Sunday, August 11, 2013

Have skills, will travel. If I have no skills ...?

There are not only two Americas, but two worlds.  One world of residents for whom geography is not a restriction, and the rest whose lives are highly restricted by geography. 

Consider the recent appointment of Raghuram Rajan as the head of India's central bank.  Rajan, who was born in India and educated at one of its best universities, came to the United States for higher studies.  His accomplishments after the formal education include having been the chief economist at the International Monetary Fund, an endowed chair professorship at the University of Chicago, and for having correctly predicted the Great Recession even as the world was partying away like there was nothing to worry about.  In a couple of weeks, the fifty-year old Rajan will take over as India's banker-in-chief.

Rajan's ease at transcending geography might be an exception only with respect to his varied accomplishments at the highest levels.  But, otherwise, it neatly fits into the increasing trend of "have skills, will travel" where those who can are no longer restricted by the geography of their birth.  Think about the numbers of actors and directors in Hollywood productions, or players in Major League Baseball, and you get even more examples of "have skills, will travel."

On a much, much reduced size, I too, of course, fit into that same category--born in India and coming to the United States by banking on my skills.  At the thirtieth reunion of our high school class, which was in 2011, I was amazed at how much of the globe we classmates had covered with our respective domiciles, leave alone the travels.  One classmate who also came to the US for higher studies is now an American expat heading a division of General Motors in China!

However, it is only one small part of humanity that has been liberated from the tight embrace of geography.  The lives of most of the rest depend not only on the countries in which they are born, but even the regions and states within those countries in which they live.

Last term, in my economic geography class, a sharp student often applied the lessons to the case of Coos Bay, where he was born and raised.  The more we got into the concepts, the more he worried that the world of economic opportunities seemed to be shrinking for those without any special talent, and for communities like Coos Bay that flourished on what was once an asset--natural resources.

In the often told story of the "American Dream," one did not necessarily have to have any exceptional skill in order to lead a successful middle-class life.  To paraphrase Woody Allen's comment in a different context, 80 percent of success in achieving that American Dream was merely showing up.  The unskilled and the semi-skilled, too, showed up, did whatever work they had signed up for, and could return to their homes with white picket fences and children and dogs.  It was possible because of the opportunity that the geography--the country in which they were born--provided.

We now live in a world that is very different.  Tasks that require unskilled or semi-skilled labor are rapidly being automated or being sent away to other geographic areas where the cost of getting those tasks done will be much lower.  And, unlike with a highly skilled Rajan who can pack up and leave to wherever the next enticing offer comes from, the less specialized have considerably fewer economic opportunities.  Sometimes the prospect is of no economic opportunity at all--which is what Coos Bay residents, for instance, worry about.

Over the last few years, public policy discussions at DC and at Salem have not reflected these phenomenally rapid changes in global economic geography and how it affects the typical American who has been raised with the hope and guarantee of the “American Dream.”  Unemployment and underemployment, stagnant wages, the widening gap in terms of income and wealth that is simplistically reduced to the phrase “99 percent”, are all reflective of the geographic shifts in the global economy.

It is a harsh reality that a geographic accident of “born in the USA” is no longer the guaranteed pathway to the American Dream.  It is also a wonderful reality that another geographic accident of born in India or anywhere else is no longer a limitation.  The less our elected officials talk about these, the more I become the messenger with a message that depresses students in the classroom.

Shakespeare wrote centuries before this level of globalization that the world is our oyster.  Despite his immense imaginations, even he might be surprised at how much that observation is true now, and how awful life can become for those trapped in the sands.  


Zach said...

If only people in Coos Bay would realize that the Oyster is no longer a primary source of resource extraction! I think change for any stagnant community comes not only from discarding romantic notions of the "American Dream" and acclimating to our globalized economy, but also bringing in policy-makers that understand the needs of the community. I learned recently that a majority of the members that sit on the board of the Port of Coos Bay live in Portland! How can they know what is best for a community they don't live in?

Adapting to a globalized economy and finding the unique skills necessary to be productive and transnational members of our world requires a change that goes beyond simply bringing in new business to struggling communities, but also changing the deeply-rooted cultural ethos of over-reliance on natural resources. It is even more striking that in communities like Coos Bay, local governance has been controlled by families that have been in the area for over one hundred years. WE NEED CHANGE!

Sriram Khé said...

Hey, didn't you vote for hope and change? you mean to say nothing out of it? muahahaha!

Port of Coos Bay board members living in Portland? really? they might as well be in DC! Or, better yet, in China. At least China will explore ways in which it can make money with the port!

I am doing my part, Zach, and looks like you are doing yours ... if only we can get a lot more students and politicians to understand the reality and adjust to it .... (note that I am not including faculty in that list--they are a worse self-serving bunch than the politicians!!!)

Ramesh said...

Unclear why the American Dream is souring simply because others are coming to the party. Everything that the Dream stood for - hard work, entrepreneurship, meritocracy, etc etc, are all still competitive advantages of the US. Its not easy, sure, but Americans are still better placed than most to succeed. So stop feeling down and get going ye men.

Sriram Khé said...

I am with you, Ramesh, that the US retains all those advantages.
But, the establishment continues to mislead people into thinking that merely born in the US is a guarantee of an easy, affluent life, as it was for most into the 1950s and 60s ... instead, my point is the need to understand, not simply note in the passing, that there are lot more eager people "coming to the party" ...

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