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Saturday, June 24, 2006

You Don’t Have a Clue, Do You?

This is Ed Leamer writing at Cato Unbound as part of the series on the future of the American worker in the global economy:

It’s Like Hurricanes, by Edward E. Leamer, Conversation, Cato Unbound: Rather than in the abstract, try tackling the following problem.

I grew up in the small town of Vestal near Binghamton, New York. The major industry of the area in 1900 was cigars, which left when tobacco fashion shifted to cigarettes and cigarette production was mechanized. No matter, by 1950 the Endicott Johnson shoe company had replaced cigars. But shoes, which had left artisan shops in Boston to come to upstate New York, continued their footloose behavior and left the US altogether in the 1960s. Not to worry. By 1980 IBM was the major employer of the area. ... IBM produced ... mainframe computers built by high school graduates at high wages.

Now IBM is gone and there is not much of anything in the way of jobs except hospitals and Wal-Mart. Young people are fleeing for better lives elsewhere. It isn’t just Binghamton. On Tuesday, June 13, Sam Roberts wrote about this in the New York Times in an article titled “Flight of Young Adults Is Causing Alarm Upstate” ...

We have a real problem here, don’t we? What is causing this radical change in the physical geography of wealth formation? What should Binghamton do? Is there any way to save upstate New York? What say ye, o wise men of Cato Unbound?

First, Mr. Thomas Friedman: What did you mean by the item quoted in Richard’s original essay: “you no longer have to emigrate in order to innovate”? Should we plaster the Binghamton area with posters that say that, and keep all the bright kids in the area?

Frank: Is this the failure of education? Did my high school in Vestal take the wrong path after I graduated? Do State officials need to swoop down on these schools to prepare kids to do the problem-solving tasks of the 21st Century? Or is it the institutions? Do we need some new laws that make membership in a labor union mandatory?

Richard: How does the word “creative” help find a solution? This region contributed more than its share to the innovations of the 20th Century—Corning glass, Xerox, Ansco, and thousands of small manufacturing firms. IBM was one of the most innovative companies that has ever existed. ... IBM was the opposite of diversity, with straight white men wearing starched white shirts and creased dark trousers. Do you think now the region could be helped by some remedial general training in tolerance as a way of attracting creative people?

Robin: What do you say about this? You have a sharp critical scalpel, but what solutions do you propose for a real problem? It sounds like your advice is: Don’t worry. Be happy.

Last, to Ed: For all the wisdom your words try to convey, you don’t have a clue, do you? It’s like hurricanes. You can study and understand, but there isn’t much you can do about it, except offer some disaster relief after the storm has hit.

    Posted by on Saturday, June 24, 2006 at 12:09 AM in Economics, International Trade, Unemployment | Permalink  TrackBack (2)  Comments (27)

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    » I wish Id written that from The Glittering Eye

    I sincerely wish Id written Ed Leamers contribution to the discussion of the future of the American worker going on at Cato Unbound, Its Like Hurricanes (hat tip:  Mark Thoma).  Heres how he opens: Rather tha... [Read More]

    Tracked on Saturday, June 24, 2006 at 09:24 AM

    » You Dont Have a Clue, Do You? from EconWatch.com

    [Source: Economist's View] quoted: This is Ed Leamer writing at Cato Unbound as part of the series on the future of the American worker in the global economy: Its Like Hurricanes, by Edward E. Leamer, Conversation, Cato Unbound: Rather than in th... [Read More]

    Tracked on Saturday, June 24, 2006 at 09:55 PM


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