If we want growth today to be more innovation-driven, more inclusive and more sustainable, then we need a more active state, not a less active one. Yet we still hear the dogma that we should just fix market failure by focusing on science and infrastructure, and to "level the playing field."

I often use the iPhone as an example of how governments shape markets, because what makes the iPhone ‘smart’ and not stupid is what you can do with it. And yes, everything you can do with an iPhone was government-funded. From the Internet that allows you to surf the Web, to GPS that lets you use Google Maps, to touch screen display and even the SIRI voice activated system - all of these things were funded by Uncle Sam through the Defense Advanced Research Projects Agency (DARPA), NASA, the Navy, and even the CIA!

Markets are not static entities that are 'intervened' in (for good or bad) but are outcomes of public and private interactions.

Fixing markets isn't enough. We have to actively shape and create them and tilt the playing field in the direction of the growth we want.

Companies prefer to put money in the pockets of shareholders or to hoard cash rather than to raise wages or invest.

With a Trump administration we don't know enough yet to make predictions, but if past behavior is any indication, I am not encouraged.

Real median household incomes in the U.S. were basically the same in 1989 as in 2014. But we are also seeing similar challenges in the U.K. in the stagnation of real wages.