http://www.economist.com/blogs/babbage/2012/12/high-tech-shopping?fsrc=scn/fb/wl/bl/bricksbitsmortar I'm pretty thrilled by this change because it'll inevitably replace a bunch of crummy low wage jobs with a smaller number of high wage specialist jobs (http://www.bls.gov/iag/tgs/iag448.htm probably a hefty increase in pay) but it highlights the need to create transitional systems for this sort of disruptive innovation (social safety net, better educational opportunities, better adult career training and wage support while changing professions, assistance hunting jobs). ANYWAY since this will likely take place in an environment where none of that is in place it'll no doubt have some pretty significant distributional impacts (not to mention will probably result in quite a lot of retaliatory regulation while other shops attempt to catch up) so I figured it needed a preemptive D&D thread.
This is a topic that both interests and depresses me. As a nation we need to transition to an even more highly educated work force to deal with the reality that we really can automate a lot of shit pretty easily. But we need to be willing to take care of the generation or two that will fall through the cracks as we do so. And I get depressed knowing that politically we seem solidly divided on this pretty obvious problem.
My pet theory why we've seen so little innovation in low wage labor replacement is that policy has crushed those wages for so long there's no incentive. Apparently there's workable mass harvesting machines for just about everything now, but no one uses them because migrant labor is cheaper.
Yep. In the even longer term we need to face the increasingly probable looking scenario that we reach a point where we make all our food and stuff and services using a negligible percentage of the available labor force, no matter how educated they are. I'm really curious how we as a society will cope with such a scenario. Traditional economics just says we will invent new stuff (new goods and services) and people will find work providing those. However, I'm not sure what's stopping those new goods and services from being automated as well. At the end of the day there's probably only a few services that we are unwilling to automate because we prefer the personal touch.
The only way to compensate for this increase in efficiency is to increase consumption! Quick, buy more things! Attend more concerts! Learn more dance steps! Fire all your guns at once and explode into a post capitalist controlled economy collectivist wonderland!
All the women will be dressmakers and all the men will open repair shops. I hope I'm getting that reference correct, I don't have time to doublecheck my copy of the novel.
I sincerely doubt that we will ever reach a situation where nothing can be done with huge herds of humans. For example, a century ago most people worked in producing food or basic resources. Now the vast majority (barring subsistence farmers) don't. We've found uses for them, all kinds of fun and fancy new uses. Same with factory workers. If it weren't for our shitty monetary policy they'd all be employed somewhere right now. Human beings -- and I cannot stress this enough -- are literally the most valuable thing on the planet. We take twenty years to train and after that can be educated to do all kinds of shit. Plus, if there's a problem we can often figure it out by dicking with it. You can't get a machine to that level of adaptability, and if you can we're all basically fucked. It's completely incomprehensible to me why we don't invest more in human capital development but that's an aside. Bottom line, we'll find a use for all these people.
There was an Econtalk interview about this topic back in February. The most interesting part of me was: Davidson: In the case of Maddie, the young woman that I focused on, so she makes $26,000; with benefits and everything let's call it $30,000 a year. And they did the math, and a robotic arm could do what she does more quickly and more precisely. But it would cost $100,000. And their metric is: Any capital investment needs to pay for itself within two years. And so Maddie makes $30,000; over two years $60,000, the net present value of which would be less; so an upfront expense of $100,000, it's clear Maddie gets to keep her job. Roberts: But as the price of the machine comes down. Davidson: Or if there is more demand for fuel injectors and they add a second or a third shift, the mathematics change. Quickly. And there certainly are robotics manufacturers out there trying to cut their costs. And Maddie isn't in a position to cut her costs very much. This is a non-union plant by the way, but $13 seems to be about the floor for a manufacturer like this. Roberts: It's double the minimum wage but it's still not a lot of money. But she knows this, right? She knows she might not keep her job for the next 25 years. Davidson: She really knows--I think what she thinks is: This is the highest I'll get, be stuck here. I don't think she fully understands: No, no, this is the highest you'll get and it's higher than you might be for the rest of your life.
I think it's inevitable that we reach a point where we can provide everyone with food, comfortable housing and clothing, and decent medical care using only a small fraction of the population and a lot of automation/computer assistance. What I like to speculate about, in an airy futuristic sense, is what we do with the rest of them at that point in time. I agree it's entirely possible we still find less critical uses for them that maintain full employment, but I'm curious if we keep our current puritan mentality that people need to be working 40-50 hours a week to be good productive members of society. There's a lot of room to turn productivity gains into a better society by working people less but right now the idea seems completely incompatible with the mores of our society.
Nick we reached that point about a hundred years ago, which is when you started seeing the big shift out of menial and routine jobs. Keynes famously speculated about the post scarcity society. Reality is people enjoy doing shit and will find new shit to do, and other people will pay them for it. We'll just have fewer and fewer people doing routine shit, and more and more people doing creative shit. Big worry for us is ensuring capital's returns are equitably shared so that we can invest in and improve the next generation. Other big worry is how we break down all the extractive shit people put in place over the years. Cities like New Yor are overrun with rent seeking cocksuckers who've found creative ways to rip everyone off (established landed interests and building codes, taxi medallion families, numerous associations, machine politicians like the assmobiles in the city council, last mile isps, whatever the fuck is going on in education that causes tons of money to go in and shitty results to come out) as that shit massivel degrades our capability for long term real (as opposed to nominal, which entirely the domain of the monetary authority) growth.
