Ever since inequality began rising in the U.S., in the nineteen-seventies, people have debated its causes. Some argue that rising inequality is mainly the result of specific policy choices–cuts to education, say, or tax breaks for the wealthy; others argue that it’s an expression of larger, structural forces. For the last few years, Tyler Cowen, an economist at George Mason University and a widely read blogger, has been one of the most important voices on the latter side. In 2011, in an influential book called “The Great Stagnation,” Cowen argued that the American economy had exhausted the “low-hanging fruit”–cheap land, new technology, and high marginal returns on education–that had powered its earlier growth; the real story wasn’t inequality per se, but rather a general and inevitable economic slowdown from which only a few sectors of the economy were exempt. It was not a comforting story.
“Average Is Over,” Cowen’s new book, is a sequel to, and elaboration upon, “The Great Stagnation.” In many ways, it’s even less comforting. It’s not just, Cowen writes, that the old economy, built on factory work and mid-level office jobs, has stagnated. It’s that the nature of work itself is changing, largely because of the increasing power of intelligent machines. Smart software, Cowen argues, is transforming almost everything about work, and ushering in an era of “hyper-meritocracy.” It makes workers redundant, by doing their work for them. It makes work more unforgiving, by tracking our mistakes. And it creates an entirely new class of workers: people who know how to manage and interpret computer systems, and whose work, instead of competing with the software, augments and extends it. Over the next several decades, Cowen predicts, wages for that new class of workers will grow rapidly, while the rest will be left behind. Inequality will be here to stay, and that will affect not only how we work, but where and how we live.