How do we encourage economic growth and progress across the country? The United States was once revered as one of the most successful economies in the world—but today, it struggles to generate the job opportunities and market stability necessary for its citizens to ensure their quality of life.
This is the question that Jonathan Gruber and Simon Johnson explore in their book, entitled Jump-Starting America: How Breakthrough Science Can Revive Economic Growth and the American Dream. In this episode, Alexander McCaig sits down with Jonathan Gruber to have a meaningful dialogue on what the government’s missing out on by decreasing funding in research and development.
According to Jonathan Gruber, public investment in research and development played a pivotal role in the economic progress of the United States. All the technological advancements we have the privilege of experiencing today—such as our smartphones and laptops—were, in part, fueled by the amount of funding that was poured into the pursuit of science.
However, the level of public investment decreased drastically, from about two percent of GDP in 1962 to just under half of that today. In his book, Jonathan Gruber explains that the nation’s renewed support in science and technology would play a significant part in generating economic growth. This is especially important in an era where plenty of citizens are facing job instability, outright unemployment, and health concerns brought about by the COVID-19 pandemic.
Ushering in a new era for research and development would not just benefit certain industries. Jonathan Gruber posits further that aside from overall growth, it would create better jobs across the economy. This would naturally occur as the market adjusts to accommodate an influx of tech professionals across the country, because they would need these goods and services to support their work as well as their quality of life.
While the US does have certain cities where tech-based growth is made possible, they are not enough to power the economy. In fact, concentrating opportunities in “superstar” cities such as San Francisco, New York, Seattle, and the Silicon Valley can be counterproductive.
This is because the demand for professionals will incentivize people to relocate from one city to another. As a result, these cities experienced increased congestion and housing prices—and those who do not have the experience necessary to become a valuable asset to the area will be forced to leave.
At this point, Jonathan Gruber emphasizes the importance of government involvement in encouraging basic research. Setting aside funding for research and development that is carried out in other areas would help incentivize private investors, or venture capitalists, to take that risk as well.
One salient point of discussion in the episode was when Alexander McCaig asked Jonathan Gruber about the impact of robotics on the future of work. Alexander pointed out that there may be some routine jobs that may phase out completely because they would be delegated to robots, who would be more efficient at performing such activities.
Jonathan Gruber believes that the outlook for robotics is optimistic, and that people should focus on the capabilities that can be developed when there is enough funding for the country to get a leg up on the tech race. Being able to scout the future of artificial intelligence and machine learning would give researchers a head start on the careers that it would affect, in both a positive and negative manner.
“The bottom line is, you can wring your hands about the fact that some low-level jobs are going to be taken by robots, or you can get to work making the robots,” Jonathan Gruber explained.
To illustrate his perspective, Jonathan Gruber explained how the invention of the wheel raised concerns about the viability of horse-drawn carriages back in the day. Fast forward to modern times, it is clear that refining the wheel has led to a plethora of different jobs across transportation, engineering, and construction as people and cities work to make their locations friendlier to vehicles.
Planning ahead for new job roles could help the labor market adjust and accommodate accordingly.
When asked about his parting words, Jonathan Gruber encourages people to take an “if you build it, they will come” mentality. People living in communities tend to go for an incredibly narrow or vague focus, but what they need is an actionable plan that can be carried out step by step.
When people have a concrete and tangible action to look back on, they have a source of inspiration that pushes them forward—even if they do not secure the funding needed to make it happen just yet.
The future is bright and full of possibilities. It’s time to take the pivot back towards science, technology, and data.
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