Map of life expectancy at birth from Global Education Project.

Tuesday, October 22, 2013

The new luddites

The latest blooming meme -- transmitted by some very credible and buttoned-down thinkers, in many cases -- is that this time, the machines are taking our jobs and they aren't coming back. Yeah yeah, the power loom and the harvesting combine put people out of work, but the thereby wealthier economy found other jobs for them to do in the long run. But this time around, the machines aren't just physically powerful and fast, they're getting smart as well. The proposition is that we'll need fundamentally new social and economic structures to keep everybody supplied with an income and meaningful ways to spend their days.

Brad DeLong, no sidewalk raver to say the least, lays it out in telegraphic form. David Atkins sees IBM's Watson replacing oncologists as diagnosticians. I'm not sure that will happen, exactly -- people will still demand that a human make the final decision, I think, even though the human isn't really necessary or even doing anything regarding decision making. But the doctor will need to talk to the patient about Watson's conclusions and their implications. Still, the broader idea that even high level intellectual work is not safe for long seems to hold.

Tom Streithorts, in a compelling essay in the LA Review of Books, puts a positive spin on this as the problem of "post-scarcity economics." But he also considers that the end of scarcity is a big problem. If the economy produces all we need and more with little human effort, your labor -- of whatever sort it may be -- isn't worth anything. We distribute resources now by exchanging them for work, or giving them to rentiers and investors. If labor is worthless, then the 1% will have everything. Of course they won't be able to sell anything, because the rest of us won't have an income. You can see the problem.

The proponents of this claim say it's already happening, that the "natural" level of unemployment is rising. We'll never get back to 4 or 5 percent, and quite possibly we'll bounce off of 7.2% -- already misleadingly low because many people have left the labor force -- and see unemployment going up even as the economy grows. Obviously this is unsustainable, but the problem demands the precise opposite of what the conventional wisdom is saying. People won't just go out and find jobs if you cut off their food stamps and disability and Medicaid. There aren't any, and there won't be any.

I don't know for sure if this is true -- it was the dystopian vision in Vonnegut's novel Player Piano, and other visionaries have been imagining this scenario for a long time. But we need to think this through.


mojrim said...

I think this process is just the same as occurred with the industrialization of farming, in that new forms of employment can open up. What will hold this up is resource limitation.

Consider: We could all (in theory) become supervisors and designers of masses of capital equipment which in turn churns out astonishing amounts of consumables, allowing everyone to live in an automated floating palace. Problem is, there's only so many clouds to sit on, and so much building material on one planet, and so much energy to go around.

This leaves us with a choice between a utopian and a dystopian option. In the utopian we colonize the solar system, mine asteroids, build giant space habitats orbiting jupiter. In the dystopian we get the scenario you predicted, which ultimately destroys everyone as scarcity economics require a mass market to function.

Perhaps we can split the difference? As the market value of labor drops, and as fewer jobs are created, we halve the work week and triple wages. The 1% won't like this, of course, but the alternative is market death. This provides a gentle glide path to the inevitable end: Only a few people have "jobs" and everyone else is living off of an allotment. How those people are going to spend their days remains to be solved, but I think it's doable.

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