Putting Dynamism in Its Place
The phrase "economic dynamism" has become so ubiquitous, its connotations so obviously desirable, that we accept uncritically the dressing up of policy debates in its terms. The standard narrative goes something like this: Disruption, a close cousin of dynamism, occurs when a new market entrant's superior offering or lower price allows it to displace an incumbent. Resources shift to this more productive use, and both workers and consumers reap the benefit. An economy featuring high levels of disruption is "dynamic," and with dynamism comes the innovation and economic growth that leads to rising material living standards for all.
The dynamists who tell this story speak confidently of its centrality to economic growth and of their ability to divine which policies will foster or frustrate it. More economic dynamism is always better, and so public policy must always be oriented toward nurturing it — with, of course, the caveat that policy inherently constrains dynamism and so we should be skeptical of its use. Merely inquiring as to the basis or veracity of these axioms risks exposing oneself as unsophisticated and, perhaps worst of all, insufficiently "pro-growth."
But an inquiry is very much needed. That disruption and dynamism can deliver enormous benefits is certainly true. That poorly conceived policies can interfere with such benefits is equally true. But the concepts involved are so vaguely defined and correlate so weakly to their stated objectives that they obscure and compound rather than illuminate and address our economic choices and challenges.
The problem is that disruption and dynamism are not ends unto themselves, but means to the ends of higher worker productivity and widely shared economic prosperity. And their effect is contingent on their form, and on the presence of accompanying and at times opposing forces. Disruption offers no guarantee that disrupted resources will be re-allocated effectively, so embracing it blindly yields an overbroad endorsement of corrosion as well. Dynamism also relies upon the vitality of numerous social endowments and institutions to facilitate and channel it; ensuring that it remains productive over time requires some deference to those forces even when they constrain it in the short run.
Exhibit A for the complexity of these phenomena is international trade, where the absolutist case for dynamism has been asserted most strongly and where it has proved most catastrophically incomplete. Trade offers a uniquely useful case study because the disruption itself, originating outside the domestic economy, is clearly disaggregated from any subsequent benefit. A foreign producer supplanting a domestic one is disruption, yes, but do the disrupted resources shift to more productive uses and does the domestic economy's productive capacity increase? Maybe. But maybe not — especially if the trade is unbalanced and the domestic economy sees no commensurate increase in foreign demand for its own production. The disruption is not inherently good or bad; the context in which it occurs and the effects that ripple outward determine its valence.
The simple heuristic that the least constrained market is the most dynamic and thus produces the best outcomes turns out not to be a useful guide for policymakers. To state the obvious (though bizarrely controversial), throwing people out of work and shuttering their businesses is not always good — either for them and their families in the short run or for the nation and its economy in the long run. Where dynamism performs as advertised, with the dislocation of disruption occurring alongside the emergence of new and better opportunities, we need to celebrate it — and defend it against those who would place protection of a particular job above progress for society. But we also need to acknowledge that dynamism comes with costs and can malfunction. A coherent and sustainable dynamism requires addressing, not ignoring, these limitations.
TRADE, FOR GOOD AND ILL
Trade delivers its benefits in several ways. The standard mechanism taught in Economics 101 is specialization. Where two parties have capabilities that make them better at different types of things, they can both be more productive (and create more output for consumption) if they specialize where they are relatively better equipped. This is true of next-door neighbors where the accountant does both households' taxes and the carpenter does both households' repairs, and it is true of the United States and Mexico, where one nation's climate is ideal for growing wheat, the other's for growing avocados.
When American farmers abandon their struggling avocado orchards and Mexican farmers their low-yield wheat fields, the disruption can be painful. But when, in conjunction, the more productive American wheat farmers and Mexican avocado growers gain new markets for their crops, the net effect for both economies and their workers can be positive.
A second benefit, which many economists now believe is more important in the international context, is scale. Think of the carpenter, who must buy a full set of tools even if just to maintain his own house but would prefer, via trade, to deploy his talents and equipment throughout the neighborhood. Likewise, Microsoft can expect far greater revenue and invest more in product development if its software will be bought not just in the United States but around the globe.
The third benefit is technological diffusion. When producers come into contact, they can learn from each other, and competition can force both to become more effective — an example of dynamism in action. If the carpenter can work all around town instead of just in his neighborhood, he will likely discover superior techniques that some of his peers use and seek to improve his time per job to match what they offer, especially if they will be doing business in his neighborhood as well. Although the stiff competition from international automakers dealt harsh blows to Detroit, it compelled the introduction of products and processes that over time led to better domestic cars, too.
Through all these channels, workers can become more productive while consumers can benefit from greater choice, lower prices, and more rapid innovation. Thanks to these effects, the elimination of trade barriers and increase in international trade in the second half of the 20th century produced gains throughout the world, above all in certain developing countries. In the 1960s, less than one-quarter of global economic output traveled across international borders. By 2003, that share had reached half; as of 2015, it stood at nearly 60%.
Yet trade is not without costs. The parties trading almost certainly gain — it is, after all, their choice to make an exchange. If one measured prosperity solely in terms of consumption, this might be the end of the story. Firms and people who once could buy things only on the domestic market now can also buy from the larger international market. What's not to love? But as Irving Kristol once observed, "Where is it written that the welfare of consumers takes precedence over that of producers?"
From the perspective of worker productivity, the calculus is more complex. In isolation, opening the U.S. market to a global supply of labor could be cause for serious concern. Trade needs to be balanced for the anticipated dynamism to materialize and the net effect on the labor market to be positive. Only if the world buys more from the United States in tandem with the United States buying more from the world will workers not only face greater competition but also enjoy greater opportunity.
That balanced outcome is by no means guaranteed. If trillions of dollars of foreign goods are flowing into the United States, then Americans must send back something in return. But other countries might impose obstacles to American producers selling in their markets and instead acquire U.S. assets like stocks, bonds, and real estate. For instance, what if China sends $50 billion worth of electronics to the United States and we send $50 billion worth of U.S. Treasury bonds back to China? In colloquial terms, China has sent the goods on credit. American production is lower, and government debt is higher. Such an imbalanced exchange is far from the model of prosperity-enhancing free trade taught in economics classes. It is disruptive, yes, but in ways that can reduce opportunities for workers, lower the trajectory of their productivity, and diminish the nation's real prosperity.
Just such an imbalance has emerged in recent decades. For instance, in 2017, the United States traded $3.89 trillion in goods: $1.55 trillion of exports and $2.34 trillion of imports, which resulted in a roughly $800 billion deficit, offset only in part by a $240 billion surplus on $1.32 trillion of services trade. Of that $3.89 trillion in goods, about 20% was in goods dependent on agriculture or natural resources, where differing national endowments would make one country or another an obvious importer or exporter. Trade of this type was balanced: $394 billion of imports against $339 billion of exports; 43 product categories with net imports and 43 with net exports.
By contrast, for the 80% of trade in manufactured products, Americans bought $1.60 of imports for every $1 of exports sold overseas — $1.86 trillion in imports against $1.16 trillion in exports overall; 120 product categories with net imports and 53 with net exports. Of the 22 product categories with a surplus or deficit of at least $10 billion, 21 ran deficits. The only manufactured product that the United States exports significantly more of than it imports is airplanes.
The U.S. trade deficit in advanced technology is particularly stunning. Balanced trade might include a large deficit in unsophisticated manufacturing that relies heavily on low-cost, unskilled labor, offset at least in part by American exports of more sophisticated products. Yet the United States is a net importer even of what the U.S. government designates as "advanced technology products," importing $464 billion against $354 billion of exports in 2017. In addition to airplanes, American exports do exceed imports in weapons and flexible manufacturing tools. But the nation is a net importer of biotechnology, life sciences, computers and electronics, advanced materials (including semiconductors), and even nuclear technology.
This imbalance has not happened by accident. Countries like South Korea, Taiwan, and Japan have achieved rapid growth in part through mercantilist policies that aggressively subsidized and promoted their strategically important industries on the global stage, while preventing foreign (for instance, American) producers from selling in their markets. Today, China is the primary practitioner of this kind of mercantilism, and its gargantuan scale is producing unprecedented economic distortions.
China's litany of abuses is by now well known. The World Trade Organization limits the explicit protectionism of tariffs, but China subsidizes its own producers while throwing roadblocks in the path of foreign competitors — arbitrary regulations, discrimination in government contracting, and requirements for partnerships with local firms and for the use of local components. It also facilitates intellectual-property theft on an unprecedented scale, which General Keith Alexander, former head of the National Security Agency and U.S. Cyber Command, and Admiral Dennis Blair, former director of national intelligence, have called "the greatest transfer of wealth in history."
As the New York Times reported in early 2017, "China has charted out a $300 billion plan to become nearly self-sufficient by 2025 in a range of important industries, from planes to computer chips to electric cars." The so-called Made in China 2025 program "would provide large, low-interest loans from state-owned investment funds and development banks; assistance in buying foreign competitors; and extensive research subsidies." Already rolling off the assembly line: China's C919 commercial aircraft, a direct competitor to Boeing's 737, built conveniently through "at least 16 joint ventures for avionics, flight control, power, fuel and landing gear." The C919 made its first test flight in May 2017 and, by early 2018, had accumulated almost 800 orders.
COMPUTER CHIPS, POTATO CHIPS
To the untrained observer, it might seem self-evidently harmful to both send away the labor-intensive industrial employers that sustain communities and forfeit leadership in the industries that might play such a role in the future, especially if the result is to become increasingly more indebted in the process. Why does everyone stand and cheer as the heart of America's dynamic economy parades away?
Dynamists dismiss such concerns as resistance to disruption. One can't make an omelet without breaking a few communities, after all. And as Harvard professor Greg Mankiw assured his New York Times readers, "full employment is possible with any pattern of trade. The main issue is not the number of jobs, but which jobs. Americans should work in those industries in which we have an advantage compared with other nations, and we should import from abroad those goods that can be produced more cheaply there."
Mankiw's formulation is telling: "have an advantage" equals "produce more cheaply." Trade's disruption need not bear any relationship to boosting worker productivity; it operates to deliver consumers the lowest possible prices. Concern for the long term falls by the wayside in this perspective, assuming away differences between industries in employment profiles, growth trajectories, opportunities for productivity improvement, and spillovers to broader research ecosystems and supply chains. Rejecting "the feeling that it's better to produce ‘real things' than services," Christina Romer (Council of Economic Advisers chair under President Obama) observed in the New York Times, "American consumers value health care and haircuts as much as washing machines and hair dryers." Or as Michael Boskin, chairman of George H. W. Bush's Council of Economic Advisers, reportedly said, "computer chips, potato chips, what's the difference?"
This unreflective presumption that disruption on consumers' behalf always ends well is myopic. In the aggregate, at the national level, imbalanced trade places the economy on a lower trajectory. In the short run, it reduces productive capacity. It also allocates both human and physical capital away from industries that hold the most potential for the future, and it builds industrial ecosystems and supply chains outside the United States, which will make future efforts to regain a competitive foothold more difficult.
"[T]he products a country makes today," explains the Economist, describing research conducted by Harvard professor Ricardo Hausmann and MIT professor César Hidalgo, "determine which products they will be able and likely to make tomorrow, through the evolution of their capabilities." What begins as a distortion or imbalance becomes genuine advantage as supply chains and know-how embed in the countries that have seized them.
Frustratingly, the same consumer-focused advocates who dismissed the strategic value of retaining industrial strength and regarded concern for its departure as anti-dynamism, now also dismiss the possibility of restoring industrial strength, on the ground that it has become too firmly entrenched elsewhere. The massive advantages of established supply chains and built expertise now preclude American-led disruption and stand as obstacles to future American growth and dynamism itself. When Apple attempted to manufacture its Mac Pro in Austin, Texas, several years ago, it couldn't even source enough screws.
The effects of imbalanced trade come home to roost for individuals and their communities in their local labor markets. Mankiw rightly defines the issue as "not the number of jobs, but which jobs." But which jobs do Americans lose and which do they gain if trade is imbalanced and other nations are dominating the most promising industries? Presumably, other jobs have not been available to them all along in which they could have been working more productively. Nor can we simply presume that the domestic labor market will be generating new demand, especially in the absence of export growth commensurate to the import surge. The new jobs could well be ones in which workers are less productive and that will provide less opportunity for gains over time.
Furthermore, where unbalanced trade reduces the American economy's output of the "tradeable" goods and services that can be produced in one place and sold to another, the suggestion that workers shift into the services economy is unhelpful. Americans take for granted that they can buy what products they want from around the world. But how can someone whose work consists entirely of serving others in his community expect a firm halfway around the world to make something for him? Tradeables are the keystones of local economies.
Consider the local physician who provides care only to those in his town. He may be well compensated, but he can't sell his work to the makers of cars or phones in Asia or even to the medical-equipment supplier in the next state. He must trust instead that some of his patients produce goods or services that can be sent to those places and, in purchasing his medical services, give him the resources to acquire the goods that he needs. Or consider the plight of a local economy as a whole. It wishes to receive from elsewhere almost all of its food, medicine, vehicles, electronics, energy, and more, so it must send tradeables of equal value. Not every individual must do so; most may work in the local services economy — but they cannot all just cut one another's hair.
Tradeables can take many forms. Wall Street provides its financial services around the country and the world; Hollywood exports its movies; Orlando sells the Disney World experience to tourists. Call-center workers are exporters, too. But manufactured products represent by far the largest category of tradeables and are, along with agriculture and natural resources, the ones in which less-skilled workers and less-urban locations are best suited to excel. The strength of the industrial economy dictates the fortunes of workers with a comparative advantage in physical activity and regions with a comparative advantage in open spaces and raw materials.
The importance of tradeables to a local community also helps to illuminate the vast difference between the often-equated phenomena of automation and globalization. For the worker dislocated by trade, the facility in which he once worked is likely gone, and the production now occurs somewhere else. But for the worker laid off or never hired because of automation, the facility is still operating in town, likely producing more output than before. Total demand for labor from the firm and its surrounding ecosystem is likely larger, and if capital has replaced labor, the remaining workers are likely earning more — and some other highly paid professionals may be arriving in the area with new demand for services of their own. Furthermore, while productivity gains occur bit by bit, year by year, a plant that shuts down and moves overseas is here today and gone tomorrow. In which situation might it be easier to find a new, well-paying job?
A reporter telling the story of automation speaks to a laid-off worker at a lunch counter; one telling the story of trade reports from the empty parking lot of an abandoned building. There is no one left to talk to. The installation of a robot and the offshoring of a production line may appear similarly "disruptive" in the abstract, but their economic effects differ radically. An economy that aggressively offshores and one that aggressively automates may both appear equally "dynamic" in the moment, but only one is likely to still look dynamic a decade later.
SECURING A PRODUCTIVE DYNAMISM
If disruption can corrode dynamism, and dynamism untended can undermine itself, then the least constrained market achieving the greatest efficiency and best satisfying the consumer at a moment in time may not in fact be the ideal, or the appropriate, objective for public policy. Attention to the social and economic conditions necessary to a productive dynamism will be critical to its sustainability and success, even when that attention shifts focus in other directions or indicates policies that might impinge on the market. At first glance, such a focus can seem to invite "big government" or imply a rejection of dynamism per se. But we should demand greater nuance from policymakers and pundits alike.
Consider the patent. The government awards a patent to an inventor, which allows him to exclude others from using his invention for a period of years. Even the fiercest libertarian — often especially the fiercest libertarian — will defend this rule as crucial to a well-functioning market. Without patent protection, if people could freely use each other's inventions, what incentive would anyone have to spend the time and money developing something new? This seems like a fairly obvious assumption (even if empirical research calls into question whether stronger patent protection necessarily correlates with higher rates of innovation). Stipulating that patents equal innovation, notice what this implies: A rule that obstructs transactions, suppresses output, and raises prices for consumers in the short run can also be the rule that is best for the market and for society over time.
Things become even more complicated when we introduce an international boundary and conflicting legal regimes. We protect patents on new drugs, but what should we do when drug-makers voluntarily sell those patented drugs in Canada at prices far below what they charge in the United States — because the Canadian government requires the lower price? Should someone be allowed to buy the drug in Canada and then re-sell it in the United States, undercutting a drug-maker's American price? We call this drug re-importation, and we prohibit it, again on the basis of bolstering the free market, again with strong support from libertarians. Some politicians will offer a rationale of "safety," as if we can't trust Canadians to monitor their drug supply as well as we do. The actual rationale is that we wish to insulate what we consider to be our freer market in drugs from contamination by the more controlled Canadian market.
Canada is hardly the archetypal case of market distortion. Take China's industrial policies, which ignore intellectual-property law entirely and flood producers with subsidies, too. If re-imported drugs from Canada are a problem, why not artificially cheap Chinese products? What if the Chinese government reimburses its producers for the cost of licensing patented technology so that those companies can behave as if there are no patents at all — should products made that way be allowed into the United States?
The point is not that these questions are easy but that they are hard. They represent policy choices necessary to the management of a free market and the advancement of a productive dynamism. But these are not situations in which a particular choice moves us obviously closer to a free-market ideal or where such an ideal would necessarily achieve the best outcome. If expanding trade merges a decidedly unfree market with our own, then we will have to choose between the freest of trade and the freest of markets. We cannot have both.
The patent is but one tool in the innovation policy belt. The major technological breakthroughs that power productivity gains and rising living standards often entail disruption, but they also frequently depend on aggressive government action. The defense sector, especially in times of military conflict, has proved a major contributor to innovation, as has the space program. The health-care sector, for all the laments about intrusive regulation and the dominance of Medicare and Medicaid as purchasers of products and services, provides frequent life-saving breakthroughs that are often cited as the most important achievements of economic growth — and they are funded directly through the National Institutes of Health and other research grants, and indirectly through the government's participation as a payer.
Silicon Valley, meanwhile, for all its veneration in the popular culture, may be more adept at producing parody-worthy uses of the word "disruption" than genuine examples. As Mark Mills has observed in City Journal, researchers at Bell Labs won eight Nobel Prizes while IBM won five; no one funded by a Valley company has achieved that feat. While California's initial wave of hardware and semiconductor firms delivered genuinely new technology, today's giants do not. Google with its search engine, Facebook with its social network, and Apple with its smartphone each built a specific product that proved a cash cow, yielding massive profits. None has managed to invest those profits in subsequent research and development that yielded a second act.
In 2010, longtime Intel CEO Andy Grove described in Bloomberg Businessweek how America's technology ecosystem was suffering from its eagerness to offshore manufacturing and argued that the result was the departure of innovation as well. "Silicon Valley is a community with a strong tradition of engineering, and engineers are a peculiar breed," he observed:
They are eager to solve whatever problems they encounter. If profit margins are the problem, we go to work on margins, with exquisite focus. Each company, ruggedly individualistic, does its best to expand efficiently and improve its own profitability. However, our pursuit of our individual businesses, which often involves transferring manufacturing and a great deal of engineering out of the country, has hindered our ability to bring innovations to scale at home. Without scaling, we don't just lose jobs — we lose our hold on new technologies. Losing the ability to scale will ultimately damage our capacity to innovate.
He cited specifically his concern about the advanced-battery ecosystems that would be crucial to electric vehicles. Because America had lost its lead in batteries as electronics manufacturing migrated overseas, "U.S. companies did not participate in the first phase and consequently were not in the running for all that followed. I doubt they will ever catch up."
In a narrow sense he was wrong: Boosted by massive federal subsidies, Tesla Motors became an industry leader and constructed its massive battery "gigafactory" in Nevada. But more broadly, he was exactly right: In July 2018, Tesla reached a deal to build its second electric-vehicle plant in Shanghai, not the United States, supported by a 50% investment from the Chinese government that would include free land. Its Shanghai gigafactory is now under construction as well. Who would bet that, 10 years hence, the majority of Tesla manufacturing will still occur on this side of the Pacific?
Disruption represents only half of the dynamism equation. The desirable dynamism that moves workers and resources toward more productive uses requires two components: disruption of the status quo, and a labor market that generates new opportunities. In an ideal case, these might occur together — for instance, a firm finds new products or processes to deploy its workers toward, essentially disrupting itself with its own resources. But often, as the trade example illustrates, the two effects are disconnected. In that case, for disruption to yield a productive dynamism, it must occur against the backdrop of other firms and entrepreneurs searching constantly for new and more productive ways to deploy existing workers, in a society capable of facilitating that redeployment. Disruption into a healthy labor market boosts dynamism; otherwise it begets corrosion.
The same problem of imbalance that presents itself so starkly in the international context is present in the domestic market as well. America's economic dynamism has exhibited a skills bias, with disruptions tending to emerge in the form of new production by highly educated workers that dislocates less-educated workers. The second step — re-allocation of those workers to more productive uses — has been lacking, and dislocated workers have often found themselves pushed into less productive work than they previously performed.
In aggregate, the economy's productivity and output may be higher, but that is little consolation to society's struggling segments. Under these conditions, dynamism produces a narrow prosperity and must rely upon redistribution to "lift all boats," which is a far cry from the widespread productivity gains and prosperity that we expect and need dynamism to deliver.
Enthusiasm for policies that strengthen the labor market and focus investment on boosting worker productivity not just in aggregate but for less-productive workers in particular must accompany enthusiasm for disruption in any discussion of economic dynamism. This complicates matters, because those two objectives may be in tension and thus a balance must be found between them.
Consider, for instance, a new business that deploys large numbers of unskilled, unproductive, low-wage guest workers to deliver a service more cheaply than an existing business that employs fewer workers at a higher wage. This is disruptive. The emergence of the new business and the bankruptcy of the old one would score high on traditional measures of "dynamism." Consumers would benefit. But the end result may be more workers in less productive roles than had the guest workers never arrived. Conversely, without access to guest workers, a model that boosted the productivity of existing workers would have offered the new business's investors a more feasible path to successful disruption.
Likewise, in education, outcomes for young people who never finish college may seem unimportant to the pursuit of disruption. But if dynamism requires both disruption and the productive re-allocation of those disrupted, effective pathways into the labor force for less-educated workers become critical. And as in the guest-worker example, the construction of such pathways is doubly important because it increases the likelihood that entrepreneurs pursuing disruption will want to use existing workers to achieve it. That form of disruption is inherently more dynamic than one that leaves the disrupted workers behind.
Even organized labor, often regarded as the hobgoblin of dynamism, can play a constructive role in helping to facilitate the effective resource re-allocation that must accompany disruption. America's Depression-era unions are plainly ill-suited to the role, and as institutions have no interest in playing it. But the American model is a sclerotic outlier, especially as compared to European models in which independent worker organizations focus on redeploying dislocated members and firm-based "works councils" create the space for collaborative arrangements between management and labor that prioritize productivity gains. Rather than celebrating labor's demise as a victory for their vision, dynamists should be leading the effort to find a replacement that could help to ensure the economy delivers on their promises. Individual firms need the freedom to pursue productivity gains even at the expense of workers, but someone needs to represent and insist upon the interests of workers economy-wide.
Implicitly, dynamists do acknowledge that a productive dynamism demands more than merely disruption when they lament "barriers" to rapid "adjustment" in the labor market. The lesson to learn from the so-called "China Shock," the argument goes, is that America needs more and better training programs, higher levels of geographic mobility, fewer occupational-licensing requirements, and a safety net that pushes people toward the workforce. That all may be true as far as it goes. But it errs in disconnecting deeply interrelated phenomena.
The rate and nature of adjustment is not exogenous; it is dictated in large part by the same conditions that drive disruption in the first place, and by the type of disruption that occurs. No one should be "shocked" that adjustment fails when all the same forces catalyzing the disruption are also ones that discourage investment in less-educated domestic workers and business models that employ them. No serious effort to restore productive dynamism can leave disruption's side of the equation untouched.
DYNAMISM, RIGHTLY UNDERSTOOD
Rebalancing the conversation in these ways runs afoul of the diktat that policymakers must not interfere with dynamism, given its extraordinary power to deliver prosperity. That reasoning is circular: Of course, beginning from the assumption that dynamism has such an effect, policymakers should stand aside. But for situations where it does not deliver on its promise, the presumption makes no sense. An active policy response is pro-dynamism for the long run.
Does discussion of the policy environment that will facilitate the highest levels of economic dynamism and the most broad-based prosperity over time risk embarrassment for the dynamists who have offered unequivocal support for economic forces that are now delivering mixed results at best? Well, yes. And that is cause for some concern. They have struggled mightily to convey the complicated but important idea that disruption and dynamism, while costly to those affected, can be worthwhile and ultimately beneficial. The argument's past success owed much to its straightforward and universal applicability: Disruption and dynamism are always good, and more is always better. To admit error in that assertion, and insist on drawing finer distinctions, invites protectionists of all stripes to argue that disruption of their preferred status quo is the bad kind.
But the embarrassment has already occurred. The mistakes of an absolutist approach have been laid bare by a 40-year stagnation in median wages and even worse results for struggling segments of the population and for less-educated men in particular, the concentration of dynamism's benefits into ever-narrowing geographic pockets, and the plainly disastrous results that unconstrained trade with China has had for millions of people and the national economy's industrial strength. No one believes that more disruption is always good or that dynamism automatically equals prosperity, nor should they.
The choice we face is therefore not between reassertion of the old orthodoxy and grappling with our challenges; it is between grappling with our challenges and abandoning the field. Building a better model that is more correct, that persuades, and that produces a healthier labor market that can co-exist in a symbiotic relationship with disruption is the only option for sustaining the genuine dynamism we all want to see.