The Ferocious Winds Blowing Us Towards Inequality For All: Four Ways to Stop Over-promising about Higher Education

During the closing credits of Robert Reich’s documentary, Inequality for All, some of those profiled describe how, now inspired, they plan to take action against inequality. Erika Vaclav—Costco worker, mother, former owner of a foreclosed Condo and wife of laid-off Circuit City manager—plans to follow her husband into higher education. With the song 9-to-5 playing in the background, she says proudly, “I want to become a lawyer.”

My heart sinks. Erika doesn’t know that law school graduates now struggle to get jobs or that lawyers’ earnings and job security have plummeted. Erika envisions a law degree taking her permanently into the middle class. I envision it leaving her with much debt and few job prospects.

The jobs of the highly educated are not immune to the information revolution or globalization. Lawyers are hurting in part because software can do discovery (searching documents for relevant information) more cheaply than live lawyers. Other educated workers are also likely to be hit by the ferocious winds of the Information Revolution blowing towards inequality.

Professors, policy wonks and politicians—not just Reich but many of us—need to incorporate these forces into our policy pontifications. Let’s stop over-simplifying and stop over-promising what higher education can do. If we don’t, we’ll misdirect and mislead people like Erika.

First, let me convince you that the lawyers’ problems are not a fluke but rather show forces likely to hit other white-collar workers.

The kind of technological change we’ve long heard about hurt blue-collar workers. Inequality for All portrayed and explained those changes—and their consequences—superbly. Robot-filled factory floors show why more manufacturing won’t bring back many good jobs. We see Amazon’s amazing packaging set-up in action, while being reminded of inefficient Mom and Pop retail stores. 1970s footage and clips of the movie 9-to-5 show women flooding the work force, paired with graphics showing the push of stagnant male wages. Sped-up footage of all kinds of workers is paired with descriptions of rising work hours.

The movie communicated economics so well that I felt a visceral fear for my own job. High production value videos can teach some things more effectively than I can. And that’s part of what’s missing: it’s likely that these forces will hit not just lawyers, but professors, accountants and other highly educated workers.

How come?

Force 1: Computers will do more and more stuff that only humans could do before

Self-driving cars now work well. Software can almost write decent simple news stories. Software can even grade essays, if trained with enough examples for specific questions and with human backup for hard cases. Tyler Cowen’s readable but apocalyptic book Average is Over  is filled with vivid examples.

Force 2: The more someone earns, the greater the motivation to substitute computers

Motivation to substitute computers is greatest for humans who earn the most. As Matthew Yglesias noted, food service workers are secure, because “The robots are going to come after truck drivers, accountants, Internet writers and other mid-skill workers before they hit the lower-skill sector.

Of course, new technologies also create new jobs at all education levels, like all the new video-making jobs. So, there are countervailing winds towards equality, but mostly those winds will arrive later.

So, how do we improve our message to Erika (and everyone else)? I suggest four points:

1. All degrees are not created equal  

Job prospects vary enormously depending on what you study. Obama was unfairly trashed for implying that art history majors have poor earnings prospects. And his carefully crated apology did not take back his original point.

People who don’t know people in good jobs have particularly poor information about good jobs. Schools serving less well off populations should help.

2. “Past performance is no guarantee of future results”

What’s true for investing in financial capital is true for investing in human capital. Just because an investment did well in the past doesn’t mean it will do well in the future. See above on lawyers.

3. STEM is a bad rule of thumb

One of the big buzz acronyms in all levels of education today is STEM: Science Technology Engineering and Mathematics. The idea is that there are lots of STEM jobs but not enough people learn STEM.

True, there is enormous demand for “data scientists,” a not yet fully defined job, and for good old tech support at the office. But STEM masks much variation in job prospects. Demand for astrophysicists is low, as Cowen notes. Meanwhile, some kinds of artistic and communication jobs are growing due to all the web sites, videos and new marketing challenges.

4. Vocational/professional is an even worse rule of thumb

We often hear arguments about the value of liberal arts degrees compared to professional/vocational training. But this too can mask what matters for job prospects: skills, particularly communication and analytical thinking. If (and only if) liberal arts degrees provide their graduates with superb communication and analytical skills, those graduates will have good job prospects. If (and only if) the professional/vocational degrees focus on transiently in-demand skills, their graduates won’t have good job prospects.

Actually, I think we need to alter our message in more ways, but they’ll have to wait. For now, I hope you are convinced that today and in the future, just getting any degree will not get and keep you in the middle class. Of course, judging by the past and present, most higher education degrees will beat most no degree alternatives for a while to come.

In fairness to Reich and his co-filmmakers, exhorting everyone to more education was not the film’s main goal. Rather, their goal was to exhort the audience to take political action—“change the rules.” The importance of higher education was just a given.

And although most of my suggestions have been technocratic, “neoliberal” ones, I think the filmmakers are right to exhort us to take political action. (I do differ on some of the specific approaches, though.) The ferocious winds towards inequality unleashed by the Information Revolution and globalization have serious consequences for many. We should try to counter those forces in any way that does not cause more harm than good.

Still, Reich—and the rest of us—should be careful not to over-promise about the impact of changing the rules either. No matter how well taxation, government spending, financial regulation, political finance or other rules are structured to reduce inequality, they will have ferocious winds blowing at them. When asking the Erikas of this world to give their scarce time, don’t over-promise about anything.

Edited slightly March 3, 2014

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