7 ms·

Sympathy for the Luddites

76 points by jaysonelliot 13y ago

porter 13y ago
In the short term taxing the rich seems like the only viable solution. But just give it some time. Skill acquisition via free online courses will replace high cost universities. This alone will solve most of Krugman's problem. Entrepreneurs have a funny way of figuring out how to solve our problems - without redistributing wealth (save for the overly hyped Tesla)
- gems 13y ago
  It still takes time to retrain, even if the education is free.
draq 13y ago
Basic income for everyone does indeed seem reasonable to me. If new technology drastically reduces the amount of labour, it seems obviously fair that everyone should be eligible to profit from its benefits. If 2% of the population can provide food for the whole society, maybe another 30% (a number to be drastically reduced by new technology) needed to maintain the social and economical infrastructure, then we will have a majority of people whose economic output is not required. Those people, e.g. children, retirees, handicapped, people with illness, etc. need means to live a decent life. To excessively burden the relatives of those people seems to be an arbitrary and cruel neglect of the society to care for its members. The argument against basic income is the same as for IP laws. Without money or legal constructs to monetize their products, people have no incentives to work. Maybe we need better incentives for working and creating things.
- msandford 13y ago
  I would argue that it's not obviously fair that everyone should profit from it. What incentives do people have to make new technologies that drastically increase labor if they cannot be paid for inventing them? People should only invent to serve their fellow men, and receive no compensation for their efforts? If they do deserve compensation for their efforts, how do you do that aside from "capitalism"? In a capitalist society if you can make more things from less resources, you should (everything else being equal) reap higher profits. That's your compensation for your invention. In the absence of such a mechanism, what is the fair price for an invention? Who decides?
  - ecopoesis 13y ago
    The incentive to work is you make more money. Everyone gets basic income, regardless of other income. It isn't taxed because taxing what the government gives just so it can redistribute again later is stupid. If you earn additional income above the government provided basic income, you pay taxes on it, on a sliding scale. The more you make, the higher the rate you pay. The rich who work for their wealth are still rich, but the gaps between their wealth and the "poor" who only receive basic income is made smaller, and no matter what, everyone has enough to live.
    - msandford 13y ago
      Sure, but who decides what the right number is for a basic income? No matter what number you pick there will be a portion of the population who sees that number as "good enough" and will cease to work. As the basic income grows, more people will choose not to work. This is good as it reduces the supply of labor, thus increasing the wages of those who do work. But it also reduces the amount of income available for taxation, as this basic income isn't taxed. And as the tax base is reduced through a higher basic income, more money is needed to pay that basic income. That drives up the tax rate. It wouldn't be terribly difficult to find yourself in a situation where the math simply doesn't work. This analysis also neglects the increase in prices that might accompany such a system. The higher the basic income the more likely you are to see an increase in prices that guts the effectiveness of the basic income.
      - dragonwriter 13y ago
        > Sure, but who decides what the right number is for a basic income? No matter what number you pick there will be a portion of the population who sees that number as "good enough" and will cease to work. This is, to an extent, self-controlling because people opting out of the labor pool decreases the size of the pool, increases the market-clearing price for labor, and increases the incentive to opt in to the labor pool. The other thing is that it gives people more freedom to undertake speculative efforts (you still need to get funding to meet any costs of the effort itself, assuming that basic income isn't high enough to provide a surplus that can be used for that purpose, but you don't need as much savings to meet your own living expenses while undertaking a speculative effort.) Opting out of the conventional labor market doesn't necessarily mean opting out of work. > This is good as it reduces the supply of labor, thus increasing the wages of those who do work. But it also reduces the amount of income available for taxation, as this basic income isn't taxed. Its not clear that this is the case: sure, those who opt out of work will no longer be paying income taxes, but, as you note, wages for those who work are driven up by supply -- which also increases the total amount of income taxes paid by those who work. What effect this has in total is unpredictable; it seems intuitively likely that overall labor-derived income would drop, which would be expected to drop income tax revenues in a flat tax regime, but its also likely those dropping out would be on the lower end of the labor-derived income scale, and in a progressive tax system, that, combined with increased wages for workers, could still increase overall income tax revenues.
- tomjen3 13y ago
  Technology doesn't drop from the sky, like everything else it is created (or farmed, or dug up from the earth) and rightfully belongs to its creator.
  - gngeal 13y ago
    Yes, that is why whenever you invent something independently you're fucked because of this nasty thing called "the patent system" that essentially guarantees that most things you create already belong to someone else.
  - jrokisky 13y ago
    All inventions are built on those that came before them. How much iteration defines a new invention?
  - iwwr 13y ago
    In some ways yes, but if you mean intellectual property then no.
- invalidOrTaken 13y ago
  Basic income would make sustained immigration untenable. Our society depends on diversity and vibrancy; we can't put a price tag on human beings.
- timberlane 13y ago
  Serious question: How to reconcile BI with more liberal immigration laws? I see a benefit of BI, but I personally see a larger benefit of allowing open immigration (else you have large inequalities based on country of origin).
- marknutter 13y ago
  The problem with "basic income" as I see it is people's ideas about what a proper standard of living is completely subjective. Should a basic income cover an apartment, or a house? Should it cover cheap food or expensive organic food? Should it cover technological gadgetry, and if so, how much? What type of car is "fair" for someone to be given? How do we ensure people's standard of living doesn't continue to increase. Will we not always have someone with more money to compare ourselves to? It's the nebulous definition of what a "basic income" should be that has me worried about the whole concept.
beloch 13y ago
I think we need to start distinguishing between the part of the 1% that builds new technologies, products, etc. and the part of the 1% that speculates on African food futures, high-frequency trading, etc.. The former is useful. The latter is entirely destructive and should be legislated into poverty for the greater good.
- thufry 13y ago
  This article is specifically about how your "useful" subset of the 1% creates technologies which benefit humanity in the long run, but harm large numbers of individuals in the short run, and what to do about that. Your "destructive" 1% doesn't even factor into this article yet you feel entitled to come in here and rant about them.
  - gngeal 13y ago
    how your "useful" subset of the 1% creates technologies which benefit humanity in the long run, but harm large numbers of individuals in the short run I think you forgot to add "in the current economical/social system". The technology never hurts anyone objectively, it always helps. It's us, humans, who decide that someone should be punished for the technological progress. ("You've been replaced by a machine, go eat cake. To celebrate our newly redoubled productivity, we'll let you starve.")
msandford 13y ago
Yeah he definitely identifies a problem but does not address any of the knock-on effects of a guaranteed minimum income, namely the incentive to not work rather than to work. What he's arguing is that we should pay people not to work the same way we pay farmers not to grow corn, to ensure that the price is kept high enough for those who do engage in working/farming to earn the "right" amount of money. It's a noble goal to be sure, to ensure that everyone can feed their families and live a comfortable-enough life and such. I don't argue with his intentions one iota. The problem for Krugman is that taxing is his hammer and every problem in the world looks like a nail. It's far easier to exhort "we must do something!" and to use the force of law to do SOMETHING than to figure out a better solution to a very real problem. I am of course in some ways a hypocrite since I can't think of any solutions myself off the top of my head.
- anigbrowl 13y ago
  Actually, the idea of a basic income (under the rubric 'negative income tax') was favored by economists like Milton Friedman as well (see http://en.wikipedia.org/wiki/Negative_income_tax http://en.wikipedia.org/wiki/Negative_income_tax for an OK overview). The underlying concept here is not so much fairness as that there's an opportunity cost to society in having people engaged in the sort of work they're not especially well-suited to in order to meet the basic needs of survival.
  - msandford 13y ago
    I never argued against this for "fairness" nor did Krugman mention the societal opportunity cost. It's more an issue of signaling. People won't go through the pain necessary to learn a new skill if there's no incentive. High wages are encouragements to endure the discomfort inherent (for most) in change necessary for the rebalancing of the labor force. Low wages signal that the skill is not in high demand (relative to supply) and that there may be other more opportunities more attractive. The negative income tax reduces the incentive to move from one segment of the labor force to another and could be analogous to a tariff, in a way.
    - 13y ago
decasteve 13y ago
We should stop using the term "highly skilled" when it really means "highly specialized". The trouble is we are still using school, from kindergarten to university (and beyond), as a system to turn people into highly specialized automatons. And the trouble with automatons is they get automated. A few have been lucky during the course of the industrial revolution to pick the right skill to specialize in, and at the right time, but examples abound when you pick the "wrong" specialization, just to see it subsequently automated. I never really understood what Buckminster Fuller was trying to get across in his Operating Manual for Spaceship Earth, until recently. The amazing thing is he addressed these concerns quite presciently in the 1960s--he saw this coming. The only advice I can give is always be learning and adapting and apply it in creative and entrepreneurial ways.
john_b 13y ago
In many ways I think the industrial revolution has made us forget a very important historical fact. Prior to industrialization, "labor" was often little more than serfdom. "Labor" in the purest sense didn't own anything, but was simply a necessary component for the wealth-producing activities of those who did. Laborers only had one economic move: to offer their time and hands in the service of those who owned things (land, a shop, a ship, etc) in return for a wage. That wage, effectively their value as laborers, was determined by the law of supply and demand. All the industrial revolution did was to vastly increase the demand for labor. However, the ancient fact that one's existence as more than a serf required ownership of something did not change. The living standards of serfs simply improved dramatically. Those living standards still depended on the demand for labor being high and/or the supply low. When technology reduces the demand for labor, while the supply increases due to population growth, it's easy to think that the economic sky is falling. But since none of us have lived in a pre-industrial revolution era, we are accustomed to thinking of wage-earning labor as an economic strategy that is more common than ownership of property, and just as valid. But historically it has been a specialized and risky economic strategy, and as the demand for labor-intensive physical products decreases it should not be surprising if those who are dependent on this economic strategy suffer. It may be tragic, but it's certainly not a new tragedy. If you want long term economic security, own something.
- socialist_coder 13y ago
  >> If you want long term economic security, own something. So your solution is to tell labor that they should turn into capital? That is what you tell the millions of people who will be unable to find a job that pays a living wage? Come on.
  - john_b 13y ago
    A solution would propose a "how to"; I did not. I am merely pointing out a long term historical trend. If a person makes their living based on selling their time and specialized skills in exchange for money (as I currently do), there is no one size fits all strategy to take a wage earner and turn them into an owner that will work for everyone. Labor is a market like any other. If it's too crowded and competitive, it's best to consider other options.
tomjen3 13y ago
Again? What has it been? two months since we last had a round of these "unlike all the other times where we said that things were really different, this time it really is different" opionions bullshit (no it isn't any different this time). Can we please just let it be just this one article, this time?
ef4 13y ago
This problem is inherently transient. The worst case is that it takes a full generation for skills and customs to adapt. Skills like "reading" and "writing" were once the province of highly-educated specialists. They became mainstream when the economic incentives made them critical to have. People learn what they need to learn -- especially if they start as children. It's entirely appropriate to worry about how we can help people during this painful transition. But we need to be careful not to turn this temporary problem into a permanent one by creating cultures of dependence.
- JamesArgo 13y ago
  I think the assertion is we are approaching a time in which skills will be automated away faster than the time it takes to acquire them. Where will AI be in a "full generation"? I don't know, but a good bet is getting very close to human-level intelligence, and far surpassing it in many many specialized tasks.
  - rayiner 13y ago
    > Where will AI be in a "full generation"? I don't know, but a good bet is getting very close to human-level intelligence LOL, no. The amount AI would have to advance from its current state to "very close to human-level intelligence" would have to be orders of magnitude more than it has evolved from its initial state to its present state (over the last 50-60 years). Pray tell, what technologies can you name that evolved faster in their second half-century than their first? Does that mean we definitely won't have human-scale AI in 50 years? No, because revolutions are impossible to predict. What it does mean, however, is that human-scale AI is not the predictable outcome of existing evolutionary trends. Indeed, developments in AI more or less stalled out in the 1980's, most of what we've seen to date is new applications of techniques pioneered decades ago. To use an analogy, what do you think CPU clockspeeds will be 10 years from now? It's possible that some breakthrough will happen and we'll have 20 GHz processors, but projecting existing trends suggests that the increase in clockspeeds from 2013 to 2023 will be a lesser percentage than what we saw from 1993 to 2003.
    - 13y ago
bcoates 13y ago
Krugman's trying to juggle two contradictory viewpoints: one (the Luddite view) holds that the purpose of work is to have something to do. The Luddite petition is arguing that allowing these people to fall into idleness simply because there is a more effective machine to do their job will be toxic to society. This is somewhat confused by the Luddites also throwing out a lot of half-baked economic arguments, but those can be safely ignored in hindsight. Krugman then proposes a solution from an entirely opposite viewpoint: that the purpose of work is to produce useful things, and if the constant disruption of jobs is the cost of efficiency, we should just give the affected a handout to provide for their needs. But because the guaranteed income doesn't solve the Luddite's complaint, it misses the point entirely.
- guelo 13y ago
  Where do you get that the Luddites' only complaint was having something to do? “How are those men, thus thrown out of employ to provide for their families?” asked the petitioners.
  - bcoates 13y ago
    They answer their own question: with a retraining process that will leave their children behind as untrained bums. They semi-accurately predict a future where employment is sufficiently fluid that nobody is securely enough situated at a job that they can train their children into it.
- dllthomas 13y ago
  Tangentially, I'd like to note that giving affected people a handout is not only providing for their needs, it's also making sure there are people with the money to buy my products.
  - marcosdumay 13y ago
    What good comes to you from "them buying your goods" if you just gave them the money they are paying you? Of course, the good comes from not making them suffer, keeping things calm, having a sfety, getting an overall civilized society out of the deal. But that's not the kind of benefit implicit on your phrase (or in the Ford's original). Oh, and yes, there is one benefit that is not dependent on the price you pay for it. It'll make it possible for lots of people - that otherwise would just starve - to work into making the world a better place (for profit or not). But again, it's at least not obvious that you mean this, and it's obvious that the original didn't.
bdcs 13y ago
Please read about Basic Income Guarantees(BIG)[1-2], if you are unfamiliar. Essentially, it is a set amount of money for EVERY citizen with NO means testing. It has been promulgated by conservative and liberal Nobel laureates alike. It turns out that the limited, preliminary data shows it to be INCREDIBLY effective. Basic Income offers surprising, non-intuitive effects which -- sometimes -- strongly contradict derogatory stereotypes of the poor. For example, BIG has resulted in increased hours worked per week and wage. These increases were attributed to people finding jobs they liked more and were better at (in lieu of jobs-based means testing programs which incentivize getting crappiest job possible as soon as possible). [1] http://en.wikipedia.org/wiki/Basic_income_guarantee http://en.wikipedia.org/wiki/Basic_income_guarantee [2] https://news.ycombinator.com/item?id=5656249 https://news.ycombinator.com/item?id=5656249
YokoZar 13y ago
On the other hand, perhaps it's entirely possible that creators of technology will notice this large swath of available labor and create technology to make use of it. An important point about the Luddites is that while expensive weavers were put out of work by machines, those machines functioned by employing greater numbers of (vastly lower paid) unskilled immigrants. If you put a 150k salary expert out of work by creating a piece of technology that requires two 70k workers, you still profit.
wissler 13y ago
Get rid of corporate entitlements like patents, obscenely long copyrights, the FDA (yes, it's an entitlement -- see how hard it is for a little guy to compete when the hurdles are so high), etc. etc. and then see how it shakes out.
- eropple 13y ago
  > the FDA (yes, it's an entitlement -- see how hard it is for a little guy to compete when the hurdles are so high) Would you like to try Ed's Patent Elixir? I promise it won't kill you. It's from a little guy, just tryin' to compete.
  - wissler 13y ago
    If you're too foolish to do some vetting of what you take, you shouldn't compound that foolishness by stripping away others' right to take novel drugs that might, say, cure their cancer, etc.
    - eropple 13y ago
      I'm not foolish enough to not vet what I take. Or I like to think I'm not. But I can't vet what I would take, because I'm not an expert. Therein lies the problem. And, no, no free-market solution solves this without people fucking dying. Back to mises.org with this silliness, please.
      - wissler 13y ago
        The fact is that what another person chooses to take is none of your business. You use fearmongering as an irrational pretext to usurp someone's right to choose what they do with their own body, and sadly, that fearmongering works. It just doesn't work on reasonable people, who are in the minority.
WiseWeasel 13y ago
The solution is obviously to watch the average standard of living get significantly worse, then elect the one promising a chicken in every pot, and a chicken-cooking robot in every kitchen (pot and kitchen sold separately).

76 points by jaysonelliot 13y ago

In the short term taxing the rich seems like the only viable solution. But just give it some time. Skill acquisition via free online courses will replace high cost universities. This alone will solve most of Krugman's problem. Entrepreneurs have a funny way of figuring out how to solve our problems - without redistributing wealth (save for the overly hyped Tesla)

gems 13y ago
It still takes time to retrain, even if the education is free.

draq 13y ago

Basic income for everyone does indeed seem reasonable to me. If new technology drastically reduces the amount of labour, it seems obviously fair that everyone should be eligible to profit from its benefits. If 2% of the population can provide food for the whole society, maybe another 30% (a number to be drastically reduced by new technology) needed to maintain the social and economical infrastructure, then we will have a majority of people whose economic output is not required. Those people, e.g. children, retirees, handicapped, people with illness, etc. need means to live a decent life. To excessively burden the relatives of those people seems to be an arbitrary and cruel neglect of the society to care for its members. The argument against basic income is the same as for IP laws. Without money or legal constructs to monetize their products, people have no incentives to work. Maybe we need better incentives for working and creating things.

msandford 13y ago
I would argue that it's not obviously fair that everyone should profit from it. What incentives do people have to make new technologies that drastically increase labor if they cannot be paid for inventing them? People should only invent to serve their fellow men, and receive no compensation for their efforts? If they do deserve compensation for their efforts, how do you do that aside from "capitalism"? In a capitalist society if you can make more things from less resources, you should (everything else being equal) reap higher profits. That's your compensation for your invention. In the absence of such a mechanism, what is the fair price for an invention? Who decides?
- ecopoesis 13y ago
  The incentive to work is you make more money. Everyone gets basic income, regardless of other income. It isn't taxed because taxing what the government gives just so it can redistribute again later is stupid. If you earn additional income above the government provided basic income, you pay taxes on it, on a sliding scale. The more you make, the higher the rate you pay. The rich who work for their wealth are still rich, but the gaps between their wealth and the "poor" who only receive basic income is made smaller, and no matter what, everyone has enough to live.
  - msandford 13y ago
    Sure, but who decides what the right number is for a basic income? No matter what number you pick there will be a portion of the population who sees that number as "good enough" and will cease to work. As the basic income grows, more people will choose not to work. This is good as it reduces the supply of labor, thus increasing the wages of those who do work. But it also reduces the amount of income available for taxation, as this basic income isn't taxed. And as the tax base is reduced through a higher basic income, more money is needed to pay that basic income. That drives up the tax rate. It wouldn't be terribly difficult to find yourself in a situation where the math simply doesn't work. This analysis also neglects the increase in prices that might accompany such a system. The higher the basic income the more likely you are to see an increase in prices that guts the effectiveness of the basic income.
    - dragonwriter 13y ago
      > Sure, but who decides what the right number is for a basic income? No matter what number you pick there will be a portion of the population who sees that number as "good enough" and will cease to work. This is, to an extent, self-controlling because people opting out of the labor pool decreases the size of the pool, increases the market-clearing price for labor, and increases the incentive to opt in to the labor pool. The other thing is that it gives people more freedom to undertake speculative efforts (you still need to get funding to meet any costs of the effort itself, assuming that basic income isn't high enough to provide a surplus that can be used for that purpose, but you don't need as much savings to meet your own living expenses while undertaking a speculative effort.) Opting out of the conventional labor market doesn't necessarily mean opting out of work. > This is good as it reduces the supply of labor, thus increasing the wages of those who do work. But it also reduces the amount of income available for taxation, as this basic income isn't taxed. Its not clear that this is the case: sure, those who opt out of work will no longer be paying income taxes, but, as you note, wages for those who work are driven up by supply -- which also increases the total amount of income taxes paid by those who work. What effect this has in total is unpredictable; it seems intuitively likely that overall labor-derived income would drop, which would be expected to drop income tax revenues in a flat tax regime, but its also likely those dropping out would be on the lower end of the labor-derived income scale, and in a progressive tax system, that, combined with increased wages for workers, could still increase overall income tax revenues.
tomjen3 13y ago
Technology doesn't drop from the sky, like everything else it is created (or farmed, or dug up from the earth) and rightfully belongs to its creator.
- gngeal 13y ago
  Yes, that is why whenever you invent something independently you're fucked because of this nasty thing called "the patent system" that essentially guarantees that most things you create already belong to someone else.
- jrokisky 13y ago
  All inventions are built on those that came before them. How much iteration defines a new invention?
- iwwr 13y ago
  In some ways yes, but if you mean intellectual property then no.
invalidOrTaken 13y ago
Basic income would make sustained immigration untenable. Our society depends on diversity and vibrancy; we can't put a price tag on human beings.
timberlane 13y ago
Serious question: How to reconcile BI with more liberal immigration laws? I see a benefit of BI, but I personally see a larger benefit of allowing open immigration (else you have large inequalities based on country of origin).
marknutter 13y ago
The problem with "basic income" as I see it is people's ideas about what a proper standard of living is completely subjective. Should a basic income cover an apartment, or a house? Should it cover cheap food or expensive organic food? Should it cover technological gadgetry, and if so, how much? What type of car is "fair" for someone to be given? How do we ensure people's standard of living doesn't continue to increase. Will we not always have someone with more money to compare ourselves to? It's the nebulous definition of what a "basic income" should be that has me worried about the whole concept.

beloch 13y ago

I think we need to start distinguishing between the part of the 1% that builds new technologies, products, etc. and the part of the 1% that speculates on African food futures, high-frequency trading, etc.. The former is useful. The latter is entirely destructive and should be legislated into poverty for the greater good.

thufry 13y ago
This article is specifically about how your "useful" subset of the 1% creates technologies which benefit humanity in the long run, but harm large numbers of individuals in the short run, and what to do about that. Your "destructive" 1% doesn't even factor into this article yet you feel entitled to come in here and rant about them.
- gngeal 13y ago
  how your "useful" subset of the 1% creates technologies which benefit humanity in the long run, but harm large numbers of individuals in the short run I think you forgot to add "in the current economical/social system". The technology never hurts anyone objectively, it always helps. It's us, humans, who decide that someone should be punished for the technological progress. ("You've been replaced by a machine, go eat cake. To celebrate our newly redoubled productivity, we'll let you starve.")

msandford 13y ago

Yeah he definitely identifies a problem but does not address any of the knock-on effects of a guaranteed minimum income, namely the incentive to not work rather than to work. What he's arguing is that we should pay people not to work the same way we pay farmers not to grow corn, to ensure that the price is kept high enough for those who do engage in working/farming to earn the "right" amount of money. It's a noble goal to be sure, to ensure that everyone can feed their families and live a comfortable-enough life and such. I don't argue with his intentions one iota. The problem for Krugman is that taxing is his hammer and every problem in the world looks like a nail. It's far easier to exhort "we must do something!" and to use the force of law to do SOMETHING than to figure out a better solution to a very real problem. I am of course in some ways a hypocrite since I can't think of any solutions myself off the top of my head.

anigbrowl 13y ago
Actually, the idea of a basic income (under the rubric 'negative income tax') was favored by economists like Milton Friedman as well (see http://en.wikipedia.org/wiki/Negative_income_tax http://en.wikipedia.org/wiki/Negative_income_tax for an OK overview). The underlying concept here is not so much fairness as that there's an opportunity cost to society in having people engaged in the sort of work they're not especially well-suited to in order to meet the basic needs of survival.
- msandford 13y ago
  I never argued against this for "fairness" nor did Krugman mention the societal opportunity cost. It's more an issue of signaling. People won't go through the pain necessary to learn a new skill if there's no incentive. High wages are encouragements to endure the discomfort inherent (for most) in change necessary for the rebalancing of the labor force. Low wages signal that the skill is not in high demand (relative to supply) and that there may be other more opportunities more attractive. The negative income tax reduces the incentive to move from one segment of the labor force to another and could be analogous to a tariff, in a way.
  - 13y ago

decasteve 13y ago

We should stop using the term "highly skilled" when it really means "highly specialized". The trouble is we are still using school, from kindergarten to university (and beyond), as a system to turn people into highly specialized automatons. And the trouble with automatons is they get automated. A few have been lucky during the course of the industrial revolution to pick the right skill to specialize in, and at the right time, but examples abound when you pick the "wrong" specialization, just to see it subsequently automated. I never really understood what Buckminster Fuller was trying to get across in his Operating Manual for Spaceship Earth, until recently. The amazing thing is he addressed these concerns quite presciently in the 1960s--he saw this coming. The only advice I can give is always be learning and adapting and apply it in creative and entrepreneurial ways.

john_b 13y ago

In many ways I think the industrial revolution has made us forget a very important historical fact. Prior to industrialization, "labor" was often little more than serfdom. "Labor" in the purest sense didn't own anything, but was simply a necessary component for the wealth-producing activities of those who did. Laborers only had one economic move: to offer their time and hands in the service of those who owned things (land, a shop, a ship, etc) in return for a wage. That wage, effectively their value as laborers, was determined by the law of supply and demand. All the industrial revolution did was to vastly increase the demand for labor. However, the ancient fact that one's existence as more than a serf required ownership of something did not change. The living standards of serfs simply improved dramatically. Those living standards still depended on the demand for labor being high and/or the supply low. When technology reduces the demand for labor, while the supply increases due to population growth, it's easy to think that the economic sky is falling. But since none of us have lived in a pre-industrial revolution era, we are accustomed to thinking of wage-earning labor as an economic strategy that is more common than ownership of property, and just as valid. But historically it has been a specialized and risky economic strategy, and as the demand for labor-intensive physical products decreases it should not be surprising if those who are dependent on this economic strategy suffer. It may be tragic, but it's certainly not a new tragedy. If you want long term economic security, own something.

socialist_coder 13y ago
>> If you want long term economic security, own something. So your solution is to tell labor that they should turn into capital? That is what you tell the millions of people who will be unable to find a job that pays a living wage? Come on.
- john_b 13y ago
  A solution would propose a "how to"; I did not. I am merely pointing out a long term historical trend. If a person makes their living based on selling their time and specialized skills in exchange for money (as I currently do), there is no one size fits all strategy to take a wage earner and turn them into an owner that will work for everyone. Labor is a market like any other. If it's too crowded and competitive, it's best to consider other options.

tomjen3 13y ago

Again? What has it been? two months since we last had a round of these "unlike all the other times where we said that things were really different, this time it really is different" opionions bullshit (no it isn't any different this time). Can we please just let it be just this one article, this time?

ef4 13y ago

This problem is inherently transient. The worst case is that it takes a full generation for skills and customs to adapt. Skills like "reading" and "writing" were once the province of highly-educated specialists. They became mainstream when the economic incentives made them critical to have. People learn what they need to learn -- especially if they start as children. It's entirely appropriate to worry about how we can help people during this painful transition. But we need to be careful not to turn this temporary problem into a permanent one by creating cultures of dependence.

JamesArgo 13y ago
I think the assertion is we are approaching a time in which skills will be automated away faster than the time it takes to acquire them. Where will AI be in a "full generation"? I don't know, but a good bet is getting very close to human-level intelligence, and far surpassing it in many many specialized tasks.
- rayiner 13y ago
  > Where will AI be in a "full generation"? I don't know, but a good bet is getting very close to human-level intelligence LOL, no. The amount AI would have to advance from its current state to "very close to human-level intelligence" would have to be orders of magnitude more than it has evolved from its initial state to its present state (over the last 50-60 years). Pray tell, what technologies can you name that evolved faster in their second half-century than their first? Does that mean we definitely won't have human-scale AI in 50 years? No, because revolutions are impossible to predict. What it does mean, however, is that human-scale AI is not the predictable outcome of existing evolutionary trends. Indeed, developments in AI more or less stalled out in the 1980's, most of what we've seen to date is new applications of techniques pioneered decades ago. To use an analogy, what do you think CPU clockspeeds will be 10 years from now? It's possible that some breakthrough will happen and we'll have 20 GHz processors, but projecting existing trends suggests that the increase in clockspeeds from 2013 to 2023 will be a lesser percentage than what we saw from 1993 to 2003.
  - 13y ago

bcoates 13y ago

Krugman's trying to juggle two contradictory viewpoints: one (the Luddite view) holds that the purpose of work is to have something to do. The Luddite petition is arguing that allowing these people to fall into idleness simply because there is a more effective machine to do their job will be toxic to society. This is somewhat confused by the Luddites also throwing out a lot of half-baked economic arguments, but those can be safely ignored in hindsight. Krugman then proposes a solution from an entirely opposite viewpoint: that the purpose of work is to produce useful things, and if the constant disruption of jobs is the cost of efficiency, we should just give the affected a handout to provide for their needs. But because the guaranteed income doesn't solve the Luddite's complaint, it misses the point entirely.

guelo 13y ago
Where do you get that the Luddites' only complaint was having something to do? “How are those men, thus thrown out of employ to provide for their families?” asked the petitioners.
- bcoates 13y ago
  They answer their own question: with a retraining process that will leave their children behind as untrained bums. They semi-accurately predict a future where employment is sufficiently fluid that nobody is securely enough situated at a job that they can train their children into it.
dllthomas 13y ago
Tangentially, I'd like to note that giving affected people a handout is not only providing for their needs, it's also making sure there are people with the money to buy my products.
- marcosdumay 13y ago
  What good comes to you from "them buying your goods" if you just gave them the money they are paying you? Of course, the good comes from not making them suffer, keeping things calm, having a sfety, getting an overall civilized society out of the deal. But that's not the kind of benefit implicit on your phrase (or in the Ford's original). Oh, and yes, there is one benefit that is not dependent on the price you pay for it. It'll make it possible for lots of people - that otherwise would just starve - to work into making the world a better place (for profit or not). But again, it's at least not obvious that you mean this, and it's obvious that the original didn't.

bdcs 13y ago

Please read about Basic Income Guarantees(BIG)[1-2], if you are unfamiliar. Essentially, it is a set amount of money for EVERY citizen with NO means testing. It has been promulgated by conservative and liberal Nobel laureates alike. It turns out that the limited, preliminary data shows it to be INCREDIBLY effective. Basic Income offers surprising, non-intuitive effects which -- sometimes -- strongly contradict derogatory stereotypes of the poor. For example, BIG has resulted in increased hours worked per week and wage. These increases were attributed to people finding jobs they liked more and were better at (in lieu of jobs-based means testing programs which incentivize getting crappiest job possible as soon as possible). [1] http://en.wikipedia.org/wiki/Basic_income_guarantee http://en.wikipedia.org/wiki/Basic_income_guarantee [2] https://news.ycombinator.com/item?id=5656249 https://news.ycombinator.com/item?id=5656249

YokoZar 13y ago

On the other hand, perhaps it's entirely possible that creators of technology will notice this large swath of available labor and create technology to make use of it. An important point about the Luddites is that while expensive weavers were put out of work by machines, those machines functioned by employing greater numbers of (vastly lower paid) unskilled immigrants. If you put a 150k salary expert out of work by creating a piece of technology that requires two 70k workers, you still profit.

wissler 13y ago

Get rid of corporate entitlements like patents, obscenely long copyrights, the FDA (yes, it's an entitlement -- see how hard it is for a little guy to compete when the hurdles are so high), etc. etc. and then see how it shakes out.

eropple 13y ago
> the FDA (yes, it's an entitlement -- see how hard it is for a little guy to compete when the hurdles are so high) Would you like to try Ed's Patent Elixir? I promise it won't kill you. It's from a little guy, just tryin' to compete.
- wissler 13y ago
  If you're too foolish to do some vetting of what you take, you shouldn't compound that foolishness by stripping away others' right to take novel drugs that might, say, cure their cancer, etc.
  - eropple 13y ago
    I'm not foolish enough to not vet what I take. Or I like to think I'm not. But I can't vet what I would take, because I'm not an expert. Therein lies the problem. And, no, no free-market solution solves this without people fucking dying. Back to mises.org with this silliness, please.
    - wissler 13y ago
      The fact is that what another person chooses to take is none of your business. You use fearmongering as an irrational pretext to usurp someone's right to choose what they do with their own body, and sadly, that fearmongering works. It just doesn't work on reasonable people, who are in the minority.

WiseWeasel 13y ago

The solution is obviously to watch the average standard of living get significantly worse, then elect the one promising a chicken in every pot, and a chicken-cooking robot in every kitchen (pot and kitchen sold separately).