Good Entropy

Megan McArdle :: The Atlantic – Sage

Harold Meyerson makes an argument that will be familiar to readers of this blog: stimulus doesn’t work the way it used to. Workers have more skills, which makes it harder to create jobs to soak up an untapped labor pool–even if we did create large numbers of jobs swinging pickaxes, many unemployed Americans wouldn’t take them.

Meyerson identifies a lot of the procedural barriers that I frequently talk about–the bidding and environmental safeguards that make federal projects very slow to get off the ground. But perhaps unsurprisingly, he doesn’t really explore a huge barrier to a WPA-type jobs program: public sector unions. They are not going to let you hire a bunch of cheap workers and run crews without civil service protections.

There’s something ironic in the fact that the legacy of the New Deal is the inability to reproduce it. On the other hand, it’s not so necessary, either. People are richer now, and though it isn’t perfect, our financial regulation is better. We’re not at much risk of people starving to death. So there’s no urgent need to create low-skilled jobs for them to fill.