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November 22, 2010

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Sarah Wang

Hi Mr. Schoepflin,

I really enjoyed your article and I think being a freshman in university this sad moral of the story really irks me, academically and professionally. However, I have another point of view.

You said that hard work has its limits is a "cold economic fact". I'm in first year economics and we just finished our midterm which is probably why I remember this: we basically spent this entire semester learning about labor productivity.

There is this equation: y=aL + Bk +TFP where y is output, aL is the contribution of labor, Bk is the contribution of capital, and TFP is the contribution of the advancement of technology. I would like to solve the equation but I doubt anyone would care. What the bottom line is that, y, our output or GDP, will go up if we have more labor, capital, or technological advancement. However, the contribution of TFP to total output is 46 percent. It's more than either labor or capital individually. Moreover, when solving how much of labor productivity [output/worker] is made out of technological advancement/innovation, we find the answer to be 80%. 80% of more output per worker rests on better technology. And if we look at this equation closely we realize that hard work is indeed at play: more labor and capital are quantitative, whereas technological advancement is only possible when people work hard to innovate. I have a feeling that this is why, the US, has historically supported entrepreneurs.

I have hated the discipline of economics my entire life but this must be the most important equation of my academic career. Krugman listed numerous ways we can improve our output, but the only longterm solution is innovation. The golden age of capitalism [1950-1973] was a testament to this notion.

I know what I'm saying isn't probably exactly related to unemployment but I feel as long as there are people innovating, there will be the creation of new "basic industries" and thus more opportunities for work. And what fuels innovation? Education, for the most part, since it's obvious there are those few outliers who, by a sudden stroke of creativity, created innovations that have helped shape society. Since economics is based on the fundamental concept of resource scarcity, I hope that states around the world can focus on innovation: there is never a limit to humankind's intellectual capacity. Intellectual poverty is the only form of poverty that can be completely eradicated. I hope this, in turn, can translate to more funding and sponsorship of education.

From a sociological perspective, I completely agree with the fact that hard work, unfortunately, can only take you so far. I believe there's still hope for hard work in economics and I truly hope people take that seriously.

Just an opinion from a severely sleep deprived first-year student!

Looking forward to reading more of your thoughts,

Sarah

Kerry

Sarah,

I understand what you are saying, but I think that would only apply to when capitalism was in it's "Golden Age". Whose to say that if we do increase innovation that jobs will not be set overseas, or to another country like Maytag. Assuming that most of the workers in this clip lived in Newton, 5,000 jobs of the total 16,000 population were sent to Mexico. That's almost a third of the jobs lost in Newton.

I think capitalism is the problem. It might have worked well years ago, when mom and pop stores were competing with each other, but with larger corporations merging together, they are controlling supply and demand and thus the competition.

Increasing innovation is key in helping create new industries that lead to more jobs, but it must be supplemented with policy that keeps the jobs in the US. Otherwise, the power elite will stay wealthy by moving jobs to another country where work is cheap and exploitation is easy.

Wynne Schniper

Mr. Schoepflin,
I enjoyed your post and agree that hard work is not always enough to ensure success. In fact, I think that rarely is sufficient.

I have to ask, do we want a country in which Newton, Iowa citizens can depend on just hard work? What would it take to ensure that putting in a hard day's work at Maytag will result in success? It sounds a bit contrived to me.

I find it interesting that society looks for the results of a free market to be coupled with the safety net of socialism. I don't think America ever had its success handed to it by an economic policy. I have always thought that America's economic strength was the result of its citizens' individual efforts to succeed. The best policy was to not get in their way and foster as much competition as possible. I do believe that the way to grow a strong economy is to decrease government interference and make room for more personal freedom.

I can't say that pure capitalism is acceptable to our nation today. In order to really allow someone to succeed, we have to also allow that person to fail. The social disparity may be too much for our social conscience.

Therefore, the problem I see for our country's economy is finding a balance between not letting people fall down too hard while they find a way to personally succeed. We obviously can't trust Maytag, and the like, to always provide for our way of life.

Thanks,
Wynne Schniper

Lexie Cook

I think that the author has a very valid point here. I'm from a very small town such as Newton, Iowa, where there is pretty much one big business that employs many of our citizens. If that business were to get shut down, hundreds of people would be out of work. There are many other towns like this all across the country. Also, there are often reasons for being unemployed, such as a business shutting down. Like the author said, when there is only one person unemployed out of many, we blame the person and their character or work ethic. When it is a whole town, however, it is much easier to just blame it on the closing of a business or factory.

Nicole Bouwma

Mr. Schoepflin,
I enjoyed reading your article and agree with you one hundred percent. I like that you go straight through all the layers to the cold hard facts. THe lfact you just came out and said it leads me to admire you even more. Hard work however, may not always be financially benficial, but it is always self beneficial. No matter if you become some big shot rich man....you will know that you did what you could.

Hannah Reed

I believe that the author has a very good point. In a town if one person becomes unemployed many may say that it is his work ethics that got himself in the place he is in right now. But, say a big company employing many people were to shut down then the people would blame the company. The guy who got unemployed before would have thought that it is easier to blame one person when something little happens, But as son as something big happens then it is automatically the big corporations problem.

marlon brooks

good point about the one umployed lead straight to the point.

Joyce Harvey

I enjoyed this article. However sad but iit is our country's reality. The hopes and ecomomic dreams of a town such as Newton rested on the promises of politiacla campaigners who have won their races through their hard work and faux promise. Now they are losing hope daily and I agree with the citizens that it does not matter who controls the house the republicans or he democrats, what matters is that they work hard for the people of this country and work on re-establishing jobs and boosting the economy instead of allowing companies to pack up and go to another country where they will benefit because they don't have to pay a fair and competitive wage to its workers. Yes minorities may work hard for their money, but so do Americans. Politicians only avail themselves tot he public during election time, after that you don't see or hear form them until the next four years. lately the prharase hard work equals success now means hard work equals survival. The 60 minutes story is an eye opener for those who don't pay attention to what this countyr is going through, but it is mostly infuriating becuase its our ouwn politicians that cause us to suffer, they need to remember without the people they don't have a job so they need to put aside the political affliations and party divides and look at the bitg picture and come up with some realistic and wrkable solutions for our failing economy or the entire working class of America is going to end up on welfare.

Jaylyn Kelly

The economy of the United States is changing as society changes. The roles of many Americans are changing due to the conditions of the economy. How one gets a job has changed from just hard work to mostly jobs in the service industry.

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