0:36 Intro. [Recording date: January 20, 2011.] Steve is a self-avowed Keynesian, not one who finds it politically expedient. Philosophical, methodological, economic differences between us. We actually have a pleasant relationship, don't yell at each other, one we really appreciate. Very much so. Somewhat rare for people who disagree about their economic theories. Want to revisit some of the things we talked about in the past and see where we are in the economy. Thought we'd start with that. We are right about at the second anniversary of the Stimulus Package that was passed in February of 2009. At the time it was $700 billion and something; I think now it's accumulated to be a little over $800 billion, maybe $862 billion. Give me your assessment of what its impact has been. Has it worked? If not, why not; and how would we know? First off, let me say it's a hard question. In economics we all have this problem: What's the counterfactual? What would things have looked like had we not done this? That's the gold standard of being able to assess a major policy like this, and we don't have that. My own sense is it's done more or less what they said it would do in terms of the marginal effect. I don't remember the exact number of jobs they were talking about. Of course there is no exact in this kind of thing. In my assessment we would have had a much deeper recession without the stimulus package. Probably not talking about recovery at this point. If you put the two things together--the fiscal stimulus and the monetary actions--without those things I think we would be looking at a much, much deeper and more persistent problem. Facing some serious problems. In that sense, I think the stimulus has done what it was supposed to do. Well, let me back up on that. I think the stimulus has done what I would have predicted it to do, but it hasn't been adequate to turn the economy around in a significant way, and I think one legitimate criticism of the Obama administration's way of discussing this at the time, and I think this was the way they thought about it when they passed it, was that this was going to be a substantial help to the economy and that it would turn things around. I think they thought it was the right thing to do at the time. But I also think they believed that in a year or so of that passage the economy would be starting to recover fairly robustly. I bet they were pretty confident that by the 2010 mid-terms the economy would be looking fairly bright. I think they were wrong at the time. The evidence turned out to be wrong. I don't think it's because the stimulus failed. I think it's because a mainstream Keynesian perspective underestimated the problems that we face.

4:20 Let me challenge you on that. Picky point, but interesting methodologically. That has been the standard defense--the one you just gave: there were predictions made at the time that if we didn't pass the stimulus unemployment could reach as high as 8.5%, whereas it went over 10%. And when confronted with that, the people who made those predictions, one of whom is a first-rate academic economist, Christina Romer--working for the President, political role--ex post, she said: The situation was worse than we thought. Of course, that's possible. How would you know? What I find fascinating about these discussions is it's like saying the chemotherapy wasn't strong enough. Sometimes you can go in and look and see how bad it really was. Sometimes you can find out that you really misestimated, underestimated the severity of the problem. Here, what could possibly help us understand that other than the fact that the stimulus doesn't seem to have been as successful as it was forecast at the time? Good question, hard question. Really comes down to this issue of what is the counterfactual. In order to jump to the end of my thinking on that good question, on some level I think this is a matter of judgment, much more than we'd like it to be. You have to look at the basic logic of the underlying theory; you have to look at evidence, both current and in the past, which is going to be sketchy; you put all this together and there's going to be different ways of looking at the world, make a judgment call. In this particular case, I think part of what happened--the Obama administration said they would reach some number. I think it was eight and a half. Without the stimulus and then a lower number with the stimulus. I think 7%. It goes up to the low tens. I think if you look at data, that number understates the severity of the problem, what's happened in the work force. It probably effectively went higher than the low tens. I suppose that's prima facie evidence that things are worse than even what we thought was the worst-case scenario when they were making this forecast. I also think the persistence of this downturn, that things turned around so slowly. I was going back, looking at what people were saying; I found something, I think the spring of 2008, a little less than a year before the stimulus package passed; a statement by Ben Bernanke along the lines of: the economy might be in a recession--and as we know now we were in a recession starting late 2007--but by the second half of this year--2008--we will start to see growth resume. Well, the second half of 2008 was when we had the most spectacular failure since the Great Depression, and the economy literally fell off a cliff. Bernanke appointed by the Bush administration, and he's making these kinds of claims--I think there was a widespread tendency across the ideological spectrum in economics to underestimate the severity of what actually happened. I agree with that. Just a footnote on the 2008 story--of course, in the spring of 2008, Bush threw a so-called stimulus program of tax rebates. Not cuts in rates, but checks that had a disappointing impact on consumer spending but at the time was thought to help ameliorate the problem; and then few people foresaw the financial catastrophes. The other footnote I would add is that I don't think the economy went off a cliff in September or October 2008. Financial markets certainly struggled and it certainly made it harder for the economy to recover. I do think there is a tendency to overstate the seriousness of the situation we are in. I don't know how we would measure it. Let me back off of that a little bit. Maybe we tend to use the "off a cliff" metaphor a little too easily. I'll take that as a friendly criticism. That said, if I want to try to defend the position that if we look at economic activity--not just financial markets--GDP numbers and maybe more importantly the labor market in the fourth quarter of 2008, first quarter of 2009, it was awful. We were tracking Great Depression numbers at that point. On the employment data it's remarkable how closely we tracked them. Not for such a long time. By the spring or summer of 2009 we were starting to see things were stabilizing and we were pulling off that awful path of the Great Depression. But there was a period of approximately six months when things looked very dark.

10:10 Let me come back to this question of how would you know if things would have been worse. The alternative hypothesis of course is that the stimulus didn't work or made things worth. We non-interventionists have our own areas where we wave our hands. We talk about expectations and regime uncertainty, that government regulation intervention discourages risk-taking. And while I think that's true, we don't have a theory of the magnitudes of those things. It's always easy to invoke those; as some commentators have observed on my blog and maybe in podcast comments: there's always uncertainty. There's always changes in regulatory activity. So, just finding them convenient to invoke when things are going badly is a little bit of confusing causation with correlation, potentially. You can get some evidence on regulatory uncertainty. You can survey people--not the best method. It's one method Bob Higgs has used, WWII, Great Depression, interventions of the Roosevelt era and how people were alarmed by them. You don't know whether those responses were real or whether they were just strategic in how they answered. But I think you have the same problem as a Keynesian. When you say things were worse than we thought, there's no--what I'm trying to get at here is this metaphor of the health of the economy. Unlike the health of a body where pre-x-ray, pre-catscan, you'd have to do an autopsy to find out if things were worse than we thought--and in an autopsy you could actually look and you could see that the cancer had spread more widely or the tissue around the arteries were more hardened. I don't think we have anything remotely like that that could add content other than the empirical outcome. Which you invoke with: look how unemployment went. Let me go back to the point I was making; spring of 2008 and spring of 2009 or winter of 2009 in terms of the information people had. But what I'm invoking here as evidence that things are worse than many expected is that people were making public statements about what they expected the economy to do. I take them more or less at their word, that their forecasts were honest and not strategic. The forecasts for some time turned out to be grossly positive. So, there was a sense of disappointed expectations. I think we'd come out of this period of the Great Moderation period of macroeconomics: recessions are troublesome, we don't want to underestimate their social cost, but they tend to be relatively mild and relatively short; and in particular monetary policy is our mechanism that can mitigate the worst sides of the business cycle. I think this was the view coming in, the view Bernanke was reflecting in the spring of 2008. Might have stretched credibility a bit further by the spring of 2009 and late 2008 or when the original Obama policies were being settled right after the 2008 election. Christina Romer was reflecting, too: this economy will come around on its own but it could use some help. But they were too optimistic. I think the data show they were too optimistic. I think the evidence that things were worse than they thought is that the forecast came out differently. I suppose you would say that's a bit of ex post reasoning. This argument is subject to that criticism. Steve, you've got to let the host do some of the work here! You made a sensible, self-aware, humble comment so I thought I would follow your lead. People were making their forecasts and they turned out to be wrong. Pretty badly wrong; we're not talking about a little. Let's invoke the private sector. I think the point I could be making applies to the mainstream macroeconomic forecasting community. Absolutely. So, everybody's too strong. Maybe a few fringe Keynesians which I will sometimes associate myself with saying: We really were saying ahead of this whole thing, look out, it's going to be different this time. If you cut across the mainstream of the forecasting community, I think there was a reasonably tight sense that more or less corresponded to what Christina Romer was saying in January of 2009. Two criticisms. The left's criticism: We knew that the stimulus wasn't big enough but they couldn't get it through Congress so they settled for what they got and put a good face on it, but they knew all along it wasn't going to turn out very well. Don't know if that's true. Don't find it compelling. The other observation is that all those mainstream models are Keynesian in the sense that they anticipated some natural stable relationship between government spending and output--not just output but employment--and those didn't happen. Two interpretations. One is the models didn't apply to this particular time period, or the underlying situation was worse than we thought. Stuck. One of the themes listeners are aware of here is I'm increasingly skeptical of the scientific nature of economics. This would be an example of where I don't think there are any data that would let us resolve this dispute. I think it's philosophical. I don't know how to characterize it precisely, but I don't think if we had all the time in the world, you and I could come to an agreement on this. I suspect you are right. I have some sympathy. Question if there is a scientific economics; I join you in that questioning without having come to a personal conclusion on the answer. But to some extent my point about judgment applies. I think we are more in the world of a historian than the physicist. Our approach is going to be to pull the world together such as it is. There will some qualitative, some quantitative evidence; what people said, survey kinds of things. At the end of the day this is not going to be definitive and people are going to have to make a judgment. Much the way you might make a judgment about what are the forces that caused WWII or what was the motivation of the Civil War. Well said. Evidence: part of it, too, is the definitive one- or two-sentence story of this is what happened, we're not going to have here. But there are other aspects of the Keynesian story that fit. For example, if you talk to a classically or neoclassically oriented economist about whether markets are all in equilibrium; we measure a lot of unemployment but it's really voluntary in some sense, and ask what happens when government deficits go from 2-3% of GDP up to 10% of GDP, they say: My gosh, interest rates are going to skyrocket. Well, they didn't. We don't want to get into the arcane details of different models, but that is a fairly direct prediction of a Keynesian prediction when you are operating below full employment. Inflation slowed during this period of time even though we had all this expansionary monetary policy. There are these other pieces that don't directly say here we can see the evidence that the stimulus worked, but they do fall in line with the Keynesian perspective on what's happened. I'm not going to defend that particular version of the classical and neoclassical market that all markets are in equilibrium all the time. Of course, a monetarist--and this is an example of the unscientific nature of economics--will have a story, one of which is the banks are holding all their cash; people are anxious about the future; that's why we haven't seen the inflation, we're going to have it. You can always tell a story that fits the facts better than another story. I think that's what historians do. They tell stories. They marshal the evidence, and some stories are more convincing than others. Our understanding of history and economics moves forward in fits and starts and sometimes doesn't move forward at all. Just different story-telling. You and I come down on different sides of that judgment call, but I think the way we reach the judgment, we agree entirely.

20:17 Let's go back to the fundamentals of stimulus in Keynesian economics. Steve is a superb Principles teacher. I want to think of this as a textbook story for the moment. When we teach our students our models of macroeconomics, the Keynesian model talks about an insufficiency of aggregate demand and that government spending can fix that under certain circumstances certainly through borrowing money and spending it. I've posted on Cafe Hayek a lot of my puzzlement over these kinds of arguments. I don't mean this doesn't make sense; rather I'm skeptical about it so I want to try to get at where my skepticism has some traction or where I'm misinformed or misunderstanding. Tell me what the argument is for why the stimulus should have worked. Forget whether it actually did; talk about the logic of it. In some respects I'm going to go to some of the topics we just mentioned, the issue of demand or aggregate demand. It doesn't really matter whether the demand comes from the public sector or the private sector. I often have a discussion with people who are somewhat conservative ideologically, businessmen; and they say you sell more when people are coming through the door. Everybody says yes, of course that's true. Any sensible economic model is going to say you only produce what you can sell. You start from that intuition, though: the number of people who walk through the door and put their money on the counter is an important factor in how many workers you'll hire. More controversial point is there are times if you just look at the private sector itself, or you hold government constant, and demand--willingness to lay money down on the counter--falters from the private sector, that there is just an insufficiency of demand spread broadly throughout the economy. Without some outside force intervening either to gin up private sector demand or to create demand in the form of something like government spending, that business will simply not be able to sell enough output to fully employ the labor force. At the most basic Principles level, that's the simple intuition of Keynesian economics. Let's talk about some different forms of stimulus, taking that structure as correct. I always think of various ways we could increase spending. I think it's important to mention--I don't know if this bothers you or not, but it bothers me--when people confuse spending in nominal terms and income in nominal terms with well-being. Not just because money isn't all we care about--which is true--but also because we care about what our spending and access to goods and services actually is, not the dollar value attached to it. It's easy to increase total spending in the economy by printing money. Here are the experiments I have in mind. Case 1: we print money and give it to people. They find themselves holding more money than they expected, and they go out and spend it. Case 2: the government creates a project that has real economic value. It builds a road that serves an area that is underserved and so is a productive use of resources. The third would be it pays people to dig ditches and holes and fill them back in--a somewhat satirical example that Keynes used. Those three all increase aggregate demand. They strike me as very different, though. Are they different? Yes. Let me be clear. Hiring one group of people to dig a hole and another group to fill them back up again is one of the great red herrings of these debates in the past. I am not in favor of such fiscal policy. I heard Joe Stiglitz say live that even though that is not the best use of government money, it would still improve the economy. I think I'm inclined to say that at least from a debating point of view, that's not a good issue to even engage on. Smart. Let's talk about number 2: increase in government spending that produces a project of value. Let me argue that there are two things that come from that. One, we don't have to talk about Keynes or even macroeconomics. We can talk about public economics, which in the profession is microeconomic. Cost-benefit analysis. There are some things it's better for the government to do than others. We could have substantial differences about the details, whether this or that project meets the criteria; we probably would not disagree very much about the basic framework for making the evaluation. It could be, and many on the left argue a microeconomic argument, that we are underinvested in infrastructure, education, green technology. They may not make the argument this way, but if I were trying to clarify the underlying argument, I would say recession or not, it would be useful for the government to engage in this. Or not--and that's a debate one could have. But the argument often presented is: It's a twofer. You get a beneficial outcome like a green technology or a road you wouldn't produce privately but which has net benefits, and you stimulate the economy. Yes; it's that second stimulate-the-economy part. Here, I go back to my simple Keynesian intuition that if more people are coming through the door, that business will produce more and hire more people. There is no reason the demand has to come from the private sector. The government building a road which hopefully is of social value independent of the state of the economy--if it turns out that private sector demand is insufficient and we have involuntarily unemployed resources then the government's money is as good as anybody's money. Construction company will be motivated to employ those unemployed resources just as well. But that wouldn't be any different in Case number 1. In Case 1, the case where we just print money and give it to people, there are going to be people who show up at those stores asking for more goods. Shouldn't Zimbabwe have a booming economy? Nice rhetorical flourish, hold off on Zimbabwe. Let me broadly agree with you. There is an allocational difference. Basically saying if the government stimulates demand through an infrastructure project, that's helpful in bringing resources into use. If the government stimulates demand by putting more money in people's pockets and they will take that money to the stores and spend it, that also stimulates. The Keynesian part of that, to the first order, is similar. Allocational difference. And important issue, much understated--allocation matters. I am strongly of the view that the economy needed in the past years and still needs more demand stimulus. I don't have a strong opinion on whether that demand stimulus should be money in people's pockets that lets them on their personal, decentralized individual preferences decide how that money will be spent, so which kinds of businesses will be stimulated, versus a government allocation policy where it's a bureaucratic process that decides that. When I say bureaucratic, I suppose for your listeners, that's sounds like a nasty word. I don't mean to imply that. Political process that will decide how the allocation goes. In the broad sense, whether you print money and put it in people's pockets or whether you have government infrastructure programs--as a first order effect qualitatively the same. Could argue one more effective than the other; different dynamics. The kind of twofer argument people on the left would make is that we need more government activity, so this is a particularly good time to create these public goods which have been in deficiency for years. All sorts of nuance.

30:48 So here's the question, then. Let's now talk about the practical aspects of the $800 billion or so--by the way, it hasn't all been spent. People have said that the stimulus was poorly designed even from a Keynesian perspective, and what it was spent on was not particularly useful. So let me talk in terms of stimulating--forget the political side. About a quarter of the lost jobs from December 2007 have been in construction and manufacturing. A lot of jobs; a lot of carpenters out of work. A lot of tool and die people out of work. As a result of that--I may have this wrong, may be half. But hundreds of thousands of jobs have been, maybe more than a million, lost in those two sectors alone. Employment is way down. Part of it: when you build way too many houses, as part of the thing that kicked the problem off, you are going to find that the demand for building new houses--just had the recent data on housing starts, horrifically bad--if you are a carpenter it's going to be a long time between jobs unless you are one of the ones who is still working. Manufacturing: we've got a combination of effects, part of a long-term trend that started in 1950 away from manufacturing, partly I think because of tariffs we put on steel, partly because of increases in productivity, partly computerization playing a major role in reducing labor costs. In both cases you have people sitting around thinking: Should I go back to work with the skill that I have--say, carpentry, tool-and-die operator--or should I take a lower paying job and suffer with what I've got. The stimulus itself didn't go to create jobs for carpenters or tool-and-die operators, to take two examples. A lot of it went to the states to continue paying unemployment benefits, which is a nice thing if you are unemployed. It went to keep teachers and other state employees from being fired or taking pay cuts even, which obviously is politically attractive. I know that Washington University in St. Louis got some nice funds to increase medical research. But those aren't going to get to the folks who are unemployed. The way Arnold Kling talks about this on EconLog: There isn't a factory that produces GDP. We have very diverse economy. Sectors that are hurt are not going to be helped much by spending in other sectors. The other example I would give is geographic unemployment. Chart on metropolitan unemployment--very high in urban areas that had the housing boom and bust. California, Florida, Nevada, Arizona, Michigan--all have above average unemployment; others have below average unemployment. Yet the spending went out in different ways all over the country. Isn't it wrong to just think about insufficiency of aggregate demand? Largely I agree. Additional flexibilities in the economy by which the stimulus can be more effective than your last few minutes of comments might suggest. Would it be better for Keynesian designed stimulus, basically trying to raise demand, to be targeted to those occupations and regions that are most hard hit? I would say, Yes. I think that would be better. You can imagine political problems. If you just said: California, Florida, Arizona, Nevada that we really need to help. Politically tough sell. Moral hazard issue: this is where people were the craziest and we are actually rewarding them after the fact. Rewarding might be a little strange--not a happy outcome--but we know that's a bit of an issue. Practical problems, but if you think of the economy as just producing homogeneous goods--which I call Stuff--GDP, not realistic. I accept the point that there is an allocational aspect. Let's go further. Our last podcast may have touched on this, too. I'm going to be the man on the left and be the one arguing: There's flexibility in the economy! We don't have Leontief technologies where there are a fixed number of people in every place. There's substitution that goes on. If a government project is building new highways that otherwise wouldn't be built, my guess is that many construction workers could find jobs there. May not be able to make as much money, but certainly the possibility and likelihood that people will move in those directions. You mentioned research funding coming to Washington University--public goods thing we could get into--but there aren't too many Ph.D. scientists who are losing their jobs because of the problem in construction, so what's the point? The Ph.D. scientist needs staff, help to take care of the infrastructure of the building; may need to build new lab space. Spillover. You do get a little bit of the best being the enemy of the good in this kind of debate. Interesting empirical question. We can actually look and say: This program funded by the stimulus, and see how many jobs are created. Whereas the key question is how many net jobs are created. Were those people already working, from a different industry but already employed? We can also see to some extent if carpenters are working in those projects. My guess is no, but that's my bias; I'm willing to be agnostic. It's harder than that. Suppose we build a new research lab and hire an administrative person who was previously employed in legal office. Now there's an opening in that legal office. I think this does get at the heart of what we talked about earlier--how hard it is to know what's going on. How do you know, if you are running a restaurant, that your customers coming in have a job because of the government stimulus program? You don't know and you don't care. Irrelevant unless you expand your restaurant and the stimulus ends--unless it's the first example of printing money--you may find that that was not a real change, a temporary change and you've over-invested. Nominal changes can have short run effect but unlikely to be sustained. But certainly a business person has trouble figuring out where the demand is coming from. To some extent, shouldn't worry about it too much unless it turns out to be really nominal and hence unsustainable.

40:37 Only thing I want to add to this discussion about the GDP factor is one issue that doesn't get talked about is if in fact you are stimulating sectors where there is full employment, where resources are fully engaged, whether it's lumber for building or steel for the new lab you are building or Ph.D. researchers, pushing up the demand for those things means the effect isn't on quantities but on prices. Implicit in the GDP factory story is there is this slack that the extra demand soaks up and therefore pushes people into the labor force. If you are pushing people into areas where there isn't slack, you are going to have price effects that are going to be seen rather than quantity effects. I agree with that. The Keynesian stimulus argument requires that there be underemployed resources in some general sense. This is why Keynes titled his book the General Theory, because he argued that should you have enough demand to get the economy to full employment, the novel aspects of his book no longer apply. Unemployed resources are critical. If you break this down to the sectoral level, I agree that you could certainly have price effects; though they could not be simple rise in price that's fully inelastic. Could imply some expansion which then could draw unemployed resources from other parts of the economy. All pretty complicated. Let's turn to the labor market. One of the things that mystifies me: you said earlier that there's this classical or neoclassical view that all unemployment is voluntary, all markets clear. Certainly the Austrian part of me would say that's not true; the neoclassical part of me would say there is imperfect information, people may not know the opportunities. Carpenter is unemployed--for all he knows, the demand for new housing may come back in 3-6 months, but it might be ten years, in which case he should probably look elsewhere. You can't foresee the future perfectly. An expert can't. Difficult decision. I don't want to debate about whether that's voluntary or involuntary. Obviously it's not ideal. Change of all kinds puts people in situations where they are unclear. That's part of the reason they are unemployed. Another reason is they don't know about every single opportunity out there every single minute. They don't know there's a job two states away or maybe across town. All kinds of imperfections. Let's put that aside. It's certainly true that--example from the tech world: In 1999 if you were an internet person, you were a skilled computer person, and your firm shut down--a startup that didn't make it--you were a little upset, disappointed, but you'd find a new job pretty quickly. In 2001 when the tech bubble collapsed, that wasn't true. But it didn't last very long, people found jobs. Today, we're in that world for a whole bunch of people. Hard to understand why it's working for some folks. For example, if you have a college education, the unemployment is about 5%, but if not it's about 15%. Thinking out loud here. We don't really understand those differences very well. Yes. I agree, something we need to pay more attention to. I think you are going to find that unemployment is up substantially even for college-educated people. It is. It's increased across the board. I think the gap has widened but not so much. It just isn't that much hardship for a college education. I guess it depends what you majored in and what your skill set is, even within that college educated group; I think there are a lot of people who if they lost their job they'd find another one pretty quickly. Right now, in the middle of a horrible recession. It's not a bad time to lose a job for some types of people, but for others it's a very, very bad time. Bit of an aside. As a professor I talk to my undergraduate students; they go through here, looking for jobs--can be a little bit of a downer conversation. Should be somewhat encouraging. If you look at the dynamics of the labor market, there are a lot of jobs. Even in the worst of the recession, a lot of jobs created every month. Monthly report on the first Friday of the month is the difference between the jobs created and the jobs lost. In a recession, jobs lost dominate, but if you look at the absolute number, there are a lot of jobs created. Even in good times, can do the symmetric thing--there are a lot of jobs lost every month. That's one of the things I find fascinating about this: We tend to think of the economic as this organic creature like a person's health. The JOLTS data, nice project where the government actually collects not net jobs but the creation. Jobs are created when existing firms expand or new firms come into being; destroyed when firms contract or disappear. In any one quarter, good times or bad, millions of jobs are created and millions destroyed. The difference is in healthy times, the number created is bigger than the number destroyed by a few hundred thousand in a given month. Or a little more or less. In a recession those numbers are different; harder to find a job. In particular last month net job creation was 103,000, which is not very cheerful when unemployment is as large as it is. We don't really understand that very well. Microeconomic dynamic. Very complex forces. There is interesting work along those lines: Olivier Blanchard, Peter Diamond who won the Nobel Prize this last year--but the paper I'm thinking of is the Blanchard-Diamond Brookings paper some years ago. This stuff has stayed fairly arcane. Another natural experiment that is puzzling: I think about the return of American soldiers after WWII--massive inflow of labor; similarly in the 1960s and 1970s huge increase in the number of women who decided they wanted to work rather than stay at home. They pretty much all find jobs. The unemployment rate doesn't go to 20% or 15% ever in those times. The economy creates jobs in a strange, organic, not-quite understood fashion; and all of a sudden it's not doing it. For me, one of the puzzles that Keynesian economists have to face is: I can go through with my students a detailed discussion of why demand may not be adequate to get us to full employment and the problems associated with that. Demand is not automatic. We can't rely on it to be sufficient really at any point in time. But, you look over the long sweep of history in the United States and you see employment growing, production growing. Influx of women into the labor force--our baby-boom generation coming into the labor force. There is some discussion of why these factors might have led to a somewhat higher than average long term unemployment rate in the 1970s and 1980s, but in retrospect those fluctuations look pretty small. One has to address that. Where does that demand come from? Where is the growth of the demand? There has to be an economic process which is generating over longer sweeps of time demand growth that seems to be following up this resource. Fascinating question. I'm doing some research on it, but not quite ready for the public yet.