A natural way that an economist approaches a problem is to say, here's where I think the economy is going; this is what we need to deal with the problem.

Making labor less expensive helps firms hire people.

If increasing income equality is the goal, it might be wiser to put money into infrastructure than to subsidize manufacturing. Construction also pays good wages, but with lower educational requirements. And America's infrastructure needs are enormous.

Raising the minimum wage, as President Obama proposed in his State of the Union address, tends to be more popular with the general public than with economists.

I think where I differ a little bit, we absolutely have to think about the deficit looking down the road. And certainly that's something the president has said that we need to, as the economy recovers, have a plan in place for getting it down.

In the four decades after World War II, manufacturing jobs paid more than other jobs for given skills. But that is much less true today. Increased international competition has forced American manufacturers to reduce costs. As a result, the pay premium for low-skilled workers in manufacturing is smaller than it once was.

You care about the deficit because it allows you to do things you need to do to help people who are suffering.