Technology + Infrastructure + Education Investments

Technology + Infrastructure + Education Investments Drove ~90% of Labor Productivity Growth for Past ~30 Years Sources of USA Average Labor Productivity Growth, 1977-2000 = Technology Investment i Infrastructure & Other Investment 1 Education (Labor Quality) 1 Other (Total Factor Productivity) Average Annual Growth Rate (%) 0.0% 1977-1990 1990-1995 1995-2000 Note: Total Factor Productivity is the portion of output not explained by the amount of inputs used in production. Source: Dale W. Jorgenson, Mun S. Ho, Kevin J. Stiroh, “Growth of U.S. Industries and Investments in Information KP Technology and Higher Education” <http:/;www.nber.org/chapters/c10627> (@)E) www.kpcb.com USA Inc. | What Might a Turnaround Expert Consider? 367 However, USA Inc. Has Increasingly Allocated Resources Away from Productive Technology + Infrastructure + Education Investment / Spending Toward Less-Productive Entitlement Program Spending USA Real Federal Productive vs. Less-Productive Spending*, 1970-2009 100% 80% 60% 40% 20% % Share of Total Federal Spending 0% 1970 1974 1978 1982 1986 1990 1994 1998 2002 2006 Note: *Total spending exciudes one-time items (such as TARP / GSE / ARRA) for F2008 / F2009 data. Data source: White House Office of Management & Budget (1970-2009). www.kpcb.com ne. at Might a Turnaround Expert Consider? kpeb USA Inc. | What Might a T dE Consider? 368 HOUSE_OVERSIGHT_021025