Government Executive - Authors - Derek Thompson

The Remote-Work Revolution Will Be Bigger Than We Think

Derek Thompson, The Atlantic — Tue, 02 Feb 2021 07:00:00 -0500

Some evenings, when pandemic cabin fever reaches critical levels, I relieve my claustrophobia by escaping into the dreamworld of Zillow, the real-estate website. From the familiar confines of my Washington, D.C., apartment, I teleport to a ranch on the outskirts of Boise, Idaho; to a patio nestled in the hillsides of Phoenix, Arizona; or to a regal living room in one of the baroque palaces of Plano, Texas.

Apparently, many of you are doing the same thing. Zillow searches have soared during the health crisis, according to Jeff Tucker, the company’s chief economist. “We’ve seen online searches for Boise, Phoenix, and Atlanta rising fastest among people who live in coastal cities, like Los Angeles and New York,” Tucker told me. Higher search volumes on Zillow have coincided with a booming housing market in the South and the West, as rents fall in expensive coastal cities.

[Derek Thompson: A lot of Americans are about to lose their homes]

Zillow tourism and a few affluent workers decamping for Atlanta might strike you as a fad—kind of like this whole remote-work moment. Indeed, if you’re lugging your computer to the living room every day to sit on the couch for eight hours, you might not be thinking to yourself, I’m practically starting the next industrial revolution.

But maybe you are. As a general rule of human civilization, we’ve lived where we work. More than 90 percent of Americans drive to work, and their average commute is about 27 minutes. This tether between home and office is the basis of urban economics. But remote work weakens it; in many cases, it severs the link entirely, replacing spatial proximity with cloud-based connectivity. What knock-on changes will this new industrial revolution bring?

The best argument against the remote-work experiment having a durable impact on our lives beyond the pandemic is an appeal to human inertia: For decades, the internet was a thing and remote work wasn’t, and after the pandemic, it’ll just feel like 2019 again.

But the impediment to widespread remote work in 2019 and before wasn’t technological. It was social. According to the economist David Autor, remote work suffered from a “telephone problem.” Seven decades after the first telephone was patented in the 1860s, fewer than half of Americans owned one. Behavior dragged behind technology, because most families had no use for a telecom machine as long as none of their friends also owned one. In network theory, this is known as Metcalfe’s Law: The value of a communications network rises exponentially with the number of its users.

The same has been true of remote work. In 2018, it was weird and rude to ask a boss to move a meeting to Skype, or to tell a business partner to fire up a Zoom link because you can’t make lunch. The teleconference tech existed, but it was considered an ersatz substitute for the normal course of business.

“The most important outcome of the pandemic wasn’t that it taught you how to use Zoom, but rather that it forced everybody else to use Zoom,” Autor told me. "We all leapfrogged over the coordination problem at the exact same time.” Meetings, business lunches, work trips—all these things will still happen in the after world. But nobody will forget the lesson we were all just forced to learn: Telecommunications doesn’t have to be the perfect substitute for in-person meetings, as long as it’s mostly good enough. For the most part, remote work just works.

[From the October 2020 issue: Generation work-from-home may never recover]

Last year, I wrote about how even a modest remote-work revolution—no more than 10 percent of Americans working remotely full time after the pandemic is over—could affect the U.S. labor force (e.g.: fewer hotel workers) and party politics (e.g.: more southern Democrats). But the more I researched remote work and spoke with experts, the more I realized I had only scratched the surface of its implications for the future of the economy, the geography of opportunity, and the fate of innovation. Here are four more predictions.

1) The Rise of the Supercommuter

Remote work sometimes severs the connection between work and home, and sometimes just elongates it. According to Chris Salviati, an economist at the online rental marketplace Apartment List, prices are falling sharply in the downtown areas of the biggest metros, but they’re rising overall in the suburbs and in nearby cities. Some of the hottest rental markets in the country include Central California cities within a few hours’ drive of San Francisco.

Referring to the internet as an “information superhighway” is retro in the most cringeworthy way. But here, the metaphor seems apt. Decades after the construction of the U.S. highway system allowed high-income families to move from downtowns to the distant suburbs, Zoom might do the same. Remote work could do to America’s residential geography in the 2020s what the highway did in the 1950s and ’60s: spread it out.

Today, the term supercommuting is often used to describe the punishment inflicted on lower-income workers who have to live far from their job because of the scarcity of affordable housing. But the remote-work revolution could spawn the rise of something a little different: the affluent supercommuter who chooses to move to a big exurban house with the expectation that she’ll make fewer, longer commutes to the office.

“Historically, people who work from home don’t commute less overall, because they just drive longer distances,” Autor told me, referring to a Federal Reserve study from 2019. One shouldn’t put too much stock in a survey of pre-pandemic behavior. But the logic of fewer-but-longer commutes should lead to small towns and suburbs experiencing the fastest price growth. And, lo and behold, that’s exactly the story the online rental data are already telling us.

2) The Decline of the Coastal Superstar Cities

Beyond anecdotal accounts of bankers fleeing Manhattan and tech workers saying sayonara to the Bay Area, we have loads of private data to back up the story that superstar cities are in trouble.

According to U-Haul’s annual review, California lost more people to out-migration than any other state in 2020, and the five largest states in the Northeast—New York, Pennsylvania, New Jersey, Massachusetts, and Maryland—joined California in the top 10 losers. Rents have fallen fastest in “pricey coastal cities,” including San Francisco, Seattle, Los Angeles, Boston, and New York City, according to Apartment List. Zillow data also show that home values in New York, San Francisco, and Washington, D.C., are growing below the national average.

These migration trends could spell long-term trouble for cities such as San Francisco and New York, where municipal services rely on property taxes, sales taxes, and urban-transit revenue.

Absent federal intervention, “the financial situation that nearly every transit agency in America is in will certainly lead to significant service cuts, which inevitably lead to terrible spirals,” Sarah Feinberg, the interim president of the New York City Transit Authority, told me. “Service reductions are bad for commuters, devastating for essential workers, and detrimental to the economy.” If people leave New York—and newcomers don’t immediately take their place—that will reduce the city’s subway and bus revenue, which will lead to service cuts; that will make New York a harder place to live, so more people will leave the city; transit revenue will be reduced further, and on we go.

More optimistically, the federal government could bail out cities, speeding up what I’ve called the urban forest-fire effect. In that scenario, the pandemic pushes thousands of people out of expensive coastal cities, reducing the cities’ rent and housing costs, but those lower costs attract a new generation of immigrants and middle-class families to move back into the city, which leads to regrowth. Note, however, that both the optimistic and pessimistic cases involve a difficult period of transition.

3) The Rise of the Rest

Superstar pain could be America’s gain—not only because lower housing costs in expensive cities will make room for middle-class movers, but also because the coastal diaspora will fertilize growth in other places.

As home values decline in the superstar cities, they’re rising in major Sun Belt metros such as Phoenix, Nashville, and Austin. They’re rising in midwestern cities, such as Cincinnati, Cleveland, and Indianapolis. And they’re going gangbusters in the Southeast, which accounts for 13 of the top 25 cities with the fastest growth in U-Haul migration in 2020. The top three cities for inbound moves were all in one state: Florida.

Why might this be a positive trend? By failing to build sufficient housing, certain superstar cities have become mere playgrounds for the wealthy—especially the childless wealthy. “The walls we’ve put up around our most productive cities has made it hard to accommodate more people,” the economist Enrico Moretti told me.

Anti-growth housing policies in rich cities reduce national productivity, income growth, and intergenerational mobility. Thanks to zoning and land-use restrictions, the American dream has fractured: The rich cities with the greatest upward mobility are the least affordable, while the most affordable places to live have a poor record of mobility. As a result, America has grown more divided in the past few decades, not only by politics and by class, but also by geography.

“Remote work is the first change in a while that can help lean against this trend,” Adam Ozimek, the chief economist at Upwork, told me. White-collar workers moving away from NIMBY areas could help solve this problem in two important ways: by reducing housing prices in superstar cities, and sprinkling high-income workers throughout the country.

Coastal cities’ depopulation will not be a perfect substitute for more housing construction in those cities, but it might be better than the before world. Remote work is not a perfect substitute for higher welfare spending, either, but thousands of high-income workers moving to lower-income metros in the Midwest and the South could stimulate local job creation and raise local incomes. And remote work is not a perfect solution to regional inequality, but it will almost certainly expand the roster of hyperproductive cities in ways that could help wages grow nationwide, according to Moretti’s analysis.

4) The Next Silicon Valley Is Nowhere

It sometimes takes only one little decision to create a new industrial hub. “If you look at Seattle in the 1970s, there was not much high tech, and Boeing was shedding jobs by the thousands,” Moretti said. “But then this random guy named Bill Gates, who started this small company called Microsoft in Albuquerque, New Mexico, decided to move his headquarters to Seattle to be closer to his family and the family of his co-founder, Paul Allen.” As Microsoft grew to become the largest company on the planet, it made the Seattle region one of the world’s leaders in information technology.

If Moretti is right, the coastal diaspora is akin to a national seed-planting experiment that has the potential to grow new industrial clusters. Today, the innovation economy is unevenly distributed. Three states—New York, Massachusetts, and California—account for three-quarters of all venture-capital investment in the United States. But one of the companies on the move could take off after relocating to Miami or Austin, and trigger the complex domino effect that creates a new hub: a Quantum Valley in Austin, or Wall Street South in Miami.

The other, weirder possibility is that the remote-work revolution will eliminate the concept of a metro hub entirely, as companies embrace the reality of a permanently distributed workforce. What if the next Silicon Valley is nowhere—or, just as precisely, everywhere?

After the pandemic, it might be better to think of Silicon Valley as an idea dispersed across many places rather than a specific piece of geography, writes Kim-Mai Cutler, a partner at the venture fund Initialized. According to the company’s recent survey, 42 percent of its firms said that starting a remote company was better than being headquartered anywhere, including California. (Last year, that figure was just 6 percent.)

What exactly would that look like? Say a tech-company founder based in Nashville hires a designer in Missoula, engineers in San Jose and Miami, and a product lead in Albuquerque. They Slack every morning, and Zoom in the afternoon. Although building a distributed-work culture takes lots of work, they might discover that the internet re-creates many of the benefits of a city. Cities attract similarly productive and talented people to the same area, where they can redouble one another’s talent; so might the internet. Cities pool large groups of workers into the same area to increase the odds that every worker finds the job with the best fit for her skills; so might the internet.

As an urban resident of Washington, D.C., writing from my dining-room table, my claim is not that I believe the internet could or should replace the riotous physical-world collision of urban work, culture, art, and life. My humbler assertion is that 2020 has punctured my confidence that the internet cannot encroach on the benefits of urban density and proximity. Going forward, many fledgling companies may agree, as they find that the city in the cloud essentially acts as a more accessible version of the city on the Earth, eerily reproducing its forces of agglomeration, specialization, and convenience. The past 12 months have offered a glimpse of the nowhere-everywhere future of work. We’re only beginning to understand just how strange that future might be.

This article was originally published in The Atlantic. Sign up for their newsletter.

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Three Theories for Why You Have No Time

Derek Thompson, The Atlantic — Wed, 25 Dec 2019 08:00:00 -0500

One of the truisms of modern life is that nobody has any time. Everybody is busy, burned out, swamped, overwhelmed. So let’s try a simple thought experiment. Imagine that you came into possession of a magical new set of technologies that could automate or expedite every single part of your job.

What would you do with the extra time? Maybe you’d pick up a hobby, or have more children, or learn to luxuriate in the additional leisure. But what if I told you that you wouldn’t do any of those things: You would just work the exact same amount of time as before.

I can’t prove this, because I don’t know you. What I do know is that something remarkably similar to my hypothetical happened in the U.S. economy in the 20th century—not in factories, or in modern offices. But inside American homes.

The household economy of cooking, cleaning, mending, washing, and grocery shopping has arguably changed more in the past 100 years than the American factory or the modern office. And its evolution tells an illuminating story about why, no matter what work we do, we never seem to have enough time. In the 20th century, labor-saving household technology improved dramatically, but no labor appears to have been saved.

Technologically, the typical American home of 1900 wasn’t so different from the typical home of 1500. Bereft of modern equipment, it had no electricity. Although some rich families had indoor plumbing, most did not. Family members were responsible for ferrying each drop of water in and out of the house.

The following decades brought a bevy of labor-saving appliances. Air conditioning and modern toilets, for starters. But also refrigerators and freezers, electric irons, vacuum cleaners, and dishwashers.

These machines worked miracles. Electric stoves made food prep faster. Automatic washers and dryers cut the time needed to clean a load of clothes. Refrigerators meant that housewives and the help didn’t have to worry about buying fresh food every other day.

Each of these innovations could have saved hours of labor. But none of them did. At first, these new machines compensated for the decline in home servants. (They helped cause that decline, as well.) Then housework expanded to fill the available hours. In 1920, full-time housewives spent 51 hours a week on housework, according to Juliet Schor, an economist and the author of The Overworked American. In the 1950s, they worked 52 hours a week. In the 1960s, they worked 53 hours. Half a century of labor-saving technology does not appear to have saved the typical housewife even one minute of labor.

This might seem impossible. But there are three simple reasons for this—and each has clear implications for why a combination of individual psychology and structural forces makes it so hard for Americans to find more time, even in an economy that is becoming ever more rich and technologically sophisticated.

Better technology means higher expectations—and higher expectations create more work.

For most of history, humans blithely languished in their own filth. Most families’ clothes were washed on a semi-annual basis, and body odor was inescapable. The fleet of housework technologies that sprang into the world between the late-19th and mid-20th century created new norms of cleanliness—for our floors, our clothes, ourselves.

New norms meant more work. Automatic washers and dryers raised our expectations for clean clothes and encouraged people to go out and buy new shirts and pants; housewives therefore had more loads of laundry to wash, dry, and fold. As one 1920s housewife wrote, of her new dusting and mopping and furniture-polish technology, “because we housewives of today have the tools to reach it, we dig every day after dust that grandmother left to a spring cataclysm.”

New home tech also created new kinds of work that absorbed the extra time. For example, refrigerators made it easier to keep food fresh and electric ovens made it faster to cook. But housewives used this convenience to spend more time driving to the supermarket to buy fresh produce to stock the fridge. Between the 1920s and the 1960s, Schor writes, time spent prepping food fell by about 10 hours a week. But time spent shopping for food increased, in part thanks to another 20th-century invention: the supermarket.

In short, technology made it much easier to clean a house to 1890s standards. But by mid-century, Americans didn’t want that old house. They wanted a modern home—with delicious meals and dustless windowsills and glistening floors—and this delicious and dustless glisten required a 40-to-50-hour workweek, even with the assistance of modern tools.

In the 1950s, a British civil servant coined the term Parkinson’s Law to explain the phenomenon that “work expands to fill the available time.” The rule first described the seemingly infinite busywork of government bureaucracies. But it might also apply to housework. Expectations rose, and work expanded to fill the available time.

This story offers one explanation for why leisure hasn’t much increased for many rich workers in the 21st century. We’d collectively prefer more money and more stuff rather than more downtime. We are victims of the curse of want.

A lot of modern overwork is class and status maintenance—for this generation and the next.

As technology has reduced the time it takes to cook a meal or wash a shirt, it's opened up more hours in the day to care for other parts of the house. Such as the little humans living in it.

In the past few decades, child care has been the fastest-growing component of housework. Since the 1980s, American parents—and particularly college-educated mothers and fathers—have nearly doubled the amount of time they spend raising, teaching, driving, and helping their kids. The economist Valerie Ramey chalks it up to a “rug rat race” led by middle- and upper-class parents devoting more hours to prepare their kids for competitive college admissions and a cutthroat labor force.

Ramey sees the rug rat race as, in part, an anxious status- and income-maintenance ritual for the college-educated class. “When my husband [the economist Gary Ramey] and I first looked at this, the research was semi-autobiographical, because we couldn’t believe the amount of pressure our friends were putting on their kids to get ready for college,” she told me. “In the old regime, college-educated parents could get their kids into good schools because the marginal slot was being filled by a first-generation college student,” she said. But today, far more children of college-educated parents are competing for a finite number of seats.

Many young people concerned with burnout don’t have kids. But their motivations are an extension of the same impulse behind concerted parenting—they, too, feel like participants in a pseudo-meritocratic rat race, and they’re terrified of losing status, class, or future income. Young YouTube stars work to exhaustion to meet the expectations of an algorithm that prizes daily content. Lawyers and consultants work overtime to prove to their bosses that they will sacrifice every shred of their personal life to help their firms crush global rivals. Some of these rat-race participants might truly be on the brink of financial emergency. But a lot of them are yuppie workists who have made a secular religion out of the pursuit of status and professional fulfillment. Like Valerie Ramey’s friends, their overwork isn’t so much about avoiding poverty as it is about avoiding the psychically difficult prospect that life, in this generation and the next, isn’t an infinite escalator.

These first two explanations might be compelling, but they’re also incomplete. They both imply that housework and modern work are things that workers have total agency over, when, in fact, most people’s working lives are not entirely theirs to control.

Technology only frees people from work if the boss—or the government, or the economic system—allows it.

Many stay-at-home moms, today and throughout the last century, have been happy to play their crucial role in the family economy. But one thing that Schor emphasizes is that underinvestment in women, and low expectations about their potential in the labor force, have played a big role in forcing many would-be woman employees to stay out of the workforce.

“I think the biggest reason that labor-saving technology in the home didn’t actually reduce labor for housewives is that the opportunity cost of women’s labor was socially valued at zero,” Schor told me. “By that I mean, a lot of men wanted their wives to keep busy but assumed that they would be worthless outside the home, as salaried workers, like lawyers or doctors.” Many women were caught between the husband’s expectation that they be useful and a male-dominated society that blocked them from education and salaried labor. As a result, they had little choice but to spend their full 40- to 50-hour workweek preparing the home for the family.

Housework hours finally fell only when women joined the labor force en masse. Since the 1960s, the share of women in the workforce has increased by about 50 percent. In that time, the typical adult woman has decreased her housework hours by about one-third, according to analysis by the economist Valerie Ramey. That is, the one thing that finally reduced labor in the home was … labor outside of the home.

What does this history tell us about life in the 21st century? Bosses set hours and income, and workers adjust. When husbands controlled their wives’ schedules, they insisted on a clean and tidy home and a ready-made dinner; and their wives typically obliged. When today’s employers hire a full-time worker under modern labor laws, they insist on a 40-hour week, or more; and the worker typically obliges. It doesn’t matter whether technology stays the same, or improves by leaps and bounds. The workweek is fixed and predetermined. A meaningful, economy-wide reduction in work hours would likely require changing the laws that determine the relationship between employers and employees.

Let’s return to the original question: Why don’t Americans have more free time? In my experience, the debate over labor and leisure is often fought between the Self-Helpers and the Socialists. The Self-Helpers say that individuals have agency to solve their problems and can reduce their anxiety through new habits and values. The Socialists say that this individualist ethos is a dangerous myth. Instead, they insist that almost all modern anxieties arise from structural inequalities that require structural solutions, like a dramatic reconfiguration of the economy and stronger labor laws to protect worker rights.

The history of American housework suggests that both sides have a point. Americans tend to use new productivity and technology to buy a better life rather than to enjoy more downtime in inferior conditions. And when material concerns are mostly met, Americans fixate on their status and class, and that of their children, and work tirelessly to preserve and grow it.

But most Americans don’t have the economic or political power to negotiate a better deal for themselves. Their working hours and income are shaped by higher powers, like bosses, federal laws, and societal expectations.

To solve the problems of overwork and time starvation, we have to recognize both that individuals have the agency to make small changes to improve their lives and that, without broader changes to our laws and norms and social expectations, no amount of overwork will ever be enough.

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Why Workers Spend All Day at the Office

Derek Thompson, The Atlantic — Thu, 05 Dec 2019 11:35:02 -0500

This is not a matter of opinion so much as a factual point of international comparison. The average American worker labors more hours than her counterparts in just about every similarly rich country, including Japan, Canada, and the United Kingdom. If the average American worked as much as the typical German, she’d have about 30 extra days off per year. That’s a free six-week vacation in exchange for embracing the famously leisurely work habits of … Germany.

The reasons behind America’s overwork are the subject of exhaustive study and theorizing—including on this site. Some observers focus above all on public policy: The U.S. has been steadily eroding labor rights since the Cold War, and there is no federal guarantee for vacation or parental leave, pushing Americans toward longer workweeks than those of their more unionized brethren in similar countries. Others look to the character of “greedy” American industries, such as consulting and banking, which demand long hours and undivided loyalty from their employees so they can thrive in a competitive global economy. Still others, including me, point out that in the past few decades, the dogged pursuit of meaning at work has become a kind of secular religion—workism.

But these explanations may be overlooking an obvious modern force: the digital revolution.

In a new working paper, the economists Edward E. Leamer, of UCLA, and J. Rodrigo Fuentes, of Pontificia Universidad Católica de Chile, studied data about working hours from the American Community Survey. They found that hours worked since 1980 increased nearly 10 percent for Americans with bachelor’s and advanced degrees. Leamer told me that he believes this is because computing has shifted much of the economy from manufacturing to neurofacturing, Leamer’s term for intellectually intensive white-collar labor that is often connected to the internet, such as software programming, marketing, advertising, consulting, and publishing.

Neurofacturing jobs lend themselves to long hours for several reasons, Leamer said. They’re less physically arduous, as it’s easier to sit and type than to assemble engine parts. What’s more, the internet makes every hour of the day a potential working hour.

If the operating equipment of the 21st century is a portable device, this means the modern factory is not a place at all. It is the day itself. The computer age has liberated the tools of productivity from the office. Most knowledge workers, whose laptops and smartphones are portable all-purpose media-making machines, can theoretically be as productive at 2 p.m. in the main office as at 2 a.m. in a Tokyo WeWork or at midnight on the couch.

As Leamer and Fuentes write in the paper, “The innovations in personal computing and internet-based communications have allowed individual workers the freedom to choose weekly work hours well in excess of the usual 40.”

The internet has also supercharged global competition and forced international firms to outwork rivals many thousands of miles away. This has created a winner-take-all dynamic that’s trickled down to the workforce. In their 2006 study, “Why High Earners Work Longer Hours,” the economists Peter Kuhn and Fernando Lozano found that the premium paid for longer workweeks has increased since 1980 for educated workers, but not for less educated workers. Their theory is that at the most competitive firms, ambitious workers putting in super-long hours are sending a clear message to the boss: Promote me! And the boss isn’t just getting the message; he’s actively soliciting it. At many firms, insanely long hours are the skeleton key to the C-suite and the partner track. Thus, overwork becomes a kind of arms race among similarly talented workers, exacerbated by the ability to never stop working, even at home. It’s mutually assured exhaustion.

It sounds dystopian to imagine a future of work where there is no end to labor and time itself is the office. But it’s not all bad, Leamer told me. Neurofacturing is safer, more comfortable, and often more fun than the most common jobs of the 20th century and earlier. There should be no nostalgia for industrial factory labor, or for harvesting sperm oil from the brains of rotting whale carcasses. If automation can replace yet more boring, dangerous, and unpleasant work, it may open the labor market to jobs that people are obsessed with, not only because they’re zealous workists but also because the work itself is gratifying, and sometimes even a blast.

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Workism Is Making Americans Miserable

Derek Thompson, The Atlantic — Mon, 25 Feb 2019 10:18:57 -0500

In his 1930 essay “Economic Possibilities for Our Grandchildren,” the economist John Maynard Keynes predicted a 15-hour workweek in the 21st century, creating the equivalent of a five-day weekend. “For the first time since his creation man will be faced with his real, his permanent problem,” Keynes wrote, “how to occupy the leisure.”

This became a popular view. In a 1957 article in The New York Times, the writer Erik Barnouw predicted that, as work became easier, our identity would be defined by our hobbies, or our family life. “The increasingly automatic nature of many jobs, coupled with the shortening work week [leads] an increasing number of workers to look not to work but to leisure for satisfaction, meaning, expression,” he wrote.

These post-work predictions weren’t entirely wrong. By some counts, Americans work much less than they used to. The average work year has shrunk by more than 200 hours. But those figures don’t tell the whole story. Rich, college-educated people—especially men—work more than they did many decades ago. They are reared from their teenage years to make their passion their career and, if they don’t have a calling, told not to yield until they find one.

The economists of the early 20th century did not foresee that work might evolve from a means of material production to a means of identity production. They failed to anticipate that, for the poor and middle class, work would remain a necessity; but for the college-educated elite, it would morph into a kind of religion, promising identity, transcendence, and community. Call it workism.

1. The Gospel of Work

The decline of traditional faith in America has coincided with an explosion of new atheisms. Some people worship beauty, some worship political identities, and others worship their children. But everybody worships something. And workism is among the most potent of the new religions competing for congregants.

What is workism? It is the belief that work is not only necessary to economic production, but also the centerpiece of one’s identity and life’s purpose; and the belief that any policy to promote human welfare must always encourage more work.

Homo industrious is not new to the American landscape. The American dream—that hoary mythology that hard work always guarantees upward mobility—has for more than a century made the U.S. obsessed with material success and the exhaustive striving required to earn it.

No large country in the world as productive as the United States averages more hours of work a year. And the gap between the U.S. and other countries is growing. Between 1950 and 2012, annual hours worked per employee fell by about 40 percent in Germany and the Netherlands—but by only 10 percent in the United States. Americans “work longer hours, have shorter vacations, get less in unemployment, disability, and retirement benefits, and retire later, than people in comparably rich societies,” wrote Samuel P. Huntington in his 2005 book Who Are We?: The Challenges to America’s National Identity.

One group has led the widening of the workist gap: rich men.

In 1980, the highest-earning men actually worked fewer hours per week than middle-class and low-income men, according to a survey by the Minneapolis Fed. But that’s changed. By 2005, the richest 10 percent of married men had the longest average workweek. In that same time, college-educated men reduced their leisure time more than any other group. Today, it is fair to say that elite American men have transformed themselves into the world’s premier workaholics, toiling longer hours than both poorer men in the U.S. and rich men in similarly rich countries.

This shift defies economic logic—and economic history. The rich have always worked less than the poor, because they could afford to. The landed gentry of preindustrial Europe dined, danced, and gossiped, while serfs toiled without end. In the early 20th century, rich Americans used their ample downtime to buy weekly movie tickets and dabble in sports. Today’s rich American men can afford vastly more downtime. But they have used their wealth to buy the strangest of prizes: more work!

Perhaps long hours are part of an arms race for status and income among the moneyed elite. Or maybe the logic here isn’t economic at all. It’s emotional—even spiritual. The best-educated and highest-earning Americans, who can have whatever they want, have chosen the office for the same reason that devout Christians attend church on Sundays: It’s where they feel most themselves. “For many of today’s rich there is no such thing as ‘leisure’; in the classic sense—work is their play,” the economist Robert Frank wrote in The Wall Street Journal. “Building wealth to them is a creative process, and the closest thing they have to fun.”

Workism may have started with rich men, but the ethos is spreading—across gender and age. In a 2018 paper on elite universities, researchers found that for women, the most important benefit of attending a selective college isn’t higher wages, but more hours at the office. In other words, our elite institutions are minting coed workists. What’s more, in a recent Pew Research report on the epidemic of youth anxiety, 95 percent of teens said “having a job or career they enjoy” would be “extremely or very important” to them as an adult. This ranked higher than any other priority, including “helping other people who are in need” (81 percent) or getting married (47 percent). Finding meaning at work beats family and kindness as the top ambition of today’s young people.

Even as Americans worship workism, its leaders consecrate it from the marble daises of Congress and enshrine it in law. Most advanced countries give new parents paid leave; but the United States guarantees no such thing. Many advanced countries ease the burden of parenthood with national policies; but U.S. public spending on child care and early education is near the bottom of international rankings. In most advanced countries, citizens are guaranteed access to health care by their government; but the majority of insured Americans get health care through—where else?—their workplace. Automation and AI may soon threaten the labor force, but America’s welfare system has become more work-based in the past 20 years. In 1996, President Bill Clinton signed the Personal Responsibility and Work Opportunity Reconciliation Act, which replaced much of the existing welfare system with programs that made benefits contingent on the recipient’s employment.

The religion of work isn’t just a cultist feature of America’s elite. It’s also the law.

Here’s a fair question: Is there anything wrong with hard, even obsessive, work?

Humankind has not yet invented itself out of labor. Machine intelligence isn’t ready to run the world’s factories, or care for the sick. In every advanced economy, most prime-age people who can work do—and in poorer countries, the average workweek is even longer than in the United States. Without work, including nonsalaried labor like raising a child, most people tend to feel miserable. Some evidence suggests that long-term unemployment is even more wrenching than losing a loved one, since the absence of an engaging distraction removes the very thing that tends to provide solace to mourners in the first place.

There is nothing wrong with work, when work must be done. And there is no question that an elite obsession with meaningful work will produce a handful of winners who hit the workist lottery: busy, rich, and deeply fulfilled. But a culture that funnels its dreams of self-actualization into salaried jobs is setting itself up for collective anxiety, mass disappointment, and inevitable burnout.

In the past century, the American conception of work has shifted from jobs to careers to callings—from necessity to status to meaning. In an agrarian or early-manufacturing economy, where tens of millions of people perform similar routinized tasks, there are no delusions about the higher purpose of, say, planting corn or screwing bolts: It’s just a job.

The rise of the professional class and corporate bureaucracies in the early 20th century created the modern journey of a career, a narrative arc bending toward a set of precious initials: VP, SVP, CEO. The upshot is that for today’s workists, anything short of finding one’s vocational soul mate means a wasted life.

“We’ve created this idea that the meaning of life should be found in work,” says Oren Cass, the author of the book The Once and Future Worker. “We tell young people that their work should be their passion. ‘Don’t give up until you find a job that you love!’ we say. ‘You should be changing the world!’ we tell them. That is the message in commencement addresses, in pop culture, and frankly, in media, including The Atlantic.”

But our desks were never meant to be our altars. The modern labor force evolved to serve the needs of consumers and capitalists, not to satisfy tens of millions of people seeking transcendence at the office. It’s hard to self-actualize on the job if you’re a cashier—one of the most common occupations in the U.S.—and even the best white-collar roles have long periods of stasis, boredom, or busywork. This mismatch between expectations and reality is a recipe for severe disappointment, if not outright misery, and it might explain why rates of depression and anxiety in the U.S. are “substantially higher” than they were in the 1980s, according to a 2014 study.

One of the benefits of being an observant Christian, Muslim, or Zoroastrian is that these God-fearing worshippers put their faith in an intangible and unfalsifiable force of goodness. But work is tangible, and success is often falsified. To make either the centerpiece of one’s life is to place one’s esteem in the mercurial hands of the market. To be a workist is to worship a god with firing power.

2. The Millennial Workist

The Millennial generation—born in the past two decades of the 20th century—came of age in the roaring 1990s, when workism coursed through the veins of American society. On the West Coast, the modern tech sector emerged, minting millionaires who combined utopian dreams with a do-what-you-love ethos. On the East Coast, President Clinton grabbed the neoliberal baton from Ronald Reagan and George H. W. Bush and signed laws that made work the nucleus of welfare policy.

As Anne Helen Petersen wrote in a viral essay on “Millennial burnout” for BuzzFeed News—building on ideas Malcolm Harris addressed in his book, Kids These Days—Millennials were honed in these decades into machines of self-optimization. They passed through a childhood of extracurricular overachievement and checked every box of the success sequence, only to have the economy blow up their dreams.

While it’s inadvisable to paint 85 million people with the same brush, it’s fair to say that American Millennials have been collectively defined by two external traumas. The first is student debt. Millennials are the most educated generation ever, a distinction that should have made them rich and secure. But rising educational attainment has come at a steep price. Since 2007, outstanding student debt has grown by almost $1 trillion, roughly tripling in just 12 years. And since the economy cratered in 2008, average wages for young graduates have stagnated—making it even harder to pay off loans.

The second external trauma of the Millennial generation has been the disturbance of social media, which has amplified the pressure to craft an image of success—for oneself, for one’s friends and colleagues, and even for one’s parents. But literally visualizing career success can be difficult in a services and information economy. Blue-collar jobs produce tangible products, like coal, steel rods, and houses. The output of white-collar work—algorithms, consulting projects, programmatic advertising campaigns—is more shapeless and often quite invisible. It’s not glib to say that the whiter the collar, the more invisible the product.

Since the physical world leaves few traces of achievement, today’s workers turn to social media to make manifest their accomplishments. Many of them spend hours crafting a separate reality of stress-free smiles, postcard vistas, and Edison-lightbulbed working spaces. “The social media feed [is] evidence of the fruits of hard, rewarding labor and the labor itself,” Petersen writes.

Among Millennial workers, it seems, overwork and “burnout” are outwardly celebrated (even if, one suspects, they’re inwardly mourned). In a recent New York Times essay, “Why Are Young People Pretending to Love Work?,” the reporter Erin Griffith pays a visit to the co-working space WeWork, where the pillows urge do what you love, and the neon signs implore workers to hustle harder. These dicta resonate with young workers. As several studies show, Millennials are meaning junkies at work. “Like all employees,” one Gallup survey concluded, “millennials care about their income. But for this generation, a job is about more than a paycheck, it’s about a purpose.”

The problem with this gospel—Your dream job is out there, so never stop hustling—is that it’s a blueprint for spiritual and physical exhaustion. Long hours don’t make anybody more productive or creative; they make people stressed, tired and bitter. But the overwork myths survive “because they justify the extreme wealth created for a small group of elite techies,” Griffith writes.

There is something slyly dystopian about an economic system that has convinced the most indebted generation in American history to put “purpose over paycheck.” Indeed, if you were designing a Black Mirror labor force that encouraged overwork without higher wages, what might you do? Perhaps you’d persuade educated young people that income comes second; that no job is just a job; and that the only real reward from work is the ineffable glow of purpose. It is a diabolical game that creates a prize so tantalizing yet rare that almost nobody wins, but everybody feels obligated to play forever.

3. Time for Happiness

This is the right time for a confession. I am the very thing that I am criticizing.

I am devoted to my job. I feel most myself when I am fulfilled by my work—including the work of writing an essay about work. My sense of identity is so bound up in my job, my sense of accomplishment, and my feeling of productivity that bouts of writer’s block can send me into an existential funk that can spill over into every part of my life. And I know enough writers, tech workers, marketers, artists, and entrepreneurs to know that my affliction is common, especially within a certain tranche of the white-collar workforce.

Some workists, moreover, seem deeply fulfilled. These happy few tend to be intrinsically motivated; they don’t need to share daily evidence of their accomplishments. But maintaining the purity of internal motivations is harder in a world where social media and mass media are so adamant about externalizing all markers of success. There’s Forbes’ list of this, and Fortune’s list of that; and every Twitter and Facebook and LinkedIn profile is conspicuously marked with the metrics of accomplishment—followers, friends, viewers, retweets—that inject all communication with the features of competition. It may be getting harder each year for purely motivated and sincerely happy workers to opt out of the tournament of labor swirling around them.

Workism offers a perilous trade-off. On the one hand, Americans’ high regard for hard work may be responsible for its special place in world history and its reputation as the global capital of start-up success. A culture that worships the pursuit of extreme success will likely produce some of it. But extreme success is a falsifiable god, which rejects the vast majority of its worshippers. Our jobs were never meant to shoulder the burdens of a faith, and they are buckling under the weight. A staggering 87 percent of employees are not engaged at their job, according to Gallup. That number is rising by the year.

One solution to this epidemic of disengagement would be to make work less awful. But maybe the better prescription is to make work less central.

This can start with public policy. There is new enthusiasm for universal policies—like universal basic income, parental leave, subsidized child care, and a child allowance—which would make long working hours less necessary for all Americans. These changes alone might not be enough to reduce Americans’ devotion to work for work’s sake, since it’s the rich who are most devoted. But they would spare the vast majority of the public from the pathological workaholism that grips today’s elites, and perhaps create a bottom-up movement to displace work as the centerpiece of the secular American identity.

On a deeper level, Americans have forgotten an old-fashioned goal of working: It’s about buying free time. The vast majority of workers are happier when they spend more hours with family, friends, and partners, according to research conducted by Ashley Whillans, an assistant professor at Harvard Business School. In one study, she concluded that the happiest young workers were those who said around the time of their college graduation that they preferred careers that gave them time away from the office to focus on their relationships and their hobbies.

How quaint that sounds. But it’s the same perspective that inspired the economist John Maynard Keynes to predict in 1930 that Americans would eventually have five-day weekends, rather than five-day weeks. It is the belief—the faith, even—that work is not life’s product, but its currency. What we choose to buy with it is the ultimate project of living.

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How the Trump Administration's Suit to Block a Media Merger Could Hurt the Tech Industry

Derek Thompson, The Atlantic — Tue, 21 Nov 2017 10:05:36 -0500

The Justice Department announced on Monday that it will sue to block AT&T’s acquisition of Time Warner, pitting the Trump administration against a media business that has turned to mergers to compete with the rise of tech giants like Facebook and Netflix. The $108 billion deal, which would be one of the largest mergers in American history, had been in the works for more than a year.

Both Democrats and Republicans have historically approved of these so-called “vertical mergers” between companies operating at different levels of a particular industry. Time Warner, which owns HBO, TNT, and TBS, is mostly in the pure content business, while AT&T, which sells phone and internet access and owns DirecTV, is largely in the media-distribution business. Mergers between such media and distribution companies have rarely faced much scrutiny. For example, the Obama administration approved a similar merger between Comcast and NBCUniversal in 2011.

So, that is the mystery of this lawsuit: By what standard would the department approve that deal, but deny the AT&T merger with Time Warner?

There are two starkly different explanations for the Justice Department’s motives. The first is that a merger between two powerful media companies deserves to be blocked, since it provides an obvious temptation for anticompetitive practices. The Justice Department has argued that AT&T could raise the price for rivals to distribute HBO and other Time Warner content and choke off innovation in video and technology. In a New York Times op-ed, Tim Wu, a Columbia Law School professor and antitrust author, wrote that “the department seems right to worry” about the merger.

But the second explanation, which leans heavily on controversial claims that first appeared in the Financial Times, argues that the Justice Department is acting purely on President Donald Trump’s behalf to punish CNN, which is owned by Time Warner, for its negative coverage of his administration. While this claim is mostly speculative, it is far from illusory. The president has publicly advocated forusing the department to destroy his rivals, such as Hillary Clinton, in the past.

The main reason this lawsuit seems suspicious, though, is that it would appear quite out of character for the Trump administration, which has hailed the need for deregulation. Thus far, the administration has cast itself outwardly pro-business and has done little to indicate that it wants to become an antitrust warrior. Meanwhile, the president’s only other push for the use of antitrust legislation was in his threat to investigate Amazon, whose founder, Jeff Bezos, independently owns The Washington Post, which published negative stories about him.

But Makan Delrahim, the head of antitrust at DOJ, made a clear case for this lawsuit in a speech before the America Bar Association last Thursday. He said his department approved the Comcast merger only by requiring that the company be subject to strict oversight to prevent anticompetitive practices. Delrahim sharply criticized that deal for increasing the need for regulation and forcing the DOJ to babysit Comcast to ensure that it doesn’t make decisions that are, paradoxically, in its own profit-maximizing interest. To simply block such vertical mergers in the first place would eliminate the need for regulation while allowing companies to seek profit without interference from the government.

There is a clean logic at work here. But the lawsuit itself could get messy. Trump’s tweets have already derailed his immigration policy. In the discovery process for the suit, lawyers may identity further Trump quotes targeting CNN, making it harder for the DOJ to argue that the suit isn’t politically motivated.

Other observers think that the lawsuit’s biggest losers may be tech giants, like Facebook and Google. To defend their merger, AT&T and Time Warner will likely argue that their union is necessary to counteract the emerging advertising and content monopolies coming out of Silicon Valley. In other words, the most persuasive case for the creation of new quasi-monopolistic media behemoths is that Facebook, Google, Amazon, and Netflix have so much market power already that mergers are necessary to compete with them. If the argument succeeds in court, it could encourage the Justice Department to turn its focus toward Silicon Valley.

This lawsuit will pit AT&T and Time Warner against the Justice Department. But it may be Big Tech on trial.

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Is Donald Trump Using the Justice Department to Crush CNN?

Derek Thompson, The Atlantic — Thu, 09 Nov 2017 09:47:06 -0500

The Department of Justice may finally be getting tough on corporate mergers. But it picked a politically explosive case to bring back the forgotten art of trust-busting.

On Wednesday afternoon, The New York Times reported that AT&T and Time Warner, in order to win government approval of their $85 billion merger, are under pressure from the Justice Department to sell off either DirecTV or Turner Broadcasting, the group of cable networks that includes CNN. A different report in the Financial Times, however, claimed that the Trump administration is focused on the sale of CNN specifically.

The latter news sparked concerns that President Trump, who has long berated CNN as “fake news,” was punishing the company for its critical coverage of his administration. Indeed, for any president to use the Department of Justice to punish enemies—either individuals or companies—would be the stuff of authoritarians.

There are two fishy details about the DOJ’s objections. First, Makan Delrahim, Trump’s handpicked head of antitrust at the Justice Department, had previously announced that this merger would be acceptable. The fact that he has changed his mind while working for this White House suggests to some that the administration may have inspired the policy change. Peter Kafka, a media reporter at Recode, called the possibility “chilling.” Second, it’s doubly startling for a Republican administration to suddenly reverse several decades of party leniency on just these sort of mergers, particularly with the president’s favorite target, CNN, hanging in the balance.

But if the White House is truly behind the news, it’s a bizarre play, since it’s not clear what Trump would get out of it. Forcing the sale of CNN wouldn’t destroy the company. At a moment of record ratings, it could fetch a healthy price on the open market. If Trump merely wanted to bend CNN to his will, he might even want to encourage the merger: The CEO of AT&T is Randall Stephenson, a Republican from Texas, who is comfortable with the administration and has praised Trump publicly. Potential buyers of CNN, meanwhile, would include CBS, led by Les Moonves, a Democrat, who might have far more tolerance for the news network’s anti-Trump reporting.

Several antitrust experts that I spoke with said CNN’s role in this story probably has more to do with the merger itself than with the president—which is encouraging. Indeed, there are several meritorious reasons for the Department of Justice to push back against AT&T’s acquisition of Time Warner. What’s more, there are reasons that AT&T would benefit from getting out the narrative to news organizations that the Justice Department might be mistreating it.

Politicians have voiced concerns about the AT&T–Time Warner union for months. In June, 11 Democratic senators signed a letter urging the Justice Department to reject the deal if it could prove that a merger would hurt competition and consumers. “In my view, the merger is potentially anticompetitive,” said Steven Salop, a professor of economics and law at Georgetown Law. Since the 1970s, the federal government has typically allowed “vertical mergers” between companies that do not have competing divisions. AT&T is a telecom company that specializes in distribution, and Time Warner is a media company that specializes in content. So, this looks a vertical merger.

But it doesn’t take much creativity to see how their combination could lead to anticompetitive practices. AT&T or DirecTV could make it cheaper for consumers to watch Time Warner content, like HBO, which would hurt competitors, like Disney. More subtly, AT&T could collect data about Time Warner and share it with its own advertisers, but not with its competitors, which would put other entertainment companies at a disadvantage. “I don’t see how anyone can know right now whether this is Trump trying to punish CNN,” Salop says. “But it does not matter. Retaliation or not, this is just good vertical-merger enforcement.“

For AT&T, whose big deal is now potentially in jeopardy, it would be strategic to push the narrative that the Justice Department’s objections are all about the president’s beef with CNN. “If I’m AT&T, I’m calling everybody and saying they want us to sell CNN,” said Andrew Jay Schwartzman, who also teaches at Georgetown Law. “That story helps AT&T.” Whether the company did that, though, is unclear.

For Trump to use the Justice Department to throttle his enemies would be a horrifying prospect, and it’s one that he has publicly mused about. But there is another disconcerting possibility here, which is that AT&T recognized it could co-opt the news media’s disgust toward the president to distribute a pro-merger narrative that would drown out the Justice Department’s reasonable objections to its acquisition. It’s important for the news media to remain on authoritarian watch. But a convenient union between anti-Trump journalists and big business would be another dangerous merger.

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Older Americans Are More Millennial Than Millennials

Derek Thompson, The Atlantic — Fri, 26 May 2017 10:35:59 -0400

Young people are the supposed vanguards of a new economic age. Unlike their parents, young people are said to value happiness over money. They prefer gigs over jobs. They prefer flexibility and meaning rather than status and hours at work. Rather than attach themselves to a single company, they are ushering in an economy of coffee-shop “creatives,” hot-desking between WeWork-style shared work spaces in pursuit of their individualistic dreams.

But there is another generation of U.S. workers with those non-monetary values and gig-style jobs. It’s not America’s youngest workers, but rather America’s oldest.

There is little question that an aging workforce—and an aging country—is one of the most important features of the modern economy. By 2024, one quarter of the workforce will be 55 and over—more than twice what the share was in 1994. And as they extend their working years, sometimes by choice and sometimes by necessity, it’s older Americans who are quietly adopting Millennial stereotypes, far more than actual Millennials are.

First, consider the gig economy, which is often framed as a Millennial counter-revolution to the failures of the traditional economy. In fact, the gig economy is full of older workers. People over the age of 65 are four times more likely to be self-employed than those under 34, and are more likely to work part-time jobs, too, according to the Bureau of Labor Statistics.

One of the most important trends in the workforce in the last decade has been the rise of “alternative work arrangements,” like freelancing or part-time work. These jobs, which often lack benefits like health care, have grown significantly in the last decade, long before Uber, Airbnb, and Lyft took off. Workers between 55 and 75 years old are 70 percent more likely to be in such alternative arrangements than 25-54 year-olds, according to the economist Jed Kolko. According to internal Uber data, half of its drivers are over 40.

One can see the same trend in part-time work. According to a survey from the Shift Commission, a joint venture between Bloomberg Tech and New America (and whose working sessions on the future of work I attended), older people are much more likely to stitch together income from multiple sources. More than 60 percent of workers under 34 derive income from a single source—as one would from earning a salary from one company. But almost three quarters of workers over 65 make money from more than one source, not counting Social Security. Gigs, freelance positions, and part-time jobs, although often hailed as the province of Millennials, are actually dominated by older workers.

Second, far more than Millennials, older workers value meaning over money. The Shift Commission asked workers if they most valued money, happiness (“doing things I enjoy”), or meaning (“doing things I feel are important”). Younger people tended to say that making money was the most important part of a job. Nobody rated happiness less important than 18-to-24-year-olds; the highest rating from people older than 65. The primacy of meaning—“doing things I feel are important”—was lowest for 25-to-34-year-olds and highest, again, for senior citizens.

This doesn’t prove that young people are greedy, or that older workers are wise. It suggests, rather, that generational stereotypes of carefree youths overlook the fact that young people can often be the most desperate to earn money, particularly since so many are graduating from college in debt or starting off in low-paying jobs.

Third, many writers—including myself—have predicted that if automation begins to eat away at the labor demand, it will sooner affect young workers, whose menial jobs are often routine, and, therefore, most easily replaced by a machine or algorithm. But it’s older workers whose jobs are most at risk of disappearing, according to Kolko. Thirteen percent of workers over 55 are in occupations that the BLS projects will shrink in the next decade, compared with 9 percent of workers under 35.

Finally, there are several cultural shifts that are purportedly Millennial-driven where older consumers are actually leading the charge. Take, for instance, the rise of restaurants. In October last year, the Wall Street Journal reported that grocers are struggling as Millennials move away from supermarkets and club stores and spend more money in restaurants. But since the early 1990s, the group that has most shifted its food spending toward restaurants has been senior citizens.

Perhaps it’s not surprising that older workers are better archetypal Millennials than Millennials themselves. The stereotype of the carefree freelancer who values meaning over money seems like it would most apply to somebody who’s not desperately poor, yet is anxious enough about their financial condition to work several jobs to make extra cash. Middle-class workers about to enter retirement after decades of steady employment, yet without adequate savings, would seem to fit that description—at least as well as young people trying to get their start.

One should always be careful not to oversell generations, which are, by definition, extremely broad swaths of tens of millions of people with diverse wealth, education, and living conditions. Still, when economists and marketers want to understand changing attitudes toward work and life, they often focus on Millennials. It’s tantalizing to say that, because something new is happening, the newest cohort must be responsible for the change. But many of the trends ascribed to Millennials are actually better fits for their parents.

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Trump's 3 a.m. Phone Call

Derek Thompson, The Atlantic — Thu, 09 Feb 2017 10:08:38 -0500

The president’s 3 a.m. phone call is typically a metaphor. It’s a symbol of the president’s ability to handle a crisis. But in the case of President Donald Trump, it appears to be a revealing reality.

According to the Huffington Post, Donald Trump recently placed a late-night phone call to Mike Flynn, his national security adviser, to ask if a strong dollar or a weak dollar is better for the U.S. economy. In the early rounds of commentary on television and Twitter, several people have mocked the president for staying up late, pondering questions that might appear on an Econ 101 exam.

But this conversation, if it’s true, is concerning for completely different reasons.

“Is a strong dollar good or bad for the economy?” is actually a reasonable question without a simple answer. A brief one is that a strong dollar empowers American buyers, and a weak dollar empowers American exporters. A strong dollar is a sign of a robust American economy, but a weak dollar can be more useful for growing the economy through trade with foreign countries.

What makes this “choice” complicated is that Americans want all of those things. Consumers want to feel rich, but companies want to export a lot of stuff (while importing parts that are affordable). U.S. ventures want to be an attractive destination for global investment, but companies want to make stuff the world can afford, so that they can get rich.

There are two reasons why this story is concerning, even if the details of the story evolve over the next few days, as these anonymous leaks often do.

First, the president inevitably has to make decisions about domestic and global affairs on which he is not an expert. This is why presidents build Cabinets and surround themselves with phalanxes of expert advisers. But calling an expert on the Middle East for on-the-spot macroeconomic theory is treating the Cabinet like a game of Apples to Apples, in which advisers are randomly paired with consequential questions. Macroeconomics and national security aren’t entirely unrelated, but it’s concerning to think that a real-estate mogul with no government experience isn’t asking the right person for advice on trade, his signature issue.

Second, Trump’s circle of trust is already extremely small. The executive order on refugees and immigration was a skunkworks operation that reportedly barely even included the president. Reaching out to a national security adviser for economic advice further suggests that Trump doesn’t have many people he can trust with a brief, and potentially embarrassing, question about policy. This leak itself might embarrass Trump and preclude further curiosity, which would also be bad. Indeed, the constant stream of leaks from the administration serves an obvious public interest. The downside is that, in embarrassing the president, it may further shrink his circle of trust to a handful of advisers whose specialty won’t be policy at all but rather their reputation for confidentiality and their mindfulness of the president’s volatility. One thing worse than being powerful and clueless is being powerful, clueless, and embarrassed to ask questions.

This leak is still fresh in the media bloodstream, and as more reporters process it, this 3 a.m. call may turn out to be as make-believe as the 3 a.m. metaphor—a story of the president's impetuous incompetence that is tailor-made for liberal readers. But there’s another reason the report, true or not, has gained the traction that it has: It keeps with a pattern that has arisen, in which Trump asks his loyalists to advise him on topics that are out of their depth. For instance, Steve Bannon, his top advisor, has been appointed to the National Security Council’s principals committee, which represents a political intrusion into meetings that the national-intelligence community has traditionally valued as being somewhat walled off from politics. This latest leak will only make the White House more paranoid, and make Trump more likely to ask basic questions of only his most trusted advisors, however qualified they may be to answer them.

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Why Democrats and Republicans Speak Different Languages

Derek Thompson, The Atlantic — Fri, 22 Jul 2016 11:26:58 -0400

On Thursday night, Donald Trump and other speakers at the Republican National Convention talked about “radical Islamic terrorism,” “illegal aliens,” and “Crooked Hillary.” In a few weeks, at the Democratic National Convention, you likely won’t hear any of these terms. The Obama administration refuses to associate terrorism with Islam, for fear of legitimizing it. Democrats are far more likely to talk about “immigrants” and “undocumented workers” than aliens. And it will be quite shocking, at a level far beyond Ted Cruz’s speech on Wednesday night, if a keynote speaker addresses Hillary Clinton with her nom de Trump.

For several decades now, Republicans and Democrats have become more polarized. There are plenty of reasons for that, including the demise of the Southern Dixiecrats and the geographic sorting of the country into ideologically homogenous neighborhoods. But the two major parties are now divided by a common language: Democrats discuss “comprehensive health reform,” “estate taxes,” “undocumented workers,” and “tax breaks for the wealthy,” while Republicans insist on a “Washington takeover of health care,” “death taxes,” “illegal aliens,” and “tax reform.” When did the two major political parties create their own vocabularies?

Around 1990. That’s according to a fascinating new paper by the economists Matthew Gentzkow and Jesse M. Shapiro and Microsoft Research’s Matt Taddy. Americans have for decades signaled their political clique with specific terms—as when Southerners refer to the Civil War as the “War of Northern Aggression,” or Northerners call it the “Great Rebellion.” What is different today, the researchers said, is “the magnitude of the differences, the deliberate strategic choices that seem to underlie them, and the expanding role of consultants, focus groups, and polls” to entrench two separate political lexicons within the same polity.

In the paper, they have a simple but specific definition of partisanship: “the ease with which an observer could guess a speaker’s party based solely on the speaker’s choice of words.” This definition of partisanship scarcely changed between 1870 and 1990. For roughly 120 years, the probability of correctly guessing a speaker’s party by listening to a one-minute speech was about 52 to 55 percent, nearly random. But suddenly, in the early 1990s, rhetorical partisanship exploded.

The Rise of Partisan Language in Congress

Gentzkow et al

“The 1994 inflection point in our series coincides precisely with the Republican takeover of Congress led by Newt Gingrich” and his Contract With America, they find. Gingrich’s revolution helped to introduce and/or popularize terms like “tax relief,” which at the time were seen as a distinctly conservative frame, as opposed to “tax cut” (or, more partisan, “tax giveaway”).

But the polarization of language did not stop when Gingrich left Washington. The Contract With America kicked off a neologism arms race, a prolonged attempt by members of both parties to coin catchy new terms for their pet policies, particularly for taxes, immigration, and health care. This neologism burst—defined as words and phrases first popularized after 1980—continued through the end of the 20th century and into the 21st century. Both Republicans and Democrats became more disciplined about defining their agendas in partisan-specific terms and getting other members of their parties to speak the same language.

The Rise of Partisan Neologisms

Gentzkow et al

Another inescapable variable here is the significant shift in media technology. Between 1984 and 1992, the cable industry spent more than $15 billion expanding its infrastructure—the “largest private construction project since World War II”—and the number of cable channels nearly tripled in that decade.

The diversity of media, alone, cannot explain the growing partisanship of language. After all, in the 19th century, there were hundreds of ethnic newspapers in the New York and New Jersey area, alone, serving socialists, conservatives, Jews, Swedes, and Italians. But the cable revolution was different by an order of magnitude: Each channel had the potential to reach tens of millions of cable-subscribing voters.

C-SPAN was introduced to the House of Representatives in 1979, and C-SPAN2 joined to film the Senate in 1986. “This plausibly increased the return to carefully crafted language, both by widening the reach of successful sound bites, and by dialing up the cost of careless mistakes,” the researchers write. In The C-SPAN Revolution, Stephen Frantzich and John Sullivan quote Newt Gingrich as saying he would have never been the Republican leader without C-SPAN. Fox News launched in 1996, and its success covering the conservative movement encouraged MSNBC to shift more and more leftward over the next decade, until finally there were two clear channels for partisan messaging.

There is little inherently dangerous about the popularization of synonymous terms. Millions of Americans say they drink “pop,” millions of Americans prefer the term “coke,” and they are all wrong because the proper terminology is “soda.” These differences hurt no one, even if their out-of-state usage might occasionally confuse a drug-store clerk.

But the Cambrian explosion of partisan neologisms is not as anodyne as the soda/pop divide. First, it’s not good that Republicans and Democrats see political expedience in accentuating their separateness down to the way they describe a reduction in taxes on households earning more than a million dollars. It is, rather, a sign that both parties are predominantly interested, not in converting the other side, but rather in speaking to the converted flock.

Second, devoting all this energy to building separate lexicons creates the impression that words are as important as policies. They are most certainly not. Coming up with a catchy name for the Iraq War doesn’t change a single substantive fact about its outcome. Despite what you’ve heard, harping on the words “radical,” “Islamic,” and “terrorism” is not a foreign policy. It is the reduction of a complex international crisis into a diction contest.

When politics devolves into a war over word choice, it is probably a sign that all hope for a more substantive debate has already been lost.

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Report: Federal Government is Effectively Fighting Inequality

Derek Thompson, The Atlantic — Fri, 10 Jun 2016 03:00:00 -0400

A new report from the Congressional Budget Office on household income since 1979 reaches two stark and significant conclusions. Inequality is growing. But so are government efforts to combat it—and they’re working.

First, the bad news. The distribution of income in the United States has been more unequal under Obama’s presidency than any time since the 1930s, according to the Gini Index, a conventional measure of the inequality. What’s going on here?

It really is a story of the 1 percent and the rest. Look at how market income grew between 1979 and 2013 for the poor (lowest quintile), the broad middle class (middle three quintiles), the fairly rich (81st-99th percentiles), and the truly rich (the top 1 percent). What’s really driving inequality isn’t really the scrum among the “bottom 99.” It’s the 1 percent sprinting away from the rest.

That may look pretty dramatic, but the gap between the 1 percent and the rest is tiny compared to the inequality within the 1 percent. Between 1979 and 2012, the top 0.01 percent—the 1 percent of the 1 percent—saw its income sextuple, according to analysis from the World Wealth and Income Database, growing more than twice as fast as the entire top percentile.

The Growth of Average Incomes Within the 1 Percent

World Wealth and Income Database

There are several reasons for rise of the 1 percent of the 1 percent, including the growing share of the economy going to finance and real estate and rising pay gaps both within companies (CEOs earning more than their workers) and between companies (all Apple employees earning more than other workers). But the result is that inequality is fractal: The gap between the 0.01 percent and “the rest of the 1 percent” is just as dramatic, if not more so, than the gap between the 1 percent and the rest of the country.

But while the economy’s reward system has never been more skewed toward the tippy top, a different measure of inequality shows a less dramatic story. “After-tax income”—which includes government help (like Social Security checks) and government levies (like Social Security taxes)—is more equal than it was in the late 1990s or the mid-2000s.

Growth of Inequality Since 1979, Measured by Gini Index
(0.00 Equals Perfect Equality)

CBO

After-tax income is a better measure of inequality for two reasons. First, it more accurately reflects the disposable income of families. Second, it reflects the serious efforts of any government—in this case, the Obama White House, Congress, former administrations, and state and local governments—to fight inequality. In 2013, President Obama signed a law to avert the fiscal cliff that raised taxes on income, long-term capital gains, dividends, and estates. It was the largest tax increase in 20 years, and the average federal tax rate on the 1 percent are now at their highest level since the mid-1990s. What’s more, the administration also increased benefits. For example, the the Affordable Care Act expanded Medicaid coverage.

The upshot is that the federal government is doing more to correct inequality right now than at any time in the last 35 years. The five years when tax and transfer policies took the biggest bite out of inequality were the first five years of Obama's presidency.

Historically, the United States has had worse inequality than most countries for two major reasons. The first culprit is the economy itself: U.S. labor markets have a large pool of low-wage workers and a uniquely rich top percentile, widening pre-tax inequality. The second culprit is U.S. culture, reflected in its government’s policies, which tolerates much higher inequality than its European peers.

Market inequality—the rewards of the economy before tax and transfers—is surprisingly about the same in the U.S. as in Ireland and the U.K. But those countries are much more aggressive about taxing income and transferring that money from the rich to the poor in the form of cash or benefits. As a result, the U.S. has the single highest after-tax inequality in the OECD,because its voters, policymakers, and elites tolerate inequality and even (if they’re running for the Republican nomination) compete with each other to exacerbate it.

The gap between the 1 percent and the rest is growing all over the world, and identifying its many causes is a difficult and ongoing challenge in economics. Some might say that the Obama administration should be doing more to fight inequality before the tax man gets his cut, by working to raise the minimum wage, strengthen labor laws, and regulate the financial sector.

But the White House’s success in tamping down after-tax inequality with taxes and transfers suggests that the a sure step toward fighting the forces of global inequality might not require much more than some simple bit of arithmetic: less for the very rich, more for the rest.

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How to Hire the Perfect Worker

Derek Thompson, The Atlantic — Mon, 11 Apr 2016 18:00:00 -0400

In the summer of 2006, Todd Carlisle, a Google analyst with a doctorate in organizational psychology, designed a 300-question survey for every Google employee to fill out, The New York Times later reported.

Some questions were straightforward: Have you ever set a world record? Other queries had employees plot themselves on a spectrum: Please indicate your working style preference on a scale of 1 (work alone) to 5 (work in a team). Other questions were frivolous: What kind of pets do you own?

Carlisle crunched the data and compared it to measures of employee performance. He was looking for patterns to understand what attributes made a good Google worker. This was strongly related to another question that interested his boss, Lazlo Block, vice president of People Operations: What attributes could predict the perfect Google hire?

Ten years ago, Google was infamous for its complex application process and brain-teasers—something Block recently admitted were "a complete waste of time.” Google was essentially trying to Google the human-resources process: It wanted a search algorithm that could sift through tens of thousands of people—Google’s acceptance rate is about 0.2 percent, or 1/25th that of Harvard University—and return a list of the top candidates. But after a great deal of question-asking and number-crunching, it turned out that the best performance predictor wasn’t grade-point average, or type of pets, or an answer to the question, “How many times a day does a clock’s hands overlap?” The single best predictor was: absolutely nothing.

***

Hiring is hard. General managers know it. Startup founders know it. School principals and casting directors know it. But for readers who are none of those things, consider America’s most public hiring processes—aside from presidential elections, perhaps—which are sports drafts.

Every year, millions of Americans watch professional talent evaluators try to predict who will be the best future athletes in the NBA and NFL Drafts. Again and again, audiences get valuable lessons in the inability of experts to divine future talent. Scouts aren’t dumb. Overall, the first pick tends to be better than the tenth pick, and he tends to be better than 100th pick. But years after the draft, at least one squad almost always looks foolish. For every top five team that can’t believe it picked a Darko Milicic or Ryan Leaf, there is a top five team that can’t believe it missed a Stephen Curry or Tom Brady.

Hiring is hard for the same reason that dating is hard: Both sides are in the dark. "The fundamental economic problem in hiring is one of matching with costly search and bilateral asymmetric information,” Paul Oyer and Scott Schaefer write in "Personnel Economics.” In English, that means hiring is expensive, time-consuming, and inherently uncertain, because the hirer doesn't know what workers are the right fit, and the worker don’t know what hirers are the right fit.

But hiring is not hopeless. Like any consequential business decision, it has been exhaustively studied. The companies with the most successful hiring practices are the ones who learn which metrics and processes reliably help to predict performance and quickly identify the metrics and processes that are complete wastes of everybody’s time.

Here again, sports are instructive. One of the most important jobs of a scout is to isolate skills (which are inherent) from outcomes (which depend on a zillion variables). In baseball, for example, it’s impressive for any young pitcher to have far more wins than losses. But wins rely on factors like the team’s fielding and runs scored, which don’t have much or anything do with pitching quality. It’s far better for scouts to focus on metrics that the pitcher controls exclusively, like strikeouts and walks. In basketball, scouts have historically been seduced by high scorers on successful college teams. But work by David Berri has shown that raw points and Final Four appearances aren’t good predictors of NBA talent, at all. Instead, subtler statistics like rebounding, assists, and field-goal percentage were much more consistent metrics from year to year.

This is a fundamental challenge in hiring: identifying the metrics that actually predict employee success, rather than relying on the most available pieces of information. The gap between these two groups is quite clear in one of the most popular industries to study the science of hiring: American schools.

***

A great teacher is hard to identify and hard to measure. You can observe a star athlete’s quality in his or her own performance. But a teacher’s quality is reflected in the performance of other people—and (this part doesn’t make the evaluations any easier) those other people are very often children.

Even so, the academic literature suggests that principals seem to value the wrong metrics. They hire for credentials (e.g. teacher certificates) and proximity (e.g. does the applicant live in the same state as the schools?) while discounting the factors that make the best instructors.

A straightforward yet under-appreciated fact about instruction is that smart people make good teachers. College GPA and SAT scores correlate very highly with teaching performances, in a range of studies. But several papers in the last 20 years have shown that teaching applicants with higher GPAs don't receive more offers; instead, applicants in the same state as the school do. Meanwhile, basic credentials like graduate degrees and certifications are valued in applications, but they "have little or no power to explain variation in performance across teachers,” according to one recent study published in March by researchers at the University of Michigan, Columbia University, and Harvard Graduate School of Education.

This study used unique access to applicants, hires, and teacher performance in Washington, D.C., Public Schools. Like many similar papers, it found that undergraduate performance and scores on a teacher screening test both strongly predicted teacher effectiveness. (“Effectiveness,” in this case, was measured using D.C.'s IMPACT system, which evaluates teachers based on their year, subject, classroom observation grades, and reports from principals and assistant principals.)

The researchers found that DC public school principals consistently missed the best teaching prospects. For example, they hired more people who went to college in D.C. (which had nothing to do with better teaching) but ignored SAT scores and GPA (both of which were “significantly positively related to performance”). Some principals might assume that high-achieving workers will feel overqualified teaching in public school and quit after a year. But the study found no correlation between academic credentials and attrition. Instead, their basic conclusion was a stinging indictment of teacher hiring: The attributes of the best teaching prospects were "only weakly, if at all, associated with the likelihood of being hired.”

***

Teaching puts one individual in charge of a classroom. That’s different than being a member of a large product team within a larger company. Hiring team members requires filtering for different hard and soft skills, so that new employees can slip into established patterns of company behavior. In this case, many companies depend on asking their employees to double as HR recruiters by leaning on referrals.

Researchers have long known that referrals surface better job candidates. Referred candidates are more likely to get call backs, more likely to be hired, and more likely to stay at the company. Furthermore, they had a pretty good theory about why referrals work. Most hiring is a blind date, and referrals are an introduction. They give both sides a little bit more certainty and information about fit. But academics couldn’t figure out why referred candidates were actually better. A May 2013 paper suggests an simple answer: Company referrals don’t work because they yield smarter workers. They work because they yield better fits.

The study found that referrals produce "substantially higher profits per worker” who are "less likely to quit," "more innovative,” and "have fewer accidents—all this, even after controlling for factors like college, SAT scores, and IQ. Team-based companies require openness, compatibility, and a willingness to cooperate. Referral programs work because great employees pass along workers who similarly match the company culture.

Although they account for only six percent of total applications, referrals now result in more than a quarter of all hires at large companies, according to a recent paper from the Federal Reserve Bank of New York and MIT. But while referrals are extremely useful, they can create their own problems. Many industries—tech and media, for starters—are infamous for disproportionately hiring white, upper-middle class young men who went to elite colleges. Relying exclusively on referrals could deepen workplace homogeneity.

What’s more, referrals help winnow the applicant pool, but that’s not nearly enough. As the New York Fed study showed, the majority of jobs are still filled without referrals and the majority of referred candidates are still rejected. More important than a strong referral program is a strong interview process. How does a hiring manager distinguish between a merely acceptable candidate and the great one, without devoting thousands of hours learning the secret talents, hobbies, and motivations of every single applicant?

Google, which depends on referrals, once administered up to 25 interviews for each job candidate. Todd Carlisle, the organizational psychology doctorate who administered the company’s surveys in 2006, thought this might be overkill. He tested exactly how many interviews were necessary to be confident about a new hire. The right number of interviews per candidate, he discovered, was four. This new policy, which Google calls the Rule of Four, "shaved median time to hire to 47 days, compared to 90 to 180 days,” Lazlo Block wrote in his book Work Rules.

But Carlisle’s research revealed something deeper about the hiring process, which has resonance for every industry: No one manager at Google was very good, alone, at predicting who would make a good worker.

Four meticulously orchestrated Google interviews could identify successful hires with 86 percent confidence, and nobody at the company—no matter how long they had been at the company or how many candidates they had interviewed—could do any better than the aggregated wisdom of four interviewers. (Okay, technically, one employee could: a data center worker, named Nelson Abrasion, who interviewed exclusively for a "very distinctive skill set.”)

There are several reasons to aggregate interview scores. First, everybody is a little bit biased in one direction or another—toward older or younger, toward extroverts or introverts. Combining scores mitigates that inevitable bias. Second, sometimes people just have bad interviews, and it’s unreasonable to base an entire hiring decision exclusively on one 30 minute performance.

Third Google’s finding suggests there are no magical hirers in the world. There are no performance oracles who just know a good candidate when they see it.

This is perhaps the most interesting an important conclusion. In a November 2015 study, researchers looked at 15 firms that used a job test, which placed applicants into three buckets: green (positive), yellow (tentative), or red (negative). These job tests accurately predicted worker performance and retention. The greens stayed longer than the yellows. The yellows stayed longer than the reds.

But sometimes, the human-resources managers ignored the data and went with their gut. Why? Perhaps the managers thought they knew better than a cold piece of data. But these "gut” picks were busts, according to Mitchell Hoffman at the University of Toronto, Lisa Kahn at Yale University School of Management, and Danielle Li at Harvard Business School. When managers thought they were smarter than the hiring systems they set up, it's the systems that ended up looking smart.

It will always be difficult to predict fit and performance, because humans are complex and humans interacting in human systems are even more complex. The right lesson is more subtle: Hiring is hard, and nobody is very good at doing it alone, whether you’re a Google boss, a high-school principal, or a sports general manager. They need help—sometimes in the form of standardized tests, and sometimes in the form of aggregated interview reports. When it comes to identifying the best future talent, groups are better than individuals, data-plus-groups is better than groups alone, and nearly anything is better than brainteasers.

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The Easy 10-Second Tax Return

Derek Thompson, The Atlantic — Sat, 02 Apr 2016 13:00:00 -0400

Each tax season, tens of millions of American households have a decision to make.

A) They can collectively spend hundreds of millions of hours preparing tax information that the federal government already has.

B) They can pay other people billions of dollars to do it for them.

But let’s add a choice C: They go for a walk. Or, they have a nice dinner. Basically, they do whatever they want with those millions of hours and billions of dollars. Because their taxes are done for them, for free. They receive a document from the government with all of the relevant information already filled out, and they check a box to say, “okay!"

In the United States, the third choice sounds like a fantasy. But the excruciating pain of tax season is just another example of negative American exceptionalism. In fact, about one-half of American taxpayers earn all their income from one employer’s wages (which the IRS can see) and interest from one bank (which the IRS can find out without much effort). The IRS could easily send tens of millions of individuals their nearly completed taxes by mail—or even, by text.

“Rather than some crazy, wild idea that’s never been tried before, this is doable and a lot of countries do it,” said William Gale, a tax expert at the Brookings Institution. Eight OECD countries, including Finland and Norway, fully prepare returns for the majority of its taxpayers. In Estonia, it famously takes the average person five minutes to file taxes.

In Sweden, the vast majority of taxpayers don’t do battle with tax documents and fine-print questions about itemized deductions. They just get a document from the government with all the relevant information already filled out. Some even get a text message with their prepared tax information, and if they respond “yes,” their taxes are done. Andreas Hatzigeorgiou, a chief economist with the Stockholm Chamber of Commerce, told PRI that individuals with more involved filings can always spend more time on their taxes, if they like. “If you don’t have any complicated things that you want to do”—like listing business expenses from a sole proprietorship —“it takes you five seconds,” he said.

In the United States, however, taxes are tortuous—for those who pay them as well as those who collect them. Compliance costs are 10 times higher than in most European countries. Poor Americans in particular suffer for the time and money it takes to fill out what are essentially redundant documents. "These taxpayers are just copying into a tax return information that the IRS already receives independently,” the economist Austan Goolsbee wrote in a Brookings paper.

In 2006, Goolsbee proposed a "Simple Return” that would pre-fill forms for workers with the most straightforward taxes. California tried something like this in 2004, when it sent 50,000 single taxpayers a European-style "ReadyReturn.” Ninety percent of users said it saved them time. The median cost of completion? Zero dollars.

The Simple Return could proceed in several steps. First, the IRS could start with a pilot program for the most straightforward tax returns: single, low-income taxpayers who don't itemize their deductions. There are about nine million such people in the U.S. They would get a document from the IRS early in the year showing total income earned and total taxes owed. They could check a box saying "Okay,” make changes, or—if they insist—burn the page, throw the ashes in the trash, and log onto TurboTax.

If millions of people seemed happy with the streamlined one-pager, the IRS could expand the program to the millions of people with the second-easiest returns, like married couples who don’t itemize their deductions. “We might never get everybody in the system, because some people’s tax situations are quite complicated,” Gale said. But step two of the Simple Return could still reach about 17 million taxpayers.

What’s stopping the Simple Return? There are three barriers, and appropriately, since the issue at stake is taxes, they are all fundamentally about money.

First, changing the tax-payment system for tens of millions of people would require resources for the federal government, and the IRS is already squeezed. Its budget has fallen in the last decade and Congress hasn’t shown much enthusiasm for making their jobs any easier.

Second, America’s federal income tax system is byzantine—a messy reflection of the messy will of the people. "A simpler tax code is everybody’s second priority,” Gale said. Their first priority? That would be to keep the tax breaks they already have—or even to create new ones. It’s often said that Americans love their congressman but hate Congress. It’s the same with tax breaks: Everybody loves their tax benefit and hates the tax system. Without a simpler tax code, it’s hard to imagine a Simple Return working for more than the low- and middle-class Americans with the most straightforward earnings.

Third, the opposition to simpler taxes unites two unlikely allies. First, Grover Norquist and other conservatives who want to cut taxes don’t want tax collection to be more efficient. They’re afraid it will be easier for the feds to raise revenue if taxes feel effortless and people spend less time considering them. Second, tax preparers like H&R Block and Intuit,the company behind TurboTax, have spent millions of dollars lobbying against painless taxes, since those companies are in the business of pain relief. It’s a rich irony that the coalition against simpler taxes creates strange bedfellows: Those who want more tax complexity and those who want the simplest tax code of all—one that doesn’t exist.

Even if the Simple Return became a reality, some Americans would still have to deal with their deductions. For example, donating to charity reduces a person's taxable income. If I donated money to the Red Cross, how would the IRS know to withhold less money from my paycheck?

Once again, perhaps the U.S. could take a lesson from the world. An American donating to charity takes a deduction at the end of the year. But a British resident donating to charity can simply leave out the amount of the tax deduction from her charitable gift; then the UK’s tax collector pays the charity the equivalent amount. To put it another way: Rather than donate $100 in December and get $10 back from the government in April, she gives $90 in December and the government pays the charity the final $10. This essentially makes charitable donations a kind of government matching program, but it has the same effect: helping charities by rewarding donations.

Several years ago, the White House estimated that American taxpayers spend 7.6 billion hours and $140 billion a year figuring out what they owe the government and paying people to help them owe less. Those who want to play the game—and have the money to do so every year—are welcome to continue. The rest of the country deserves a 21st-century approach to taxes.

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How Donald Trump Can Beat Hillary Clinton

Derek Thompson, The Atlantic — Thu, 03 Mar 2016 05:00:00 -0500

Donald Trump and Hillary Clinton’s Super Tuesdays put them on a collision course this fall. Betting markets make Clinton the strong favorite, given Trump’s high unfavorables, his incendiary comments about minorities, and the fact that members of his own party seem eager to disavow him. But Trump’s strengths and grand strategy make him considerably more dangerous in a general election than people seem to think.

There are two pieces of conventional wisdom about Donald Trump that don't fit comfortably together. On the one hand, people seem to think Trump’s appeal transcends the issues and that he doesn’t really care about policy. On the other hand, he’s considered unelectable because of his policies, like building a Mexican wall and banning Muslim immigrants.

But here’s the problem: If Trump doesn’t care about policy and his appeal truly transcends issues, what’s stopping him from becoming a starkly different person in the general election, the same way he's morphed, with convenient timing, from a moderate businessman—supportive of Canadian health care, a friend of Democrats, an admirer of Hillary Clinton—to a nationalist demagogue?

Trump’s most famous skill is self-promotion through bloviation. But his most underrated skill is he is a terrific panderer. He will say anything he thinks people want to hear, but he'll say it in a way that makes his pandering look like an act of courage. The ingenious subtext of much of his messaging is: “Nobody wants to hear this hard truth, but here it is: you’re right!” As a businessman, he had no problem hiring illegal immigrants. But when he sniffed out illegal immigration as a hot-button topic, he promised mass deportations, the most beautiful wall in the Western Hemisphere, and a punitive financing scheme: Mexico pays! He trashed former klansman David Duke years ago. But when he suspected that some voters in Super Tuesday states might be sympathetic to white supremacy, he scolded CNN’s Jake Tapper for asking him to disavow somebody he’d never met.

In all 15 states that have voted in the GOP primary, Trump’s supporters have named the same quality as most important in a president: Somebody who “tells it like it is.” Does it matter that Politifact determined that 76 percent of Trump's statements were errors, inaccuracies, or absurd lies? No way. Somebody who “tells it like it is” doesn’t have to “get the facts right.” Trump doesn’t need to be accurate, because he’s authentic. And yes, there is a difference. The difference between accuracy and authenticity is the difference between a British passport and a British accent. People with the former tend to have the latter, but the first is concrete and falsifiable, and the second is easily faked.

Trump will exploit this. He will fake it until he absolutely cannot make it. He’ll fib about policy, because he doesn’t care, and maybe voters don’t either. He won’t adhere too closely to what he’s already said, because he doesn’t care, and maybe voters don’t either. (What about that Muslim database? “Well, I don’t want to talk about it much now, I’m considering all options.”) He’ll borrow shamelessly from Bernie Sanders and Barack Obama—the two candidates who gave Hillary fits—by repeatedly slamming the establishment, talking about middle class pain and anger, and promising to be a uniquely unifying force in American politics. Consider the red-and-blue state unity messages in Chris Christie’s introduction speech last night: “Donald Trump has won Georgia and Massachusetts… Tonight is the beginning of Donald Trump bringing the Republican Party together ... Tonight is the beginning of Donald Trump bringing the people of our nation together to help America win again.

Overall, Trump will continue to alight to the majority’s latent fears and frustrations and confidently promise magical solutions. It’s not hard to imagine him sounding like an palatable moderate Republican:

Take, for example, what he might say on income inequality: The middle class has been creamed in this country. Creamed. Hillary wants to raise taxes. She might even want to raise taxes on the middle class, you never know with Democrats. But I want a big, fat, beautiful tax cut for the middle class. It will make every American family richer. It will create jobs. We’ll win and win. It will be beautiful.

A tax cut? How would he pay for that without slashing spending on defense, Social Security, or Medicare? We’ll cut so much. There is so much waste and fraud. We’ll cut and cut. You’ll get sick of cutting.

And he may be surprisingly quick to answer questions about Black Lives Matter and criminal-justice reform: We imprison so many men in this country. It’s a disgrace. When I’m president we’re going to be a tough country. But a fair country. Because that’s who I am. It’s who I’ve always been. I’m a tough, fair guy. Hillary can’t do this. Her husband passed a criminal-justice law that even she considers a disgrace. Just ask her. A total disgrace.

Trump is also positioned to offer a devastating critique of Hillary Clinton—that she never wins: She tried to pass health care reform. Biggest disaster I ever saw in Washington. Biggest I ever saw. And that’s saying a lot. She wanted us to go into Iraq and then into Libya. Look at that mess. Worst decision in foreign policy history. Worst. NAFTA, prisons, welfare reform. You know that story about King Midas? Where he touches something and it turns to gold? Hillary’s the opposite. Everything she touches blows up. She’s a disaster.

Is it really so hard to imagine Trump peddling a populist message that keeps the Great Wall of America (he can’t disavow that wall), dials down on the dog-whistle rhetoric toward Hispanics and Muslims, and goes hard at the economic and cultural insecurity of the middle class by promising them a gorgeous new fleet of protectionist trade deals, a big beautiful tax cut, and all the social spending they’ve come to love? Pay Less, Keep More, Win, Win, Win. It will be a incredible six months of populist pandering. And what’s worse: If it produces results and he rises in the polls, the political media will paint Trump as a rapidly maturing centrist.

So, it is time for the to-be-sure paragraph. To be sure: Donald Trump faces massive impediments, many of which he put up himself. He’s spent the last nine months doing his best to alienate every minority group in an electorate that is more diverse than ever. He has a history of radically hypocritical statements. His business record is a massive, beautiful, terrific Jenga tower. He is also getting beat steadily and mightily by Clinton in early head-to-head polls. Although it’s reasonable to think the gap could close in a general election campaign, you have to begin to wonder how many Americans haven’t made up their mind about this guy, already, since Trump is a historically overexposed political product. An intended voter saying, “I’m still making my mind up about Donald Trump” in April 2016 is like a fully grown adult saying, “I’m still deciding if I like ice cream.” You kinda do or you don’t, by now.

Hillary Clinton is the clear favorite in November. But if you think Donald Trump’s past positions will make it hard for him to win a general election, recall that Donald Trump does not care about his past positions. He cares about winning. He’s going to spend the next few weeks figuring out what he needs to say to win, and when he thinks he’s found those things, he's going to say them, over and over, with shameless disregard for consistency, accuracy, or morality. Factuality will be sacrificed, over and over, on the altar of authenticity. He won’t tell “the truth.” He will tell “it like it is."

Pragmatists like to seek solace in the quote, “You can fool all the people some of the time, and some of the people all the time, but you cannot fool all the people all the time.” The quote is falsely attributed to Lincoln (fooling people is easy, it turns out, if you just repeat the fib emphatically enough), yet I wouldn’t be surprised if the Clinton campaign used the line, to contrast the Republican forefather’s virtue with Trump’s chintzy salesmanship.

The thing about majoritarian government, though, is that nobody has to fool everybody all the time. Donald Trump’s objective couldn’t be clearer. He only has to fool half the people once.

(Image via Flickr user Michael Vadon)

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'From Atoms to Bits': A Brilliant Visual History of American Ideas

Derek Thompson, The Atlantic — Mon, 16 Feb 2015 09:00:00 -0500

One night in the the spring of 1983, the scientist Kary Mullis was driving with his girlfriend along Highway 128 from Berkeley to Mendocino, California. As Mullis took in the perfume of California buckeyes swinging their blossoms along the road, his mind wandered back to his job as a chemist . He was thinking about human DNA. Specifically, he was thinking about how to replicate human DNA. And it was there, at "mile marker 46.7 on Highway 128,” as he specified a decade later in his Nobel Lecture , that he experienced that rare and often apocryphal moment of invention—a eureka .

Actually, it was a kind of rolling eureka, a rapid-fire series of bingo moments. Mullis would later name his idea “polymerase chain reaction,” or PCR. It was, to oversimplify greatly, the singular invention that made possible that mass duplication of short sequences of DNA. It is a technology behind cloning, gene sequencing, identifying hereditary diseases, making velociraptors in Jurassic Park , and catching criminals in CSI (both in the shows and in real life). In the 1990s, the London Observer suggested it was the most "momentous idea” of the past two centuries .

But was it, really? Was it more significant than the transistor, or the microprocessor, or the World Wide Web? More importantly, how would an enthusiast of American ideas (as The Atlantic has proudly been for a century and a half ) measure something as ineffable as the significance of a new invention? In fact, in a new paper, Mikko Packalen at the University of Waterloo and Jay Bhattacharya of Stanford University, devised a brilliant way to address this question empirically. In short, they counted words in patent texts .

In a series of papers studying the history of American innovation, Packalen and Bhattacharya indexed every one-word, two-word, and three-word phrase that appeared in more than 4 million patent texts in the last 175 years. To focus their search on truly new concepts, they recorded the year those phrases first appeared in a patent. Finally, they ranked each concept's popularity based on how many times it reappeared in later patents. Essentially, they trawled the billion-word literature of patents to document the birth-year and the lifespan of American concepts, from "plastic" to "world wide web" and "instant messaging."

Here are the 20 most popular sequences of words in each decade from the 1840s to the 2000s. You can see polymerase chain reactions in the middle of the 1980s stack. Since the timeline, as it appears in the paper, is too wide to be visible on this article page, I've chopped it up and inserted the color code both above and below the timeline.

A Brief Visual History of American Ideas

The overall story, Bhattacharya told me, follows the shift from "atoms to bits"—from the loud world of trains and cars in the 19th century to the invisible life of software. But within that meta-narrative (and this is where the colors come in handy), you can see moments where one industry dominated the patent literature—like chemistry (black) in the 1930s, medicine (red) in the 1980s, and computers (green) in the last few decades.

Since the 1970s, medicine and computers have reigned over patents like no two categories have dominated any previous period of invention in U.S. history. In his Nobel address, Mullis described his midnight eureka as a solitary moment of invention on an lonely California road. But rather than seeing him as a lonely inventor, it might make more sense to view him as a product of his times, a medical scientist working in the 1980s, at the apex of medicine's potency in the patent literature. His PCR patent was a part of, and a catalyst for, its own chain reaction of innovation in genetics, from "genomic DNA" to "DNA sequencing" to "monoclonal antibodies." Patents that introduce entirely new fields of study (like PCR) spur much more new research than subtle tweaks to old ideas, Packalen and Bhattacharya found. Still, past research has shown that organizations like the National Institutes of Health and the National Science Foundation are more likely to subsidize projects in highly familiar areas. Indeed, one of the major implications of Packalen and Bhattacharya's research is that, by awarding established scientists in well-understood fields, the government is implicitly discouraging the most radical innovation.

Another theme of Packalen and Bhattacharya's research is that innovation has become more collaborative. Indeed, computers have not only taken over the world of inventions, but also they have changed the geography of innovation, Bhattacharya said. Larger cities have historically held an innovative advantage, because (the theory goes) their density of smarties speeds up debate on the merits of new ideas, which are often born raw and poorly understood. But the researchers found that in the last few decades, larger cities are no more likely to produce new ideas in patents than smaller cities that can just as easily connect online with their co-authors. "Perhaps due to the Internet, the advantage of larger cities appears to be eroding,” Packalen wrote in an email.

Bhattacharya didn't want me to go away with the impression that he thought something about the American invention machine was broken. He pointed out that patents with first-name authors living in the United States were considerably more likely to introduce new concepts than those with foreign authors today, a clear reversal since the 19th century.

U.S. Invention: From Follower to Leader

Packalen & Bhattacharya

The good news, Bhattacharya said, is that this picture provides clear evidence that although the United States often followed the world in chemical and electrical innovation in the late 19th century, today's American inventors are far more likely than Edison and Einstein's generations at coming up with truly new ideas that haven't been picked to death. "There’s still something in the American culture that emphasizes invention," he said.

( Image via Wutthichai / Shutterstock.com )

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The Typical Millennial Is $2,000 Poorer Than His Parents at This Age

Derek Thompson, The Atlantic — Mon, 02 Feb 2015 14:30:00 -0500

The past is another country. In 1980, the typical young worker in Detroit or Flint, Michigan, earned more than his counterpart in San Francisco or San Jose. The states with the highest median income were Michigan, Wyoming, and Alaska. Nearly 80 percent of the Boomer generation, which at the time was between 18 and 35, was white, compared to 57 percent today.

Three decades later, in 2013, the picture of young people—yes, Millennials— is a violently shaken kaleidoscope, and not all the pieces are falling into a better place. Michigan's median income for under-35 workers has fallen by 26 percent, more than any state. In fact, beyond the east coast, earnings for young workers fell in every state but Hawaii and South Dakota.

How Young Adult Earnings Compared to 1980

The median income of young adults today is $2,000 less today than their parents in 1980, adjusted for inflation. The earnings drop has been particularly steep in the rust belt and across the northwest.

As you can see in the next interactive graph, the three states with the highest median income for young people in 1980 were also the three states with the steepest 33-year decline in median income: Michigan, Wyoming, and Alaska. The winners of this continental shake-up are all on the coasts, particularly Virginia, Maryland, and just about all of New England.

Millennials Falling Behind Their Parents (Except in the East)

The Census, which offered some of these findings on Friday , tells an occasionally contradictory story of the youngest generation in the workforce. For example, how does one make sense of the fact that Millennials are more educated and more impoverished than its parents' generation at a similar age? Surely, some of this is a matter of timing. The Census figures from 2009 through 2013 survey a generation struggling their way out of a historic recession.

The deeper explanation might be structural. Many young adults, particularly those who represent their families' first college graduates, are earning more than their parents. But young adults without a college degree have been run roughshod by technological changes, globalization, and slow wage growth that continues to this very week . Many of the cities with the largest declines in median income (Flint, Detroit, Cleveland, Youngstown, Toledo) were industrial hubs undone by the demise of manufacturing employment.

It's also worth pointing out that the United States has absorbed millions of immigrants over the past 30 years, often from poorer Latin and South American countries. (The Census notes that the share of ethnic minorities has doubled over the last 33 years.) It's possible that, even as these young families have raised their own living standards by moving to the U.S. and contributed to a growth economy, their below-average wages, when lumped into the aggregate, make it look like native-born families' wage growth is worse than it really is.

Although these figures paint a lugubrious picture of young workers today, it's nonetheless true that Boston, San Jose, Washington, San Francisco, and New York's metro areas have all seen double-digit real income growth since 1980. The coasts (and, more recently, energy-rich states like Texas) have largely thrived. Indeed, the United States is a plural noun, and the country's health is most accurately captured as a mosaic rather than a monolith. An unequal decade punctuated by an unequal recovery has left parts of the country better off in just about every way, while the vast majority of states are home to a Millennial generation that is quite clearly falling behind the pace of its parents.

( Image via Volt Collection / Shutterstock.com )

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The Incredible Shrinking Incomes of Young Americans

Derek Thompson, The Atlantic — Fri, 05 Dec 2014 14:00:00 -0500

American families are grappling with stagnant wage growth, as the costs of health care, education, and housing continue to climb . But for many of America's younger workers, "stagnant" wages shouldn't sound so bad. In fact, they might sound like a massive raise.

Since the Great Recession struck in 2007, the median wage for people between the ages of 25 and 34, adjusted for inflation, has fallen in every major industry except for health care.

Young People's Wages Have Fallen Across Industries Between 2007 and 2013

Census: Current Population Survey

These numbers come from an analysis of the Census Current Population Survey by Konrad Mugglestone, an economist with Young Invincibles .

In retail, wholesale, leisure, and hospitality—which together employ more than one quarter of this age group—real wages have fallen more than 10 percent since 2007. To be clear, this doesn't mean that most of this cohort are seeing their pay slashed, year after year. Instead it suggests that wage growth is failing to keep up with inflation, and that, as twentysomethings pass into their thirties, they are earning less than their older peers did before the recession.

The picture isn't much better for the youngest group of workers between 18 and 24. Besides health care, the industries employing the vast majority of part-time students and recent graduates are also watching wages fall behind inflation. (40 percent of this group is enrolled in college.)

The Wages of the Youngest Workers (Ages 18-24) Have Fallen, Too

Census: Current Population Survey

There are a few reasonable follow-up questions to these stunning graphs.

First: Why are real wages falling across so many fields for young workers? The Great Recession devastated demand for hotels, amusement parks, and many restaurants, which explains the collapse in pay across those industries. As the ranks of young unemployed and underemployed Millennials pile up, companies around the country know they can attract applicants without raising starter wages.

But there's something deeper, too. The familiar bash brothers of globalization and technology (particularly information technology) have conspired to gut middle-class jobs by sending work abroad or replacing it with automation and software. A 2013 study by David Autor, David Dorn, and Gordon Hanson found that although the computerization of certain tasks hasn't reduced employment, it has reduced the number of decent-paying, routine-heavy jobs. Cheaper jobs have replaced them, and overall pay has declined.

Your second question might be: Why have health-care wages been the exception to the rule? One answer is that health care is, generally speaking, the exception to many rules. Demand for medical services is dominated by the government (i.e. Medicare, Medicaid, and the employer insurance tax break), which doesn't face the same vertiginous up-and-downs as the rest of the economy. So as the Great Recession steamrolled many industries, health care, propped up by sturdy government spending, kept adding workers. What's more, computerization and information technology have yet to work their magical price-cutting power in health care as they have in other industries, for a variety of reasons . Americans are spending four percent less on food away from home than in 2007; but we're spending 42 percent more on health insurance . As prices have increased, so have wages for younger workers in the medical field. ( Update : Some readers have made the smart suggestion that money which might have gone to higher salaries has instead gone to paying higher health insurance costs.)

Once you account for falling wages among young workers—if you must: "the Millennials"—many mysteries of the economic behavior of young people cease to be mysterious, such as this generation's aversion to home-buying, auto loans , and savings . Indeed, the savings rate for Americans under 35, having briefly breached after the Great Recession, dove back underwater and now swims at negative-1.8 percent.

Savings Rates Since 2004, by Age

WSJ

Some of these young people could afford to save more , even if it's a small share of their meager income, since small amounts of money put away several decades before retirement (or an unexpected emergency) can help later. But it's easier to see why young Americans aren't saving any more than we used to: Their wages are falling behind the cost of basic goods and many are going into debt to pay for a college degree.

The evaporation of real wages for young Americans is a real mystery because it's coinciding with what is otherwise a real recovery. The economy has been growing steadily since 2009. We're adding 200,000 jobs a month in 2014. That's what a recovery looks like. And yet, overall U.S. wages are barely growing, and wages for young people are growing 60 percent more slowly than overall U.S. wages. How is a generation supposed to build a future on that?

( Image via smutny pan / Shutterstock.com )

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The Gender-Wage Gap Is Shrinking—or Is It?

Derek Thompson, The Atlantic — Thu, 20 Nov 2014 14:00:00 -0500

The wage gap between young male and female workers is historically low. The wage gap between young male and female workers is growing. Yes, both things can be true at the same time.

Intergenerational economic inequality is declining: The gap between male and female wages among Millennials is lower than it was among boomers or Gen-X. But the pernicious gender gap is reasserting itself as you look higher up in the corporate ladder. Income data shows that middle-aged women fall behind their male peers, particularly when they take time off to be moms. Men with families and children, on the other hand, earn more than their same-aged bachelor colleagues, according to Pew . So as Millennials grow up, today's entry-level inequality could still yield to middle-age inequality.

If that paragraph doesn't entirely make sense to you, this graph should make things crystal clear. It comes from data in a new PayScale and Millennial Branding study. You can see Millennials (in grey) have the smallest gender-wage gap at all levels, but the difference in pay deepens as you move up the corporate ladder.

The Gender Wage Gap: Percent Difference in Pay

This is what economists call the "sticky floor" theory of the gender wage gap. Women make very close to men coming out of college, but as men climb the corporate ladder, female salaries stick to the ground. Consider that women account for 49 percent of the bottom 99 percent of earners, but just 11 percent of the 1 percent, and just 9 percent of the top 0.1 percent of earners, according to one recent paper .

* * *

Another fascinating nugget from the PayScale report asks Americans if they consider themselves under employed. That is, do they feel underpaid or unfulfilled for their level of education?

If you feel underemployed in your current job, the good and bad news is that you're not alone. At least 20 percent of every age group, at every level of educational attainment, is disappointed by their pay or job. But underemployment declines by education level.

Percent of Americans Who Consider Themselves Underemployed, by Education Level

It's fairly surprising that business-school graduates are more likely to feel underemployed than a typical college graduate, even though they earn much more. Perhaps it's an acknowledgement that underemployment is not a fixed definition, but a sliding scale that moves with our expectations.

Percent of Americans Who Consider Themselves Underemployed, by Degree

Underemployment is considered a less empirical measure of the labor market than unemployment, because what it is measuring most accurately is personal disappointment . You'd think expectations rise with education attainment. But self-reported underemployment declines as you spend more years in school. Maybe that's another bit of data suggesting that, both financially and emotionally, a college degree still pays off.

( Top image via kmlmtz66 / Shutterstock.com . Charts via PayScale . )

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Quit Your Job

Derek Thompson, The Atlantic — Fri, 07 Nov 2014 10:00:00 -0500

My friends sometimes approach me with career anxieties, under the false impression that writing about economics makes somebody a good career advisor. My counsel is typically something like optimistic incrementalism. Don’t quit your job, mastery comes with time, job satisfaction comes with mastery...that sort of stuff.

When the same friends ask my roommate, an entrepreneur building a financial services app, they’re whiplashed with radical optimism. Get the hell out of there! Quit if you have to! You’ll be happier doing just about anything else!

I never said it outright, but I assumed that my cautious approach was more responsible, even if it seldom proved more inspirational. But according to a new study of youth unemployment by economists Martin Gervais, Nir Jaimovich, Henry Siu, and Yaniv Yedid-Levi, my incrementalist advice, while appropriate for the worst periods of the Great Recession, isn’t so great, overall.

Instead, there is what you might call a "dream-job premium.” Jumping between jobs in your 20s, which strikes many people as wayward and noncommittal, improves the chance that you'll find more satisfying—and higher paying—work in your 30s and 40s.

"People who switch jobs more frequently early in their careers tend to have higher wages and incomes in their prime-working years,” said Siu, a professor at the Vancouver School of Economics. “Job-hopping is actually correlated with higher incomes, because people have found better matches—their true calling.”

"True calling" is a messy term, since (a) job mastery, (b) job satisfaction, and (c) compensation don’t always line up. There are talented yet miserable investment bankers (a and c, not b), talented and fulfilled public-school teachers (a and b, not c), and several shan’t-be-named general managers of professional sports teams (b and c, not a). But overall, Siu said, adults who switch jobs multiple times are more likely to find a position in their prime-work years where they earn a higher wage and have a lower chance of quitting. (As always, causality is difficult to prove: Perhaps pro-active behavior leads to both higher wages and a greater likelihood of quitting.)

Young people are more likely to be unemployed. Siu's paper tries to understand why. Is it because they have a harder time finding work or because they’re more likely to leave jobs? I always assumed that youth unemployment was higher because it was harder to find a job than keep one, and most people graduating from college or high school are starting at zero.

Siu informed me that I have it backwards. "You can quite clearly see the reason young people have relatively higher unemployment is not because they have a harder time finding jobs,” he said. “Actually, they find jobs with greater ease than somebody who is 45 or 55. But they are more likely to leave a job."

In conversations with executives at larger companies about Millennial behavior, I've heard over and over that young people today are more likely to quit quickly. This has been used as an excuse to not training young workers—why invest in an asset that's going to disappear in a few months, anyway? But Siu said that young people aren't any more likely to quit today than they were in the 1970s or 1980s. But once they leave, young people today are more likely to try out an entirely new job. (For the technical-minded: the "separation rate" for young people isn't radically different than it used to be, but "occupational switching" is up.)

In Siu's words: "For the HR person considering a young worker, it’s not true to say, 'If I hire them they are more likely to leave my firm.' That likelihood hasn’t changed. But if that person does leave my firm, the next job is more likely to be totally different." Young people aren't quitting more. They're experimenting more.

Youth unemployment has been particularly elevated in the last few years. Young people are the only age group that has seen falling real wages since 2008, according to Pew, and there is really very little good to say about the labor market of the last few years, particularly with regard to wage growth. But, if you squint really hard, there is a silver lining to the fact that youth unemployment is typically elevated. It shows young people treating the labor market appropriately—as an laboratory for trying a few jobs rather than chain themselves to the first company that returns their phone call.

"There’s still this antiquated notion that success is a stable labor force attachment, and then you get to your 50s and 60s, and you’re golden with the pension plan and that’s it,” Siu said. "The US labor market is much more fluid than that. There is more movement in between jobs. The fact that young people have higher unemployment than others is, to the extent that it’s due to [switching jobs], a good thing."

(Image via schatzy/Shutterstock.com)

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One Simple Trick to Make People Approve of Government Spending

Derek Thompson, The Atlantic — Mon, 03 Nov 2014 19:00:00 -0500

What's the largest category of government spending?

If you ask a normal person, she might tell you it's Medicare (close), Defense (closer), or even foreign aid (c'mon). But there's another category of the budget that's even larger. The trick is, it's not a form of spending at all. It's called tax expenditures .

When the government writes a law that takes your money, that's a tax. When it creates an exception to that law, it's a tax expenditure. To take a simple example: You pay taxes on your work compensation—like Social Security taxes and federal income taxes—but you don't pay taxes on employer-sponsored health insurance, even though that's clearly a part of your compensation. This is an exception to the rule: a tax expenditure.

When you stack up all the exceptions carved into our tax structure—the health care exclusion, the mortgage interest deduction, the lower rate on capital-gains income, and more—you have a pile of money taller than any other program in the government budget.

Big Tax Spender

What's the matter with this enormous pile of money? Maybe nothing. The tax expenditure tower includes programs like the Earned Income Tax Credit, which has done wonders to reduce poverty for low-income families. But some budget experts worry that this shadow budget has become an unwieldy excuse for politicians to sneak in new spending programs without using the word spending .

In fact, there's new evidence that Americans are much more likely to accept a new government program if it's described as a "tax break" rather than "spending", even when the programs are identical. Yale Law School students Conor Clarke, a former Atlantic staff editor, and Edward G. Fox , ran a series of online survey experiments that asked people what they thought of various spending proposals. The only variable they changed was whether the proposal was framed as a tax break or direct spending. Consider how you'd respond to the following questions:

"Would you support the government offering annual $1000 cash payments to each family, to help cover rent?"
"Would you support reducing each family's taxes by $1000 to help cover rent? If a family owes less than $1000, they get the rest in cash."

These two plans are identical. But respondents didn't see it that way.

People were 10 percentage points more likely to support policies expressed in tax terms. They were also more likely to say that a $6 billion direct subsidy added "a lot" to the federal deficit than an identical $6 billion dollar tax break. It didn't matter how much additional information the researchers provided (in some instances, they clarified that a $1000 refundable tax credit means: you get $1,000 ). People just liked the idea of a tax expenditure more.

In the early 1980s, Amos Tversky and Daniel Kahneman popularized the idea of "framing effects," demonstrating that people are more likely to support a drug that saves one-third of a group of mortally ill patients than a drug that will kill two-thirds of them. Just as those subjects supported a drug with positive framing ( think of the lives you'll save... ), Clarke and Fox's respondents seem enamored by policies that emphasized savings over new spending.

These days, it's en vogue to consider the American electorate to be clueless glob of near-random, hyper-emotional convictions. Academics have shared this opinion of the country for some time. In 1960, researchers from the University of Michigan published a famous study noting “the general impoverishment of political thought in a large proportion of the electorate,” adding that “many people know the existence of few if any of the major issues of policy.” Clarke and Fox's work is more subtle. The fact that people can have starkly different support for identical programs with slightly different descriptions suggests that even well-intentioned and well-informed voters have a hard time escaping the pull of positive framing effects.

The effects add up, too. The tax-expenditure budget unwinds some of the progressivity of the tax code. More than 50 percent of the benefits of tax expenditures go to the richest fifth of the population, thanks to tax breaks on investment income, savings, and mortgage interest. The richest fifth of the country sees almost all (93 percent) of the benefit of the tax break on capital gains, and the richest 1 percent enjoys two-thirds of that benefit. Something tells me that if the capital gains tax were framed like that, it wouldn't be considered quite so untouchable.

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Presidential Speeches Were Once College-Level Rhetoric—Now They're for Sixth-Graders

Derek Thompson, The Atlantic — Tue, 14 Oct 2014 18:00:00 -0400

Is political rhetoric becoming less sophisticated over time? One interesting way to answer the question is to study the complexity of presidential speeches, from George Washington's first inaugural to the recent addresses of Barack Obama.

To do that, the site Vocativ used the Flesch-Kincaid readability test, which was developed by the U.S. Navy in the 1970s to ensure the simplicity of military instruction manuals. The Flesch reading formula is not a measure of vocabulary or the technical construction of sentences. Instead, it measures two variables—syllables per word and words per sentence. So a cryptic sentence like this:

As mist slunk in, the oiler on the rig slewed the boom of the crane.

actually has a lower (simpler) Flesch score than this sentence of equal words:

The cat was so happy after eating the goldfish that it made a big smile.

because happy , after , eating , and goldfish have two syllables, even though they're far more common than one-syllable words like slunk , rig , slew , or boom .

With that caveat out of the way, here is a look at presidential-speech complexity over time. Lower scores mean simpler speeches. Bigger circles mean longer speeches.

Simpler Times: Presidential Speeches Through History

The upshot is that up to the 1850s, most presidential addresses were what modern Flesch scores would consider college-level rhetoric. Since the 1940s, presidential addresses have often been at a sixth-grader's level.

And despite the impression that Obama restored old-fashioned flourishes to the White House after George W. Bush, Flesch scores grade both candidates at about the same upper-elementary-school level. (If you object to the comparison for whatever reason, recall that Flesch measures words and syllables, not quality of inspiration.)

Modern Presidential Speeches: GWB vs. BHO

Three observations for the road:

1. Presidential rhetoric is becoming simpler because the country is becoming more democratic.

“It's tempting to read this as a dumbing down of the bully pulpit,” says Jeff Shesol, a historian and former speechwriter for Bill Clinton. “But it’s actually a sign of democratization. In the early republic, presidents could assume that they were speaking to audiences made up mostly of men like themselves: educated, civic-minded landowners. These, of course, were the only Americans with the right to vote. But over time, the franchise expanded and presidential appeals had to reach a broader audience.”

Indeed, the major shift downward in presidential complexity happens around 1920, which coincides with at least four positive developments: (1) the 17th Amendment allowing direct election of senators in 1913; (2) the 19th Amendment giving women the right to vote in 1920; (3) the movement to make public education mandatory in the 1920s; (4) the invention of radio, which passed 50 percent penetration among US households by the 1930s. TV passed the 50-percent threshold in the early 1950s. *

2. Complex speeches aren't better speeches. In fact, they're worse.

The most memorable lines in modern rhetoric—"Ask not what your country can do for you, ask what you can do for your country"; "The only thing we have to fear is fear itself"; —are remembered precisely because they're simple enough to understand, memorize, and talk about. Practically every modern sage of language—George Orwell, Steven Pinker, William Safire, Strunk & White—advises non-fiction writers to express themselves with simple language. Even if you like purple prose in your long-form narrative non-fiction, you'll agree that it's pleasing to hear complex policy points in clear sentences and parallelisms. (It's hard to rule out that the dense language of the 19th century was pleasing and cogent in its own time.)

3. Even if you think that democratization and simple language aren't always good, there is no chance you want presidential candidates talking like George Washington.

Here is the beginning of President Washington's first inaugural address, which he delivered to a joint session of Congress, where there were no recording devices to beam the words to a broader audience. The Flesch reading-ease formula ranks it as one of the most difficult speeches in American history. We'll go sentence by sentence. (W arning : These are absurdly long, excruciatingly overwrought, unforgivably dense sentences)

Among the vicissitudes incident to life, no event could have filled me with greater anxieties than that of which the notification was transmitted by your order, and received on the fourteenth day of the present month.

Okay so: "I received a letter a few weeks ago that made me conflicted."

On the one hand, I was summoned by my Country, whose voice I can never hear but with veneration and love, from a retreat which I had chosen with the fondest predilection, and, in my flattering hopes, with an immutable decision, as the asylum of my declining years: a retreat which was rendered every day more necessary as well as more dear to me, by the addition of habit to inclination, and of frequent interruptions in my health to the gradual waste committed on it by time.

"You interrupted my exquisite and much-needed retirement by electing me as your president."

On the other hand, the magnitude and difficulty of the trust to which the voice of my Country called me, being sufficient to awaken in the wisest and most experienced of her citizens, a distrustful scrutiny into his qualifications, could not but overwhelm with despondence, one, who, inheriting inferior endowments from nature and unpracticed in the duties of civil administration, ought to be peculiarly conscious of his own deficiencies.

"Folks, it's hard to be the president."

George Washington deserves to be remembered. But this, the first chapter of U.S. presidential-speech history, is duly forgotten. The gradual simplification of political rhetoric is, even Washington might agree, one of the less despondent vicissitudes incident to life.

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Why New Ideas Fail

Derek Thompson, The Atlantic — Fri, 10 Oct 2014 12:00:00 -0400

In 2007, Steve Ballmer, then-CEO of Microsoft, emphatically predicted that Apple's new phone would fail. "There's no chance that the iPhone is going to get any significant market share," he said. "No chance."

The volume of Ballmer's voice makes him a popular target in technology, but he wasn't an outlier, just the loudest guy in crowd of skeptical experts. RIM CEO Jim Balsillie said the iPhone would never represent "a sort of sea-change for BlackBerry." Cellphone experts writing in Bloomberg , PC Magazine , and Marketwatch all said it would flop .

No one had seen something like the iPhone before. One large screen? With no keypad? That tries to be everything at once, but actually offers a poor call service, slow Internet speeds, and worse camera quality than your existing devices? The experts were certain: This will not work.

Everybody knows the end of that story. The failure forecasts failed.

To be fair, predicting the future is hard. But what if the industry experts here were wrong about the iPhone, not just because of the uncertainty of predictions, but also because they were experts ? What if they were blinded by their own knowledge, so confident in what was already working that they couldn't contemplate the feasibility of something new? In 1997, Clayton Christensen coined the term "the Innovator's Dilemma" to describe the choice companies face between incrementally improving their core business (perfecting old ideas) and embracing emerging markets that could upend their core business (investing in new ideas).

But what if the innovator's dilemma is part of something bigger—a creator's dilemma, an innate bias against novelty?

Indeed, it turns out that our aversion to new ideas touches more than technology companies. It affects entertainment executives deciding between new projects, managers choosing between potential projects or employees, and teachers assessing conformist versus non-conformist children. It is a bias against against the new. The brain is hardwired to distrust creativity.

***

The physicist Max Planck put it best: "Science advances one funeral at a time.”

One place to watch the funeral march of science is America's peer-review process for academic research, which allocates $40 billion each year to new ideas in medicine, engineering, and technology. Every year, the National Institutes of Health and the National Science Foundation review nearly 100,000 applications for funding. The vast majority—up to 90 percent in some years—are rejected. For many breakthrough ideas, this selection process is the difference between life and death, financial backing and financial bankruptcy.

What sort of proposals do NIH evaluators approve? It’s a critical question for scientists. And the answer is nobody knows. Submissions receive such widely varying treatment that the relationship between evaluators' decisions is “perilously close to rates found for Rorschach inkblot tests,” according to a 2012 review .

A new ingenious paper raises a dangerous question: Are expert evaluators subtly biased against new ideas?

Researchers Kevin J. Boudreau, Eva Guinan, Karim R. Lakhani, and Christoph Riedl recruited 142 world-class researchers from a leading medical school and randomly assigned them to evaluate several proposals. Sometimes, faculty were experts in the subject of the submissions they read. Often, they were experts in other fields. But in all cases, the experiment was triple-blind: evaluators did not know submitters, submitters did not know evaluators, and evaluators did not talk to each other.

The researchers found that new ideas — those that remixed information in surprising ways — got worse scores from everyone, but they were particularly punished by experts. "Everyone dislikes novelty,” Lakhami explained to me, but “experts tend to be over-critical of proposals in their own domain." Knowledge doesn’t just turn us into critical thinkers. It maybe turns us into over -critical thinkers. (In the real world, everybody has encountered a variety of this: A real or self-proclaimed expert who's impatient with new ideas, because they challenge his ego, piercing the armor of his expertise.)

Experts might be particularly biased against new ideas*, but most people aren't too fond of creativity either, either. In fact, they can be downright hostile.

A 1999 study found that teachers who claim to enjoy creative children don't actually enjoy any of the characteristics associated with creativity, such as non-conformity. A famous 2010 study from the University of Pennsylvania showed that ordinary people often dismiss new ideas, because their uncertainty makes us think, and thinking too hard makes us feel uncomfortable. "People often reject creative ideas even when espousing creativity as a desired goal," the researchers wrote. People are subtly prejudiced against novelty, even when they claim to be open to new ways of thinking.

***

How should creative people fight this widespread prejudice against creativity? Perhaps by disguising their new ideas as old ideas. If people are attracted to the familiar, it’s crucial for creative people to frame their ideas in ways that seem recognizable, predictable, and safe.

We're not prejudiced against all creativity, Karim Lakhani told me. In fact, his team studying academic submissions found that slightly novel medical proposals got the highest ratings. The graph below shows evaluation scores on the Y-axis plotted against the measured novelty of each submission. The overall trajectory is downward. Newer ideas generally got worse ratings. But you'll notice that something important is happening at the left end of the curve ...

Gimme Something New (But Not Too New)

... the line goes up. Indeed, that small bump at the beginning suggests there is an "optimal newness" for ideas that lives somewhere between the fresh and the familiar, Lakhami said.

In Hollywood, the "high-concept pitch" offers a useful example. Film producers, like NIH scientists, have to evaluate hundreds of ideas a year, but can only accept a tiny percentage. To grab their attention, writers often frame original ideas as a fresh combination of existing ideas. "It’s Groundhog Day meets War of the Worlds!” O r “It’s Transformers on the ocean!" In Silicon Valley, where venture capitalists also shift through a surfeit of proposals, the culture of the high-concept pitch is vibrant (Airbnb was once eBay for homes; Uber, Lyft, and Zipcar were all once considered Airbnb for cars; now, people want Uber for everything).

Creative people often bristle at the suggestion that they have to stoop to marketing their ideas. It's more pleasant to think that one's brilliance is self-evident and doesn't require the gloss of sales or the theater of marketing. But whether you're an academic, screenwriter, or entrepreneur, the difference between a brilliant new idea with bad marketing a mediocre idea with excellent marketing can be the difference between success and bankruptcy.

American culture worships creativity, but mostly in the abstract. Most people really don't like new ideas that sound entirely new, particularly the experts that often have to approve them. The trick is learning to frame new ideas as old ideas—to make your creativity seem, well, not quite so creative.

( Image via Peshkova / Shutterstock.com )

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A Formula for Perfect Productivity: Work for 52 Minutes, Break for 17

Derek Thompson, The Atlantic — Thu, 18 Sep 2014 11:00:00 -0400

Sometimes, productivity science seems like an organized conspiracy to justify laziness.

Clicking through photos of cute small animals at work? That's not silly procrastination, Hiroshima University researchers said. Looking at adorable pictures of kittens rolling helplessly in balls of yarn heightens our focus, and the "tenderness elicited by cute images" improves our motor function on the computer.

Going on long vacations? You're not running away from your responsibilities. Studies show that long breaks from the office reboot your cognitive energy to solve big problems with the mental dexterity they deserve.

Working from home? Shut down your boss's rude accusations that you're too slothful to put on a pair of pants in the morning by handing him this 2013 study of Chinese call-center employees, which found that "tele-commuting" improved company performance. (Actually, don't hand it to him. That would require going into the office.)

The scientific observation underlying these nearly-too-good-to-be-true findings is that the brain is a muscle that, like every muscle, tires from repeated stress. Many of us have a cultural image of industriousness that includes first-in-last-out workers, all-nighters, and marathon work sessions. Indeed, there are many perfectly productive people that go to the office early, leave late, and never seem to stop working. But the truth about productivity for the rest of us is that more hours doesn't mean better work. Rather, like a runner starting to flag after a few miles, our ability to perform tasks has diminishing returns over time. We need breaks strategically served between our work sessions.

So what's the perfect length for a break? Seventeen minutes, according to an experiment released this week.

Telling people to focus for 52 consecutive minutes and then to immediately abandon their desks for exactly 1,020 seconds might strike you as goofy advice. But this isn't the first observational study to show that short breaks correlate with higher productivity. In 1999, Cornell University's Ergonomics Research Laboratory used a computer program to remind workers to take short breaks. The project concluded that "workers receiving the alerts [reminding them to stop working] were 13 percent more accurate on average in their work than coworkers who were not reminded."

It seems unlikely that there is one number representing the ideal amount of time for every employee in every industry to break from work. Rather than set your stop-watch for 17:00 when you get up from your desk, the more important reminder might be to get up, at all. Indeed, the most productive employees don't necessarily work the longest hours. Instead, they take the smartest approach to managing their energy to solve tasks in efficient and creative ways.

Perhaps managing our office energy is a lost art. In the mid-1920s, an executive in Michigan studying the productivity of his factory workers realized that his employees' efficiency was plummeting when they worked too many hours in a day or too many days in a week. He instituted new rules, including an eight-hour work day and a five-day work week. "We know from our experience in changing from six to five days and back again that we can get at least as great production in five days as we can in six," he said. "Just as the eight hour day opened our way to prosperity, so the five day week will open our way to a still greater prosperity."

That company turned out to be one of the most profitable companies of the mid-twentieth century, and the boss at its helm is remembered as one of the most talented executives in American history. His name was Henry Ford.

(Image via Laborant/Shutterstock.com)

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The Procrastination Doom Loop—and How to Break It

Derek Thompson, The Atlantic — Wed, 27 Aug 2014 11:00:00 -0400

When I woke up this morning, I had one goal: Finish this article by 11 a.m.

So, predictably, by the time it was 10 a.m., I had made and consumed two cups of coffee, taken out the trash, cleaned my room while taking a deliberately slow approach to folding my shirts, gone on a walk outside to clear my head, had a thing of yogurt and fruit to reward the physical exertion, sent an email to my aunt and sister, read about 100 Tweets (favorited three; written and deleted one), despaired at my lack of progress, comforted myself by eating a second breakfast, opened several tabs from ESPN.com on my browser ... and written absolutely nothing.

What's the matter with me? * Nothing, according to research that conveniently justifies this sort of behavior to my editors. Or, at least, nothing out of the ordinary for writers , as Megan McArdle has explained on this site. I'm just a terrible procrastinator.

Productive people sometimes confuse the difference between reasonable delay and true procrastination. The former can be useful ("I’ll respond to this email when I have more time to write it"). The latter is, by definition, self-defeating (“I should respond to this email right now, and I have time, and my fingers are on the keys, and the Internet connection is perfectly strong, and nobody is asking me to do anything else, but I just … don’t … feel like it.”).

When scientists have studied procrastination, they've typically focused on how people are miserable at weighing costs and benefits across time. For example, everybody recognizes, in the abstract, that it's important to go to the dentist every few months. The pain is upfront and obvious—dental work is torture—and the rewards of cleaner teeth are often remote, so we allow the appointment to slip through our minds and off our calendars. Across several categories including dieting, saving money, and sending important emails, we constantly choose short and small rewards (whose benefits are dubious, but immediate) over longer and larger payouts (whose benefits are obvious, but distant).

In the last few years, however, scientists have begun to think that procrastination might have less to do with time than emotion. Procrastination "really has nothing to do with time-management,” Joseph Ferrari, a professor of psychology at DePaul University, told Psychological Science . “To tell the chronic procrastinator to just do it would be like saying to a clinically depressed person, cheer up .”

Instead, Ferrari and others think procrastination happens for two basic reasons: (1) We delay action because we feel like we're in the wrong mood to complete a task, and (2) We assume that our mood will change in the near future. See if you recognize any of these excuses...

If I take a nap now, I’ll have more focus later.
If I eat this cake now, that’ll be my cheat for the month, and I’ll have more willpower.
If I send a few Tweets now, my fingers will be used to typing sentences, which will make this article easier to write.
If I watch TV now, I’ll feel relaxed and more likely to call the doctor’s office tomorrow morning.

This approach isn’t merely self-defeating. It also creates a procrastination doom loop. Putting off an important task makes us feel anxious, guilty, and even ashamed, Eric Jaffe wrote . Anxiety, guilt, and shame make us less likely to have the emotional and cognitive energy to be productive. That makes us even less likely to begin the task, in the first place. Which makes us feel guilty. Which makes us less productive. And around we go.

The Procrastination Doom Loop

One thing that can cut through the doom loop is the inescapable pressure of an impending deadline. So what's the best way to design deadlines to make us more productive?

* Besides practicing the cliché of writing about one's procrastination as an introduction to analyzing it.

People often schedule reminders to complete a project significantly before the deadline, so they have time to complete it. But this strategy often backfires. Some practiced procrastinators are both “present-biased” (they choose ESPN.com or BuzzFeed over work every time) and overconfident about their ability to remember important tasks, according to a new paper by Keith M. Marzilli Ericson . As a result, they often put off assignments, only to forget about it until long after the deadline. Procrastination and forgetfulness are bad, independently. Together, they're a double-headed meteor hammer smashing your productivity to tiny little bits.

To hack your way to productivity, you could schedule one-shot reminders as late as possible—even slightly after you were supposed to start the project. Not only will the last-second reminder and looming deadline break the doom loop and shock you into action, but also it won’t give you time to put off—and, potentially, forget about—the task.

For pathological procrastinators, recognizing that we need deadlines to bind ourselves to our responsibilities is the first step. The second step is recognizing that our own deadlines are less effective than other people's deadlines.

In one famous experiment, Dan Ariely hired 60 students to proofread three passages. One group got a weekly deadline for each passage, a second group got one deadline for all three readings, and the third group chose their own deadlines. Readers were rewarded for the errors they found and penalized a dollar for each day they were late. Group II performed the worst. The group with external deadlines performed the best. "People strategically try to curb [procrastination] by using costly self-imposed deadlines,” Ariely and his co-author Klaus Wertenbroch concluded, "and [they] are not always as effective as some external deadlines."

A more theoretical approach, from Yanping Tu and Dilip Soman writing in the new Journal of Consumer Research, aims to change "the way consumers think about the future." Tu and Soman point out that people have a habit of managing goals and tasks in specific time categories—we plan activities by the day, expenses by the month, and resolutions by the year. This way of thinking can separate us from future selves. When we say “I’ll start that project next week,” or “I’m starting my diet next month," what we're really saying is "I hope that after an arbitrary amount of time, I will be in a better mood to bind myself to this task."

One study in their paper asked consumers to open a savings account within six months. One group was given a December deadline in June and a second group was given a January deadline in July. Although each group presumably contained a similar number of procrastinators, significantly more people in the first group chose to open their account immediately. When the deadline was a calendar year away, people were more likely to rationalize that they could put it off.

Finally, procrastinators are more likely to complete a piece of work if they’re persuaded that it’s not actually work. In one study reviewed by Jaffe , students were asked to complete a puzzle, but first they were given a few minutes to play Tetris. "Chronic procrastinators only delayed practice on the puzzle when it was described as a cognitive evaluation," he wrote. When scientists described the puzzle as a game, they were just as likely to practice as anybody else.

( Image via Paul Schlemmer / Shutterstock.com )

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Study: Nobody Is Paying Attention on Your Conference Call

Derek Thompson, The Atlantic — Fri, 22 Aug 2014 09:00:00 -0400

It's 3:15 p.m. on a Wednesday, and I am deep, deep inside the guts of BaseballReference.com, the statistical mecca for MLB fanatics, conducting an exhaustive investigation on an issue of national importance: What was the greatest pitching season of all time? Was it Bob Gibson in '68? Pedro Martinez in 2000? Clayton Kershaw in 2014? Browser tabs and Excel charts extend across my two computer screens like the dashboard of a junior analyst. The answer is coming into focus when, suddenly, a voice from the phone shocks me back into reality...

... "Derek, what do you think? Derek. Derek! "

Oh, that's right. I'm on a conference call.

"Sorry, I was on mute," I say.

I wasn't on mute. What were they talking about? From my shallow working memory, I can make out a few words spoken while I was looking up Martinez's strikeout numbers— headlines? narrative structure? something about never again using personal anecdotes as ledes ?—and I take a deep breath.

"Well, I guess I'd like to begin by piggy-backing on that last point about anecdotal ledes..."

***

The best studies are the ones that tell us we are not alone. A new survey from Intercall, the largest international conference call company, finds that when I occasionally zone out on conference calls, I'm participating in a national pastime, not unlike baseball.

More than 60 percent of Intercall's respondents admitted to doing other work or sending an email while on a conference call. More than half the people on the line are eating (hopefully on mute). Just under half are in the bathroom (hopefully on mute!). One in five are shopping. One in 11 are exercising . Six percent are taking another call. Suddenly I don't feel so bad about looking up Clayton Kershaw's ERA+.

Conference calls might be one of the least exciting aspects of office life, but their necessity points to a positive development in the workplace.

When routine-based assembly-line work dominated the economy, important decisions were made by a small group of executives and delegated down to the drones. Today, the decision-making process at many large corporations is diffuse and democratized, so that many lower- and mid-level employees have responsibilities that would have seemed absurd at old companies. With this democratization of power comes a heightened need for bosses to constantly check in, assess, manage, and tweak strategy. As teams spread out across the country, the conference room has given birth to the conference call.

But even the executive that stands to benefit the most from our conferencing addiction says that it is killing our productivity. Rob Bellmar, Intercall's executive vice president of conferencing and collaboration, told Harvard Business Review that the fault is not in our attention spans, but in our approach to work. "Part of the problem comes from too many meetings," he said. "This leads people to confuse activity with productivity." In three separate surveys , managers said that between 25 and 50 percent of their time in meetings was a waste of time. A large review of studies on meeting productivity similarly found that meetings, although critical to workflow across many industries, repeatedly tested as being net drains to productivity. One 1982 study found that mid-level managers spend the equivalent of one full year of their full working-and-non-working life in meetings.

The academic literature doesn't say that meetings are intrinsically pointless. After all, that conclusion wouldn't make any sense. There are some questions that require input from entire teams, or from individuals from multiple divisions, and it would be absurd to call for dozens of one-on-one meetings rather than call a single get-together. An often-cited 1982 study with the catchy title Are N + 1 Heads Better Than One? found that "group performance was generally qualitatively and quantitatively superior to the performance of the average individual." The key is knowing when to let individuals work individually and when to pool together their ideas. “Decades of research have consistently shown that brainstorming groups think of far fewer ideas than the same number of people who work alone and later pool their ideas," wrote the Washington University psychologist Keith Sawyer.

The meetings will continue, whether or not my morale improves. I will do my best to keep the BaseballReference.com dalliances down to a single tab.

( Image via zhu difeng / Shutterstock.com )

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The Thing Employers Look For When Hiring Recent Graduates

Derek Thompson, The Atlantic — Tue, 19 Aug 2014 10:00:00 -0400

When I was 17, if you asked me how I planned on getting a job in the future, I think I would have said: Get into the right college. When I was 18, if you asked me the same question, I would have said: Get into the right classes . When I was 19: Get good grades.

But when employers recently named the most important elements in hiring a recent graduate, college reputation, GPA, and courses finished at the bottom of the list. At the top, according to the Chronicle of Higher Education , were experiences outside of academics: Internships, jobs, volunteering, and extracurriculars.

Chronicle of Higher Ed

"When employers do hire from college, the evidence suggests that academic skills are not their primary concern," says Peter Cappelli, a Wharton professor and the author of a new paper on job skills . "Work experience is the crucial attribute that employers want even for students who have yet to work full-time."

Before you retreat to the comment section and scream at me for saying that school, classes, and grades don't matter, let me say: I don't think this should be interpreted as a sign that schools, classes, and grades don't matter. Employers might not crave academic skills. But students often qualify for the "right" internships by getting good grades in relevant classes at challenging schools. In this calculation, a strong academic record buys you a strong experience record, so when an employer is evaluating your internships, he's indirectly evaluating your academic achievements, too.

But the U.S. economy isn't a monolith: Do some industries care more about internships than others?

The Chronicle has the answer: Media and communications companies are gaga for internships and uniquely indifferent toward your classes. Health care companies care the most about your major, and white-collar businesses care the most about your GPA. Ironically, education employers care the least about grades.

Chronicle of Higher Ed

Can America's employers really be that indifferent toward what college I attend? Could they really read "Harvard University" and just see "University"?

Consider the larger picture. Every year, about 3 million people start their first year of college in this country. About 1,600 of them enroll at Harvard. That means that, relatively speaking, nobody goes to Harvard. Harvard does not exist. Add up all the capital-E Elite schools that jostle for the top 20 national universities and colleges in US News' annual rankings , and you've reached just 1 percent of the higher-ed population.

So, while it's true that some consulting firms and banks take first-years exclusively from these campuses, they are fishing in a minuscule pond. Their elitism is diluted in a survey that spans the entire economy.

When you drill down into how a college's reputation affects hiring, employers' mean rating of "regionally known" colleges and universities was practically indistinguishable from their rating for elite schools.

Chronicle of Higher Ed

Internships occupy an awkward place in our labor market and in our lives. Many of them are indistinguishable from jobs; but while unpaid jobs are considered immoral, unpaid internships are considered common. On a day-to-day basis, even desirable internships can resemble worthless months of servitude, where meaningless tasks interrupt long stretches of numbing boredom. Yet, employers will eventually regard these agonizing periods of numbing boredom to be the most significant professional moments of our college career.

( Top image via hxdbzxy / Shutterstock.com )

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