Weekend News & Commentary — December 3-4, 2016
Yesterday afternoon, the largest public-employee union in California announced a deal with the state government to avert a Monday strike. Though terms of the contract have yet to be released, leaders of Service Employees International Union Local 1000 called the agreement a win for the group’s 95,000 members.
Following up on our earlier coverage of President-elect Trump’s deal with Carrier to keep 1,000 factory jobs in Indiana, Politico reports that criticism has begun to emerge on the right from none other than Sarah Palin. The former Alaska governor and rumored Trump Cabinet pick called the agreement, which will apparently grant the company substantial tax relief, “crony capitalism” bearing the “hallmark[s] of corruption.”
In further manufacturing news, the New York Times looks into how heated rhetoric from Trump and others may negatively impact domestic production. Noting the reliance of many American manufacturers on imported parts, the Times spoke with factory owners and academics afraid that a trade war — especially one involving the imposition of new tariffs on goods from China — could ultimately make U.S. goods less competitive.
Also at the Times, Patricia Cohen analyzes recent economic news and observes that President Obama will be handing off an economy far stronger than those generally present when the White House switches parties. After 80 straight months of job growth in the private sector, unemployment is at its lowest level since the summer of 2007 — and, with 5.5 million open jobs, two major deficiencies in the current recovery (wage growth and labor force participation) seem poised to creep up. More analysis on the contrast between current economic conditions and those in 2008 comes from Jared Bernstein, the former chief economist to Vice President Joe Biden.
Finally, Ruchir Sharma, chief global strategist at Morgan Stanley Investment Management, writes at the Washington Post that increased automation and use of robots may actually be necessary for the continued growth of the global economy, contrary to the many predictions of severe disruption. Sharma observes that widespread drops in the population-growth rate have created a looming demographic crisis across the developing world, and that robots may offer a politically palatable method of expanding workforces.