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A journalist who has decades of grim tendencies sees things align for metheric growth.
By Neil Irwin
The economy of the century has been a series of two decades of blows to the stomach.
The century began with economic triumphalism in the United States, with the feeling that economic cycles had been defeated and that prosperity relied on a blindly bright future; instead, a slight recession followed by a weak recovery followed by a currency crisis followed by weak ones The recovery followed a pandemic-induced collapse. A few smart years just before the pandemic aside, two decades of crushing inequality and disappointing expansion: an economy in which a consistently weak labor market left great human potential untapped, contributing to social and political dysfunction. .
These two decades almost exactly coincide with my career as an economic writer, so among my colleagues, I have a reputation for writing stories ranging from the sinister to the dark and the scary.
But as might seem in this pandemic, I’m starting to get optimistic, it’s a feeling, because a lot of other people are suffering and because for much of my career, a dark attitude has been the right one.
Forecasting is a complicated task, of course, and many things can happen and make the coming decades so bad or worse than those of the recent past, but this optimism is not just about the main points of the new pandemic aid law or the politics of the moment, but comes from a diagnosis of 3 problematic megatendences , all linked.
There has been a shortage of inventions that are turning the economy, those driving immediate expansion into the economics’ production potential There has been an excess of global labor due to an era of immediate globalization and technological replacement that has reduced the bargaining force of staff in rich countries and there has been a steady lack of demand for goods that government policy has been unable to address.
However, there is not a single explanation as to why these negative trends have continued their course, there are 17 of them.
1. Tomato sauce could possibly sink
In 1987, economist Robert Solow said, “You can see the era of PC unless it’s in productivity statistics. “Companies were making extensive use of immediate innovations in computing power, however, the economy in general was no more productive.
This research began in the mid-1990s, technological inventions in chain of origin control and industrial production allowed companies to make more profit from each and every hour of painting and from each and every dollar of capital expenditure. a vital explanation for why the economic boom of the late 1990s.
Solow’s paradox, as would later be called the concept underlying his quotation, reflected one concept: an innovation, but revolutionary, would have little effect on the economy as a whole without delay after its invention. have and how to use them, and years more to fix disorders and lower costs.
At first, it can even decrease productivity! In the 1980s, corporations that tried new PC technologies needed to employ new armies of programmers, as well as others, to keep old systems redundant.
But once these obstacles are overcome, innovation can spread at breakneck speed.
It’s like the song: “Shake and shake the bottle of tomato sauce. First, none will come, then a lot of things. “
Or, in a more formal sense, economists Erik Brynjolfsson, Daniel Rock and Chad Syverson call it the “J-curve of productivity,” in which a new primary generation of multiple uses (they use synthetic intelligence as a new example), first depresses productivity, but over time triggers a much more powerful expansion in economic potential. It seems that corporations have made many paintings without return, but once returns begin to flow, they arrive faster than it seemed imaginable.
There are several spaces where innovation turns out to be of such magnitude, not just synthetic intelligence.
2. La 2020s battery generation is a bit like the microprocessors of the 1990s
Do you remember Moore’s law? It’s the concept that the number of transistors that can also be placed in a built-in circuit would double every two years as production generation improved That’s why you’d probably be dressed in a clock with more computing force than the devices sent by others. people in the area in the 1960s.
Battery generation is not at this rate, but it is not left behind: the value of lithium-ion batteries has fallen by 89% in inflation-adjusted terms since 2010, according to BloombergNEF, and is on the brink of additional drops. it has been manufactured in the solar cell box, broadering the prospect of more widespread cheap blank energy.
Another similarity is that microprocessors and batteries are not extremes consistent with it, however, technologies that allow many other innovations. Fast and reasonable PC chips have led to software that has revolutionized the fashion economy; Reasonable batteries and solar cells can lead to a wave of innovation in the way energy is produced and used. We are in the early stages of this process.
Stimulus bills would be $1,400 for maximum beneficiaries. Eligible Americans would also get the same payment for each of their children. To qualify for the full $1,400, a single user would want a source of adjusted gross income of $75,000 or less. of households, the adjusted gross income source is $112,500 or less, and for married couples who report together, this figure will be $150,000 or less. To be eligible for payment, a user must have a Social Security number. Read more.
Buying insurance through the government program known as COBRA would be much cheaper temporarily. The user would possibly have to pay at least 102% of the premium charge. According to the relief bill, the government would pay COBRA’s full premium from April 1 to September 30. September 30 would lose their eligibility for the free policy, and someone who voluntarily gave up their homework would also not be eligible. Read more
These credits, which are helping families offset childcare prices for young people under the age of thirteen and others dependents, would be particularly widened for a year without getting married. More people would be eligible and many beneficiaries would get benefits from a longer break. The bill would also make the credits fully refundable, which means you can collect the cash as a refund even if your tax bill is zero. “This will be useful for other people at the back of the ladder,” said Mark Luscombe, senior federal tax analyst at Wolters Kluwer Tax
There would be a lot for other people who are already in debt. You would not have to pay the source of income tax on the canceled debt if you qualify for repayment or cancellation of the loan, for example, if you followed an income source based on income. payment plan for the required number of years, if your school let you down, or if Congress or the President settles $10,000 of debt for a large number of other people. This would be the case with the debt cancelled between January 1, 2021 and the end of 2025 More information.
The bill would provide dollar bills in rental assistance and utility bills to other people in distress and in danger of being evicted from their homes. A bill of approximately $ 27 would go to emergency housing assistance. The vast majority would fill the so-called coronavirus relief fund, created through the CARES Act and distributed through state, local and tribal governments, according to the National Low-Income Housing Coalition. This is the most sensible of the $ 25 bill in aid provided through the aid plan followed in December. To get cash aid, which can only be used for rent, utilities, and other housing expenses, families would have to meet several conditions. The household income source cannot exceed 80% of the area median income source, at least one family member will have to be at risk of homelessness or housing instability, and Americans will be entitled to benefits unemployment or have experienced monetary difficulties (directly or indirectly) due to the pandemic. Assistance can only be provided for up to 18 months, according to the National Coalition for Low Income Housing. Low-income families who have been unemployed for 3 months or more would get prior assistance. Read more.
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