Not just one, but two liberal friends independently pointed me to a New York Times posting titled "Is This the End of Market Democracy?" I've often been harshly critical of things written by the Times staff, but I think this one actually makes some good points. The most important one is regarding the effects of the "gale of creative destruction" which really isn't being addressed by anyone and I think it may be important to consider when formulating policy.
The phrase "creative destruction" was popularized by Schumpeter as a description of an evolutionary process of continuous innovation. The creation of the automobile destroyed the horse and buggy industry, the creation of the telephone destroyed the telegraph, and in general, the creation of automation and other technologies and business innovations have and will continue to destroy huge numbers of jobs. The job destruction isn't necessarily a problem since when the U.S. economy is healthy, millions of jobs are destroyed every year, but even more jobs are created.
While the creation part of the process makes the general population better off, it's always been true that those who lose their jobs face some or even a great deal of hardship while they transition to something else (or retire or become permanently unemployed or whatever). The next generation always benefits because they don't yet have jobs to be destroyed.
As long as the creation is significantly beneficial and the rate of destruction is not overwhelming (or the cost and effort of transitioning to new jobs isn't too high), significant progress in terms of wealth creation is made without intolerable pain.
The rate of creative destruction has been rapidly increasing over the last few decades, taking us to the point where there's an uncomfortable and perhaps intolerable rate of destruction. While many people like to blame foreign trade (which I lump in with general business innovations), new technology destroys far more jobs than the Chinese. How many bank tellers lost their jobs to ATMs, how many stores have closed due to Amazon's automated order system, how many factory jobs are lost to robots and automation, etc.? Far more than have been lost to the Chinese making cheap widgets. Nonetheless, both technical and business innovations have been aligning to destroy jobs at an ever increasing pace.
Further exacerbating the problem is that the jobs being destroyed are potentially being replaced by jobs that require far more skill and talent and the people whose jobs are being destroyed are simply incapable of filling those new jobs. So they often end up being unemployed for a long time.
I also agree with the article that neither Democrats nor Republicans have discussed the issue of accelerating creative destruction and what, if anything, to do about it. The article is a little short on solutions as well.
So am I.