The Biggest Economic Issue Facing America Is Not Job Creation

Quartz: “The biggest economic issue for the future is closing the skills gap and retraining workers who have been displaced from their old jobs that have been automated. Both the US unemployment rate and the total job openings have been relatively unchanged in the past year. The unemployment rate in January was 4.8%, down only 0.1% from the same time in 2016. The total job openings were 5.5 million in Dec. 2016, up from a mere 100,000 the same time in 2015. We simply don’t have people with the right skills to fill millions of jobs, yet many of them are still underemployed or living in poverty.”

“The problem is that one in every five adults globally has no formal education, which is a total of 682 million people, and jobs that require formal education are the ones expected to grow by nearly 8% in the next seven years.”

A Tax Overhaul Would Be Great in Theory. Here’s Why It’s So Hard in Practice.

Neil Irwin: “A short list of the plan’s potential benefits looks awesome: It would give companies more incentive to keep jobs in the United States, less to overextend themselves on borrowed money and provide vast savings by reducing what companies spend on tax lawyers, who help them game the current system.”

“Yet these changes could also set off a cascade of more harmful effects. The plan could shift trillions of dollars of wealth from Americans to foreigners; set off an emerging markets financial crisis; wreak havoc in global oil markets; and cause sustained harm to the American higher education and tourism industries (including, as it happens, luxury hotels with President Trump’s name on them).”

“Welcome to the real world. The tax code has been flawed and inefficient for a very long time, precisely because fixing it could be so terribly disruptive.”

Which States Pay Teachers the Most (and Least)?

Education Week: “Alaska and New York pay teachers nearly double the salaries of those working in Mississippi and Oklahoma, says a new study by GoBankingRates.”

“The average teacher salaries in 50 states (not including the District of Columbia) were calculated using data from the Bureau of Labor Statistics. The authors averaged the mean salaries of elementary, middle, and high school teachers to get the average salary in each state. The calculations did not include the salaries of special education teachers.”

The Damaging Impact of the Relentless Pace of Automation

MIT Technology Review: “The White House report points in particular to the current wave of AI, which it describes as having begun around 2010. That’s when advances in machine learning and the increasing availability of big data and enhanced computation power began providing computers with unprecedented capabilities such as the ability to accurately recognize images. The report says greater deployment of AI and automation could boost economic growth by creating new types of jobs and improving efficiency in many businesses. But it also points to the negative effects: job destruction and related increases in income inequality. For now at least, ‘less educated workers are more likely to be replaced by automation than highly educated ones.’ The report notes that so far automation has displaced few higher-skill workers, but it adds: ‘The skills in which humans have maintained a comparative advantage are likely to erode over time as AI and new technologies become more sophisticated.'”

“The problem is that the United States has been particularly bad over the last few decades at helping people who’ve lost out during periods of technological change. Their social, educational, and financial problems have been largely ignored, at least by the federal government. According to the White House report, the U.S. spends around 0.1 percent of its GDP on programs designed to help people deal with changes in the workplace—far less than other developed economies. And this funding has declined over the last 30 years.”

Donald Trump’s Wall May Stop Immigrants Who Want to Return to Mexico

Ana Raquel Minian: “Donald Trump’s executive order to build a wall between Mexico and the United States overlooks how the fences, walls, and border-control measures that already exist between the two countries have come to act as a barrier—or a ‘cage of gold’—that discourages migrants from leaving the United States, rather than preventing their entrance in the first place.”

“Trump has never acknowledged that since the Great Recession the net outflow of Mexicans is larger than the inflow, and instead, continues to insist that the wall is necessary to curtail Mexican undocumented migration… But it’s a wall that will likely reinforce the bars of the cage of gold and discourage those who are already here to continue leaving as they have done since the Great Recession.”

How Microsoft Avoided Billions in Taxes, and What the GOP Says It Will Do About It

Washington Post: “On paper, Microsoft’s facility in Puerto Rico was wildly profitable. With just 177 workers, the plant recorded $4 billion in earnings in 2011, a Senate investigation found.”

“The gimmick was entirely legal. According to the Senate’s report, the software company’s lawyers were channeling its profits from sales all over the country through the Puerto Rican operation, getting Microsoft out of about $1.5 billion in taxes a year.”

“It was the kind of scheme that designers of congressional Republicans’ tax proposal hope to eliminate. The vast sums Microsoft saved hint at how much money is at stake for corporations that rely on similar strategies to reduce their taxes, which are especially common among technology firms and other companies with valuable brands, patents and copyrights.”

Trump’s Travel Ban Is Not Recruiting More Terrorists

“The argument goes like this: Jihadists believe there is a Manichaean struggle between Islam and the West. An alleged ‘Muslim ban’ plays directly into this worldview, telling Muslims that they are not safe in the un-Islamic world. No wonder they are calling the executive order a ‘blessed ban’ on Islamic State web forums… If only jihadi recruitment were so easily disrupted. Sadly it’s much more complicated,” Eli Lake writes for Bloomberg.

“A far better argument against Trump’s executive order is that it undermines our own recruitment efforts to counter the jihadists. At first the travel ban applied to translators who helped the U.S. military in Iraq, not to mention leading advocates for the Islamic State’s victims like the Yazidi-Iraqi legislator Vian Dakhil. Fortunately the Trump administration has reversed these elements of the travel ban in the last week. But the perception that America would close its doors to the people who helped us makes it harder to recruit allies against the Islamic State going forward.”

What Worked With Obamacare? Lessons From 5 States

NPR: “The researchers looked at California, Florida, Michigan, North Carolina and Texas, interviewing state regulators, health providers, insurers, consumer organizations, brokers and others to understand why insurance companies chose to enter or leave markets, how state regulations affected decision-making and how insurers built provider networks.”

“Despite the political diversity of the five states, some common lessons emerged.”

Handling North Korea Is a Team Sport and We Need China

Admiral James Stavridis: “We have to recognize that all roads lead to Pyongyang through Beijing. Despite the Trump Administration’s desire to get tough with China, we will need political capital with President Xi Jinping to enlist his help. Without China, further sanctions are meaningless. An open dialogue and the outline of a plan are critical. We may have to moderate our approach on Taiwan (falling back to the ‘one China’ policy, which Trump has questioned) and ease our opposition to China in the South China Sea. Geopolitics, like life, is full of choices.”

“North Korea is a team sport. Our allies and friends — South Korea, Japan, Australia, Vietnam, Malaysia and others — all agree on the challenges. We should leverage their participation in diplomatic and economic initiatives to deal with the North. And we’ll need to conduct frequent allied exercises to leverage joint operational capability in things like missile defense.”

The Next Big Blue-Collar Job Could Be Coding

“The Valley employs only 8 percent of the nation’s coders. All the other millions? They’re more like Devon, a programmer I met who helps maintain a ­security-software service in Portland, Oregon. He isn’t going to get fabulously rich, but his job is stable and rewarding: It’s 40 hours a week, well paid, and intellectually challenging. ‘My dad was a blue-­collar guy,’ he tells me—and in many ways, Devon is too,” Clive Thompson writes for WIRED.

“Politicians routinely bemoan the loss of good blue-collar jobs. Work like that is correctly seen as a pillar of civil middle-class society. And it may yet be again. What if the next big blue-collar job category is already here—and it’s programming? What if we regarded code not as a high-stakes, sexy affair, but the equivalent of skilled work at a Chrysler plant?”