Out of Good Jobs and Good Ideas: Is This The Downer Economy?


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Some days you look behind the headlines and all you see is trouble. Today, two cautionary tales. First: Ten million jobs were created in the U.S. economy from 2005 to 2015. But nearly all of them, according to a study by Princeton economists, are in the “alternative work” category — part-time, freelance, or contract work rather than steady full-time jobs (Quartz). That’s a boon to people who value gig-economy flexibility but bad news for people who seek or need the security and benefits of more traditional employment. It’s also something lawmakers ought to keep in mind as they prepare to dismantle Obamacare: The need for attractive alternatives to employer-based health insurance is only going to grow.

But new ideas will help us weather this transition, right? Not so fast, says Greg Ip in The Wall Street Journal, who argues that we’re in an “innovation slump.” In recent decades, “outside of personal technology, improvements in everyday life have been incremental, not revolutionary,” Ip writes, and that’s why productivity growth has slowed to a crawl. In most areas outside of infotech — the one innovation bright spot — we’ve grown risk-shy, and we’re spending more on undoing damage caused by past innovations (e.g., fossil fuels) than on introducing new ones.

If Ip is right, we should be worried enough to do something about this stasis. He offers a few prescriptions for jumpstarting the flow of new ideas: spend more on R&D, pay more attention to developments in other countries, and loosen the restrictions on new realms like drones and self-driving cars. Also: Maybe figure out how that “alternative work” boom can benefit more of us.

Wells Fargo Dodges the Courts

Wells Fargo, reeling from a scandal involving employees who opened millions of fake accounts under the names of real people, has a new CEO and a publicity campaign promising to “make things right.” One thing it’s not publicizing is a legal fight to move challenges from defrauded customers out of the courts and into private arbitration (The New York Times).

Companies often prefer arbitration, in which they’re often able to limit damages, avoid class actions and keep outcomes quiet. The problem for Wells: The bank screwed a lot of people over once, and now it’s giving the public a good reason to think it is screwing them over again. Could that be right?

CRISPR Patent Fight Enters Round Two

In an Alexandria, Va. hearing room Tuesday, a courtroom battle that could shape the future of genetic engineering emerged briefly into public view (Stat News). In the legal ring are the Broad Institute of MIT and Harvard on one side and UC Berkeley on the other. Both institutions claim patent rights to CRISPR, the genetic-code editing tool that has revolutionized biological research. An earlier ruling awarded the patent to the Broad, and Berkeley is now challenging it in an appeal at the US Patent and Trademark Office. A ruling is expected next year.

One side not represented in the hearing: the people — like Berkeley’s Michael Eisen, co-founder of the Public Library of Science — who argue that, in this instance, no patent at all would be the best outcome for science and the public. CRISPR is a fundamental tool of biological research that should not be owned or controlled by any one institution. Let the argument over credit for it play out, but don’t turn it into private property.

Otto’s Self-Driving Truck Test Skirted State Rules

Otto, the self-driving truck startup, won a lot of “wow”s with its release last summer of a video showing a driverless truck on a Nevada interstate. Not long after, Uber bought the company. Now it turns out, according to public documents unearthed by Backchannel’s Mark Harris, that Otto’s truck run may have flouted Nevada rules. The company appears to have ignored repeated demands from state officials that it obtain permits beforehand. And Otto has now changed its story, saying that the truck actually had a backup driver.

Of course, Otto’s “better to ask forgiveness than permission” stance is right in line with its new owner’s sharp-elbowed culture. And Nevada’s autonomous vehicle rules don’t carry any penalty for violations, so the company isn’t likely to pay for its brashness. The technology will evolve faster this way, but there’s a downside, Harris writes: “it means there will be few regulatory tools in place to cope with the many ethical, logistical, and safety challenges that lie further down the self-driving road.”

The Man With the Trillion Dollar Budget

As head of the Centers for Medicare and Medicaid Services, Andy Slavitt oversees a trillion dollar healthcare budget and has introduced a new, outcome-based approach to paying healthcare providers. Slavitt talks with NewCo editor-in-chief John Battelle (NewCo Shift) about how the Affordable Care Act gave workers more freedom and mobility, what the prospects are for the future of health policy under the incoming Trump administration, and why he has only one email account.


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