Technology Isn't The Problem

Russell Roberts, professor of economics at George Mason University and research fellow at Stanford's Hoover Institution, writes a strong critique in the Wall Street Journal of Obama's foolish attacks on technology.  He quotes Obama's comments blaming technological change as a structural issue and cause of job losses.

There are some structural issues with our economy where a lot of businesses have learned to become much more efficient with a lot fewer workers.... You see it when you go to a bank and you use an ATM, you don't go to a bank teller, or you go to the airport and you're using a kiosk instead of checking in at the gate.

This argument, as Roberts successfully explains, it complete bunk.  Productivity increases are the backbone of a successfully growing economy.  Such increases free up resources to be used in new industries, thus raising the standard of living for everyone.  Roberts argues that,

Somehow, new jobs get created to replace the old ones. Despite losing millions of jobs to technology and to trade, even in a recession we have more total jobs than we did when the steel and auto and telephone and food industries had a lot more workers and a lot fewer machines.

Roberts' economic argument is sound and history bares out his logic.  Tellingly, despite years of technological progress, unemployment rates have fluctuated around a band of 2.5% to a little over 10%.  If Obama's assertion that technology causes job losses and hurts the economy is correct, we would arguably see much greater unemployment, particularly as our history progressed.  After all, millions have left the agricultural industry, for instance, over the US's relatively short history.

The attempt to link technology growth and jobs loss is not only poor economics but down-right bad for the future of our country.  We already see this problem rampant in the discussion over free trade.  By confusing the masses, these arguments only help special interests gain from the loss of the country.  Technology, like trade, helps everyone in the long-run.  While some may be hurt in the short-run transition, there are far better and more efficient ways to help them than by criticizing or tampering with technological growth.

Obama and other politicians (this happens all too frequently on both sides of the aisle) should think before they whip out the rhetoric - it only serves to distract, "miseducate", and ultimately drive our country down the wrong policy paths.