Dr. Chhoda explores the truth that there are ‘two Americas’, and how this pandemic shines a light on the difference between labor on one side and software / automation on the other side. Dr. Chhoda explores:
1. THE TWO AMERICAS
2. EFFECTIVE TAX RATE OF LABOR VERSUS AUTOMATION
3. YOUR NEXT MOVE
You have probably figured out by now that my channel is not like other channels. It’s about the truth, and it’s what some would want hidden from you. I want to get this information out because this is the information that has set my free. If this illness had not happened, you could have gone your entire life without knowing this.
There are 2 sets of rules in America. I don’t mean this in a conspiracy theorist kind of way, I mean this in a factual way.
The pandemic has led to unemployment of workers in the service sector, retail and other fields at a scale and with a swiftness unprecedented in the historical record. They are cashiers and janitors, construction laborers and secretaries. For many, their prospects were already diminished by decades of technological progress. They are, disproportionately, women and minorities, precisely the groups that were already saddled with a spectrum of pay and wealth gaps even before the pandemic hit.
What’s making things worse for these workers and their families is that the pandemic is also accelerating the arrival of remote work and automation. It is a turbo boost for adoption of technologies that, according to some economists, could further displace lower-wage workers. It could also help explain the “K” shaped recovery many pundits have observed, in which there are now two Americas: professionals who are largely back to work, with stock portfolios approaching new highs, and everyone else.
Even before the pandemic, “Automation can explain labor share decline, stagnant median wages and declining real wages at the bottom,” says Daron Acemoglu, a professor of economics at the Massachusetts Institute of Technology. “It’s the bottom that’s really getting hammered.”
Payroll and related taxes have held steady over the past 40 years, but the effective tax rate on automation has fallen.
Those workers aren’t likely to find any near-term relief. In a recent essay, David Autor, an economist at MIT, and Elisabeth Reynolds, who leads the Task Force on the Work of the Future at MIT, outlined the ways they believe technology-driven trends unique to this pandemic might continue to disrupt the lives of some of America’s most vulnerable workers, even once things get back to some semblance of normalcy.
In the past 10 years especially, the economy is no longer creating steady jobs for low-skilled, low-wage workers as fast as it once was, he adds.