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Hillary Clinton paid $300,000 to explain what ails the middle class

Rick Newman
Columnist

She’s identified the problem. Now, assuming she runs for president, Hillary Clinton will have to come up with ways to solve it.

During a speech in Silicon Valley, Clinton, the presumed Democratic presidential nominee in 2016, highlighted the displacement many workers have suffered as new technology has made many jobs obsolete. “The old jobs and careers are either gone or unrecognizable,” Clinton said, according to the Los Angeles Times. “The old rules just don’t seem to apply, and, frankly, the new rules just aren’t that clear. “[If] we want to find our balance again, we have to figure out how to make this new economy work for everyone.”

Clinton also addressed Silicon Valley’s male-centric culture, one factor responsible for a notable gender pay gap in the tech industry and a shortage of women in the field. “We’re going backward in a field that is supposed to be all about moving forward,” the former senator and secretary of state said. Clinton herself is a counterexample: She earned a reported $300,000 for her speech, comparable to what she usually gets and more than all but a few highly prized male speakers (including her husband).

Clinton’s remarks on the gender pay gap are buzzy, given actress Patricia Arquette’s recent advocacy on the issue at the Academy Awards. But Clinton’s diagnosis of the job-market dilemma previews a bigger theme of her coming campaign. By aggregate measures, the economy is in pretty good shape, and it will be stronger still once the 2016 campaign kicks off in earnest. Yet behind the numbers, good jobs are still hard to find, pay is stagnant and many middle-class families are falling behind.

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Candidates of both parties will be wooing those voters in 2016 by feeling their pain — but coming up with remedies will be a lot harder. Clinton got started by acknowledging a puzzle economists are just beginning to address: Technology revolutions always make some industries obsolete, but they usually create new industries as well, and on balance add jobs to the economy. Often, a lot of jobs. That hasn’t happened during the 20 years (and counting) of the digital revolution. The disruption caused by technology is apparent in many industries, as software, robots and other machines do a lot of work once done by humans. But so far, lucrative new jobs are scarce and the wealth created by the barons of Silicon Valley and other tech hubs seems to have done little to improve the fortunes of the backsliding middle class.  

Clinton didn’t outline any solutions to this problem, as Aaron Task and I discuss in the video above. In fact, coming up with government solutions to this unusual economic problem could be more difficult than isolating the Higgs boson. First comes the challenge of devising new policies able to help outmoded workers join the technology revolution instead of being trampled by it — without slowing the technology innovation that remains one of America’s key economic advantages. After that comes the need to get Republicans and Democrats to agree to new government initiatives instead of fighting the usual political wars of attrition.

But that comes after getting elected president, and for now, Clinton has at least identified the right issue for debate: Finding new ways to assure the digital economy does more good than harm for the largest number of Americans. At the moment, there’s no app for that.

Rick Newman’s latest book is Liberty for All: A Manifesto for Reclaiming Financial and Political Freedom. Follow him on Twitter: @rickjnewman.