The Economist Can’t Make Head or Tail of Trumponomics


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Forget about the FBI director’s firing for a minute, and consider this: President Trump gave an interview to the editors of The Economist to explain his economic plan, and it seems to have made their heads explode. The painful-to-read transcript is rambling, repetitive, disjointed, and incoherent, raising disturbing questions about both the president’s competence and his mental state.

With his treasury secretary nodding assent from the side, the president outlines Trumponomics as a series of idees fixe: Rewrite the terms of international trade deals like NAFTA to make them fairer. Encourage companies to create new jobs in manufacturing, and punish them if they don’t. Tax imports to make all that happen, but give corporations tax breaks to repatriate the mountains of cash they’re keeping overseas.

Each of these issues could be argued one way or the other. The larger problem, as The Economist explains, is that they are all essentially footnotes to the far bigger challenges the U.S. economy faces today. And those issues just don’t seem to be anywhere on Trump’s radar.

Figuring out an appropriate policy to save jobs during the wrenching transitions being triggered by automation and AI; crafting measures to blunt the damage a rising tide of inequality is wreaking on U.S. communities; shaping an effective and sustainable safety net for working families in a time of growing insecurity — these are the agenda items an American voter can reasonably expect from a rational economic policy today, whether a president’s answers to the problems lean right or left.

Trump seems to be aware of none of this. He talks as if he has just discovered basic concepts of economics like “pump priming,” a term which he bizarrely claims to have invented. It’s all too much for The Economist, whose editors, steeped in an urbane tradition of covering international markets in a nuanced fashion, recoil from Trump’s inconsistencies and illogic.

Trump’s policies, they conclude, “treat orthodoxy, accuracy and consistency as if they were simply to be negotiated away in a series of earth-shattering deals…Trumponomics is not an economic doctrine at all. It is best seen as a set of proposals put together by businessmen courtiers for their king…. Trumponomics is a poor recipe for long-term prosperity. America will end up more indebted and more unequal. It will neglect the real issues.”

When the Robots Arrive, Should We Run or Cheer?

The biggest question mark hanging over the economy is whether business automation will leave us with more or fewer jobs to go around. No one knows the answer to this question. But everyone has an opinion, and most of those opinions contradict one another.

Here are two more. First, from Dave Wright (Recode), who is chief strategy officer at ServiceNow, comes a prediction that in the short term, meaning the next two years or so, automation and AI will create a lot more jobs than they will kill. The way Wright sees it, companies automate processes to keep up with relentless increases in the pace of business, and as they do so, they increase revenue. That gives them the resources they’ll need to hire more people to handle the increased volume of work the growing business spins off. In other words, it’s a virtuous cycle — hooray.

But maybe don’t cheer yet. In The Wall Street Journal, Greg Ip argues that, in fact, U.S. businesses aren’t letting automation destroy jobs fast enough. Hidebound sectors like healthcare and personal services are stuck in their traditional ways and fighting efforts to introduce robotics and AI-driven efficiencies.

Right now, Ip points out, the U.S. is creating jobs at a fast clip, and nearing full employment. Individual productivity is growing anemically or not at all, which is not what you’d expect if automation were transforming the workplace. So maybe we should quit fretting and start investing.

A new report from the Information Technology and Innovation Foundation calls worries about labor-market disruption by new tech “false alarmism.” If Ip and this report are correct, we should stop worrying about robots stealing jobs and accelerate their deployment. As a first name on the list of stuff that ought to be automated next, we propose the executive branch.

At Online Stores, It’s Bot vs. Bot Combat

For most of us today, “bots” means the conversational software agents that answer questions and provide customer support all over the web and the chat-o-sphere today. But there are all kinds of bots, and in one category — the bots that commercial rivals use to track prices in one another’s stores — there’s a war on (Jeffrey Dastin in Reuters).

The underlying logic of this conflict is simple: A company like WalMart wants up-to-date information on what its online rival Amazon charges for each of the gazillion products it sells. So WalMart sends out an army of bots to swarm over Amazon’s site and collect the info, disguising the bots as human users where possible to evade Amazon’s countermeasures.

Amazon can’t keep its prices secret — customers need to see them — but it will do everything it can to bar WalMart’s bots and maintain a competitive advantage. The ensuing bot vs. bot combat is both a complex game of technical oneupmanship and an exemplar of the sort of race-to-extremes that online commerce so often seems to trigger.

Reuters concludes that, in the bot trenches right now, Amazon has the most effective defenses. That’s good for the company and its users. It’s also rough on the site : at peak bot times, Reuters says, Amazon sees up to 80 percent of its clicks coming in from bot traffic rather than human customers.

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