Dear President-Elect Trump
Congratulations! You confounded all the pundits, refused to be repackaged by those around you, ran a campaign that almost everyone said could not possibly work and then pulled it off. Now you need to govern. The measure of your success will be if you are reelected.
You succeeded in gaining the presidency by channeling the rage of citizens who have not only been struggling economically as a result of the forces of globalization, but who have also felt increasingly marginalized socially. You certainly channeled not only their spiraling job loss and rising, out-of-control debt, but—probably much more important—their rage at being looked down upon by the very elites in the press, the universities, the media, Wall Street and Washington who they believe sold them out for their own gain.
Now, these people are counting on you because you told them that you can restore their jobs and their incomes, and, most important, their pride and self-respect.
The most important reason that the people in your base are in trouble is because they don't have the education and skills they need either to get decent jobs or command the respect of the people around them. It used to be possible for people with only a high school education and even those who had not completed high school to get jobs—in a mine or on a factory floor—that paid well enough to get a home in the suburbs, a little place in the country, a nice-looking boat on a trailer and a college education for their kids.
But that has not been true for decades. By the 1970s, the cost of shipping a ton of freight was so low and shipping costs accounted for so little of the final cost of the product to the consumer that manufacturing companies could locate their factories wherever the cost of the labor they needed was lowest. During the 1970s, literally billions of people in Eastern Europe, India and China came onto the global labor market who were willing to work for far less than American factory workers with about the same level of education. Those might have looked like low wages to us, but they looked like fortunes to workers who had been making much less. Manufacturers who did not take advantage of these low-wage-low-skill workers were put out of business by those who did. In this way, hundreds of millions of people in other countries who had been appallingly poor were lifted out of poverty and into the middle class. But millions of American workers who had only the basic skills lost their jobs to people who had the same skills but were willing to work for less.
Within a few years after that, it became clear that jobs requiring higher skill levels could also be done for much less than more highly skilled American workers were charging for their services. And within a few years after that, observers realized that, for every job that was being lost to outsourcing, ten were being lost to automated machinery. Automated gas pumps pumped the gas. The same machines wrote up the credit slips and authorized payment. Automatic bank tellers replaced humans. Automatic mining equipment replaced miners. Automatic stock pickers replaced warehouse pickers. Robots replaced welders and painters on the automobile assembly line. Software replaced back office insurance specialists who crafted insurance plans for customers. Secretaries disappeared as personal computers loaded with word processing software, calendars and mailing programs replaced them.
You promised your base that you would fix the damage that was done by outsourcing by revoking trade treaties and renegotiating them. But it is too late for that. While American manufacturing wages have been steady or declining for decades, wages in the leading developing countries, like China have been going up, way up. They are so high now that many companies are already bringing their manufacturing operations back to the United States, not because treaties were renegotiated, but because it makes economic sense to do that. Although the work is coming back, however, the jobs are not.
Manufacturing companies based in mainland China have ordered millions of robots to replace their Chinese manufacturing workers, because, given current Chinese wages, it makes sense to do so. The machines work 24/7, do not need vacations, do not earn benefits, do not go on strike and do not complain. In Australia, the coal is mined by automatic machinery, transported from the mines to the coast in trains that require no human drivers, unloaded by automated equipment, reloaded onto ocean-going ships, again, by automated equipment and shipped to China in ships that require only a handful of crew, because most of the ship's operations have been automated, just like all the operations that got the coal out of the ground and onto the ships. So renegotiated trade treaties won't bring our coal mining jobs back, either.
From here on out, American manufacturing workers, and a growing number of workers in other fields, will be competing with machines with artificial intelligence, neural networks, natural language capabilities and access to the cloud. Cheap foreign labor is not the problem here, either.
Workers who have only the capabilities that the new intelligent machinery have will be put out of work by them. This will include millions of truck and bus drivers who voted for you, as well as retail workers in stores large and small who are being put out of business by automated warehousing and delivery systems with automatic billing, and millions of others whose professional and personal advice will be replaced by automated advisory services that can access the cloud for information and analyze that information in microseconds. Workers whose skills complement those of the machines will do very well.
But the skills required to complement the new intelligent machinery require much better education and more education than the old jobs did. So it is reasonable to ask how the skills of the American worker compare to the skills of their competitors in other high wage countries. The answer is sobering. A recent reanalysis by ETS of an earlier OECD survey of the skills of workers all over the industrialized world showed that American workers are the least-well educated of the workers in all the countries surveyed. We used to have the best-educated workforce in the world. Now our workers' skills tie for last.
So, the challenge you and your team faces is very straightforward. The intelligent machinery I have been describing is gobbling up the low-skill, routine work that those machines can do more quickly, more accurately and cheaper than human beings can do it. If you want your base to be with you four years from now, you will have to find a way to give the people in your base the skills they will need to complement the skills of the intelligent machines that are flooding into our workplaces. To do that, you will have to reskill and upskill the people already in the workforce on a vast scale and you will have to greatly improve the skills of the young people graduating from our high schools. The average high school graduate today has a very hard time reading a community college textbook written at a 12th grade level of literacy and has a no less hard time doing middle school mathematics . That same typical high school graduate leaves high school with two to three years less education than the typical Northern European high school graduate. They are even further behind the typical high school graduate in Singapore, Hong Kong, Japan and Shanghai.
The United States needs a massive effort to upgrade the skills of the people already in our workforce if it is to compete with workforces elsewhere in the world. That should go somewhere near the top of your list if you want to keep your base on your side, because that is the only way they will be able to make more money and hold their heads up high.
You should know that the federal job training budget is only one fifth of what it was in the Carter administration. If you want to make a strategic investment in the mid-skill American workforce--your base--then that is the one to make. But the whole thing needs to be reorganized and modernized to be effective. Go and look at places like Switzerland, Singapore and Sweden to see how a first-rate government-funded workforce training system can be organized.
But that won't get you very far if the country keeps graduating students from high school in enormous numbers who can't read 12th grade textbooks and can't do middle school math. Your proposal to give billions of dollars to parents to let them send their kids to private schools, religious schools and other kinds of schools might make the Republican Party regulars happy, but there is no evidence from anywhere on the planet that such a program will result in improved student performance of the kind that you have got to produce to give your base a new lease on life. We know what the countries with the best-performing education systems have done to get to the top of the heap, and would be glad to share that information with you.
The bottom-line message here is simple: You cannot get reelected unless you have a program for enabling your base to get the high level of education and skills they need to be competitive in the new global economy. You need a massive program and that program should build on the successful strategies that the nations with the best-educated and best-trained workforces have been using. What you need to do to succeed four years from now is figure out what the top performers have been doing and then do it here, even better.