Dear Mr. Trump:
Sir, you do want to make some changes for whole American people. I think that is a great idea. But I have to ask you to postpone your conflict plans for one year. Lately, the US economy is fine and getting well. Now, the financial market runs smoothly and people could get some jobs to do in the US. The plan you want to implement should have a forward looking viewpoint. Tax cut is fine, but not this moment. If you give tax cut for the wealthy, you may expect the stock market goes even higher. So does the US property market. But the poor American people still could not reap the reward from your tax cut when they have not enough income to enjoy the benefit because a lot of American people get a lower-paid job. When is the proper time for the tax cut? People know that the right time is when a lot of American people have a well-paid job and the economy is getting soft. At the time, the tax cut could boost spending of ordinary people and keep the economy going. Now, the tax cut is a little premature.
We do not want you to feel that people leave not many choices on the table to you. We want you to know that a lot of policies you want to do are good, but they all need to be implemented at proper time. Now the tax cut is not proper when the US government still faces the debt ceiling issue and there are not enough American people have a good job. People may expect the time comes when the unemployment rate goes down to 4% or even lower. We may expect some salary raising at the time. At then, the tax cut is much meaningful for whole American people. All the policies should be done at proper moment. The issue about when the time is proper depends on your economic consultants' advice. Infrastructure investing is good. Tax cut is nice. Some regulation refinements are excellent. But all those acts should depend on a big question - when is the right time to do that?
What's wrong with the United States and the whole world? It is a question we have to ask. The first one is how come the Phillips curve relationship disappear in the US. In simple words, the question is how come the the lower unemployment rate does not push up the inflation. The second question is how come the property price in the United States could not be stablized at a proper place.
For the first question, we have to understand the technology does play the role with the issue. If the corporate could find some ways to use machine learning and artificial intelligent to replace the repetable boring jobs people do all the time, then we may see those jobs disappear forever because the machine would never get tired and never have temper or emotion. The machine could do the job fine when the rule is stricly set. We should remember the booming age of personal computer and high speed super-computer in the United States. Now they are gone as the component price gets lower from a large production oversea. The most important thing is the technology updates even faster than people think. Artificial intelligent is with people in daily life for years. When we use iPhone or Andriod system, those applications are all with artificial intelligent and machine learning algorithm. When people ask something from Siri or other intelligent system, the machine learning algorithm plays the role. Those machines do grow up with more data they get for training. That is what we call the machine learning. The machine learns from the presetting algorithm with data they get from daily business.
This factor creates the lost relationship of the Phillips curve, people could only find a lower-paid job when the automation and artificial intelligent play the role. Lower-paid jobs bring lower wealth to people and all the aggregation creates lower inflation. As the Milton Friedman, an Noble Economic prize winner, once said that inflation is always and everywhere a monetary phenomenon. When people circulate tons of money among themselves, we may see the price goes up with much money chase few goods. But it is not the case we see in real life lately, especially for those ordinary American people. All the lower-paid job created does have something to do with the global supply chain. A college graduate student earns USD 650 a month in China. They have college degree and can perform machine learning algorithm if the corporates they serve have the software. What is the advantage that American people have? To be honest, not much if American people can not do the same thing smarter with different creation. It is the reason why we still see a lot of higher paid jobs find no American people to fill in. We even see a lot of greater universities in the United States create some programs to fill the need. For example, we see the Standford University has a program on Big Data with AI for those people who wants to work as a data science. It is an example that the American university tries to find a way out. To have some directions for American people to pursue in order to have a higher paid jobs. If those goals could be obtained, then we will see the situation that Phillips curve is alive eventually. Now, we see no clue how the Phillips curve revives. American people do pay a higher price for college education, but it seems not have much help for them to have a higher paid job sometimes. What's wrong? How to help American people allocate their resources in the right direction and have a greater life? It does need Mr. Trump to watch out and seek some ways to help.