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00:00We continue our discussion with a look at the well-being of the American people. Joining me now from Washington D.C. is Tyler Cohen. He is a professor of economics at George Mason University and columnist for Bloomberg View. His new book The complacent class the self-defeating quest for the American Dream identifies a crisis in social and economic mobility here in the United States and I am pleased to have him on this program . Tyler Hello Ian. Good. Congratulations. Congratulations on the book just out today and wish you well with it. Look a lot of challenging topics in this book. The biggest one hit you right in the face is that the biggest problem we have in the United States right now is that our people are too complacent. I want I let you define that for a second just for their viewers. People are seeking too much safety and too much security. And at the individual level this is fine. We enjoy safety and security but at the aggregate level when everyone does this we end up with a nation which is not sufficiently dynamic. So we have people who are moving across state lines at much lower rates than before . We're afraid to let our kids go out and play. We're overmedicating ourselves. Rates of productivity growth are actually much lower than they used to be. So I mean I get complacency when you talk about you know sort of the middle class perhaps I can even understand complacency when you talk about you know sort of the wealthy. But how do you when you talk about those that really are upset you know those that are we have we've populism in the U.S. just as we do in Europe right now the Bernie Sanders vote the Trump vote these truly complacent people even for the lower middle class. We see a lot of complacency . So there is a new ambition basically to get on disability or if you look at data on unemployed young males it's amazing a how many live at home b how much time they spend playing video games and see how many don't have a driver's license. So the sense of urgency in the lower middle class isn't there the way it might have been say 50 or 60 years ago. And when you hear these stats about well people aren't staying in the same jobs as much as they used to Millennials aren't as committed they'll do three years here in three years. Are you saying that that's. Is that a wives tale. I mean is that not really true. That's a wives tale. If you look at actual census bureau data people are staying in their jobs longer than ever before as best as we can tell. And rates of moving across state lines. That's down 50 percent from its peak. So there are different sociological areas when you look at information tech that's our most dynamic sector. But what do people use it to do to have Amazon ship them packages and watch Netflix at home. Again it's very comfortable. It's just not all that dynamic from a macro point of view. Do you think that's starting to change in the sense that I mean how do you and others how did how do you get out of that is that the demonstrations that you've seen in the United States over the past few weeks. Do you think you're going to see more activism or is this something that is just a morass that long term you see no fix for the long term. I'm very optimistic but I think this deeply in the only way you get out of it is to suffer a fair amount and to hit all of the bumps in the road. So the return of protests and demonstrations the rather unorthodox political culture we have in Washington right now these are a kind of warning sign that the path we were on the complacent path it's not possible anymore. In essence in the broad sense of the term you just can't pay all the bills . So we just had Larry Summers talking about the challenges of making the kind of investments that would be required to lead to real growth for the American worker. What if you had policy solutions here that would improve the social contract in United States what would they look like. Well I agree with a lot of the policy solutions proposed by other economists including Larry. But I also think they're asking the wrong question the right question is why is there so little interest in listening to economists. People are in a kind of denial. They want America to go back to an earlier time Make America Great Again . They're not willing to suffer losses to their own budgets or situations in life. So it's ultimately a psychological and sociological problem not just one of the economists lecturing people more and more. Is there a social and cultural issue which is actually quite distinct from the economics here. I think the cultural issue is much more important. So there are some very serious wage erosions in America. I don't want to minimize those problems but actually America is still a pretty wealthy country. And I think what people are really feeling is a perceived loss of control and people hate that feeling of loss of control whether it be trade whether it be immigrants whether it be their standing in the local community the erosion of that community itself observing an opioid epidemic around them. So it's this psychological issue of people wanting to do something to reassert control again somehow so then that would imply that solutions from a Trump administration might look very different that it has a lot more to do with reasserting that control control over borders control over identity control over families. I mean do you think that's something that Trump could actually do I sometimes call Trump the placebo president. I think his domestic agenda. He's not sure what it is. I don't yet see that as the he has the attention to detail to get very much through. He's still not sure what to do about Obamacare. I think a strategy actually is to try to reform discourse and raise the status of neglected groups and tell them look someone cares about you and do that for four years and in some funny way that might actually work as a sort of placebo bill for our troubles and we'll get out of those troubles some other way by growing out of them in some slow and painful set of adjustments . But that's what I think Trump's doing. It's mostly about the talk .

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The State of the American Dream: Charlie Rose

Tyler Cowen is a professor of economics at George Mason University and columnist for Bloomberg View. His new book, "The Complacent Class - The Self-Defeating Quest for the American Dream," identifies a crisis in social and economic mobility in the United States. (Source: Bloomberg)

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