Obama's Jobs Plan Takes a Page From Marx

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Politics: The president has unveiled a plan to cut joblessness with an industrial policy from the 19th century. In this "new" economy, government will pick winners and losers for industry. It didn't work then, it won't work now.

Taking a cue from classical Marxist theory as well as vintage union organizing doctrine, both discounting the value of service work over manufacturing, we now see President Obama touting training for factory jobs over all others, pushing government spending in that area and calling it a jobs recovery plan.

"I see a future where we train workers who make things here in the United States, and continue a important and honorable tradition of folks working with their hands, creating value, not just shuffling paper," he said Wednesday at Northern Virginia Community College, urging students to pack up and go to ... Detroit.

As he announced his public-private "Skills for America" partnership to train and credential 500,000 students for jobs in industries favored by the Obama administration, it bears looking at how at odds this approach is to both history and economic reality.

"We know it means building the infrastructure, the roads and bridges, and manufacturing new products here ... that create good jobs," Obama said. "Above all, it means training and educating our citizens to out-compete workers from other countries."

The Bill Moyers crowd has been touting manufacturing-era nostalgia for years, claiming the world would go back on its axis if America could just shut its market and put everyone back into blue collars, turning gears and listening for the lunch whistle.

Fact is, the more advanced the economy, the greater percentage of the work force that moves out of manufacturing and into services.

Economists call this the "tertiary progression" of development - from farming and fishing, to the Industrial Revolution, to an advanced service economy. Every rich nation has followed this path - every one.

In the U.S., that move started not last decade but more than 70 years ago. In the U.S. there are six times more service workers than factory workers, boasting higher skills and per capita income. U.S. trade data consistently show U.S. surpluses in service exports across the board because that's America's competitive advantage.

Now the president wants us to "give back" all that white collar development and return to a simpler sort of economy premised on manufacturing - one that's more characteristic of today's China or Peru than a developed economy such as America.

Amazingly, he wants this even though he admits state-directed industrial policy has failed. "We've got a lot of programs out there," he said. "If a program does not work in training people for the jobs of the future and getting them a job, we should eliminate that program."

Which defies belief when one recalls he's holding up job-creating free-trade treaties with Colombia, Panama and South Korea for just such a useless training program called "Trade Adjustment Assistance," or TAA.

That program is so bad a 2008 American University study by Kara Reynolds and John Palatucci declared it "of dubious value in terms of helping displaced workers find new, well-paying employment opportunities." Obama is holding up a proven way to create jobs - trade deals - to expand TAA from $2 billion to $7 billion.

It's as if all the economic knowledge acquired in the course of the 20th century never made it to the Obama White House. Obama wants to pick industrial winners while the economy languishes from high taxes, massive new regulatory burdens and his failure on free trade.

The only logic that can explain this is that Obama means to spend more money on vocational education to prepare kids for work in industries dominated by unions - Obama's main base of political support.

Presumably, if enough community college students can be trained for traditionally unionized manufacturers, employers will have no choice but to hire them. That's a win-win-win-win for educational bureaucrats, unions, jobs and Obama's political prospects.

Too bad the rest of the economy - which accounts for three-quarters of all U.S. output - didn't make Obama's list of industrial winners.


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