Yesterday, Neel Kashkari, President of the Federal Reserve Bank of Minneapolis, spoke to the Rotary Club of Downtown Sioux Falls, South Dakota and then opened up the mic to questions from the audience. One question concerned today’s lack of true innovation rather than just innovations in social media. Kashkari responded as follows:
Kashkari: ‘This is a big complicated topic. A big question mark in the economics profession is why is productivity growth in the U. S. economy so low. It’s much lower than it has been in prior decades. And, we think, you pull out your iPhone or Twitter or Facebook – you think, wow, all this stuff is happening. Well, some experts say the things that we’re creating now – that we’re innovating now – just aren’t that impactful. They don’t really move the needle very much. So if you compare Facebook and Twitter, which seem pretty cool, to electricity or the internal combustion engine, or the airplane, it’s just not that important.’
Kashkari is on to something significant but we have to differ with him in this regard: this is not really ‘a big complicated topic.’ It’s a very basic concept: we are living in the most narcissistic era that America has ever experienced and it’s dragging down not only U. S. productivity but the country itself.
This post was published at Wall Street On Parade on August 8, 2017.
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