http://www.nytimes.com/2015/02/23/opinion/paul-krugman-knowledge-isnt-power.html?_r=0
This is NOT it:
Here’s the Krugman solution:
In so many words, attach more weight and more wagons to the locomotives. That will make the trains run faster.
Xiggi, Xiggi, Xiggi…
This thread should be closed. 
Anything Krugman says, I instantly put into the BS file. And no matter what he says, he manages to find a way to praise the administration for their wisdom. He’s nothing but a hack.
Re: “because businesses can’t find the workers they need.”
They can not find quality workers for the wages they are willing to pay, and/or they are not willing to spend their own money on training their workers (using other people’s money instead.)
The trend is that the college students are now expected to have a high quality and “relevant” intern experience (in order to learn something which are not expected to be learn at an education institute) in addition to receive the education in the traditional sense.
It is all about the bottom line.
Receiving more education like going to a grad school) may not always increase your marketability in the job market, depending on what careers you are going in. (It could be misleading to say "wait till your graduate school to get that prestigious grad degree. Some companies may not even be willing to compensate your additional investment there. This could be worse if it is indeed true: I also heard that, in some engineering discipline, only the UG degree in that major counts for securing a license for that profession, because a grad level education is considered as a different kind of “training”.)
It’s two separate problems, really.
I am not an economist, but I know a number of economists, and they’ve convinced me that the problem with US corporate taxes is a high nominal rate with a lot of specialized deductions that target established corporate interests. This simultaneously provides an incentive to established companies and a barrier to new corporate formation.
The issue of having enough skilled workers is more of a demographic issue (and in my own research I do work a lot with demographic shift, so I know what I’m talking about on this one) than an educational issue, and all the playing with tax rates in the world isn’t going to change that at anything more than the margins, and likely not even there.
^ do you refer to the aging of population/workforce? If yes, we need more babies and qualified parents! Then again, who are going to motivate people (esp. women) to become parents? It is a big debate about how to achieve it. On one hand, many people prefer to use other people’s money to solve their problem: Who will be working to pay for, SS and Medicare when they are old?
I saw more and more two-income-no-kid families in recent years…I live in an apartment area where a lot of young immigrant families (most from India) live there. For some reasons (unexplainable to me), there are a lot of babies and young kids in this area. Whenever I see more babies (and their caring parents), I feel my retirement prospect is brighter. (I heard some countries in Europe and the east Asia are much worse than us.)
Princeton apparently drop-kicked him to New York.
It’s made my opinion of the place rise a few notches. (Princeton, not New York.)
It was bad enough when krugman was awarded the nobel economics prize in 2008. Little did I know then, that the even bigger joke would occur the year after.
I’m going to let this thread continue for a while but if this goes south it will be closed. The topic is certainly on the edge of politics but some of the comments have been thoughtful. Please play nice.
ED
Mod
US corp tax rates are already pretty high compared to the rest of the industrialized world. I’d rather see the bottom half lifted thru education.
It would be a mistake to make the replies Krugman-centric – or apply a “political” stamp on the subject at hand. Would it be different if Thiel or Buffett has made a similar statement?
This is about the continuous evaluation of the merits of … education. It should not be about Krugman, but about the fact that the opinion of a really smart man (hard to deny him that part) is shared by a VAST number of people who are tasked to educate the next generations, and often placed in front of our most prized and selective universities.
It is not about the conclusions he reaches about corporate taxes and reinvestment. It is about his ease to dismiss the notion that education could or should be an equalizer in our society. Again, the real question should be about WHY an Nobel Prize winner who taught in one of the best universities in the world, think “we” have missed the point for so long.
The corporate tax is only a canard that masks the deeper point. A deeper point that could debated as the correlation between our education system and the creation of new jobs. And, I mean the creation of new jobs, and not the recycling of qualifications that no longer matter. In so many words, what has the role of broad education (the one you find almost anywhere) been in the development of the most successful components of our business world? Why did it happen in North California or Texas and not in Florida or Wisconsin?
Apple - market cap - $760 Billion
Microsoft - market cap - $361 Billion
Oracle - market cap - $192 Billion
Number of real college degrees between Jobs, Gates and Ellison - 0?
I sometimes wonder if Thiele fellowships do make a real point.
Well, we know why it was Northern California, right? Stanford’s mission (I cynically believe in response to UC Berkeley’s dominance in some science fields, go Bears) HP, etc. Texas pumped huge money into UT Austin in the 80s. On the East Coast, Harvard/MIT were the origins of the Miracle Mile. In other words, a handful of universities helped create huge centers of industry/wealth. Is it a coincidence that all these places are progressive in politics? Or a result of it?
Well Xiggi,
What do you think of this?
It was news in our paper this week that Boeing actually paid corporate taxes this year. They threaten and blackmail the state with job loss to gain significant tax breaks then complain that the Universities are under funded. Microsoft does the same thing. Microsoft does it one better and complains that the University of Washington isn’t turning out enough CS majors (due to financial constraints) so they absolutely must import cheaper labor with H1B visas.
Perhaps the employment mismatch has more to do w the majors students pick:
http://m.mic.com/articles/111164/if-you-want-to-make-a-ton-of-money-after-graduation-here-s-what-you-should-major-in
Scroll down the article to see the table of unemployment rates for different majors
There are more people who want to pick CS than CAN pick it due to department size constraints which translates to money constraints.
Actually, I am not sure we know the WHY part that well! Could it be as much as story of a blind hog stumbling on the proverbial acorn? What I am sure about is that almost anyone could build a plausible case of the chicken and the egg sequential synergy for Northern California. For instance. what was the catalyst in the development of the new darlings that supplanted Microsoft or HP. Why did Steve Jobs decide to launch his venture in the shadows of Palo Alto? I surely do NOT buy that it might be a result of progressive policies and the business-minded local policies. Those companies probably PUT UP with local conditions as opposed to benefit from them. Ask Google about his attempt to transport his workforce to the preferred housing in San Francisco and all that hoopla about forced gentrification. And ask the people who are schlepped in the bus how they feel about the CA’s little grab in their wallet! But, given the warning of politicizing the thread, it might best to leave it at that! Obviously, I think that California’s success happened in spite of its leadership! /wink
A better answer might be found in the symbiotic relationship between the companies and the production of local talent from Foothill or DeAnza all the way to the big dogs that sit on the pinnacle of education. Or could it be a simpler logistical solution when it is easier to poach the upcoming talent from the ranks of your competitors or buy the little fish out before they start eating at your own reserves.
However, it is hard to deny that the local schools (and not only Stanford) have responded to the needs of the local employers, and perhaps created a large part of the opportunities for their own students. The real question is why this has not happened somewhere, and in places that would appear a lot more hospitable and affordable?
/musing away
Dstark, could it be that the high education of the people described in “Actually, the inflation-adjusted earnings of highly educated Americans have gone nowhere since the late 1990s” happens to be in areas that have become obsolete and present little value in the current marketplace? If today’s skills include the ability of analyzing vast amounts of data and respond to a 24/7 connected marketplace, it might not bode well for the analyst who only knows how to start his Windows98 machine and fire up a basic Excel sheet.
As an example, a family member used to hold important functions in IS and could run the mainframes in the 70s and 80s. Over the years, his skills lost much relevance but he did keep his employment. He just retired and his last job was … replacing wired computers with new wireless technology. And the replacement part was a technical job. In so many words, he was not supervising the job. He was carrying boxes and cables! In his early days, he was on top of the food chain in his field. The speed of changes in technology have been brutal. Just look at the fax machine and how one sends a fax nowadays to the … few outfits that still like them.
Technology eats its own. That is for sure. Do the technology changes that are occuring create jobs overall?
Employees share of the economy has decreased for a long time. Does that play a factor in how much education matters? Capital is taxed at a preferred rate compared to labor. Is that a factor? As wealth becomes more concentrated and income growth becomes more concentrated in fewer hands, does that make education less important?
I am asking here…I am not pontificating.
As to why silicon valley is in Nor Cal…smart rich people want to live here…look at the weather…It is Feb.