Corporate profits are soaring in the US, yet the economy is depressed. Why? Because capital is doing fine at the expense of labor, Paul Krugman observes in today's New York Times. Yes, that sounds like "an old-fashioned, almost Marxist sort of discussion," but it's the reality we're seeing, and there are only two possible explanations: "robots and robber barons." On the robot side, there's the argument that technology is displacing and devaluing even the most highly skilled employees—"the downside of technology isn't limited to menial workers."
The other possibility, Krugman writes, is that "robber barons" have created monopolies that allow them to raise prices without increasing wages. But the Financial Times sees the two explanations as related. Technology "is reducing the natural employment rate," it argues. "But rather than our subsidizing those who have lost jobs to technology, so as to spread that mana wealth that's literally dropped onto the surface of the earth," companies are using their muscle to "extort rents on the capital that is creating all that free wealth." For much more, see the sources, and this earlier Krugman post. (Read more Paul Krugman stories.)