Saturday, January 06, 2018
Warren Buffett: I have good news. First, most American children are going to live far better than their parents did. Second, large gains in the living standards of Americans will continue for many generations to come. Some years back, people generally agreed with my optimism. Today, however, pollsters find that most Americans are pessimistic about their children's future. Politicians, business leaders and the press constantly tell us that our economic machine is sputtering. Their evidence: GDP growth of only 2% or so in recent years.
To all this good news there is, of course, an important offset: in our 241 years, the progress that I've described has disrupted and displaced almost all of our country's labor force. If that level of upheaval had been foreseen -- which it clearly wasn't -- strong worker opposition would surely have formed and possibly doomed innovation. How, Americans would have asked, could all these unemployed farmers find work?
We know today that the staggering productivity gains in farming were a blessing. They freed nearly 80% of the nation's workforce to redeploy their efforts into new industries that have changed our way of life.
You can describe these develop-ments as productivity gains or disruptions. Whatever the label, they explain why we now have our amazing $59,000 of GDP per capita.
The market system, however, has also left many people hopelessly behind, particularly as it has become ever more specialized. These devastating side effects can be ameliorated: a rich family takes care of all its children, not just those with talents valued by the marketplace.
In the years of growth that certainly lie ahead, I have no doubt that America can both deliver riches to many and a decent life to all. We must not settle for less.
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