Job Problem brings out the Wadhwas in people

Why Andy Grove Is Wrong About Job Growth - BusinessWeek...by Vivek Wadhwa, who appears to be well-qualified to teach in the BeckU.

Vivek Wadhwa, yet another proponent of free market economics, wrote in BusinessWeek that Andy Grove was wrong about jobs. Dr. Grove led Intel - a company that arguably has been at the core of technology innovation, and has given the U.S. the technology edge over the past thirty years. To call Dr. Grove wrong is arrogance- Wadhwa has never created jobs on the same scale as Dr. Grove.

Wadhwa recycles the same old argument that since the large companies get large chunks of revenues from other countries, a trade war will cost American companies money and Americans jobs. What he fails to observe is the % of profits that are generated in the U.S. versus other markets. A crooked argument which any smart person would not put forward.

While Dr. Grove talks about manufacturing jobs- the type of jobs Intel created in its fabs, Wadhwa dismisses the argument by citing the worker conditions and suicides at Foxconn.

So what is Wadhwa's Rx? "We need to have the concept of lifelong education become part of our culture." When folks with PhDs are unable to find jobs, the message to them is - lifelong education? Perhaps he is unaware that continuous process improvement and lifelong learning have been embraced by many firms- some of whom have laid off the very employees who participated in these activities. Another Wadhwa's Rx is "...Clearly, not everyone is cut out to be an entrepreneur, but a significant proportion of the workforce can be taught to start successful companies and create jobs." In other words, the jobless should become entrepreneurs and hire others. What kind of an idiot would use the phrase "a significant proportion of the workforce?" What is significant?

After making a couple of other incorrect recommendations, Wadhwa closes with "...we need to provide incentives to American companies to keep research in the U.S..." Appears that free market proponents like Wadhwa never hesitate to ask government to provide incentives. Perhaps he is unaware that the U.S. is running massive deficits, and providing incentives and tax breaks has not produced much job benefits (the failure of American Jobs Creation Act of 2004 to create jobs is an example).

Wadhwa falls into the halo trap that is described brilliantly by Phil Rosenzweig - he justifies his claims with the line "My team's research has shown that most high-growth companies are founded by middle-aged workers..."

Dr. Andy Grove made excellent points in his piece. The government needs to get money from firms that generate revenues here but have their employee base in other countries, in order to provide incentives to firms to create jobs locally. Whether the money should come from higher taxes on imported products, as proposed by Dr. Grove, or from higher taxes on profits can be analyzed.