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Why Workers Are Losing the War Against Machines

93 points by ph0rque 14y ago

sonabinu 14y ago
Very reminiscent of creative destruction from Joseph Schumpeter - the whaling industry was destroyed by the petroleum industry. The survivors are the ones who possess the skills that are in demand. As the demand shifts, skills need updating.
- jeremyjh 14y ago
  Why would new industries and job roles always spring up to replace ones which have become obsolete? I agree that historically this has happened but I see no reason that it should be a necessary consequence. We have to consider the possibility that a segment of the population will have no realistic options for producing marginal value.
  - dreamdu5t 14y ago
    Because the labor and resources freed up from automation and increased productivity allow us to pursue new things. There's always more to improve upon. Why would this segment of the population not have realistic options for producing marginal value? Everyone is capable of learning new things.
    - jeremyjh 14y ago
      Why would those new things necessarily be labor intensive? Lately most new profitable things require capital.
      - nickff 14y ago
        It should generally be presumed that when something has happened repeatedly and predictably in the past, it shall continue to do so.
        jeremyjh 14y ago
        Until it doesn't - how many draft horses do you see working now? Besides which, we've got over fifty years of history telling us that wealth concentration is happening faster and faster. If just that trend alone continues then within our lifetime most people would not be earning enough to sustain themselves.
        Crake 14y ago
        We're such a small segment of history, though. We're just a blip on the timeline of the universe. Look at how our population has expanded in the last 100 years alone...some things are just unsustainable.
      - saosebastiao 14y ago
        Do they? Cause from my view, the role of capital is greatly diminished, even from 10 years ago. PG has acknowledged as much with their move towards smaller monetary investments in Y Combinator businesses.
        jeremyjh 14y ago
        pg is a pretty small part of the economy. Still, there is truth in what you are saying but when it comes to developing software there are barriers to entry much more substantial than capital.
        tomjen3 14y ago
        PG is a tiny part of the economy -- but he is also on the bleeding edge. What is true of him will be true of others in 50 years.
    - Jare 14y ago
      > Everyone is capable of learning new things Perhaps not quickly or efficiently enough, but even worse, it's not a given that there will always be enough valuable activities for everyone to perform and earn a wage. This is particularly true when wealth is not evenly distributed. The needs that a small group of wealthy people have for human-created value is, well, small, and therefore wealth barely gets redistributed. Other factors compound this, like the fact that most of the proceeds from a market do not go to the (potentially many) people involved in producing the goods or services, but to those comparatively few with the capital to finance that activity; the chasm between the (so to speak) haves and the have nots grows bigger and bigger. At that point, a significant segment of society simply can't earn a living, and society must adapt to become sustainable again. It's not the kind of thing that happens overnight, but you can see how most forces are pushing in that direction, so without a fundamental change in the dynamics of production, market and compensation, it's not a question of if, but when.
- pixl97 14y ago
  And when the day comes that available labor far outstrips the demand for labor? Your skill may be in demand, but how many will be willing to do the job at subsistence rates? Will the day come when 10s of millions (billion even?) of people be made redundant by technology? What will they do to eat? How will nations and societies deal with this? Grind the unemployed in to Soylent Green?, grand social welfare programs?, war? I always liked this fictional story about it. http://marshallbrain.com/manna1.htm http://marshallbrain.com/manna1.htm
  - dreamdu5t 14y ago
    They will need to learn skills that are in demand. I don't owe you anything simply because you exist.
    - waterlesscloud 14y ago
      The day will come when no human skills are in demand. That day may not be next week, but it might be in the next couple of centuries. It might even be in your lifetime. What then?
      - nickff 14y ago
        Dreamdu5t was just making the point that every person owns the products of their labour; and one's failure does not grant any right to take from others.
      - saosebastiao 14y ago
        We ensure that the machines serve the people, as opposed to a person.
        lgieron 14y ago
        Exactly! We just raise corporate taxes so high that the money collected can support unemployed masses, thus reaching the long sought after ideal of work being the option and not the necessity. Each person will have the choice to either work towards elevating his social status (via creating his own invention/company/piece of art/...) or just collect the state check.
deleted 14y ago
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gmaslov 14y ago
Why on earth is this framed as a "war against machines"? That's just plain wrong. The machines serve people. If there's a war, it's between people and other people.
- anigbrowl 14y ago
  You'd feel different if your job were eliminated by automation (not least because such jobs are correlated with lower educational achievement).
- ChuckMcM 14y ago
  Because that makes it emotional. You are absolutely correct that job loss due to automation is really people figuring out how to do something less expensively with a tool than without one. This process of elimination is ongoing. Periodically people put forward the notion that there is some community 'good' to be achieved by not taking advantage of this progress. Ned Ludd is probably the most well known example but lots of folks have made similar suggestions over the years. In every example, without exception, that path has lead to stagnation and death of the community that supported it. This truth however does not stop people being displaced by automation to suggest it however, that death will come later to community they are no longer a part of so they don't really care, they only care about the here and now. Talk to former factory workers of car companies that no longer exist but they successfully kept automation out of those factories. They protected their own jobs, at the expense of killing the company and all future jobs it might create, and ultimately their own pensions took a hit when those companies died. As a journalist though it is a great way to generate rage views with the dispossessed and the fearful.
- it 14y ago
  People use machines for various things, but you could also say that machines use people to reproduce and continue functioning.
- eli_gottlieb 14y ago
  If there's a war, it's between people and other people. Because pointing out the existence of class war is politically incorrect. Most people would sooner admit to a race war than a struggle between the capitalist class and working class.
ilaksh 14y ago
> Ironically, the best-educated economists are often the most resistant to this idea, as the standard models of economic growth implicitly assume that economic growth benefits all residents of a country. Because economics is not a science, its a religion devoted to making sure that those who have money and power keep it and get more. The idea that there is a set of high-skill jobs which are immune to technological unemployment is false. It will just take a little while longer for those jobs to be replaced by artificial intelligence. The concept of superstars v. the rest is mainly just a weak argument attempting to cover for the tendency of monopolies to form in any economy. Technology just amplifies this fundamental characteristic of our 'economic' system. Technology directly opposes our 'economic' system because technology is the application of science to solving problems (i.e. information and resource _sharing_) whereas economics is about using proprietary information and resources to your advantage.
- anigbrowl 14y ago
  Economics is not scientific enough, but your statement is purely ignorant and makes ti clear you've never cracked open an economics textbook.
- Jimmy 14y ago
  [citation needed]
pash 14y ago
A couple of comments: > People with little economics training intuitively grasp this point. They understand that some human workers may lose out in the race against the machine. Ironically, the best-educated economists are often the most resistant to this idea, as the standard models of economic growth implicitly assume that economic growth benefits all residents of a country. No important model of economic growth assumes that growth or technological progress benefits everyone. What is broadly assumed (and there's a lot of empirical evidence behind it) is that innovation is the prime driver of economic growth, particularly in advanced capitalist economies. Economic growth means that society is gaining wealth in aggregate. And so long as the pie is growing, it is always possible, in principle, to allocate the gains in a Pareto-efficient manner (that is, in a manner in which everybody gains) through the political process. Therefore many economists consider the "distributional" question, concern about who gets what, to be of secondary importance to their field. They see their job as figuring out how to maximize the size of the pie and leave it to others to figure out how to divvy it up. (Economists do of course have a lot to say about how various ways of distributing the gains from growth affect the prospects for future growth.) > Shortly after the Luddites began smashing the machinery that they thought threatened their jobs, the economist David Ricardo, who initially thought that advances in technology would benefit all, developed an abstract model that showed the possibility of technological unemployment. What the author is eliding here is Ricardo's development of the idea of comparative advantage [0], one of the truly remarkable ideas in economics. Comparative advantage is basically the idea that even if one country (or firm, or group of people, or single person, or whatever economic unit you want to think about) is better at producing every conceivable good or service, that country (firm/group/person/etc) will still gain from specializing in producing the good or service it (they/he/she/etc) is relatively best at producing, then trading with others—who will also gain by the interaction. This insight does not mean that everyone will always gain from freer trade, or from innovation (which can be thought of as essentially similar in this regard to a relaxation of trade barriers with a country that's particularly adept at producing one good or another). But it does suggest that there is a net gain to be had from these developments. And, again, economists are primarily concerned with growing the pie. > At least since the followers of Ned Ludd smashed mechanized looms in 1811, workers have worried about automation destroying jobs. Economists have reassured them that new jobs would be created even as old ones were eliminated. For over 200 years, the economists were right. And that, really, is where I would leave things. There is very little to suggest that technological progress is about to take on a fundamentally different character, or entail much different results, than it has had, and has done, throughout the course of human history. When the singularity arrives, let's have this conversation again. 0. http://en.wikipedia.org/wiki/Comparative_advantage http://en.wikipedia.org/wiki/Comparative_advantage
gregpilling 14y ago
Whether or not a machine can replace me, I will still work. I enjoy work, I get great satisfaction from doing work and completing a project I set out to do. It may be an open-source project, it may be in my garden, but I will still work because I do it for me. I personally can't wait until I have a robot to do the heavy digging in the garden. I enjoy the planning part, and the smelling of the roses more than the digging part. Also, as a small manufacturer I am forced to train the people I have to adapt to the new world order. The article implies that the uneducated worker is to be replaced with the educated worker. I can't just replace my staff with all new people. I would lose the tribal knowledge. I can't avoid automation that my competitors have; it would put me at a big disadvantage. In fact the biggest advantage I can get is to automate a process that we do manually. This is why mcmaster.com will send you a huge catalog (printed) for free. It is because the people that order from the catalog are price insensitive. I certainly am when I have a broken machine. My automatic sand blaster needed $1000 worth of bearings overnighted last month. To make a big advantage in automation I need the help of the guy who has been doing it manually. So we work on bottlenecks in production one after the other. Every month we figure out what is slowing us down, or causing quality variations, or supplier problems and we try to come up with a way to improve things. The obvious first place to look for solutions is with the person suffering with the problem. The next obvious thing to do is to use some technology to make repetitive tasks easier. So my welder is now learning to use Arduino, and we are working on updating some old machinery with new automation. He might not do the coding, but he will certainly be the guy bolting the hardware together. So I would say the workers are not at war with the machines. The workers are working with the machines.
acslater00 14y ago
Yet another example of the "all labor is manufacturing" fallacy. A future where machines displace most of what we currently think of as blue collar workers is a future where most of the things blue collar workers currently produce are much, much, cheaper than they are now. This author worries whether blue collar jobs will pay "subsistence" wages. They will, because the cost of subsistence [and indeed, the cost of a fairly satisfied life] will be lower. As machines become better at manufacturing and hard labor, unskilled "work" will shift from physical to service industries. That's good! It's been happening for the past century. Unskilled physical labor is hard, especially as you get older and banged up. A mechanized future is one where physical resources are plentiful. People will figure out a reason to trade them. Humanity will be fine.
- moultano 14y ago
  Food, housing, transportation, and medical care may not get any cheaper. Food is already highly mechanized. Housing is saturated in the places where people want to live. In the US at least we lack the political will to make transformative investments in transportation, and gas production is already as mechanized as it is going to get. Medical care is likely to remain labor intensive using very expensive labor. Sure, the average worker may be able to buy more things at Walmart than they can today, but that has less of an effect on quality of life.
  - pchristensen 14y ago
    Housing is politically saturated. There's plenty of room and technology to vastly increase the number of housing units and lower cost in desirable cities, but current zoning and planning regulations make them illegal to build.
    - Surio 14y ago
      Regardless of how semantically we phrase it, the bottomline that the parent made is valid... (Housing is saturated in the places where people want to live) i.e., it is as saturated as it can be, with no immediately conceivable resolution to the status quo.
stilltrying 14y ago
This sentence grabbed my attention, but I'm having trouble getting a clear understanding: "While efficient finance is essential to a modern economy, it appears that a significant share of returns to large human and technological investments in the past decade, such as those in sophisticated computerized program trading, were from rent redistribution rather than genuine wealth creation." In particular, modern finance as rent redistribution. The wikipedia entry on 'economic rent' is helpful, but doesn't get me all the way there. Help would be much appreciated!
- barrkel 14y ago
  In the language of the current top comment, rent seeking is looking to increase your own share of the total pie (and implicitly, other people's share less), rather than making the pie bigger. So the "profits" are more about redistributing things into your own pocket through structural advantages (like control of capital or co-opting the state), rather than wealth creation. The implication is that this is inefficient because the same resources and intelligent people could have been doing productive things that created wealth, like creating startups, rather than e.g. creating financial products that return big bonuses today but blow up a few years down the line, where the state or other people are left holding the can, with no net gain in the system.
- aphelion 14y ago
  If I buy logs and built rafts with them, which I then sell to people trying to cross a river, I'm creating wealth. If I own a strip of land up and down the river and charge people who want to cross it in their rafts, I'm extracting rents. If I patent the concept of raft building and require anyone building their own rafts to pay me, I'm extracting rents. What that quotation means is that all the finance MBAs and Wall Street quants of the last decade aren't making the economic pie bigger, they're just ensuring that they get a bigger slice of it.
- stilltrying 14y ago
  Thanks for the replies. I kept searching around, and I think my mistake was focusing too much on the word 'rent'. Focusing instead on 'redistribution', what helped clarify my understanding the most is the criticism that modern finance is becoming more of a zero-sum game; and 'rent' is mainly being used as the economic dirty word for this behavior. http://seekingalpha.com/article/1069231-from-positive-to-zero-to-negative-sum-capitalism http://seekingalpha.com/article/1069231-from-positive-to-zer...
nhashem 14y ago
More analysis on Point #3 in this article was also covered by Paul Krugman (liberal economist columnist at the NY Times): http://krugman.blogs.nytimes.com/2012/12/11/human-versus-physical-capital/ http://krugman.blogs.nytimes.com/2012/12/11/human-versus-phy... http://krugman.blogs.nytimes.com/2012/12/10/technology-and-wages-the-analytics-wonkish/ http://krugman.blogs.nytimes.com/2012/12/10/technology-and-w... Basically it's simple: as more wealth creation is driven by technology, the wealth shifts to whoever owns the technology or can operate it. Why is the payoff for founding a successful technology company so potentially lucrative? It's because you're basically both. If you think acqui-hires that pay something like $1 million per engineer is a lot, that's basically why. In the US, we should have two political parties mitigating this by figuring out the balance between helping low-skilled workers become high-skilled (e.g. education funding and reform) versus making sure those unemployed low-skilled workers don't get sick and starve to death on the street in the meantime (e.g. unemployment and health insurance). Instead we have two political parties arguing to the death about whether or not to raise taxes by 4.9%.
- bennesvig 14y ago
  We already have a system that's supposed to help people become high skilled workers, public education. Instead of producing competent workers, it churns out compliant cogs.
  - InclinedPlane 14y ago
    It's designed to churn out compliant cogs, and through various forces has only become better at doing so. Modern western public education is based on the Prussian school system (http://en.wikipedia.org/wiki/Prussian_education_system http://en.wikipedia.org/wiki/Prussian_education_system) which emphasizes compliance, uniformity, attendance, punctuality, busy work, etc. All of which are great for making functional factory workers, but that has become less and less relevant as the nature of the economy has changed due to technological disruption. More so, the increasing disempowerment of individuals and refusal to treat students as adults in training (see: closed campuses, zero tolerance policies, etc.) has merely exacerbated that impedance mismatch. Now we have high school graduates who can barely read or do algebra let alone use rules of logic to reason or communicate effectively on complex topics at a time when knowledge workers are in the greatest demand in all of human history.
alok-g 14y ago
Alert: Newbie to economics here sharing some thoughts for feedback. At time t -> infinity, the ideal state would not be humans not having jobs (machines taking over), but humans not "needing" jobs (machines doing everything we need to do today). This may however never be since natural resources are limited, and so the cost of goods (while reducing due to economically cheaper machines taking over) would never come to zero. So then, as time progresses, the jobs for humans would end up being at the end of the production-possibility frontier [1] where their sole motive is to figure new things (entrepreneurship), while the machines take care of existing methods of producing. [1] http://en.wikipedia.org/wiki/Production-possibility_frontier http://en.wikipedia.org/wiki/Production-possibility_frontier
- wissler 14y ago
  Natural resources are virtually unlimited, at least for the current size of the human race. We're only just scratching the surface of the resources available on Earth, and there's a whole solar system we have access to. The only issue is the technology required to transform these resources into something useful, and the "permission" to create and deploy such technology.
  - Surio 14y ago
    >> Natural resources are virtually unlimited at least for the current size of the human race I was sort of nodding in agreement at another comment you left elsewhere but this one is just not on. This belief is definitely at odds with mine (specially going in with Club of Rome studies on this topic, for e.g.).
    - wissler 14y ago
      It's not useful to just say you disagree. You ought to say why. The fact is that matter is virtually unlimited, and it is not against the laws of physics that we can transform matter into more useful kinds, that we can deploy various means of collecting energy from the sun (even extraterrestrial), that we can learn how to fuse hydrogen, etc. Edit: I guess you sort of did indicate why you disagreed, but referring to "Club of Rome" is just argument from authority, and anyway their study flies in the face of common sense. We know the Earth is brimming over with energy and resources, that the main difficulty is collecting and transforming them. This is a technological problem not a fundamentally unresolvable problem.
wissler 14y ago
The root problem is that instead of being able to appropriate resources from nature and produce what we need as individuals directly, we've been corralled into a setup where we have to get permission from government to appropriate and transform raw materials. This is a completely artificial man-made problem, due to various forms of fiat property, one important class being patents, another being government-granted permission for resource extraction (but this is not exhaustive). It wasn't always so. Early man could claim and transform resources as he needed. Now we are required, on pain of death really (if we try to disobey we will be arrested, if we don't comply with the arrest we will be shot), to either plug into the existing economic structures -- or to starve to death.
- Riesling 14y ago
  > It wasn't always so. Early man could claim and transform resources as he needed. Now we are required, on pain of death really (if we try to disobey we will be arrested, if we don't comply with the arrest we will be shot), to either plug into the existing ecoIt wasn't always so. Early man could claim and transform resources as he needed. Now we are required, on pain of death really (if we try to disobey we will be arrested, if we don't comply with the arrest we will be shot), to either plug into the existing economic structures -- or to starve to death.nomic structures -- or to starve to death. And this is in my opinion the number one argument for socialism. We have taken people the possibility to go into self providing mode (by claiming land and producing food and shelter) because WE as a society PROFIT from it. If some people are not able to find a job in our current system, then we have the obligation to make sure that those people still have access to our basic services (food, shelter, healthcare).
joering2 14y ago
My conspiracy theorist side tells me that you don't need another War World to "clean up" the world, because eventually, most will find themselves out of job due to the raise of machines. They will be protesting on the streets, but when you broke with steam pipe in the hand its hard to protest against heavily armed LEs.
deleted 14y ago
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Hitchhiker 14y ago
" The future of work consists of learning a living " - Marshall McLuhan
harryf 14y ago
The reason why the "machines are winning" is most of the humans are held back by idiotic corporate structures and processes. Take HR for example; I've yet to see an HR department deliver real value that boosted performance.
digitalWestie 14y ago
We need workers to transition to becoming owners or capitalists. Technology now allows us to control the means of production much more cheaply than ever before. Example: self-publishing It's time our educational system reflected that.
nickik 14y ago
Its funny, in my Oral History exams I got a Text and had 10 min to analyze it. The Text could easly reprinted today, maybe switch out the word 'machine' with 'robot' once in a while. This idea has been around since more then 100 years and it has shown again an again to not be true. I have nothing against bringing up the same stuff again but if you do that you have to improve your argument not just reprint popular essays from 100 years ago with modern language. Tell me exactly what fundamental thing has changed with todays innovations that was not true for innovations in 1920 for example.

93 points by ph0rque 14y ago

Very reminiscent of creative destruction from Joseph Schumpeter - the whaling industry was destroyed by the petroleum industry. The survivors are the ones who possess the skills that are in demand. As the demand shifts, skills need updating.

jeremyjh 14y ago
Why would new industries and job roles always spring up to replace ones which have become obsolete? I agree that historically this has happened but I see no reason that it should be a necessary consequence. We have to consider the possibility that a segment of the population will have no realistic options for producing marginal value.
- dreamdu5t 14y ago
  Because the labor and resources freed up from automation and increased productivity allow us to pursue new things. There's always more to improve upon. Why would this segment of the population not have realistic options for producing marginal value? Everyone is capable of learning new things.
  - jeremyjh 14y ago
    Why would those new things necessarily be labor intensive? Lately most new profitable things require capital.
    - nickff 14y ago
      It should generally be presumed that when something has happened repeatedly and predictably in the past, it shall continue to do so.
      - jeremyjh 14y ago
        Until it doesn't - how many draft horses do you see working now? Besides which, we've got over fifty years of history telling us that wealth concentration is happening faster and faster. If just that trend alone continues then within our lifetime most people would not be earning enough to sustain themselves.
      - Crake 14y ago
        We're such a small segment of history, though. We're just a blip on the timeline of the universe. Look at how our population has expanded in the last 100 years alone...some things are just unsustainable.
    - saosebastiao 14y ago
      Do they? Cause from my view, the role of capital is greatly diminished, even from 10 years ago. PG has acknowledged as much with their move towards smaller monetary investments in Y Combinator businesses.
      - jeremyjh 14y ago
        pg is a pretty small part of the economy. Still, there is truth in what you are saying but when it comes to developing software there are barriers to entry much more substantial than capital.
        tomjen3 14y ago
        PG is a tiny part of the economy -- but he is also on the bleeding edge. What is true of him will be true of others in 50 years.
  - Jare 14y ago
    > Everyone is capable of learning new things Perhaps not quickly or efficiently enough, but even worse, it's not a given that there will always be enough valuable activities for everyone to perform and earn a wage. This is particularly true when wealth is not evenly distributed. The needs that a small group of wealthy people have for human-created value is, well, small, and therefore wealth barely gets redistributed. Other factors compound this, like the fact that most of the proceeds from a market do not go to the (potentially many) people involved in producing the goods or services, but to those comparatively few with the capital to finance that activity; the chasm between the (so to speak) haves and the have nots grows bigger and bigger. At that point, a significant segment of society simply can't earn a living, and society must adapt to become sustainable again. It's not the kind of thing that happens overnight, but you can see how most forces are pushing in that direction, so without a fundamental change in the dynamics of production, market and compensation, it's not a question of if, but when.
pixl97 14y ago
And when the day comes that available labor far outstrips the demand for labor? Your skill may be in demand, but how many will be willing to do the job at subsistence rates? Will the day come when 10s of millions (billion even?) of people be made redundant by technology? What will they do to eat? How will nations and societies deal with this? Grind the unemployed in to Soylent Green?, grand social welfare programs?, war? I always liked this fictional story about it. http://marshallbrain.com/manna1.htm http://marshallbrain.com/manna1.htm
- dreamdu5t 14y ago
  They will need to learn skills that are in demand. I don't owe you anything simply because you exist.
  - waterlesscloud 14y ago
    The day will come when no human skills are in demand. That day may not be next week, but it might be in the next couple of centuries. It might even be in your lifetime. What then?
    - nickff 14y ago
      Dreamdu5t was just making the point that every person owns the products of their labour; and one's failure does not grant any right to take from others.
    - saosebastiao 14y ago
      We ensure that the machines serve the people, as opposed to a person.
      - lgieron 14y ago
        Exactly! We just raise corporate taxes so high that the money collected can support unemployed masses, thus reaching the long sought after ideal of work being the option and not the necessity. Each person will have the choice to either work towards elevating his social status (via creating his own invention/company/piece of art/...) or just collect the state check.

deleted 14y ago

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gmaslov 14y ago

Why on earth is this framed as a "war against machines"? That's just plain wrong. The machines serve people. If there's a war, it's between people and other people.

anigbrowl 14y ago
You'd feel different if your job were eliminated by automation (not least because such jobs are correlated with lower educational achievement).
ChuckMcM 14y ago
Because that makes it emotional. You are absolutely correct that job loss due to automation is really people figuring out how to do something less expensively with a tool than without one. This process of elimination is ongoing. Periodically people put forward the notion that there is some community 'good' to be achieved by not taking advantage of this progress. Ned Ludd is probably the most well known example but lots of folks have made similar suggestions over the years. In every example, without exception, that path has lead to stagnation and death of the community that supported it. This truth however does not stop people being displaced by automation to suggest it however, that death will come later to community they are no longer a part of so they don't really care, they only care about the here and now. Talk to former factory workers of car companies that no longer exist but they successfully kept automation out of those factories. They protected their own jobs, at the expense of killing the company and all future jobs it might create, and ultimately their own pensions took a hit when those companies died. As a journalist though it is a great way to generate rage views with the dispossessed and the fearful.
it 14y ago
People use machines for various things, but you could also say that machines use people to reproduce and continue functioning.
eli_gottlieb 14y ago
If there's a war, it's between people and other people. Because pointing out the existence of class war is politically incorrect. Most people would sooner admit to a race war than a struggle between the capitalist class and working class.

ilaksh 14y ago

> Ironically, the best-educated economists are often the most resistant to this idea, as the standard models of economic growth implicitly assume that economic growth benefits all residents of a country. Because economics is not a science, its a religion devoted to making sure that those who have money and power keep it and get more. The idea that there is a set of high-skill jobs which are immune to technological unemployment is false. It will just take a little while longer for those jobs to be replaced by artificial intelligence. The concept of superstars v. the rest is mainly just a weak argument attempting to cover for the tendency of monopolies to form in any economy. Technology just amplifies this fundamental characteristic of our 'economic' system. Technology directly opposes our 'economic' system because technology is the application of science to solving problems (i.e. information and resource _sharing_) whereas economics is about using proprietary information and resources to your advantage.

anigbrowl 14y ago
Economics is not scientific enough, but your statement is purely ignorant and makes ti clear you've never cracked open an economics textbook.
Jimmy 14y ago
[citation needed]

pash 14y ago

A couple of comments: > People with little economics training intuitively grasp this point. They understand that some human workers may lose out in the race against the machine. Ironically, the best-educated economists are often the most resistant to this idea, as the standard models of economic growth implicitly assume that economic growth benefits all residents of a country. No important model of economic growth assumes that growth or technological progress benefits everyone. What is broadly assumed (and there's a lot of empirical evidence behind it) is that innovation is the prime driver of economic growth, particularly in advanced capitalist economies. Economic growth means that society is gaining wealth in aggregate. And so long as the pie is growing, it is always possible, in principle, to allocate the gains in a Pareto-efficient manner (that is, in a manner in which everybody gains) through the political process. Therefore many economists consider the "distributional" question, concern about who gets what, to be of secondary importance to their field. They see their job as figuring out how to maximize the size of the pie and leave it to others to figure out how to divvy it up. (Economists do of course have a lot to say about how various ways of distributing the gains from growth affect the prospects for future growth.) > Shortly after the Luddites began smashing the machinery that they thought threatened their jobs, the economist David Ricardo, who initially thought that advances in technology would benefit all, developed an abstract model that showed the possibility of technological unemployment. What the author is eliding here is Ricardo's development of the idea of comparative advantage [0], one of the truly remarkable ideas in economics. Comparative advantage is basically the idea that even if one country (or firm, or group of people, or single person, or whatever economic unit you want to think about) is better at producing every conceivable good or service, that country (firm/group/person/etc) will still gain from specializing in producing the good or service it (they/he/she/etc) is relatively best at producing, then trading with others—who will also gain by the interaction. This insight does not mean that everyone will always gain from freer trade, or from innovation (which can be thought of as essentially similar in this regard to a relaxation of trade barriers with a country that's particularly adept at producing one good or another). But it does suggest that there is a net gain to be had from these developments. And, again, economists are primarily concerned with growing the pie. > At least since the followers of Ned Ludd smashed mechanized looms in 1811, workers have worried about automation destroying jobs. Economists have reassured them that new jobs would be created even as old ones were eliminated. For over 200 years, the economists were right. And that, really, is where I would leave things. There is very little to suggest that technological progress is about to take on a fundamentally different character, or entail much different results, than it has had, and has done, throughout the course of human history. When the singularity arrives, let's have this conversation again. 0. http://en.wikipedia.org/wiki/Comparative_advantage http://en.wikipedia.org/wiki/Comparative_advantage

gregpilling 14y ago

Whether or not a machine can replace me, I will still work. I enjoy work, I get great satisfaction from doing work and completing a project I set out to do. It may be an open-source project, it may be in my garden, but I will still work because I do it for me. I personally can't wait until I have a robot to do the heavy digging in the garden. I enjoy the planning part, and the smelling of the roses more than the digging part. Also, as a small manufacturer I am forced to train the people I have to adapt to the new world order. The article implies that the uneducated worker is to be replaced with the educated worker. I can't just replace my staff with all new people. I would lose the tribal knowledge. I can't avoid automation that my competitors have; it would put me at a big disadvantage. In fact the biggest advantage I can get is to automate a process that we do manually. This is why mcmaster.com will send you a huge catalog (printed) for free. It is because the people that order from the catalog are price insensitive. I certainly am when I have a broken machine. My automatic sand blaster needed $1000 worth of bearings overnighted last month. To make a big advantage in automation I need the help of the guy who has been doing it manually. So we work on bottlenecks in production one after the other. Every month we figure out what is slowing us down, or causing quality variations, or supplier problems and we try to come up with a way to improve things. The obvious first place to look for solutions is with the person suffering with the problem. The next obvious thing to do is to use some technology to make repetitive tasks easier. So my welder is now learning to use Arduino, and we are working on updating some old machinery with new automation. He might not do the coding, but he will certainly be the guy bolting the hardware together. So I would say the workers are not at war with the machines. The workers are working with the machines.

acslater00 14y ago

Yet another example of the "all labor is manufacturing" fallacy. A future where machines displace most of what we currently think of as blue collar workers is a future where most of the things blue collar workers currently produce are much, much, cheaper than they are now. This author worries whether blue collar jobs will pay "subsistence" wages. They will, because the cost of subsistence [and indeed, the cost of a fairly satisfied life] will be lower. As machines become better at manufacturing and hard labor, unskilled "work" will shift from physical to service industries. That's good! It's been happening for the past century. Unskilled physical labor is hard, especially as you get older and banged up. A mechanized future is one where physical resources are plentiful. People will figure out a reason to trade them. Humanity will be fine.

moultano 14y ago
Food, housing, transportation, and medical care may not get any cheaper. Food is already highly mechanized. Housing is saturated in the places where people want to live. In the US at least we lack the political will to make transformative investments in transportation, and gas production is already as mechanized as it is going to get. Medical care is likely to remain labor intensive using very expensive labor. Sure, the average worker may be able to buy more things at Walmart than they can today, but that has less of an effect on quality of life.
- pchristensen 14y ago
  Housing is politically saturated. There's plenty of room and technology to vastly increase the number of housing units and lower cost in desirable cities, but current zoning and planning regulations make them illegal to build.
  - Surio 14y ago
    Regardless of how semantically we phrase it, the bottomline that the parent made is valid... (Housing is saturated in the places where people want to live) i.e., it is as saturated as it can be, with no immediately conceivable resolution to the status quo.

stilltrying 14y ago

This sentence grabbed my attention, but I'm having trouble getting a clear understanding: "While efficient finance is essential to a modern economy, it appears that a significant share of returns to large human and technological investments in the past decade, such as those in sophisticated computerized program trading, were from rent redistribution rather than genuine wealth creation." In particular, modern finance as rent redistribution. The wikipedia entry on 'economic rent' is helpful, but doesn't get me all the way there. Help would be much appreciated!

barrkel 14y ago
In the language of the current top comment, rent seeking is looking to increase your own share of the total pie (and implicitly, other people's share less), rather than making the pie bigger. So the "profits" are more about redistributing things into your own pocket through structural advantages (like control of capital or co-opting the state), rather than wealth creation. The implication is that this is inefficient because the same resources and intelligent people could have been doing productive things that created wealth, like creating startups, rather than e.g. creating financial products that return big bonuses today but blow up a few years down the line, where the state or other people are left holding the can, with no net gain in the system.
aphelion 14y ago
If I buy logs and built rafts with them, which I then sell to people trying to cross a river, I'm creating wealth. If I own a strip of land up and down the river and charge people who want to cross it in their rafts, I'm extracting rents. If I patent the concept of raft building and require anyone building their own rafts to pay me, I'm extracting rents. What that quotation means is that all the finance MBAs and Wall Street quants of the last decade aren't making the economic pie bigger, they're just ensuring that they get a bigger slice of it.
stilltrying 14y ago
Thanks for the replies. I kept searching around, and I think my mistake was focusing too much on the word 'rent'. Focusing instead on 'redistribution', what helped clarify my understanding the most is the criticism that modern finance is becoming more of a zero-sum game; and 'rent' is mainly being used as the economic dirty word for this behavior. http://seekingalpha.com/article/1069231-from-positive-to-zero-to-negative-sum-capitalism http://seekingalpha.com/article/1069231-from-positive-to-zer...

nhashem 14y ago

More analysis on Point #3 in this article was also covered by Paul Krugman (liberal economist columnist at the NY Times): http://krugman.blogs.nytimes.com/2012/12/11/human-versus-physical-capital/ http://krugman.blogs.nytimes.com/2012/12/11/human-versus-phy... http://krugman.blogs.nytimes.com/2012/12/10/technology-and-wages-the-analytics-wonkish/ http://krugman.blogs.nytimes.com/2012/12/10/technology-and-w... Basically it's simple: as more wealth creation is driven by technology, the wealth shifts to whoever owns the technology or can operate it. Why is the payoff for founding a successful technology company so potentially lucrative? It's because you're basically both. If you think acqui-hires that pay something like $1 million per engineer is a lot, that's basically why. In the US, we should have two political parties mitigating this by figuring out the balance between helping low-skilled workers become high-skilled (e.g. education funding and reform) versus making sure those unemployed low-skilled workers don't get sick and starve to death on the street in the meantime (e.g. unemployment and health insurance). Instead we have two political parties arguing to the death about whether or not to raise taxes by 4.9%.

bennesvig 14y ago
We already have a system that's supposed to help people become high skilled workers, public education. Instead of producing competent workers, it churns out compliant cogs.
- InclinedPlane 14y ago
  It's designed to churn out compliant cogs, and through various forces has only become better at doing so. Modern western public education is based on the Prussian school system (http://en.wikipedia.org/wiki/Prussian_education_system http://en.wikipedia.org/wiki/Prussian_education_system) which emphasizes compliance, uniformity, attendance, punctuality, busy work, etc. All of which are great for making functional factory workers, but that has become less and less relevant as the nature of the economy has changed due to technological disruption. More so, the increasing disempowerment of individuals and refusal to treat students as adults in training (see: closed campuses, zero tolerance policies, etc.) has merely exacerbated that impedance mismatch. Now we have high school graduates who can barely read or do algebra let alone use rules of logic to reason or communicate effectively on complex topics at a time when knowledge workers are in the greatest demand in all of human history.

alok-g 14y ago

Alert: Newbie to economics here sharing some thoughts for feedback. At time t -> infinity, the ideal state would not be humans not having jobs (machines taking over), but humans not "needing" jobs (machines doing everything we need to do today). This may however never be since natural resources are limited, and so the cost of goods (while reducing due to economically cheaper machines taking over) would never come to zero. So then, as time progresses, the jobs for humans would end up being at the end of the production-possibility frontier [1] where their sole motive is to figure new things (entrepreneurship), while the machines take care of existing methods of producing. [1] http://en.wikipedia.org/wiki/Production-possibility_frontier http://en.wikipedia.org/wiki/Production-possibility_frontier

wissler 14y ago
Natural resources are virtually unlimited, at least for the current size of the human race. We're only just scratching the surface of the resources available on Earth, and there's a whole solar system we have access to. The only issue is the technology required to transform these resources into something useful, and the "permission" to create and deploy such technology.
- Surio 14y ago
  >> Natural resources are virtually unlimited at least for the current size of the human race I was sort of nodding in agreement at another comment you left elsewhere but this one is just not on. This belief is definitely at odds with mine (specially going in with Club of Rome studies on this topic, for e.g.).
  - wissler 14y ago
    It's not useful to just say you disagree. You ought to say why. The fact is that matter is virtually unlimited, and it is not against the laws of physics that we can transform matter into more useful kinds, that we can deploy various means of collecting energy from the sun (even extraterrestrial), that we can learn how to fuse hydrogen, etc. Edit: I guess you sort of did indicate why you disagreed, but referring to "Club of Rome" is just argument from authority, and anyway their study flies in the face of common sense. We know the Earth is brimming over with energy and resources, that the main difficulty is collecting and transforming them. This is a technological problem not a fundamentally unresolvable problem.

wissler 14y ago

The root problem is that instead of being able to appropriate resources from nature and produce what we need as individuals directly, we've been corralled into a setup where we have to get permission from government to appropriate and transform raw materials. This is a completely artificial man-made problem, due to various forms of fiat property, one important class being patents, another being government-granted permission for resource extraction (but this is not exhaustive). It wasn't always so. Early man could claim and transform resources as he needed. Now we are required, on pain of death really (if we try to disobey we will be arrested, if we don't comply with the arrest we will be shot), to either plug into the existing economic structures -- or to starve to death.

Riesling 14y ago
> It wasn't always so. Early man could claim and transform resources as he needed. Now we are required, on pain of death really (if we try to disobey we will be arrested, if we don't comply with the arrest we will be shot), to either plug into the existing ecoIt wasn't always so. Early man could claim and transform resources as he needed. Now we are required, on pain of death really (if we try to disobey we will be arrested, if we don't comply with the arrest we will be shot), to either plug into the existing economic structures -- or to starve to death.nomic structures -- or to starve to death. And this is in my opinion the number one argument for socialism. We have taken people the possibility to go into self providing mode (by claiming land and producing food and shelter) because WE as a society PROFIT from it. If some people are not able to find a job in our current system, then we have the obligation to make sure that those people still have access to our basic services (food, shelter, healthcare).

joering2 14y ago

My conspiracy theorist side tells me that you don't need another War World to "clean up" the world, because eventually, most will find themselves out of job due to the raise of machines. They will be protesting on the streets, but when you broke with steam pipe in the hand its hard to protest against heavily armed LEs.

deleted 14y ago

[deleted]

Hitchhiker 14y ago

" The future of work consists of learning a living " - Marshall McLuhan

harryf 14y ago

The reason why the "machines are winning" is most of the humans are held back by idiotic corporate structures and processes. Take HR for example; I've yet to see an HR department deliver real value that boosted performance.

digitalWestie 14y ago

We need workers to transition to becoming owners or capitalists. Technology now allows us to control the means of production much more cheaply than ever before. Example: self-publishing It's time our educational system reflected that.

nickik 14y ago

Its funny, in my Oral History exams I got a Text and had 10 min to analyze it. The Text could easly reprinted today, maybe switch out the word 'machine' with 'robot' once in a while. This idea has been around since more then 100 years and it has shown again an again to not be true. I have nothing against bringing up the same stuff again but if you do that you have to improve your argument not just reprint popular essays from 100 years ago with modern language. Tell me exactly what fundamental thing has changed with todays innovations that was not true for innovations in 1920 for example.