Americans created the knowledge economy. So why can't they keep up with it anymore?
- By Mishaal al GergawiMishaal Al Gergawi is an Emirati political commentator.
America today is akin to the Ottoman Empire at the end of its days. Immensely important, commanding huge global influence, badly run under mounting debt, it is not the leader of the world, but the sick man of it.
At the root of America’s problems today is one that Americans themselves created: the knowledge economy. That economy and its associated technological advances, from outsourcing to Internet telephony, has displaced many Americans from work even as it has made firms like Apple among the world’s richest and most admired companies.
The three-year-old economic crisis has only accelerated that process, but in no way started it. As in Europe’s transition from an agrarian economy to an urban powerhouse during the Industrial Revolution, there will be many whose skill sets just won’t be needed in this new age.
But the likes of Amazon, Apple, Facebook, and Google put together cannot employ the people laid off by Ford and General Motors. According to the U.S. Bureau of Labor Statistics, the manufacturing industry’s employment numbers went from 17.6 million in 1998 to 13.4 million in 2008; they are projected to decrease to 12.2 million by 2018. The IT industry’s employment numbers are projected to grow to only 3.1 million by the same year. Designing more Facebook clones and iPad apps won’t close this gap.
And that’s at least in part because, for all the incredible quality of U.S. discourse, the American education system is in an abysmal state. Its universities are still the envy of the world, but the United States has a 30 percent high-school dropout rate and recently ranked 31st of 65 countries in math proficiency in a ranking compiled by the OECD. What will those people do? How will they live? No wonder America’s Ph.D. students, especially in science and engineering, come increasingly from overseas.
If the United States continues to look to the tech sector to lead it out of recession while maintaining unemployment close to 10 percent, it may well have nothing more than a feudal recovery, one in which those who have the immediate skills or the wealth to take part in it do so and those who don’t remain unemployed — a techno-aristocracy of sorts.
I recently asked an American businessman what many unemployed Americans will do if they can’t find new jobs comparable to their old ones. "Go back to farming," he said. And it didn’t entirely sound like a joke.
Clyde Prestowitz is the founder and president of the Economic Strategy Institute (ESI), where he has become one of the world's leading writers and strategists on globalization and competitiveness, and an influential advisor to the U.S. and other governments. He has also advised a number of global corporations such as Intel, FormFactor, and Fedex and serves on the advisory board of Indonesia's Center for International and Strategic Studies.| Prestowitz |
Daniel W. Drezner is professor of international politics at the Fletcher School of Law and Diplomacy at Tufts University and a senior editor at The National Interest. Prior to Fletcher, he taught at the University of Chicago and the University of Colorado at Boulder. Drezner has received fellowships from the German Marshall Fund of the United States, the Council on Foreign Relations, and Harvard University. He has previously held positions with Civic Education Project, the RAND Corporation, and the Treasury Department.| Daniel W. Drezner |