cent decades have continued to witness gains for the American economy — from new ideas, openness to trade, and technological advance. As they have since the Industrial Revolution, these gains reflect the upside of disruption and change. But there are downsides, too. These downsides have transformed our politics in recent years, and the economic disaster that has accompanied the coronavirus pandemic has only magnified them. Yet economists and defenders of markets have too often sought to dismiss these downsides or failed to appreciate their scope and character.
In our political debates, there have been two approaches to the downsides of disruption. Some treat the articulation and celebration of the upside (which is very real, of course) as though it were an answer to the downside. That celebration speaks to the truth of the achievements of modern economics, but it also pretends that the benefits of those achievements are easily available to everyone and that what is lost in the process was of no value. Meanwhile, others call to erect walls against economic change because of its negative consequences. Such walls, in the form of protectionism and regulation, try to hold off the economic forces that have transformed the modern world; they speak to a broadly shared desire for security and stability. Yet the costs of these walls are too rarely considered — and ultimately, the walls themselves are unlikely to hold.