 So you're unemployed, but you're getting cash, but you don't have child care, or you're essential, you're not getting hazard pay. Sometimes arrangements for child care have been worked out, but generally you still have to figure out your own child care, and you're worried about getting sick on the job. It's a bifurcation, and it's not entirely obvious, and I'm sure it goes both ways depending on everything, but would you rather have been a retail worker or taking unemployment, or would you have rather been a home health care aide, keeping your job, keeping your health benefits important, but being worried about getting sick? My name is Suresh Naidu. I'm a professor of economics and public affairs at Columbia University. My research interests are broadly in political economy and historical labor markets, so I've studied everything from American slavery to the effects of democracy on economic growth, to monopsony and modern day labor markets and labor unions, and so kind of the whole spectrum of things. You know, we're asked, oh, what does the pandemic reveal about the economy? But in some ways, you know, the pandemic has changed the economy in lots of ways, and there's new things that we've learned about not even the underlying structure of the economy, but just actually the economy under COVID. So, I mean, I think one of the interesting things is particularly, you know, this is what someone on the internet called the first service sector recession, where it's really like a huge shock to the particular kinds of services that have to be delivered in person. So, this is why the hemorrhaging of jobs in retail and restaurants, which are really low-wage sectors, has been so salient. But then on the other side of that, we have other service sector jobs that are deemed essential work, nurses, healthcare aides that some of them are also low-wage jobs. And those are, you know, those jobs have not disappeared. But I think because these labor markets are tied together, those jobs, which you'd expect to see a big increase in wages due to all the hazards of working in a care-related or service-related profession during a pandemic, we haven't really seen much evidence of that. So, there were some big retailers, for example, like Amazon, that gave a big hazard pay bonus or Kroger's. And then they kept it for about six months and then took it away, even though COVID had gone nowhere. And so, the absence of that kind of, you know, compensating differential that we call in economics, I find interesting. And it suggests, and because I kind of constantly have labor market power on the brain, it's sort of, I read it as kind of evidence that because the unemployment rate is so high, even essential workers don't have the bargaining power that lets them kind of ask for higher wages in exchange for this job. So, in a normal sort of tight labor market, if you were worried about getting sick on your job, you'd basically go to your employer and say, I need a raise or I'm out of here. But in an environment with, you know, 8%, 7%, 10% unemployment, that threat to walk away from your employer just isn't really credible. And so, your employer doesn't really face any pressures to raise your wages, even though your risk of getting sick on the job is a lot higher. And part of that is an interesting thing, which I think also points to the divergence and what gets called the K-shaped recovery in the low wage labor market. So, for example, you'll have a number of low wage workers that have just lost their jobs, but then they got eligible for a really big UI increase. And I think it's not as appreciated as it should be just how generous the CARES Act was, particularly on the unemployment insurance margin, which basically it topped up unemployment insurance by $600 a week for unemployed workers, which just thinks $600 a week for a worker making the federal minimum wage at $40 a week, that's effectively $15 an hour at $40 a week and not working. And so, we just have, I think, a whole group of generally low wage poor workers that, as a result of CARES, got a pretty big bump up in their income. And now, that has to be traded off against, I think, some of the other things that are happening inside the household, which is, for example, the closing of schools and child care, and I'll say this as a parent, it's just a huge blow to not just even have the regular child care support. And so, another part of it is this closing of the public goods that the government offers. And so, you have to have for a whole bunch of these workers you're getting a combination of, so you're unemployed, but you're getting cash, but you don't have child care, or you're essential, you're not getting hazard pay, sometimes arrangements for child care have been worked out, but generally, you still have to figure out your own child care, and you're worried about getting sick on the job. And so, I think it's a bifurcation and it's not entirely obvious, and I'm sure it goes both ways, depending on everything, but would you rather have been a retail worker taking unemployment, or would you have rather been a home health care aid keeping your job, keeping your health benefits important, but being worried about getting sick in this super hazardous environment, and ineligible for UI. And I think this is an interesting thing that around the world, and it's something I would like to study more, is that you're not eligible for unemployment insurance if you voluntarily quit. And so, that means that where unemployment insurance could be a backstop for workers against all kinds of abuses of employer authority or poor working conditions, is just not allowed to be. And there's exemptions in some places for you can quit for health or safety reasons, but then you generally have to get a labor lawyer to fight for you. And so, that kind of thing where our social safety net is kind of deliberately designed to not provide a backstop to worker bargaining power, I find that that's one thing that's been revealed during the pandemic. I'm sort of an optimist in that I think America has no problems that five years of basically full employment wouldn't fix. Maybe that makes me a pessimist, but if you could actually figure out how to deliver five plus years of unemployment at close to two or three percent, I'm enough of a believer in the forces of supply and demand to think that that would drive up wage growth, that would just be overall economic growth. It would basically bring down all kinds of balance sheet to GDP ratios. And that would be the great reset in some way. His would be just kind of a boom somewhat similar to the post-war boom of just many, many years of pretty high employment. And how we get there, I think, is the question. And it does sort of feel like it's not clear that the standard channel of liberalized credit to the banks and let the banks push it out to private employers and they'll create jobs. It's not clear that that works anymore and so that we need, so I think like the ambitious fiscal policies need to be there. But I think complimenting just the amount of money, the real American state capacity and the ability to deliver that money and turn it into jobs and turn it into useful goods and services, that really needs to be built back. And that's kind of undergone, I think, a long set of deterioration. We can just see it with the vaccine rollout. We can see it with all kinds of things that just kind of the bureaucratic machinery of getting things done quickly. The American state just needs to be able to do that and needs to be able to do that partly just to get to this full employment thing, but partly because we need, obviously, a whole set of things from the government in the way of efficiently provided public goods and effective regulation that we demand more competent technocracy in the domains that we want technocracy to work in. It should be competent and accountable. It still seems that the only degrees that qualify you for a job in the federal government are an economics PhD or a JD. And I don't understand why the diversity of academic portfolios going into the government isn't larger. Here's just throwing a balloon in the air, which is that the rise of computer scientists, both in kind of everything in our world, obviously now depends on computer science in a really deep way. But in particular, a lot more social science is getting done by computer scientists. And they're bringing their own kind of metaphors and analytical tools to doing social science. And I don't think they're going to replace economics or sociology, but I do wonder if the metaphors and analogies that come from our increasing use of tools from computer science and just collaborations with computer science will wind up meaning that we're thinking about institutional design in different ways. So for example, instead of trying to figure out the optimum best, we start thinking about engineers guaranteeing the worst case can't be too bad. And just kind of there's a different library of tools that computer scientists bring to studying problems that I wonder if they'll become kind of the an architecture of a social theory as well in the way that economics wasn't just like about figuring out the optimal tax. It became like a metaphor for philosophers or political scientists to use to study all kinds of problems. I wonder if we're going to kind of get there with computer science is kind of like the master metaphor.