Sorry…We Can’t Go Back

Troy Gilliam
Nov 29, 2016 · 8 min read

A look into the economic underpinnings of the 2016 election.

I, like many Americans, was shocked with the outcome of the 2016 presidential election. And as I am sure was the case with many people, opinions were quickly shared with family and friends on social media. It was during one of these discussions that a family member had a comment along the following frame of thought:

“You need to think more about the USA. If you would stop with liberal left-wing thinking, your children could have a better future”

This comment was from a very vocal, very right-wing family member just after the election. Some may see it as inflammatory, while others see it as true. However, it did something very important to me…it caused me to think deeper about various issues that were highlighted during the election and how those issues may or may not be addressed (for the purpose of this post the economical issues).

Before I get started, let me be honest and say that I disagree with the choice that was made this election. President-elect Trump ran a campaign of fear, divisiveness, bigotry, racism, and lies. This strategy has had consequences, from peaceful protests against his election turning violent, to bigoted and racist empowerment by some of his supporters. And while I personally find these post-election outcomes very sad, if not inevitable, for me there was something deeper about why I felt this choice was wrong. This is what I would like to explore.

Please…Can We Just Go Back?

America, like most countries, can now access a global economy. The driving factor behind this has been the adoption of capitalism and free market economies. It became a true bedrock of American economic philosophy under Reagan to help define the participants of the Cold War. Capitalism won, and with its subsequent adoption it lifted hundreds of millions of people out of poverty and into prosperity. It also further propelled America as the economic leader of the world.

But capitalism has drawbacks, as no system is perfect. It plays by some very simple rules which are 1) Supply and Demand, 2) Be Profitable (mainly achieved by increasing revenues and decreasing costs). Capitalism is not an American function. It does not inherently care about borders or keeping all people employed. It has no loyalty. Recent technological advances have further increased the ability of all countries to access and share global goods, services, capital, and labor pools. In addition, these global markets increase the complexity of the economic landscape, which is both good (powerful nation states that are deeply connected trade partners don’t easily start wars with one another), and bad (complexity can make outcomes difficult to anticipate).

America has been feeling the negative aspects of capitalism and globalization for a while, but these aspects were more sharply in focus during the election. Communities have been hit hard as jobs have been replaced by automation, sent offshore, or closures. In fact, many industries have faltered due to the efficiencies of capitalism. (Coal is a good example. Both Trump and Clinton made significant efforts to address the concerns of communities that relied on the coal industry. While some blamed the EPA or regulations, the biggest contributor to the decline of coal is that capitalism identified better opportunities.)

This anxiety has seemingly formed the heart of the Trump message…

“Make America Great Again”, “Bring back American jobs”, “The US doesn’t win anymore’

These election slogans, goals, and sentiments are now well known. They help form the backbone of Trump’s political philosophy and promises. But they share something in common. They cry for a return to a time that Trump supporters remember. A nostalgic plea to bring back peace a time of peace and prosperity when America truly lead the world, powered by a nation of patriotic and hard-working people. In fact, this strategy to lure voters utilized by both Republicans and Democrats. Let’s be honest, what politician wouldn’t promise to try and provide Americans with more jobs. But in this past election these rallying cries have hit over-drive.

However, here is the crux. Someone can cry slogans such as “America First” or “Make America Great Again”, but the core is isolationism and nationalism. To draw back from the global economic stage would be a mistake. History has proven time and time again that periods of nationalism and isolationism lead to greater instability, even though it may feel “right”, and be a natural reaction.

But there is another reason why this mindset is a mistake. It won’t work. Something far more powerful is looming.

Sorry, We Can’t Go Back!

As discussed above, American jobs have taken a hit due to pressures exerted by global capitalism. A good example of this is manufacturing, which has been a major talking point of this election. Here is a chart showing manufacturing jobs in America.

Bureau of Labor Statistics

Since its peak just before 1980, manufacturing jobs have seen significant loss, especially after the year 2000 (though it has increased slightly in the last few years). However, America’s manufacturing output has followed a different trajectory:

Manufacturing jobs decrease but manufacturing output increases? Trade contributes somewhat to the problem, but this is really the result of increased technology in the form of automation, robotics, and software. This is nothing new. Technology has been accelerating economies for a long, long time. The industrial revolution did not displace workers but in fact created many more opportunities.

(Also, despite all the despair the US still employs over 12 million people in manufacturing.)

Unlike previous era of technological advancement, many are concerned that this time the technology revolution is different. Not only are we still replacing humans with mechanical muscle (and doing this better than ever), but we are starting to replace our minds. Here are some examples of both:

The list goes on and on. Automation in certain labor pools will happen faster than others, but the trend is alarming in that humans are innovating themselves out of jobs. This is especially true against the backdrop of an ever expanding population that continues to expand the labor pool and diminish opportunities or wages (that pesky Supply/Demand rule).

This is why we can’t go back. NAFTA, TPP, and all the other trade deals can be thrown out or re-negotiated, but unless we choose to regulate our own innovation and ingenuity, we will continue to feel the effects of economic strain as we develop greater levels of automation, software, and artificial intelligence. This is especially true for the areas where more jobs are “routine” and ripe for technology replacement. These areas, mainly in the Rust Belt and Mid West, will continue to feel the effects of the very economic anxiety that supposedly drove them to vote for Trump.

It’s this concept that has lead to my concern during the election beyond the divisive rhetoric that so hideously stained the election. The consequences of this concept didn’t quite form in my mind until I really got to thinking about the meaning behind the comment that introduced this post.

“You need to think more about the USA. If you would stop with liberal left-wing thinking, your children could have a better future”

This represents a hardened mindset that is not only blindly partisan, but dismissive of reality. Its hypocrisy is centered on not acknowledging that for decades voters who are now screaming to “Make America Great Again” are the very same ones who voted for the economic system that lead to their present reality of insecurity and doubt. If anything, it is emblematic of the greatest political failure of the last 40 years by both parties…that our politicians embraced and implemented the economic systems that generated wealth and prosperity, but either blatantly ignored or ineffectively communicated the negative impacts that would impact a large number of Americans.

What happens when we can’t go back and millions of people are further disillusioned or experience more hardship. The disillusioned are a very large group of voters and will have influence for years to come, and as the saying goes, “Misery loves company”. It is concerning what other extreme options voters may succumb to in the future. We may not be able to go back economically, but we certainly can go back socially or culturally as voters veer towards backlash.

“You need to think more about the USA. If you would stop with liberal left-wing thinking, your children could have a better future”

I love America. I want it to succeed, for its people to be happy and prosper, and for it to be an example of how the world can progress forward. But I also understand that America is now entwined in a complex world, which itself is a good thing, and that in order for myself and my family to succeed it has be viewed realistically within that context. I don’t have the luxury to just retire and chant “U.S.A” for some feel good patriotism. My job isn’t to sit idly by and score some internet burn points for my “team”. If deeper considerations of how the world economy is structured and evolving makes me a “liberal elitist” than so be it.

Ultimately, we all will have to navigate this ever complex world together. A deeper discussion will be needed, one that will require us rise above the deep partisanship currently infecting the country. It will require an examination of our definition self-worth, our willingness to share resources, and how societies evolve to structure themselves.

Some will not be able to have these discussions, but I remain hopeful that the majority of us can.

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Coming Soon…A look into the non-economic drivers of the 2016 election

“It’s The Economy, Stupid!”…Isn’t It? An additional concern is that if Trump’s election was mainly about economic anxiety then many of his supporters would have been just as concerned with technology and automation as they were with immigrants, if not more so. Suffice it to say that there is case to be made that for a large block of voters “Make America Great Again” was based on loss of culture and racial grievances versus economic concerns.

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References & Links:

I recommend anyone to refer to the various links throughout the article and below.

Technology and Automation

The Future Of Global Capitalism