tried to understand theeconomy well enough to understand thecauses and maybe the cures for thesuffering. Then, in one of the moredisappointing developments of my life, anda source of deep, profound, bitterdisappointment and outrage, the bestinformation I could get on the US economywas 99 44/100% make-work, junk-think,busy-work, prof-scam down to just theempty set — no content present. E.g., Igot a famous text on economics and readthrough looking for what made sense, andall I found was the chapter on the FederalReserve — there it appeared that theauthor knew what the heck he was writingabout. For the rest of the book, nothing,nichts, nil, nada, zip, zilch, zero. YesProfessor Samuelson did some work instochastic optimal control, but from hisbook as far as I could tell he didn’t knoweven the first thing about the US or anyreal economy. And it went on that way.Finally I concluded that the academiceconomics community was dedicated toignorance about any real economy and gaveup. Yes, I’m bitter about it becausepeople were suffering then and still arenow with essentially no progress onsolutions.If all the academic economists were lainend to end, ….Here is a little ‘thought experiment’:Suppose some people were making theirlivings playing chess. Well, as we know,now it would be possible to show up with acheap computer and a good chess programand beat nearly all the humans and killoff nearly all their jobs. Next,generalize a little: Suppose with cheaperhardware and better software, someonedevelops some fairly significant versionof ‘artificial intelligence’ — it canread and write, speak and listen,communicate well in a natural language,e.g., English, understand what it sees,and out think any faculty of professors,all of them at the same time. Maybe thatwould be the easiest way to settle theclassic computer science question P versusNP. So, this cheap computer could dobetter than any human at nearly all thejobs. Now what will society do?This example is an ‘ideal’ point, a pointon the distant horizon, a point that wewill reach only slowly, but apparently weare moving toward it. So, as we reachthis ideal point, we should figure outwhat we are going to do.Maybe for this extreme case there is aneasy answer: Everyone gets a few suchcomputers, lets them do the work stillneeded for food, clothing, shelter,transportation, medical care, recreation,education, etc. and otherwise enjoys life.E.g., last night I got far enough intoWagner’s opera ‘Lohengrin’ to see wherethe evil witch and her evil, confused,defeated husband were plotting how to getback at the sweet Elsa, with longstrawberry blond hair, and her knight ofthe Holy Grail who had just saved her fromthe false accusations of the evil husband!Fun stuff: Fun to see how the characterswere ‘drawn’ in 1850 and how good themusic is. Hollywood, try for at bestsecond place in the music!Between now and that ideal point in thefuture we’ve got some hard work in boththe computing and the economics to do withso far little evidence of our gettingstarted. It’s been this way for decades,e.g., through each recession. Bummer.One point that seems important but seemsto be neglected: For the chess example,the chess player worked hard to get good.So that was an investment of time, effort,and money. Then along comes the chesscomputer, also from investment, and wipesout the value of the investment of thechess player; on his personal balancesheet, he has to ‘write down’ his ‘asset’.Then, he needs a new career and for that anew investment of time, effort, and money.Well, he, and society can come up short onthat investment.More generally, creating a job takes someinvestment, maybe $50,000 a job, maybe$500,000, maybe more. Well, if theinvestment has to be written off too soon,then no one will want to make it. Then,unemployment.Still, there is plenty more that peoplewant in consumer goods and services. So,somehow we need to find a way to use theavailable labor to provide the goods andservices people want and, thus, to providethe jobs people need. Just where thebottleneck is I don’t know. I can guess,but from all I saw looking at economicsthere is so little there as a basis forany reasonably good analysis that aboutall I could do is guess. Bummersituation.For myself, my solution is my startup(right, the SEC may send SWAT teams,attack dogs, break down my doors, kill mytwo kitty cats, etc.), but I don’t see mystartup, even if it is successful, as muchof an example for the country.

  58. Donna Brewington White

    I believe we have to teach people relevant skills so that they can work, but as much as possible we need to teach our young people to think. Not every person is a gifted thinker and there is nothing wrong with being a hard worker and producer. Not everyone can be the entrepreneur, the scientist or the executive. But our success as a nation will depend to a large extent on the types of thinkers we produce more than the types of producers.My son begins tomorrow, the day after Labor Day, to study computer science. With his brain and aptitudes there are many directions he could have taken. I want him to be able to get a job but to also impact society. There is no guarantee that he will not change his mind. At the end we will have spent hundreds of thousands unless he gets scholarships along the way. And he is only the first. He could have taken some coding courses and become employable but in a decade or so he could be the equivalent of today’s auto worker. I want him to be in a position to create jobs either directly or indirectly. This is worth some sacrifice.As someone whose life’s work revolves around work …who appreciates its value to the human psyche, business enterprise, the economy, the marketplace and the social good, the current state of affairs is troubling. This is one small way that I am personally addressing the problem.

    1. Cam MacRae

      Great stuff, Donna. You’re one of the good guys. (Although it’s a shame about the $000,000s — quite ludicrous in a developed economy.)Is this the young fella? So, secondary school CS? A great complementary discipline for budding computer scientists is philosophy. I have never been less than impressed by anyone who majored in both (it’s not uncommon to do so as an undergraduate).

      1. Donna Brewington White

        Thank you for the kind words, Cam. Every bit of encouragement helps as we embark on this new phase of the journey.That’s a great suggestion for my son. I believe that when he takes his first philosophy course there will be a sense of coming home. I will have your suggestion in the back of my mind to bring forth at the right time. Right now, he is considering a double major in psychology.About the cost of education, I believe this will get sorted as he demonstrates what he can do. He missed his opportunity in high school for scholarships — had a bit of a detour in spite of — or perhaps due to — his brilliance. Fortunately I’ve spent enough time around entrepreneurs to recognize the type.Hey BTW loved your “hang 16” comment about Murphy. Not sure how to reply to comments on Tumblr that don’t go to Disqus.Again, thanks, Cam.

        1. Cam MacRae

          A psychology program, especially if it has a significant (geddit?) emphasis on statistics, is another very good option.If he missed his opportunity in high school does that infer he’s starting at university? Part of me thinks the best approach to university is to defer, buy a round the world ticket and a $10k prepaid Amex, and drop him off at the airport with the promise of a ride to college in 12 months! (That’s just me though. And what would I know — the good ship offspring has long since sailed).Let me know when he’s visiting on his Fulbright 🙂

  59. Carl J. Mistlebauer

    Can we create jobs?On a macro economic, national level the answer is no. Yes, technology has done a great job, but so has fast food, retail, and the service industry, in creating jobs.The reality is we have not created any net new jobs since 2000; thus the seeds of our current situation were planted long before today.We have an economic system where corporate profits as a percentage of our GDP are at their all time high and the stock market is doing quite well. Thus, all the clamor over government, regulations, and taxes seem to be rather moot.At the same time, wages and benefits, again as a percentage of our GDP, continue to fall and are at their lowest levels ever.With corporate profits at all time high levels we are seeing net investment at a measly 4 per cent of output. If you are making a greater profit than you ever deemed possible only a few short years ago then why wouldn’t you be investing to lay the groundwork for future profits?…Short term shareholder value.Sometimes we have to ask ourselves what is the difference between “wealth creation” and “wealth extraction.” They can look very similar but they are in effect very different.Its easy to put logic aside and sing the praises of capitalism all the while blaming “government” for all the evils of the economic system….It won’t lead you anywhere near a solution because the reality is the trend is toward higher corporate profits, lower wages and benefits, and less investment in the future…its a vicious cycle.

    1. Anne Libby

      Carl! Nice to “see” you here.

      1. Carl J. Mistlebauer

        Why thank you Anne, I am “retired” (as in keeping my head down, minding my own business, and keeping my mouth shut) until I find that opportunity to “make a difference.”

        1. Anne Libby

          Well, I hope that “retirement” brings you back over here from time to time!



      1. Carl J. Mistlebauer

        That is what differentiates capitalism from feudalism.

        1. FAKE GRIMLOCK


          1. Carl J. Mistlebauer

            Capitalism realizes that workers/employees are an integral part of the economic system and that their well being and success is of benefit to everyone. Feudalism on the other hand sees labor as an expense to be tolerated and exploited.

          2. FAKE GRIMLOCK




    1. Matt A. Myers

      Which should mean that the quality should be increasing rapidly, however competition and patents in part prevent that.I think we’re inevitably leading to a society where everyone has what they need to survive, and then being productive and working on cool things – and learning over your lifetime, along with having family – and work in food / social-related situations – is what life will look like.



    1. Gustavo Melo

      I had such a nice post typed up, and Disqus ate it before I could click the post button 🙁 The one below is probably longer since I am less willing to edit it down to perfection.When I interview people today I notice the biggest divide is between those who “get it” and everyone else. Does that make everyone else less smart or less creative? I don’t think so; they’re just too far away from the right mode of thinking to be effective.So I think the position that there is no place for “everyone else” is too elitist for my liking. It doesn’t take geniuses to do what we do, it just takes the right frame of mind and a reasonable amount of dedication.Today there is zero relation between a school degree and the right frame of mind. I can speculate on why that is or whether we should blame schools or some other institution, but ultimately that is what’s missing from “the rest”, and once we figure out how to change it, more people will become more employable.



        1. Gustavo Melo

          That analogy is flawed in my view because I don’t see evidence of such a thing as an ‘average dude off the street’ in the sort of fatalistic, slightly demeaning way you imply. I think we probably all look like average dudes (average dinosaurs?) off the street to people who have different values than we do.And anyway, we are not interested in the ‘average dude off the street’ to begin with, only in the people qualified enough on paper to apply for a job writing software, right? (though my point is broader, it’s not restricted to developers but qa, marketing, etc).It may be that today, having the right skills and the right mode of thinking requires highly smart and creative people because there isn’t an effective way to forge anyone else into what we need (though even this seemingly reasonable argument makes me a little wary of the implied hubris).That looks to me like a ‘roll up our sleeves and fix the problem’ kind of situation. Because while jobs of the very near future may belong to very smart or very creative people, there is no predetermined factor about people that says things have to or ought to be that way.

          1. SubstrateUndertow

            I’ve often been surprised by the vast spectrum of flavors that smart and creative come in.Our challenge is to gin up a more organically distributive dovetailing between that vast spectrum of smart/creative and our institutional mechanisms for education, production and wealth redistribution(effectively distributive purchasing power).I know most read this as a vague pie in the sky pipe-dream but that perspective belies the anally retentive grip that linear 19th century quid-pro-quo value exchange attitudes hold over contemporary economic group think.If we are unable to visualize our present social and economic realities as generic instantiations of universally recurring organic system dynamics we will have no way to frame the social and economic organizational phase change that is upon us.

    2. Jonny Schnittger

      Soylent Green?

  62. William Mougayar

    Another theory by Daniel Greenfield is “We’re turning Japanese Now”http://sultanknish.blogspot…

  63. Shane Johnson

    Singularity is an overused word but it is coming to where work-life and a persons whole life is merged into one, but not in a negative way, but in a way that is fulfilling psychically, spiritually and economically. How do we get there in a way that is the most humane to the current workforce, not just low skilled workers but to all workers?It is interesting that the same questions are being asked now during the post-industrial revolution that were being asked during the industrial revolution. My hope is that we do better than our ancestors.

  64. laurie kalmanson

    the diamond age…”Thetes” are individuals who are not members of any phyle and are often socially disadvantaged and economically poor, being similar to second-class citizens under the CEP. In the novel, the material needs of nearly all thetes are satisfied by freely-available food and clothing, albeit of low quality; thetes without the political connections of a phyle are entitled to similarly low-quality “free justice.”The book distinguishes three Great Phyles: the Han (consisting of Han Chinese), the Neo-Victorian New Atlantis (consisting largely of Anglo-Saxons, but also accepting Indians, Africans and other members of the Anglosphere who identify with the culture) and Nippon (consisting of Japanese). The novel raises the question as to whether Hindustan (consisting of Hindu Indians) is a fourth Great Phyle, or a “riotously diverse collection of microtribes sintered together according to some formula we don’t get.”Internally, the New Atlantis phyle is a corporate oligarchy whose “equity lords” rule the organization and its bylaws under allegiance to the vestigial British monarchy. Other phyles are less defined – some intentionally, as with the CryptNet group or the mysterious hive-mind Drummers. Over the course of the story, the Common Economic Protocol sponsors the investigation of clandestine Seed technologies in order to preserve the established order from subversion. It is also hinted that property rights are so expansive that the Protocol recognizes children as the economic assets of their parents.

  65. Noam

    Fred, I have an idea on this. If you’d like, email me and I’ll aim to reply with a PDF of it (13 pp): a way for governments to create jobs at minimal public cost, durably.

  66. Abdallah Al-Hakim

    I recommend reading Albert Wenger post as it offers lots to think about. Here is one excerpt “We are facing a problem of dramatic oversupply of labor that we will ultimately only be able to address with redistribution of wealth most likely in the form of some kind of guaranteed base income and/or negative income tax rates at low income levels” so much here to consider and intend to agree with him

  67. Ciaran

    Here’s two things that summarise my views. One is a recent article from the UK:http://www.marketingmagazin…He highlights that this is the first industrial revolution that has destroyed more jobs than it created.And here’s the banned TED talk which makes us reevaluate who really creates jobs

  68. Alper Akgun

    I am sure, there are a lot of unmatched job positions, and efficient and smart positon/job seeker matching would be a remedy. Especially a software solution which matches people to skills in the best way possible is good but not enough.A software would check your CV, and would give you a list of trainings and additional skills which, when gained, would make you quickly increase your chances. Moreover unemployment benefits may include trainings you must attend to.Indeed as USV you have investments on both job search and education area, as far as I remember, so you do already good for everyone.

  69. MCM

    I believe a large part of the solution could be found in the transition towards a circulair economy. The linear model, which developed during the industrial revolution, is not a logical model and has led to many of the modern day challenges. We have started a investment fund based on the believe that we are going to make a transition towards this new economic model. It will go slow but demographics in combination with a linear model will push us toward this model one way or another. Another option is that we start exploiting the moon or mars….. See below a link to a report on the logic behind the circular model.

  70. marccanter

    Indeed – I’ve been at this very issue for 4+ years now.Here’s the beginning of some different kind of education:…But it can’t be JUST education! It has HAS to have some aspect that creates the jobs themselves!

  71. Kevin Yien

    “access to the kind of education that will give them the skills to do the work of the future”The current state of education is something that is always on my mind. The troubling situation I have stumbled across from speaking with those who should be in positions to make change (national councils, VC’s, educators) is that they are all equally disheartened. The lack of action at the government level is large, and while not surprising, still a problem.When I spoke with someone who straddled government and venture funding, he said he would be re-allocating his time to his fund because that was where he felt he could make a greater impact.What are everyone’s thoughts on this? Given our options, what are the most effective paths to changing education standards and curriculum to align with the skills needed for work of the future?(P.S. *long* time reader, first time poster – hoping to be get out of my shell and be vocal in this wonderful community)

    1. ShanaC

      i’m not sure what the skills of the future are.

      1. Kevin Yien

        Excellent point, Shana. None of us do (or if we did, we should put those prescient powers to good use!).It seems that the overly structured way of forcing students to learn specific subjects in K-12 is no longer a fit though. For example, Fred’s involvement in AFSE is a great step in the right direction. This is not to say that promoting software engineering is the only, or right, way of the future. But it at least opens up the possibilities for students.As another example, there are places like the Hawken School in Ohio that are teaching core entrepreneurial concepts at K-12, which strongly resonates with me.Thoughts?

  72. andyidsinga

    i enjoy alberts writings on he subject.

  73. David Poulter

    Capitalism is generally about exploitation. Creating cheap products exploits people and the environment sometimes. A better system? I hope we find one.

  74. alg0rhythm

    It’s truly a depression- for some. The jobs we have are less productive- I love eating at restaurants, but I’d like there to be as many building and fixing jobs, considering the state of the infrastructure- 50-100 years old, used every day. Half of all energy wasted, half of all garbage, easily eliminated, everything recycled, can we get energy from something that doesn’t leave a mess. WHERE’s THE MONEY COME FROM? NOT WASTING IT. Start off with looking to not send 500 Billion a year abroad if possible. Lots to do but is theGovernment needs to shift spending priorities and eliminate redundancies, as well as provide for the revamp of how it regulates most things, tax code expenditures, justice system, budgeting, accounting, and the opportunity cost assessment of our spending dollars(i.e. how much extra missile grade uranium is tied up in quintuple redundant nuclear warheads- probably enough to power the country for a year) We need an audit.But to deny governments role, or the power of government to create economic conditions, as well as raw capital for new initiatives is to not understand the system in any way. There is no way around the fact that the government got us out of the Depression. But it shouldn’t need to run a deficit. Regular government revenues make the Federal government itself a G10 country.

  75. kailash

    since last decade govt. of America and some European countries kept focus on only futuristic industries and services industry and ignored basic industries and that is the main problem. Strong Present is must for the bright future. All the raw materials required for basic industries (like crude oil, iron ore, steel, electricity power) is in the control of oppressive corporates while in china all these are controlled by the govt itself and is provided to the manufacturers at much cheaper price/subsidized rate.There are every kind of people in every country ,rich and poor, highly educated,intelligent and highly skilled (minority of the poulation) and also stupid, semi educated and unskilled,lazy (majority of the population) so are the requirements.

  76. Itamar Goldminz

    This topic has been on my mind a lot recently. Though there’s still some debate going on about whether this is even a problem, I share Albert Wenger’s perspective that this is a real issue. Sadly, very few people offer practical solutions that go beyond the “more education” and “negative income tax” buzz words. The one exception to that rule that I was able to find is the work done by Lane Kenworthy on the matter. You can find a summary of it here: http://www.policy-network.n… and deeper dive here:

  77. Sociabl Web

    Yes, who do not have specific skills they are in tough condition.

  78. Richard

    Fred, What’s the ideal font size for you?

  79. Roy Liu

    I try to stay as informed as possible about education, and business & job formation, and drivers of economic growth – it is a complex problem of which I can’t even begin to scratch the surface. But, there is a core problem that I see in all these things. And perhaps I am not thinking about the paradigm correctly, but the description of our economy that has always stuck in my mind is that it is like a poker game (not in the sense that everything is a gamble), and with each round being played, strong hands tend to get stronger, weak hands tend to get weaker as money gravitates to those strong hands. At some point, in a real poker game, one hand ends up with all the money. In the real economy, government redistributes a portion of the money from strong to weak hands, the economy (hopefully) grows thus increasing the overall pot size, and other external factors come into play that may provide those who might start with weaker hands with a stake to continue to play and move from weak to strong (good education, creating a successful business, etc.). But at the end of the day, if the economy/society becomes too ossified and money does not some how move in meaningful amounts from strong hands to weak hands, I’m not sure how a better-educated work force necessarily changes this dynamic. It may (hopefully) increase our overall population’s well-being relative to other nation-states, but the dynamic of strong hands beating weak hands, of income/wealth/money flowing continuously to the stronger hands, giving them built-in advantages over time – I don’t see how that dynamic gets changed. As a thought exercise then, one should consider whether an inheritance tax might be the preferred method for redistributing that accumulated wealth from strong hands to weaker ones. Not that I am advocating that as a policy position at all.

  80. Ana Milicevic

    I agree. It’s interesting to compare perceptions of value of work in the EU and in the US. While neither should be considered a perfect model, what troubles me in the US is the apparent perception that low skilled labor and minimum wage jobs are somehow an embarrassment: we appear to imply that people earning minimum wage do not deserve to earn enough to support their families since it’s their own fault for not being qualified for some mythical, non-existent higher-paying job. In the EU there is an understanding that working even on the very low end of the pay scale should enable you to subsist in relative, if modest, comfort.