Alan Greenspan has an interesting new take on what’s wrong with the U.S. economy.He blames the young work force — there are “major concerns about the productive skills of our future U.S. labour force” — and U.S. trade policy mirroring China’s.
Greenspan interviewed himself (or so it appears) for the Globalist recently about how the U.S. is handling job creation. He says that the U.S. is doing it backwards by trying to increase jobs via trade policy.
“Increased jobs are the consequence of increased trade. Increasing jobs more than output implies a fall in productivity and standards of living. That surely cannot be our goal.”
But that is exactly what China is doing wrong, says Greenspan.
“[The Chinese] are manipulating their currency in order to get low-quality, high-labour-content products produced — for maximum employment. They are distorting their economic structure and creating long-term economic damage.”
It sounds like Greenspan is primarily worried that the U.S., in its quest to create jobs quickly and get the recovery on track, will employ the young U.S. work force in easy, lower-paying, unproductive jobs. And since the young work force is unintelligent and lazy compared to the workers they’re replacing, the Baby Boomers, this spells bad news for the U.S. economy.
“[Baby boomers] are being replaced by groups of young workers who have regrettably scored rather poorly in international educational match-ups over the last two decades.”
“The average income of U.S. households headed by 25-year-olds and younger has been declining relative to the average income of the baby boomer population. This is a reasonably good indication that the productivity of the younger part of our workforce is declining relative to the level of productivity achieved by the retiring baby boomers. This raises some major concerns about the productive skills of our future U.S. labour force.”
Greenspan would prefer the U.S. let in more skilled immigrants instead.
“Most high-income people in our country do not realise that their incomes are being subsidized by their protection from competition from highly skilled people who are prevented from immigrating to the United States. But we need such skills in order to staff our productive economy, so that the standard of living for Americans as a whole can grow.”
via Net Net