3 ms·

I'm not sure if I understood your points correctly. There is always more to be done. There is not a fixed set of things humanity needs that will one day be fulf

I'm not sure if I understood your points correctly. There is always more to be done. There is not a fixed set of things humanity needs that will one day be fulfilled. We didn't know we wanted cars, computers and smartphones until they were invented. This is regardless of scarcity, possibly even because of it (scarcity of resources will drive the need to be more efficient handling them). I also don't understand your two points since (1) automation increases efficiency and thus production levels and (2) as a result of that increased productivity, there is a raise in wages.

AstralStorm 10y ago
The part you're missing is that a higher wage is given to one person rather than many people, that you need capital to produce (hey, we need more chips, so now everyone with a hammer makes one). Can you actually make a car? How many people are involved in making a Honda Civic vs Ford Model T?
- andrenth 10y ago
  See the quote above. Automation has historically increased wages AND the number of available jobs. No, I can't make a car, and have no interest whatsoever in making one. I could, however, buy a Honda Civic today in the US for more or less the same price (adjusted for inflation) as a Model T, but thanks in no small part to automation, it's a much more efficient, safe and comfortable car. And still the auto industry directly employs 1.5 million Americans now vs. 450k in the late 20s.
Animats 10y ago
There may "always be more to be done" (even that is questionable) but demand is limited by personal income.
- andrenth 10y ago
  I don't see your point? Some demand may be limited by personal income, while some is limited by corporate income and so on. This will cause producers to focus on things that are more in demand, while bringing down the price of lower demand products. But this is just demand/supply dynamics. I don't see how automation is relevant here since that is valid with or without it.
Animats 10y ago
"(2) as a result of that increased productivity, there is a raise in wages." That stopped years ago. Ask any auto worker. There's no economic reason that increased productivity should lead to an increase in wages. The benefits of increased productivity accrue to capital, not labor. What produced the increase in wages with productivity was labor activism, and fear of government intervention. It's hard to imagine now, but there was a time when American companies were seriously afraid of what workers could do, both through unions and politics. Communism was considered a serious competitor to capitalism from about 1930 to 1980. That's what kept wages rising. Once Ronald Reagan successfully made the case for unbridled capitalism, that ended. Now the US has "just in time" workers, few unions in the private sector, and weak worker protections. Competition between employees keeps wages down.
- andrenth 10y ago
  Of course there are economic reasons for wage increases with productivity. They are the same reasons that explain any other increase in prices. First, employers don't want to lose their more productive employees, and they have to compete with other employers offering jobs at higher pays. Second, once productivity rises, employers increase their earnings and can therefore hire more. This creates more demand for employees, and the price of work rises. It's in fact the view that companies should be "afraid" that create regulations and restrictions that are usually what's responsible for reduction of wages and quality of life in general for workers. See also: http://www.heritage.org/research/reports/2013/07/productivity-and-compensation-growing-together http://www.heritage.org/research/reports/2013/07/productivit... Finally, I find it really unbelievable that someone can claim in a serious conversation that the US have anything remotely similar to "unbridled capitalism".
deleted 10y ago
[deleted]

AstralStorm 10y ago

The part you're missing is that a higher wage is given to one person rather than many people, that you need capital to produce (hey, we need more chips, so now everyone with a hammer makes one). Can you actually make a car? How many people are involved in making a Honda Civic vs Ford Model T?

andrenth 10y ago
See the quote above. Automation has historically increased wages AND the number of available jobs. No, I can't make a car, and have no interest whatsoever in making one. I could, however, buy a Honda Civic today in the US for more or less the same price (adjusted for inflation) as a Model T, but thanks in no small part to automation, it's a much more efficient, safe and comfortable car. And still the auto industry directly employs 1.5 million Americans now vs. 450k in the late 20s.

Animats 10y ago

There may "always be more to be done" (even that is questionable) but demand is limited by personal income.

andrenth 10y ago
I don't see your point? Some demand may be limited by personal income, while some is limited by corporate income and so on. This will cause producers to focus on things that are more in demand, while bringing down the price of lower demand products. But this is just demand/supply dynamics. I don't see how automation is relevant here since that is valid with or without it.

Animats 10y ago

"(2) as a result of that increased productivity, there is a raise in wages." That stopped years ago. Ask any auto worker. There's no economic reason that increased productivity should lead to an increase in wages. The benefits of increased productivity accrue to capital, not labor. What produced the increase in wages with productivity was labor activism, and fear of government intervention. It's hard to imagine now, but there was a time when American companies were seriously afraid of what workers could do, both through unions and politics. Communism was considered a serious competitor to capitalism from about 1930 to 1980. That's what kept wages rising. Once Ronald Reagan successfully made the case for unbridled capitalism, that ended. Now the US has "just in time" workers, few unions in the private sector, and weak worker protections. Competition between employees keeps wages down.

andrenth 10y ago
Of course there are economic reasons for wage increases with productivity. They are the same reasons that explain any other increase in prices. First, employers don't want to lose their more productive employees, and they have to compete with other employers offering jobs at higher pays. Second, once productivity rises, employers increase their earnings and can therefore hire more. This creates more demand for employees, and the price of work rises. It's in fact the view that companies should be "afraid" that create regulations and restrictions that are usually what's responsible for reduction of wages and quality of life in general for workers. See also: http://www.heritage.org/research/reports/2013/07/productivity-and-compensation-growing-together http://www.heritage.org/research/reports/2013/07/productivit... Finally, I find it really unbelievable that someone can claim in a serious conversation that the US have anything remotely similar to "unbridled capitalism".

deleted 10y ago

[deleted]