> What about the workers thrown out of jobs by the new robo-waiters? Many would get new jobs, though the way this would work is often ignored.
> Most restaurants would keep longer hours (they're paying for the rent and the robots anyway), meaning many workers would get a raise and change shifts.
No, the workers are now fired. They don't get a raise.
> The advanced robo-restaurant technology would itself be a valuable American export good, and people would be employed in designing and selling it.
Yes, but not the people we just fired.
> Some low-wage work would be reallocated out of the relatively low-social-value restaurant sector and into things like child care and home health assistance, for which there is ample demand.
If there is ample demand for such things, and those things pay better, and typical restaurant workers are qualified, then we should already see a mass exodus from restaurant work. We don't. Thus one of these things isn't true.
You are essentially making the luddite case. The counterargument usually goes like this: yes, people would be fired and there will be serious pain in the short run; however the machines will drastically improve productivity, therefore reduce prices, so real wages will go up along with demand and the extra income not spent on, say, buying feed stock for your horse, will go in creating other jobs and economic sectors that will make use of the available labor. The government can and should ease the transition by offering skill-training and incentives.
While economically sound, I'm skeptical this process can go on forever. The human biology and mind is clearly limited, while the progress of machines does not seem to be. So eventually you will hit a fundamental limit where larger and larger chunks of the workforce will simply be too old, uneducated or simply too human to keep up.
How close we are to this fundamental limit it's anyone's guess, but I would venture to say we are closer than most think. At the point where a serious part of the population is unable to participate in the labor market, this ceases to be an appropriate system to distribute the fruits of economic activity and some form of basic income is required to maintain social order.
I'm not, I'm just countering some "don't worry, everything will be fine" idealism.
I don't think we should halt progress, but I do think we should be more intentional about how we go about it. There is not currently a solution on the table to address mass un/under-employment caused by near-term automation. Basic income is thrown around, but even if enacted, does not change the fact that our culture views work ethic ~= value. People want to be valued.
Choosing not to address it in the next couple of years results in a large number of mostly young, angry, disillusioned people with lots of free time. If you've got a history book handy, you can read plenty about what happens after that.
Completely agree. Can't help myself from thinking that the "continuous economic growth" supported by an ever growing population size is a broken paradigm. The more automation the less people will have an intrinsic value to society unless extremely highly educated/specialised.
"Normal" people simply won't be needed and according to liberal capitalism, they'll quickly be marginalised.
The solution I'd like to see: Enact basic income AND change the fact that our culture views work ethic (narrowly defined in terms of market income) ~= value.
When has that ever worked? I can't think of a single example.
Things people may raise like racism and sexism, in so far as they are changed, weren't changed per se, but merged with pre-existing values (liberty, fairness, equality) and morphed into a (usually) more consistent new definition. "We can all vote but not women" is more caveats than the new reality. Sexist ideas and elements weren't so much changed, they were contrasted with other values, and the inconsistency removed. Women vote, we can't pay less based on religion/race/gender etc. Same values, inconsistency removed.
So rather than change the view, I think the question is what can we contrast "work ~= value" with so that the inconsistency is clear? Maybe a sense of "money isn't everything"? That's all I've got, but then all the "77c on the dollar" talk puts money front and centre in almost every debate, making the "money is not everything" hard to sell as a deep cultural concept.
I dunno, the protestant work ethic is deeply, deeply ingrained in the west - not sure we really can change it, or what it can be merged with that we believe as strongly.
>> Maybe a sense of "money isn't everything"? That's all I've got, but then all the "77c on the dollar" talk puts money front and centre in almost every debate, making the "money is not everything" hard to sell as a deep cultural concept.
If we can get rid of the consumerism then I guess, we'd able to rein in many ill effects of "money is everything".
But again with all these criminally deceptive advertisements targeting the most fundamental animal instincts in us and thus turning us into mindless consumers and thus in turn transforming us into beings which are slaves to their money. Frankly, short of putting ban on the overt and covert advertisement and full implementation of public education in this regard, I don't see any way out of this dire situation. Public education beginning right from the primary school w.r.t. awareness of the ill-effects of advertisements, must be implemented with full gusto.
I don't think work ethic = value is ever going to go away to be honest. People will always value hard workers, and rightly so, because hard workers get things done and problem solved.
However, I don't necessarily think that work ethic needs to equal basic income. That homelessness is even a thing is a symptom of this world view; we are in a society that is more than capable of dealing with some problems in the most poverty stricken parts of the world, and yet we don't, because we say these people have no work ethic, and therefore they don't deserve to be clean, to be fed, to have access to sanitary facilities.
However we end up at a solution to this problem, I'm open to explore. I'm sick of us criminalizing the lazy, because the consequence is to also criminalize the disabled, the elderly, the mentally disabled, and occasionally the perfectly great, strong individuals who roll a poor lot in life and can't escape the system.
Laziness should mean a lack of respect, a lack of advancement, maybe a lack of entertainment and privilege. But the primary reason we have so many low wage jobs is because there is an incredibly huge incentive for people to work them; they have no other choice. If you don't work in this country, that's it. You're "worthless."
Rather than eliminate work = value, introduce no value = don't work. The problem is not going to be laziness on the unemployed, it is going to be unemployability. We are going to point at gross overhead in business and every sector of the economy in how we have grown tumorous bureaucracy on everything that saps human labor without producing marginally useful value. Just consider the advertising industry - billions of dollars to just change who people give their money to through psychological manipulation. Absolutely zero value ad to the whole economy, it only gives value to the company who can persuade people to buy from them by taking value from whomever that sale was taken from.
How do you enact basic income when a majority of your population doesn't have an income and thus can't pay the taxes that finance that exact basic income?
These people would never have enough money especially since the companies they control will have a much smaller consumer base due to higher and higher unemployment rates, a consequence of automation.
The opposite side of idealism is cynicism. Further more if there's one thing humanity has proven itself bad at, it's the ability to make economic predictions.
I'm not saying your comment isn't a valuable counter-weight, just that we have a ways to go in this discussion still.
People should want to be valued, and people should be motivated to provide value to others via the market. Basic income is a good thing because it preserves this, while at the same time recognizing and mitigating the harms arising from the fact that automation and fluid market conditions make it increasingly likely that success in providing marketable value will both require periodic adjustments and be intermittent for many individuals.
Q. Did prices go down? A. Yes! Scanners reduced prices of groceries by about 1.4% in their first decade. (p<1%)
Q. What happened to those workers? A. We don't know, but scanning stores reduced their wage bills by about 4.5%. (p<1%) Revenue didn't change. Data is insufficient to answer whether payroll reduction was achieved by reducing cashiers or deskilling cashiers.
I bet consumers didn't notice any benefits but did receive benefits. I bet wait times stayed the same because fewer lines were open. I bet prices did go down.
When I go to the supermarket I go through a self-serve scanner to pay for my items. It's much faster than waiting in line. So yes, some consumers get benefits.
Grocery stores operate on very low profit margins already. Also, agriculture/husbandry and mass transport is heavily subsidized and regulated (in thr USA at least). It's a good suggestion, but I don't think cashiers are a major labor cost, and suspect the lessons to be gleaned from that industry will have limited predictive power.
And you are essentially repeating the "wealth inequality does not exist" mantra. But it does not matter how many times people repeat, it does not become real.
Inequality exists. Those people fired will be out of places to go. Yes, overall people will become richer, those people are an exception.
That's not a given either. The working masses are many many times more than the business owners in count.
So, while a few business owners can get cheaper with being able to fire part of their employees, those employees will be a bigger number that the business owners who benefited.
As for customers, they'll hardly see any difference (except negative, if they're also part, or their spouse/parents are part, of those workers being fired).
Everybody becoming an entrepreneur is not gonna help either -- there's only so much entrepreneurs a market needs or can support. (It's like everybody becoming an artist with easy access to self-releases on the internet: the end result is not everybody getting into the top of the charts, but, if anything, even those getting there having much fewer listeners that stars did in the past).
> however the machines will drastically improve productivity, therefore reduce prices
Except why would that ever happen? If you were a business owner selling widget X, and it suddenly cost you half as much to make that due to automation, you don't pass those savings on to your customers, you celebrate how much better your margins have gotten and how much more profit you're making.
Competition is one reason. Increased sales volume is a second. Social pressure is a third. It's why we get clean tap water for less money than it would cost someone to bring it by bucket. It's why a gallon of gasoline costs less than the bale of hay equivalent. Regardless of the mechanism, the world is full of examples of technology lowering costs.
Certainly you're correct that not all of the cost savings will be passed on to consumers, but as long as the market is not a zero-price-elasticity monopoly immune to social pressure and government regulation, some savings ought to be passed on.
Now suppose the automation technology is thoroughly patented and the inventor effectively has a government-granted monopoly on the right to use it or anything similar to it.
Because of this little thing called "competition". There will always be new businesses who can live with lower profit margins and drive you out of the market for good.
Less and less industries today have any remaining barriers of entry.
Some still remain, though. Race and gender issues being the most obvious (I find it shameful and outrageous that this is still a problem in 2016, but evidently it is). Another fantastically blatant example is having a non-US non-European citizenship and being unable to relocate to San Francisco Bay Area, wherever this magic wonderland filled with ponies and unicorns is.
Others, like access to education, are disappearing very fast, despite all resistance of the education mafia. Thank you, Wikipedia, I owe you so much.
You're missing a key component of economics. You are saying suddenly widgets can be made for less then previously by automation. If there was a monopoly seller of widgets, your argument makes sense but if there is competition, prices will be driven down, or some other effect will occur.
I read somewhere that the amount of people employed in the transportation industry is roughly equal to the tech industry. If 75% or more become redundant, where will they go? Certainly not the restaurant industry...
One theory I have about all of the coding "boot camps" popping up is that they are preparing for an exodus of people from the next job sector to be automated/eliminated (auto-lated?).
No, coding boot camps are just capitalizing on the idea that there is a shortcut to the high wages some people earn in the tech industry. It's not "preparing for" anything, it's trying to exploit a present market opportunity.
I teach CS classes at a community college when I have the time. Our CC has a 2 year program; having taught classes in the 1st semester and the 4th semester, I have noticed that the 1st semester classes are larger than the 4th semester classes, much larger. This school offers eight sections of the intro programming class, and not more than one section of any top level class (Java, .net, and C++). The top level class sizes are also smaller, and not offered every semester (the intro class is). Net, I'd say that around 3/4 of the students fail out, quit, or change majors.
I've seen students bust their asses to get it. Spend time with tutors, countless hours with the book, with study groups, and other students and still not get it. I've also seen students sleep through most of their classes and pound out not only the lab, but also their entire three week assignment during the lab time.
Anyway, my point is that trying to get a tech degree is far from a sure thing, and for many people, something that they may not be able to finish. It takes a certain kind of thought process to write good software, and while some of it can be taught, I firmly believe that innate ability is equally important. Just like you couldn't teach me to be a good salesman if you had to, some people can't be taught to do tech jobs.
I think access to CS concepts for all ages in schools is a good thing because 1) technology is increasing a part of the fabric of life and 2) it is good have a way to identify early those whose inate abilities could do technology jobs. The same could be said of people that want to become engineers. Some can and some can't.
I think any activity in school or out of school at an early age that exposures students to a set of possible tasks for them to do and to learn from helps people learn about and grow their inate strengths. I am experienced in FIRST Robitcs as one of those out of school programs that does just that. For years I have witnessed students learn what they are good at and get better. Yes some of that is CS, CAD design, fabrication and trouble shooting but for some it is marketing, business planning, fund raising and presentation skills.
I have witinessed this first hand as a mentor and parent of middle school and high school students.
> The human biology and mind is clearly limited, while the progress of machines does not seem to be.
Can you explain what you mean by that? That's not an intuitive idea to me, animals/AIs just seem like two different kinds of machines to me with different computational characteristics, neither of which can fully simulate the other.
Not op, but i will try. There's no distinction of biological computation and machine computation, there's just computation. What our brain is doing is computation, we may not fully understand how it does what it does yet, but what we know is that our brain is a very powerful computational machine, that's why it is so hard to emulate its processes. But as man-made machines are still getting more powerful, it will someday be able to do everything our brains do (from playing chess, go, understanding images, walking, driving to understanding language, creating a self-model a reality model and having self awareness).
But as man-made machines are not constrained to a skull and body, and other physical limitations, it will eventually surpass our processing power. There will be some limit for it though, just nowhere close to our wetware.
>There's no distinction of biological computation and machine computation, there's just computation. What our brain is doing is computation, we may not fully understand how it does what it does yet,
Doesn't the second part cast doubt on the first part?
Only if you fundamentally believe there's something "magical" going on in the brain; scientifically there's no reason to believe that (given current understanding).
We understand individual neurons and how they can lead to computation, we also understand (the existence of) emergent behavior in general.
This was my thought as well. I'm not even sure how to judge this article. It seems very misinformed with making assumptions without any supporting evidence on how we get there.
It's true that automation would bring in new jobs, but not the jobs that the people affected would be able to jump into.
As far as the whole child care and home health jobs go, I'm not sure there would be a mass influx of opportunities there.
I don't know if I've ever personally seen employees at a daycare making much more than minimum wage and there's already a thin margin with daycares. So, I'd think they'd be in same trouble as a restaurant employee.
Daycare is a hard industry to pay decent wages since it's basically a replacement for an adult to stay home and the child to staff ratio is a factor (infants were 3 to 1 staff). Also, about 1/2 the population (males) are heavily discriminated against (85+% women). I did budgets for a group of daycares serving 45 families in the 90's and we did not pay well even for ND.
> Some low-wage work would be reallocated ... Since poor people are now making more money, there will be opportunities to sell them things — things like restaurant meals! — that they couldn't previously afford, which in turn creates demand for new jobs.
Even if the poor people were making more money, the rest of the logic here is equally as flawed; somehow by firing people and replacing them with machines, those people will spend more money, and that will create the same jobs for which they were replaced by machines. Kind of a new twist on circular logic where each point in the circle is also a logical fallacy.
Yes, people will be fired. Yes, that is fine. Yes, we need a minimum guaranteed income as a result of increased automation. Ideally, you'd get the income for going to school and learning.
In 1900 there were 1.6 billion people, and we had a lot less technology, with many people living in poverty.
In 2016, there are 7 billion people, we have a lot less technology, only about 1 billion still live in poverty. If technology 'killed' jobs we shouldn't have more than about 400 million people employed in the world.
I was thinking the same thing. Just replace whatever job people are saying will be automated with {horse shoe maker, blacksmith,farmer} and you'd swear the current discussion was taking place in the 1900's.
Reading this article disgusted me. I'm not a "republican" or "democrat", or anything else for that matter, but I have some intelligence and sense. Arguing that raising minimum wage will some how lead to more prosperity is the same thing as stating "people with minimum wage jobs currently have prosperity". The minimum is the minimum, no matter how high we raise it. The only thing raising the minimum wage does is punish people like my little brother who worked so hard to get to $14/hr. If minimum wage is raised to $15, he will earn minimum wage again. This means the buying power he has earned over the past 3 years will be lost to those who should be starting where he started 3 years ago. If you don't understand the difference between that and prosperity, then you're an idiot. That's not an ad hominem attack. That's meant in the literal sense.
Hi, Australian here. Our nominal prices (in AUD) are about the same as in the US (in USD) and our minimum wage is $17.29 an hour (+ 25% for casual employees). People who make minimum wage here aren't struggling to survive like they are in the US; the minimum wage is actually liveable.
Prices don't just rise when the minimum wage does. Firstly, people who make minimum wage make up a small proportion of overall income (something something 1% something something). Secondly, prices vary mostly because of the price of inputs and the demand for the product, not the overall wage level; if anything, prices of locally produced, labour-intense goods will rise a little because labour is now more expensive (not because some customers have a little more money).
I understand that your brother might not like the social stigma of making minimum wage again, but make not mistake; he will have more purchasing power than before.
YOu didn't bring it up, but the strongest criticism to make about a higher minimum wage is that it will leave some people with better paying jobs and some people with no jobs.
The prices are higher. In NYC, I can get a breakfast for $5, and I got a FRESH BLT at 3am at a deli in Brooklyn... for $3.50. There ain't no WAY I can buy either of those thongs in Sydney, Brisvegas or Radelaide.
Besides, Australia is basically the same demographics coast to coast, where the vast majority of people live in just a few cities, and the popluation is really small. Try to make broad gerneralisations that link San Francisco (7 million people, $63,024 household income), Miami (3,876,380/$38,632) and Los Angeles–Riverside–Orange County, California CMSA (16,373,645/21,170). https://en.wikipedia.org/wiki/Highest-income_metropolitan_st...
Australian minimum wages are high for a variety of (historically anomalous?) reasons, that aren't always applicable to countries with much more varied demographic splits.
My little brother can save his paycheck for 1 month right now and afford to pay a minimum wage employee (much like he was a few years ago) for 1 month while also living. This would allow him to start a business. If minimum wage was raised to $15, he would never be able to save enough to pay this employee with his savings. Ever.
I refer you to Question A [0], where in 2013 a few dozen practicing economists were asked this question:
> Raising the federal minimum wage to $9 per hour would make it noticeably harder for low-skilled workers to find employment.
Not a single economist chose "strongly agree" or "strongly disagree". The results were split very roughly evenly between agree, disagree, and undecided.
From this research I have derived the following conclusions:
1. Neither being for or against a raised minimum wage is an idiotic opinion from the current research. The experts are divided, so there must be no conclusive argument either way.
2. There is one real idiotic opinion: claiming to be sure. The sole point of consensus here is that nobody is confident in their answer.
First off, I gave a concrete example and said you're an idiot if you can't see the difference between that example and prosperity. I don't see a rebuttal from you. All I see is a genetic fallacy, namely appeal to authority.
The reason nobody agrees whether minimum wage is good or bad is because we have Austrian and Keynesian economics at battle in America. Only one of those two can be better than the other, and if we define "better" as the ability for an individual to work hard and prosper as a result, there is no question about which it is.
The debates are not about things like the validity of the technical aspects of Adam Smith's Wealth of Nations. The debates are about whether the individual should be allowed to prosper any longer. The debates are about whether equality means everyone should have an equal chance and also be allowed to fail, or whether they should get everything free.
> All I see is a genetic fallacy, namely appeal to authority.
Appeal to relevant authority is not a fallacy.
> because we have Austrian and Keynesian economics at battle in America.
This is a common misconception among "armchair economists". There is no battle betwen Austrian and Keynesian economics in America today any more than there is a battle between Confederates and the Union. There was a battle, years ago, but it has been over along time, although there still are a small number of weirdos still carrying on.
Now many of the conclusions of Keynesian and Austrian economics are still alive and well, but the reasoning behind them is completely different, and the war today is between camps with names like Monetarism, Lukasian Rationalist, Chicago School, and so on. The people in that poll are not citing Human Action, anymore than working programmers today are citing the 8088 specification. It is a thing that happened, it was important at the time, but we've moved on.
> The debates are not about things like the validity of the technical aspects of Adam Smith's Wealth of Nations. The debates are about whether the individual should be allowed to prosper any longer.
Have you read an economics paper? They are so technical many programmers cannot get through one. For example, here's some random abstract from the SSRN [0]:
> We provide a formula for the tax rate at the top of the Laffer curve as a function of three elasticities. Our formula applies to static models and to steady states of dynamic models. One of the elasticities that enters our formula has been estimated in the elasticity of taxable income literature. We apply standard empirical methods from this literature to data produced by reforming the tax system in a model economy. We find that these standard methods underestimate the relevant elasticity in models with endogenous human capital accumulation.
There is no debate among working economists about "whether the individual should be allowed to prosper any longer". It is like suggesting mathematicians are debating whether imaginary numbers exist.
Yeah, because nothing says "relevant" like failing to see a global economic catastrophe, like the one in 2008 (or any other in the history of the human race). To suggest that economists are, aggregate, any more relevant than you or I is literally the quintessential example of a genetic fallacy. Such ignorance.
> There is no battle betwen Austrian and Keynesian economics in America today any more than there is a battle between Confederates and the Union.
You really need to turn off the TV... I can't even finish the rest of your comment, it's so full of ignorance.
Minimum wage increases, experience has shown, put upward pressure on wages generally. It is not the case that everyone making between the old minimum wage and the new minimum wage ends up at the new minimum after the change.
If minimum wage increases put upward pressure on wages generally, then what happens? Higher wage levels in general means more money in people's pockets, and this can turn into general price inflation (especially since business costs have risen due to the general level of wages going up).
So let's assume you now have inflation. This means everything just got more expensive, so now that new higher wage level buys you less and less. And now the people who are completely out of work and can't command the minimum wage for their skills/labor are even farther behind.
More money in people's pocket doesn't necessarily cause inflation in everything - for goods which supply can be increased at will(new factory etc), their long-term prices mostly depend on competition and manufacturing costs.
As for goods with inherently limited supply, like land, there would likely be some inflation - so in the end maybe you'll spend the same salary share on them. But the rest of your salary still carries more purchasing power than before.
Then it seems like the minimum wage is not the underlying issue.
If there are too many people and not enough jobs, fiddling with the minimum wage won't have any real effect because regardless of what it is, there are always going to be people who are jobless (and therefore without income).
So how do we reconcile the fact that currently, most people must work in order to live and yet there isn't enough work to go around?
What if we stop trying to control everything and let people make their own choices. In nature, if an animal doesn't hunt for food, it dies. We should take care of those who can't "hunt" because they're handicapped, but we can't afford to because we spend all of that energy on handing things to the ones who don't want to "hunt".
I can't tell if this is a serious comment or a facetious one. Do you know me from somewhere else? Very strange.
If serious, I believe that it would be categorized under the "appeal to nature" group of fallacies. Secondly, who is "we" in this situation? People are making their own choices. We live in a representative democracy and people vote to decide things. Not everybody gets their way all the time. And then, is it worth the time and energy spent on differentiating between those who can't hunt and those who won't? I would think it's much more efficient to assume that everyone who asks for help needs it and simply help them.
I agree with mangeletti's first sentence completely, but I have no comment on his appeal to nature.
Democracy is one of the most insidious forms of government, since it gives the people the illusion of choice and the "we made this decision together" mindset. The problem is that a bare majority of voters (not population), can force its will upon all others in society, bringing down the hammer of government arbitrarily on any group it chooses.
Look how politicians who win a decisive presidential race in the electoral college go into office with a self-proclaimed "mandate from the people" to change things. Now his every action cannot be scrutinized because "we" chose this course. Ridiculous.
And don't get me started on wars waged by democracies...
> how do we reconcile the fact that currently, most people must work in order to live and yet there isn't enough work to go around?
If you are a big powerful government, you have many tools to reconcile sweeping social problems like this.
Foreign wars and civil wars are effective at wiping out lots of people here and abroad. So are infectious diseases. You can also round up and intern undesirable people indefinitely as well or just kill them off.
I didn't down vote you but I assume the people that did have some kind of value system that doesn't involve culling the underperforming subsection of humanity during their annual review.
The implication in my original post was that there is enough "wealth" to go around but the current system prevents it from being shared with everyone. When I say shared wealth I don't mean equally, I mean enough so that people can survive without having to fight for subsistence wages to work part time at their local mega mart.
> I didn't down vote you but I assume the people that did have some kind of value system that doesn't involve culling the underperforming subsection of humanity during their annual review.
This is a rad comment, I laughed. Well, I'm not sorry if I jarred them, that was my intention.
> The implication in my original post was that there is enough "wealth" to go around but the current system prevents it from being shared with everyone. When I say shared wealth I don't mean equally, I mean enough so that people can survive without having to fight for subsistence wages to work part time at their local mega mart.
When I think about the great social upheaval that will come about from job sector-eliminating automation, I shudder to think about what the hundreds of thousands of newly unemployed masses will do. And, I shudder to think about what governments will do with them in response, (which I why I wrote what I did.) In my opinion a living wage just puts the class war pressure cooker on medium instead of high heat.
I wish I had a great idea or plan to keep things running smoothly, but I don't. I have seen homelessness explode in my city ever since the Occupy Wall Street protests, and I see a lot of young people among the homeless who should/could be off the streets making a living. It's absolutely criminal simply from a public health standpoint for the city to let homelessness proliferate like this, and that comes from someone who thinks of himself as a libertarian.
Here's a recent interesting interview on RuneSoup about work and money. It gives me hope when smarter people than me can present a positive vision of the future. https://www.youtube.com/watch?v=1Ci24y4wOHY
You're basically arguing that it's raising the minimum wage that increases inflation, when this is patently not true. Inflation is almost always present, regardless of modifications to minimum wage.
I think the fundamental purpose of a business is to accomplish a task, not to employ people. For example, I don't care how many people are employed to keep hackernews running. I'm thankful for their efforts, but I don't care if it's one person, ten people, or one bot. Or how much any of them get paid. The only thing that consumers and businesses care about is the end result.
If a job can be done by a machine, that's fine. People will find new forms of employment. Or they won't. But we can't expect businesses or consumers to misallocate their resources for the sake of someone's job.
Fortunately, fully automating the process of driving or running a restaurant is decades away. We have time to implement a basic income. Or just come up with more ways to employ people. The number of available jobs is limited only by imagination. "Instagram Photo Producer", "Online Forum Discussion Facilitator", "3D Printed Object Finisher". Someone can pay someone else to do any given thing, and now that's an occupation. "Potential Job Titles" isn't a finite list, and we can't ever run out of them.
The Marxists and communists have tried doing that thing many times and have failed spectacularly. Business based market economy is the only (till now) successful and socially most beneficial type of society that has ever existed. I upvoted the OP because he/she/it (it may be a bot) has put this thing in clear words.
Up until now, the possibility of having a group of people who lead a leisure life without an undercaste of slaves hasn't existed. Automation is a new thing under the sun.
No, no it is not, for fuck's sake. Automation is not new. The spinning Jenny was invented in 1764. Robot labor has been here since industrialization started and there is NOTHING new in the last twenty years. Automation is only the replacement of manual labor with machine labor, a.k.a productivity growth. If you've noticed, economies have been growing for centuries. In fact, growth is slower now than in the past. Automation is happening less now.
Stop believing all this 'robots are coming for our jobs' crap. The robots have always been here.
New or not, there are more and more jobs which are becoming automated and it is a valid question to ask how society should be organized when all jobs would be automated.
No, this is the wrong question to ask. First of all, the rate of automation has not so far resulted in the disappearance of new work - we all survived the contraction of agriculture from employing some 50% of the population to less than 3%.
There is plenty of work. An astonishing amount of work is available for people to do that isn't being done, and it's not because people are obsolete. What is lacking is capital directed at hiring people for that work. You can argue about why this is, but the basic reason to me is the general lack of demand because, more or less, the rich have all the money.
How is this not patently false? If you take someone living below the poverty line, earning minimum wage, renting their meager apartment, eating highly processed carbs and pseudo-meat, in debt to their bank and payday loan sharks, and under constant threat of homelessness brought on by unexpected illness or economic downturn, how is this situation in any way superior to a king or queen as they existed before "our generation" which I take to mean the modern era rather than literally our generation.
A monarch of the past would have obviously better access to food, more of it, higher quality, they might have slightly less variety available (dependent on the era and location) but they certainly weren't eating the prepackaged garbage that passes for low budget food today.
By law they owned not only their own vast properties, houses, palaces, etc. but also that of all of their subjects and nobility allowing them to give and take as they wished from anyone under their dominion. Even after reforms almost all royal families were still left with vast holdings that produce more than enough wealth to live absurdly opulent lifestyles. There have been many cases of indebted rulers but that is debt in the sense of illiquidity, they were still asset rich and able to melt the plate down to pay off the debts, so to speak.
This notion that everyone was universally worse off in the past and therefore even the lowest of the modern low are somehow better off in their current state and should be thankful for it is the crudest of fallacies. The trite example of modern healthcare being a shining example of why it's better to be poor today than wealthy 200 years ago is equally absurd considering that such care is often avoided by the poorest due to its cost right up until it's too late to do anything about it. You wind up with a situation where a person's only choice is to hope not to get sick since they can't afford the treatment or the missed work either of which could put them even further under water or on the street.
I think that image of monarchs comes from the movies? The famous inventory of Charlemagne's estate includes 2 cups, one chair and a towel. Their food back then was bad meat and oatmeal, no matter who you were.
Indeed, just the existence of cheap antibiotics are likely to make the most humble of today's citizens live decades longer than anyone from the past.
To give you an idea as to why an estate belonging to a king may appear so sparely furnished, let me ask a question of you. What personal belongings do you usually leave in your hotel room when you're travelling?
I'm going to guess none unless you forget your toothbrush or some other small item. The estate of a king is essentially a hotel room that he also happens to own along with dozens or hundreds of other such locations scattered around the country he rules. Little inventory would be kept there since the majority of day to day furnishing, and I do mean furnishings as including pieces of furniture, would travel with the court as they moved from estate to estate. Nothing valuable would be left behind for the same reasons that you wouldn't leave your laptop at the hotel after you check out, chances are when you come back (if you come back) it's not going to be there and if it is there's a good chance someone else will have had their grubby paws all over it the entire time you were away.
After looking up the inventory in question, it also happens to contain enough livestock and grain to feed well over a 100 people (there were about 100 full time residents) as well as a list of buildings including the mansio itself, two smaller manors, 17 wooden houses, 3 barns, a stable, a kitchen, a mill, two gardens, and a granary. There were also more than 60 horses boarded there.
As for kings not living as long as modern paupers, Charlemagne was a septuagenarian when he died.
A poor person today has access to thousands of movies and music on Netflix and YouTube. A poor person today has a vast array of meals they can purchase with less than one hour of minimum wage work. A poor person today can buy tons of generic prescription pills whose formulas were nonexistent during yesteryear.
A poor person has no Netflix, and doesn't have time for YouTube, she is either clocked in on the job, sitting in traffic to pick up kids from school, or cooking dinner. Besides, that kind of mindless passive entertainment is vastly inferior to what monarch had access to -- hunting, horseback riding, live music and shows, sex, etc.
See pharke's response above regarding cheap processed foods.
You think the image of monarchs comes from the movies and that actually monarchs had little more than a couple of cups? I'm sorry but that is a very delusional view.
Then your evidence is pretty terribly weak. I didn't bother with this link because your claim that monarchs did not live in opulence and that some link proves that is hard to take seriously.
A person on welfare today has more access to a vast number of food options than Kings and Queens of yesteryear. Grapes and wine are extremely cheap and affordable to anyone who has $5 in their pocket. A full meal of chicken and rice can also be had for $3.
Marxists and communists have tried this without also sticking to democracy... The well known failings could just as well be due to the massize amount of corruption that came from the strong bases of power.
We also had "real" market economies (no trust busting or the like) in the early 20th and it was shitty for a huge part of the population
History is the biggest argument against all economic systems
Are you suggesting that in the West our democracies do not contain massive amounts of corruption stemming from strong bases of power?
I also question your suggestion that "real market economies" were responsible for the dispair that certain communities felt in the early 20th century. "Real" market economies really didn't have much of a chance to exist in the 20th century because by 1913 the Federal Reserve was installed. That ended self-regulated capitalism in the United States, at least. Europe followed suit shortly thereafter.
Just prior to the early 20th century, enormous numbers of people were liberated from the misery of famine and early mortality thanks to the innovations derived from a loosely-regulated market economy. Back then, nobody knew how to deal with a world where the vast percentage of infants born would live beyond early adulthood. Most poor people would just die and there would be no government, nor economic system, around to help anyone. So when these people, born into the late 19th century system, grew into adults living in the early 20th century system, policymakers and citizens alike had no idea how to respond to the challenges that arose. We did some really stupid things as a result, and we are still paying for, and suffering from, some of those policy decisions.
What's that number? Not even out of single digits? That's rich indeed, considering the entire history of the 20th century is that of successful foreign capitalist intervention, starting all the way with the Russian revolution.
No matter how bloody the communists were, my original point was that it was never done in an environment without active foreign involvement of undermining, destabilization, and outright warfare.
How does that compare to a Marxist/communist like Mao/Stalin killing and maiming hundreds of thousands just because they didn't exactly speak the way he approved?
European social democracies have made it work by continuously re-constructing it. Employees and citizens of the welfare state are at the table when negotiating how to set rules for the managed capitalism. Check out Sweden for example.
Sweden and the rest of European economies built their wealth on typical capitalism.
And I've checked out Sweden, after you've gone into its current situation it ain't so great as communists like Sanders make it to be
I'm actually from Poland, a country that had actual communism created by another rich jew that wanted to help "the opressed masses". You think at the beginning any of the commies said straight what they plan to do how it will look like after they're done? And what they will do with the evil burgois (or "the 1%" as Sanders and his cultists name it). You're playing with fire, just be wary.
I watched a bit of that and he just says basically that you had to admit Cuba had built a lot of medical clinics. Which I agree is true. Doesn't make either of us communists.
There have been successful (meaning what exactly?) societies that were not market economy based.
People tend to think communism vs capitalism but for most of human history it's been something else. Like hunter/gather or some form of feudalism. I don't disagree that market societies work for distributing goods. But they do have external costs. Are there more efficient ways? Probably. Will market economies go the way of hunter/gather economies at some point? Almost certainly.
Sure I can. Feudalism. Oh, you meant a higher standard of living for everyone? Well then, are you sure market economies are really the end all solution for that?
Listen, you seem to think I'm arguing against market economies or trying to promote some kind of communism. I'm not. I'm just pointing out capitalism and communism are not the only choices. There have been other systems and some of them lasted a long time and were extremely "successful" (if by success you mean providing a sustainable livelihood for the members).
But I don't disagree that market economies are effective in achieving certain ends. However humanity didn't come down out of the trees to a market economy and market economies likely won't be around when humanity finally ends. They are a phase in human history, that's all. It's not an ideological statement. Just observation and projection.
If a television is a requisite for a high standard of living, great, we're beating Ptolemy. It's disingenuous to pretend that you can do an apples-to-apples comparison across thousands of years and attribute it to market economics. Given the tremendous natural wealth in the United States, we'd probably have a higher standard of living most countries even if we adopted mercantilist economic policies.
This isn't to claim that market economies aren't a great idea, just that I don't think your reasoning holds water.
Surely there are no advanced economies without rich natural resources. Oh wait. There's South Korea and Singapore who are some the most capitalist countries on Earth.
I'm also questioning your belief that being protectionist wouldn't hurt our standard of living. Do you know the T-shirt you're wearing cost a lot more if it was made in the USA?
Oh, we still do, they're just in second and third world countries. The author of this article focused on service industries that require a physical presence in the local area ... and did not address outsourcing. I think that one likely outcome of this law will be that people will find creative new ways to move work to lower cost locales.
Maybe it we is the US its true but if you look at Germany they are a net exporter of manufactured goods and probably have an agricultural surplus so it's quite possible to get by in a modern economy.
"un-construct it... drag it out behind the shed and shoot it."
Can you "un-construct" this newspeak for us? It sounds like you're advocating that you or some other force besides free and voluntary trade should literally shut down private businesses, possibly beating and robbing their owners in the process (as has been done historically)?
Because there's some formula for determining "social value" which has "number of employees" as a factor?
> It sounds like you're advocating ... literally shut down private businesses, possibly beating and robbing their owners in the process
No, that's what happens in the scenario where we make workers redundant and fail to provide some alternative social contract.
> Because there's some formula for determining "social value" which has "number of employees" as a factor?
Value of Social Contract = (cost of what you have to sell)/(cost of what you need), aggregate over members of the social group in question.
Markets ruthlessly optimize both the numerator and denominator. So far, the scales have tipped in a direction that benefits most members of our society because there has been plenty of (relatively) valuable work to do. That may be changing. A decreasing numerator can be worse than an increasing (or shrinking-but-too-slowly) denominator. Even in aggregate. The market doesn't really have an innate preference for one direction or another.
It's up to us to fix the problem if the winds shift. If we don't, someone else will, and it will get very messy.
Huge amounts of modern businesses aren't about "free and voluntary trade".
While I'm not saying we should, we could (for example) get rid of limited liability or the massively different tax arrangements for individuals and businesses (which usually greatly favour businesses over individuals). These are social constructs, and we could decide that they are no longer benefitting society.
Humanity, a sufficient majority thereof, simply stops playing the game. Money was a concept. It is now ignored. Corporations were a concept. They are no longer believed in. Ownership is a bouncing cheque with nobody caring to cash it. Most people stop playing "private business". You owned a railway? It's been automated. You owned a steel foundry? It's been automated. It answers to the world direct democracy, not to you. It's busy making things for free. And everyone else is busy doing their vocations. If you wanna go hide in a valley, sell things to each other and hope for civilization to vanish, go right ahead.
What you're saying doesn't make sense. Again, your position ignores scarcity and act as if economics is something like a "big bad boogey man" cooked up or something weird like that.
The steel foundry example is interesting. Does it have an infinite amount of raw materials? Is it utilizing a perpetual energy machine?
To me this like if the professor asks the class "where does the electricity in your class come from?" and the students respond "The socket!"
Of course that is silly, but sweat of the brow gets a little hypothetical when you start talking about piling up billions of dollars (probably even less than that). Should we pay the people that are rich today a larger share of the benefits of automation out of nothing more than a commitment to tradition?
You earlier referred to Business as a potential "parasite". Sounds like you are clarifying that you hope such a parasite will starve and wither away. Which is fine. Others might advocate taking proactive and violent measures to kill something which they deem to be parasitic.
They would just revoke it because they are the issuers of the license in the first place. You can't take something that you already own from yourself by force.
You're not taking into account that this "Issuer" claims some right to decide (by force, obviously) who can do business in the first place.
So if some entrepreneurial lady begins, say, arranging flowers or braiding hair... maybe she gets forced out of business for not having a license. Or maybe she does get a license but it is revoked for some arbitrary reason like the Issuer decides she's a "parasite" because she doesn't employ "enough" people. Either way, force is being used against her.
So wait, what if some nice lady decides to set herself up as an issuer of professional licenses. Do you want her put out of a job. Are you calling her a parasite? Are you going to beat her up if she doesn't meekly do what you tell her to do, which is clearly against her own self-interest? Why must all anarchist libertarianism devolve so quickly into bloody, revolutionary violence against individuals! Won't someone think of the children!
Do we really need every thread that even tangentially mentions government on HN to devolve into this same childish nonsense?
> So wait, what if some nice lady decides to set herself up as an issuer of professional licenses. Do you want her put out of a job. Are you calling her a parasite?
She'd only be a parasite if she claimed a monopoly on her license and threatened any alternative with violence and imprisonment.
What if I still want to exercise my business without a license? How would they enforce it? Hint: see what happens to abortion practitioners in countries where abortion is illegal or marijuana resellers where it's illegal etc.
It isn't robbery as defined by the law like the death penalty isn't murder either legally. From a philosophical point of view though, opinions defer. Not saying I agree or not, just saying.
I'm still not comprehending how telling someone not to do something would amount to confiscation of property. State mandated confiscation of property would be comparable to robbery the way that legal death penalty would be comparable to murder, but no confiscation of property seems to be involved in simply telling people that some things are not allowed (I'm avoiding here, of course, the very issue of whether it's wise to do that in the first place, which it probably isn't, at least for the foreseeable future.)
The property used to commit a crime are usually taken by the police. What do you think happens to your meth lab if you get caught? Or your stock of marijuana or raw milk or the other gazillions things you are forbidden to sell by the power that be and knows better what's good for us?
The police can't do any such thing here. Only a court could. And even then, it generally happens to the property that is the result of a crime (like bribes, for example, or drug money). What message about the level of respect towards private property and human rights would it send if unrelated property was seized for no good reason? If you can't sell your raw milk (I don't actually believe it's illegal here anyway), I don't think anyone is going to take it from you. After all, it's better if you have to get rid of it. You're perfectly free to drink it. At least the state doesn't have to pay for its sanitary disposal.
Most businesses don't require a license to operate unless they deal with controlled goods like tobacco, alcohol, pharmaceuticals, or the exploitation of natural resources.
Beyond that, what the government provides is the articles of incorporation to limit the liability of investors, and allow the owners and operators of the business to act as a single entity within the court system.
If we take away the articles of incorporation, the business can still operate but it's not shielded in anyway from being cut up piecemeal via lawsuits, and a lot of the reason people find it worthwhile to invest in or work for a corporation will be removed.
In the United States, there are no national or state level service taxes, so that's a whole branch of businesses that do not have to register for specific taxation purposes.
If the US were a VAT-style country, everyone would have to register for taxation purposes.
Regardless, at least in the USA, sales tax registration is not the same thing as a licence to operate. You can start a business dealing in tangible goods, and begin selling to out-of-state customers without needing to register for sales tax. The in-state registration for sales tax is simply that---registration, there's no qualifications that you need to attain before you get it, and even without registration you are still required to collect sales taxes.
If I understand you correctly, while it's not a license, you must have one to do business and you can be punished for not having one.
So I have to ask exactly how many businesses can you give me the names & addresses of which legally operate in the USA without any sort of government paperwork which they could punish you for operating without?
My understanding is that we were talking about removing the idea of a business as seperate legal entity, not stopping capitalism in general and preventing people from exchanging money for goods or services.
As such, the only 'business' licence of interest is one which would prevent an individual, real, breathing human being from selling goods, or providing services to the general public.
The requirement that you must personally fill out a sales tax form is not that. This is really just on par with the law that says 'if you make an income, you must fill out your income tax forms'. The only penalty for ignoring it is paying additional administrative costs (and perhaps a small punitive fine) because you made everything harder for everyone.
Edit: And importantly, no one can stop you from filling the form so it can't be called a barrier to entry.
Overly small scale perspective. Exaggerated scenario for clarity: your one starving human buying survival kibble from a fully automated megacorporation is better off with the kibble and without the pittance they spent on it, an infinitesimal amount of value was created. But humanity as a whole would be better off overthrowing the business system and directing the machines to make every human's life a paradise.
Systems should be compared as systems, not as piecemeal and mostly-forced decisions.
No, not at all. I think in all the comments here, there is an egregious error. The error is in totally ignoring the concept of economics or failing the recognize the reality of scarcity. It's not a "social construct"in any non-trivial sense. People throw that "social construct" thing around as if it is at all relevant. You could say the "law of identity" is a social construct and you don't accept ... Ok that's fine, it just means you, and I mean this only literally, don't accept "logic."
To "make every human's life a paradise" is also quite literally to either reject the concept of scarcity or to think you would create some sort "Matrix" like environment, some weird sci-fi stuff, which is fun to talk about but not a solid economics argument.
That's absurdity. If economics were the end all, be all, we'd live in a planned economy dominated by a small cartel of businesses.
Society rejected that 100+ years ago. Recall that until recently, the folks concerning themselves with money were not at the top of the social heap -- with good reason.
Based on your usage, this is totally wrong notion of "absurdity." What I wrote is actually correct.
I'm not sure what "economics were the end all be all means" but economics is a method by which to understand the "world" under the circumstance of scarcity. I suggest reading a little more of it; it's an interesting topic.
Actually, I don't think this makes any sense. Economics is not about describing a perfect society or something. Don't be silly. :)
It's about understanding reality. Agents engage in activity described by economic principles under the condition of scarcity.
I know that seems sad or something I guess to some. It's like climate change doesn't care if you believe it's real or not.
It's just the way it is ... under the condition of scarcity.
Most economists didn't predict the Global Financial Crisis. Given that you have to wonder about the utility of the so called 'economics' and whether statements made by economists are true.
Feel free to correct me or give more information, I am perfectly fine with being educated.
The problem with "dragging out behind the shed and shooting it" is that the people who propagate it usually start with other people. Thanks 20th century, but no thanks.
Interestingly though, it's just now becoming possible to build a fully autonomous, distributed company on Etherium. In theory there's no way to tell if such an entity were controlled by humans or an AI.
"Fortunately, fully automating the process of driving or running a restaurant is decades away."
It's closer than you think. Dominos Australia is already trialling automated delivery (in Brisbane, I believe?) with their new DRU robots. [1][2] On the pro-human side, Dominos appear to be testing if people will pay extra for a human, under the guise of "For an extra $3, guaranteed delivery in 20 minutes." (The DRU robots have a top speed of 20km/hr currently.)
There was something about that video that makes me think DRU isn't a serious proposition; and even if it were, it isn't yet being used for actual deliveries.
This is a common theme with new technology. The sceptics always claim "it's decades away", the enthusiasts always claim "it's nearly here - look!" But what usually happens is something in between. Essentially both are right, some stepping-stone will launch or be trialled, but it takes decades to be refined to the point where it actually delivers on the hype that was "real soon now" way back when; and by the time that happens, everyone has got used to it so the milestone passes without anyone noticing.
In the case of automatic vehicles I don't know when that clock started ticking, so I don't really know how far along we really are.
The one fault in your logic is that the way companies behave in terms of hiring, can affect the value decision for agents/consumers and thus I think the economics in the world is a little more complicated than you suggest.
Full employment is one of the fundamental macroeconomic objectives. So yes as governments you do expect exactly that. You also expect to reduce disparity between the rich and poor. Why? Because you don't want people to revolt and create chaos. If unemployment goes up too much and there are no jobs, people will revolt and violence will occur... in which people will probably destroy your peaceful stable life... your factory... and your government. So yes the government has to as its objectives solve these issues. If they don't then people have the right to get rid of such a government, and take all your wealth and means of production.
The government could achieve full-employment by drafting everyone or paying them to dig ditches then fill them in again, but that would be really wasteful. If there's actually nothing useful for some people to do (they can't find a job that supports them) then we should stop thinking of employment as a requirement for survival.
If the economy can't find full-time roles for some people, then we as a society — though the state — can just give them money to survive (a 'basic income') and let them do whatever they want with their time (including working part time jobs that wouldn't be able to sustain them on their own). It would be a much more productive and enjoyable use of their time than digging ditches :p
If there's actually nothing useful for some people to do (they can't find a job that supports them) then we should stop thinking of employment as a requirement for survival.
They could fix our crumbling infrastructure, provide child care for working women, in-home care for our elderly, reduce overcrowding by making prisons larger, build community gardens, or a hundred other popular left wing causes.
The claim that we couldn't get productive labor by drafting the unemployed is also the claim that there is nothing else useful that the government could do even if the cost is $0. Do any basic income proponents really believe this?
> They could fix our crumbling infrastructure... reduce overcrowding by making prisons larger
Unskilled people make crappy engineers and construction workers.
> provide child care
These days, child care workers need a lot of paperwork and a bit of training. Not to mention that you kind've have to be good with kids; it's not really a job just anyone can do.
> in-home care for our elderly
And this is in the same bucket. Forcing people into a caring role makes for bad carers.
> build community gardens
This one could work... but then again, how many gardens can you have, and how many folks would they support the work for?
Throw in also that all of these things are not 'free labour'. You still need to manage and train that staff, and you're going to have higher overhead costs because you'll have higher turnover. It's not as simple as just saying "labour = free, so go do something".
But suppose you are right - there are no unemployed people out there capable of fixing our crumbling infrastructure. Suppose we were to just throw money at the problem via ordinary government spending. How would the work actually get done, i.e. who would do it?
Forcing people into a caring role makes for bad carers.
No one is forced into anything. You do work and you get money, same as any other job. In any case, the folks who make bad carers can do other things, e.g. pick up trash in the park or work as janitors in government buildings.
This one could work... but then again, how many gardens can you have
When I hear this, I immediately think of Great Cultural Revolution in China, and Pol Pot in Cambodia. Also there the joys of gardening and agricultural work were supposed to cleanse the bourgeois people.
And while we are there, let's shoot anyone with eyeglasses for trying to be too intellectual.
Basic income frees people to do private work. Government projects, to be comparable, would have to pay people for their work, as you know,and also add a premium to cover the time spent.
Basic income and government spending on projects are separate ideas that are only related because they compete for budget.
> If there's actually nothing useful for some people to do
then those people who cannot be useful will not survive - it's as simple as that. It takes resources to keep someone alive, and that resource must come from somewhere.
I'd live for basic income to be viable, but i highly doubt it's viable, given that it amounts to altruism (from those people who own the means of production/automation). We'd have to have free or near-free energy.
but that's the thing... they most likely wont be paid for unproductive work or given a basic income they will simply be let to starve as has ALWAYS been done historically.
This is the key point that always perplexes me in these discussions of automation, the belief that somehow a fully automated society is going to lead to large swaths of the population not doing work and somehow being given basic income and being left to chase 'loftier pursuits' instead of 'wage slavery'...
its not a logical expectation based on past human history...
One could hope that we aspire higher than killing people or allowing people to dies because they have no use to you. It's psychopathic and values people as nothing expect for their use to you, the same way a rapist doesn't give any value to their victims lives, just what they can get from them. Anyone suggesting that unemployed people don't get paid are on the same boat, because they do not value those lives at all, unless it gets them something.
Human history has always been dominated by scarcity. Fully automated production would by definition be a repudiation of all economic theories built upon a foundation of scarcity, so we can't really use them to guide us in devising a solution.
The closest humans have ever come is the indiginous potlach societies of Papua New Guinea where scarcity wasn't an issue and people lived fairly idle lives (and substituted physical scarcity with societal scarcity).
It's like there are extremists on both side of this conversation. :)
To say those people that cannot be useful will not survive is sort of despicable and naive. Someone on the other side made a point about revolts and if we carried this view so far, I guess something like that would happen and make normal economic activity untenable.
Full employment is not a goal of any particular business, though. "The economy" is just a term to describe the transactions people make over time in their own interest. And any system built on the expectation people will ignore their own interests for the common good is destined to fail.
I'm not sure what you mean by "fundamental macroeconomic objective". Surely the purpose of full employment is so the people who are employed can enjoy a certain standard of life.
> Full employment is one of the fundamental macroeconomic objectives
Except for kids/students, and retired people. Nothing is preventing us from studying until we're 30 and retiring at 35 - if only the minority of the population can be productive enough (with the help of machines, obviously) to produce enough for the rest.
the thing that is preventing this from happening is starvation. In a capitalist society where 90% do not contribute to production or commerce and the labor is done and capital owned by the 10%... the 90% starves.
Keep in mind too that the idea of "full employment" doesn't mean 100% employment, it's a technical term.
I will just say, your view is a little overly antagonistic. Keep this in mind, if they government created too much artificiality in the market, which seems to be what you are asking for, this would not solve the people's problems.
Under your view, the government might as well print countless amounts of currency and just distribute it without any regard to it's value.
I'm all for raising the minimum wage, temporarily it may help people for several years. The truth is the automation wave is coming quickly regardless of what people are paid. And it's not for just minimum wage jobs. Think about jobs like truck driver where there's probably several million people who count this as their profession in the US. In 10-20 years, that number will probably approach 0.
There's a nasty new world order coming where a vast majority of jobs will be gone. There will be super wealthy 'robot owners' and peasant/slaves, and probably first in america.
The only hope is that the government completely changes the entire society through 'more than' basic income. Of course we know that won't happen. It is high unlikely that even a subsistent basic income will be put in place. The government is run by the super-rich, and really only does what ever it takes to protect their interests.
Hopefully my life span doesn't range long enough that i feel the devastating impact of these changes, but i fear the timespan where this occurs is so accelerating that it will be here in force way before we estimate it today. 30 years? I can see it being here in 30 years.
Even if you have a job that is 'automation-proof' or 'automation-resistent' but not an elite, your income will be paltry compared to the super rich class, and thus you will be relegated to the masses.
Yeah, I know, i sound hysterical. Hopefully i am. I doubt it.
> Even if you have a job that is 'automation-proof' or 'automation-resistent' but not an elite, your income will be paltry compared to the super rich class, and thus you will be relegated to the masses.
If my real income goes from $100,000 to $200,000 and the CEO's from $10 million to $100 million, am I worse off than before? Should I be averse to that future? I don't see why...
If you exist in an economy solely consisting of yourself and your employer, you went from receiving 1% if revenue to .2%. Your earnings are never absolute in terms of buying power or wealth - they are both relative, because the market behaves relatively to what people have or do not have. If your CEO gets 5 times richer than you, they now exert 5 times more economic influence on the economy and you in reciprocal exert 5 times less. R&D will cater less to you, industry will target you less, and most importantly your real spending power will go down.
How? Because your economy just went from 10.1 million to 100.2 million. That is a 10 times inflation of the monetary base, which in aggregate would see a correspondingly (smaller) influence on the price of goods and services. Your buying power will drop.
That extends to whole economies. If you are a part of a contiguous segment of the economy whose total wealth or revenue is declining, your influence, buying power, and real prosperity is also declining, regardless of absolute income.
It is also worth mentioning that wealth is a much greater influence on prosperity than income. He who owns the means of production is he who reaps the spoils of growth first, and can decide what to do with them. That is trickle down in a nutshell, but it is at complete discretion of the capitalist running the show how the money they get is then spent, and nowadays it is definitely not going to be on you.
> That is trickle down in a nutshell, but it is at complete discretion of the capitalist running the show how the money they get is then spent, and nowadays it is definitely not going to be on you.
So wait, you're saying the capitalist can choose to pay people zero dollars for their salaries or charge 100 times more for their goods and workers/consumers will automatically accept those terms? Because that's not really how it works.
You are giving exaggerated examples, but in practice the capital owner can, if they want, do the long form negotiations with people to lower wages (to the minimum) and raise prices because they have significantly more bargaining power when they control so much of the wealth pie.
Respectively:
If I run a business and I want to stifle wages at my company, I both stop raises and then start cutting gradually. People will leave, I will hire new workers (we have a labor glut after all, if you expand your reach enough you will find more and more desperate people for money) and repeat the cycle until we hit the wage floor.
No, it is probably not $0. There is some point for even the most desperate and hungry person where you say it is not worth my time to make, say, $2 an hour rather than just trying to find another job. It is not about not giving the worker anything in return, it is about finding the least they are willing to take for the work.
But it is not a fair negotiation. When you are talking about almost every employee, they are bargaining from the perspective of having no time (in a business sense) to barter, and their ability to eat or sleep depends on the job. For the owner, their ability to expand their own wealth depends on the employee, and they can wait as long as they want for the hiree to forfeit to their terms.
Likewise with goods prices, if you are in perpetual profit you can constantly amass more money, and in the US economy wealth amassment enables you to take several measures to raise prices in the long term without losing customers to competition - you buy your competitors out, you bribe politicians to pass legislation that reduces competition or the ability to startup in your industry (through expansive regulations, permit requirements, red tape, and sometimes even outright banning competition as is the case with teleco) and you use the market leverage you get to make more profit.
I imagine today companies like Comcast in some areas are charging 100 times more than real market valuation of a cable internet subscription would be in an environment of absolute market freedom.
> There's a nasty new world order coming where a vast majority of jobs will be gone. There will be super wealthy 'robot owners' and peasant/slaves
This will maybe be the case in the beginning but if you have to deal with an unemployment rate of 20-40% inside a country under heavy arms as America you have to find solutions quickly as modern society tend to fix problems when they occur we will have a bumpy ride into our new economy model that has to come.
And with the automation that is coming like delivery / fully autonomous fabrics / A.I etc. we can provide the basic needs to everyone food / electricity / water / housing at no cost.
>we can provide the basic needs to everyone food / electricity / water / housing at no cost.
what evidence do you have of this? those resources are not free (unless you consider fusion a solved problem, and thus have near-free energy).
More likely scenario is that the vast majority of people who are too uneducated, or is not from a wealthy background will suffer, whilst those with the means will live way above (literally, in huge skyscrapers/floating cities, as well as figuratively). There will still be slums, and the conditions of those places will be as you imagine.
> (unless you consider fusion a solved problem, and thus have near-free energy)
I wonder where the idea that "fusion = extremely cheap" comes from. Even if/when we get commercially viable fusion, there's no reason why it should be significantly cheaper than energy from nuclear fission – you'll still need extremely complicated, high-precision, high-technology machines, generators, cooling towers, buildings, skilled workers, some amount of regulation, and disposal of nuclear waste. Oh, and if your fusion design is a tokamak, it might easily be more expensive than energy from fission reactors.
If you want electrical energy that's some orders of magnitude cheaper, you'll need a break-through in fundamental physics.
I am, also, very much imagining a situation like in the movie "Elysium" being both probable and probably inevitable; the more interesting question is will there be a revolution after?
>There's a nasty new world order coming where a vast majority of jobs will be gone
Want to know the biggest job killer in history? The tractor. Farm employment in the developed world went from 70% to 2%. We have been through this before. We can generate new jobs.
We do create new jobs. But you do recognize it's a Ponzi scheme right? Each iteration include a smaller set of highly educated jobs, which will be out of reach for a larger percentage of the population.
Indeed. I propose we create a professional meeting attender certification. We could even have meeting attending bootcamps which teach people how to do things like bring up points that only relate to one or two others, schedule further committee meetings, go off on tangents and otherwise extend meetings into a full time profession.... which it actually kind of is in some cases.
I for one would be very grateful for this new class of service workers. I mean.. I don't change my own oil. I could but I don't. Jiffy Lube does it better and cheaper.
Yes, we have already automated away some production facilities and will soon automate the rest, but human work is way more than just producing goods. Increasing amount of our work is focused on solving problems. Saying that we may now stop working is like saying there are no more problems to solve. That we're done here. That this is the world we want.
Given the abundance of problems to solve, I think there will be abundance of jobs. Many of them may involve directing robots or ML algorithms for increased productivity at lower skill level. Others may involve seeking out specific problems to solve. Note that this task requires you:
* to have initiative,
* to be affected by a problem yourself or to empathize with someone else who is affected.
Such jobs would stay around for a very long time.
Maybe one day we will have a god-like super-AI that would not need to be run and configured by anyone and would seek out and solve problems completely of its own accord. But this isn't even on the horizon.
We are already a good ways toward the outcome you describe, having gutted manufacturing employment. The reason we are so heavily policed and imprisoned is that those are good jobs for people with stronger necks than minds. Those people used to work in factories.
Here's the twist: The self-organizing nature of free market capitalism has been fetishized without justification. Yeah it's more efficient than a Soviet Five Year Plan. But that's not saying much. What if command economies run my machine intelligence turn out to be the most productive and best able to deliver a good life for the most people?
I'd be happy to see Sanders pull an upset, but lets not fool ourselves, the democratic party didn't move an inch. They are the same corporatists that they ever were.
>There's a nasty new world order coming where a vast majority of jobs will be gone.
If anything is going to cause this dystopian future to happen it'll be trade deals like TTIP and TPP not magical androids.
>Even if you have a job that is 'automation-proof' or 'automation-resistent' but not an elite, your income will be paltry compared to the super rich class
Americans have fought (and won) against robber barons before and they will do again. This kind of shift in wealth is a cyclical thing that happens with or without jetsons-style robot maids.
How do TPP and other trade deals which allow Chinese people to compete economically with Americans destroy jobs? I'm assuming, of course, that Chinese are people too.(I've never been there but I've met a few of them. They didn't seem that different from me.)
Out of curiosity, did ending Jim Crow (allowing blacks to compete economically with whites) also destroy jobs? Can we create prosperity by making up arbitrary divisions and then imposing internal trade barriers?
By moving factories which previously employed Americans to countries where they don't, leaving those Americans unemployed.
Assuming you are right that those Americans remain unemployed, you are completely ignoring the newly employed Chinese people. Do they count for nothing? Not even 3/5?
Out of curiosity, since your calculus is explicitly putting zero value on Chinese people, why would you care about Chinese slaves?
I've never heard a good argument to justify having a minimum wage. A lot of the people who argue for minimum wages commit the fallacy of the false dichotomy: they think that the choice is between everyone having jobs and getting paid what they're paid now, and everyone having jobs and getting paid more -- they think they can somehow legislate the latter outcome.
In reality, what tends to happen when you increase minimum wage is that businesses lay off workers. They only have so many dollars to spend on wages at current profitability levels. Seattle's minimum wage for example has caused a massive loss of jobs compared to the rest of the state: https://www.aei.org/publication/minimum-wage-effect-from-jan...
Minimum wage directly causes unemployment by making it illegal to employ people at their fair market wage. [Edit: I'd be glad to read an argument for minimum wage if someone would like to link one. The articles that I see in the news tend to engage in moralizing and lack real explanation and justification.]
The "good argument" for having a minimum wage is that without it, wages will be pressured down, because every business on the planet wants wages as low as possible, and they generally have the means to achieve this. It has nothing to do with job creation: it's about having jobs that are not basically slavery. It's for job quality, not quantity.
Besides, you're just assuming people should be employed at "fair market wage." The political process is part of the market, and the fair market wage is determined by what is politically determined to be fair (AKA, minimum wage) just as much as it is by employers' demands. As a business, you are not entitled to a profit. Especially not at the expense of your employees welfare.
True, every business on the planet wants wages as low as possible. This is, of course, correct.
On the other hand, every employee on the planet wants her wage to be as high as possible. This is also obviously true.
This creates law of supply and demand. Google can't hire a decent software engineer for, say, $30000/year, because other companies will immediately offer more, and supply of talented software engineers is quite limited, even globally. But unskilled labor can be hired for much cheaper, as supply is nearly limitless.
I don't know, they don't teach this stuff anymore in high school / colleges, or what?
Why do you think minimum wage laws exist? It's because at one point in our nation's history, businesses implicitly colluded to set wages low. They have more power in wage negotiations than workers do, because there are generally people who can afford to do unskilled labor for very small amounts. Businesses got greedy and took that too far, offering people wages far beyond a minimum standard of living. So in response, the people voted to set a minimum that would prevent corporations from being outright exploitative.
The same thing could happen today. Google engineers will always be paid a lot of money, but the average McDonalds workers could see their income fall way below the national average cost of living. Whether the minimum should be $5/$10/$15 is up for debate, but without businesses would have an unfair amount of bargaining power.
The average McDonalds worker will very soon be a robot.
Already everywhere in Europe, there are order-taking kiosks in McDonalds, each one replacing at least two workers. Fast, convenient, never demanding a raise, never joining a union. Pure win.
The good news is that society already survived this kind of economic transition, no less dramatic: moving from manual labor to automated manufacturing.
The bad news is this transition required a world war and temporary export of working class in China (the latter won't happen this time). There are almost no unemployed at wartime.
Collusion to suppress wages is already illegal. All you're saying is that you don't have any faith in the government to prevent collusion. Which is a whole separate issue.
The other problem is that today we have labor gluts, particularly of the unskilled variety. Automation reduces the need for workers, those workers become economic outcasts with no influence to have their needs satisfied by capitalism, and the ownership class does not create demand for more unskilled labor - they want founders and professionals who can grow their wealth, that is what they demand.
If you drop the minimum wage you do not need collusion to see real wages for jobs drop insanely low, ironically because those who can live off other income will work them when there is no other easy way to earn additional income - IE, those with wealth will work for less because their life does not depend on that income providing their base needs, which already are in many places more than what the minimum wage offers already (ie, living wage).
We don't have labor gluts at all. In the US working mothers struggle to find child care for their children, houses go uncleaned, and productive people drive themselves to work.
That's a situation of labor scarcity, not a labor glut.
No, we have a labour glut (unemployed people) and a jobs glut (work not being done) at the same time. In other words, a market failure -- caused in part because for work which is valued at less than minimum wage, the market can only function by evading minimum wage laws.
Well, childcare, house-cleaning and car driving have potential costs far in excess of the cost of wages - if someone steals your stuff or damages your furnishings whilst cleaning your house, or crashes when they're driving you to work, or injures your kids, that can be hugely expensive. Also, getting someone else to drive you to work is really inefficient - it means that two people are stuck in a car being unproductive for the entire drive rather than one, plus the driver probably has to drive back afterwards.
If you offered sufficiently high wages to do those jobs, you would find plenty of people willing to do them.
A labor glut does not necessitate me being able to ask for someone to mow my lawn for one cent and having someone volunteer. You have a labor glut when the availability of living wage work declines below the working population who need to earn such a living.
That's fine - the point is that people aren't obsolete and work is available. People are just unwilling to do the work.
That's not an argument in favor of a basic income - a basic income just increases the incentives for laziness and makes the labor scarcity worse. (10% or so in the Canadian experiments.)
Basic income gives the poor bargaining power in wage negotiations. It would require cultural adaptation, but I know of few individuals whose whole needs can be satiated by just having food and shelter. People still want things. They take out insane loans, mismanage their money, and even sacrifice those base necessities to possess things. We have a strong consumer culture, and UBI can take advantage of that to reduce suffering and empower workers more to actually negotiate with employers rather than it being a one sided conversation with your only failsafe being an undesirable minimum wage.
I highly doubt making labor more scarce, when we are in such a glut (and continued automation will perpetuate and expand the glut) would actually cause any real harm to the economy. We already pad economics with millions of ghost jobs that exist solely because the marginal loss in productivity and efficiency having unnecessary workers is less than the cost of having mass destitution and social instability.
A glut is when the supply is available to anyone who wants it and additional supply goes unused.
We've already established that we have the exact opposite problem. Our national infrastructure is crumbling because no one is fixing it. Skilled women stay home with their children because child care is unavailable. Homes go uncleaned, nails go un-manicured, etc, because no one is available to do these things.
If we reduce the labor supply by 13% (what was done during the Mincome experiment) that only makes these problems worse. For comparison, the great recession cut labor supply by 5%.
The supply and demand of labor does not care what people need - it does not care at all that mothers want childcare, or the citizens want better roads. All that matters is if that mother or if the citizenry are willing to pay for it.
Predominantly most of that is due to the labor glut driving down median incomes and leaving people with less economic negotiating power to get the things they want done.
It isn't appropriate to talk in absolute figures of reducing labor supply. That is one side of an equation without considering the other. UBI would generate tremendous real demand for cheap housing, cheap healthy food, and all manner of amenities that can fit in that universal budget. Those demands would be met, because everyone than has the economic negotiating power equal to their UBI as a minimum, rather than today where many people have no (unemployed) or negative (indebted) negotiating power at all and thus have no effective economic influence at all.
It is always about supply and demand, and to only talk about economics in terms of one or the other is to argue for an intended outcome rather than seeking out the best possible one.
If there were actual demand for childcare, the going rate of childcare workers would continuously rise as capital fought to be supplied by limited demand. The rising prices would create incentive for people to enter that labor force. That does not happen because real economic demand does not exist at those levels - it is not an actual labor shortage if all you want is childcare workers at minimum wage. If I want rocket scientists at minimum wage, I cannot claim there is a shortage of rocket scientists period if they are not willing to take the lowest possible payment I can give them.
There is a shortage of something when the real supply cannot meet demand at sustainable price points. Are Nannies expensive? Yes. Is that not a sustainable cost? Absolutely not, Nannies are a valuable commodity, and those that can do a good job should be paid for the scarcity of their skillset. The reason there are not more Nannies is not because of some incredibly bullshit argument about how "nobody wants to do the job, we would pay them anything, but people just refuse to act rationally economically" it is because nobody is willing to pay anyone sufficient wages to justify the career pivot into the discipline.
And that relates back to my central argument for UBI - our economy prioritizes the work "worth doing" as a central tenant of capitalism. All a UBI does is potentially drop out the labor force of the work being done now that is the least worth doing to begin with.
But TLDR, fundamentally, it is important to recognize that in capitalist economies, demand is not people wanting something (better roads), it is the money willing to be spent on the supply. So if nobody will supply the money to build better roads at rates construction workers are willing to take, you do not have a shortage of construction workers, you have a shortage of funds to pay for better roads and thus you are not generating enough demand for them.
We have a demand problem, not a supply problem, as long as major corporations are hoarding money and the stock market is at all time highs, capital is out there. There is just nothing the controllers of that capital actually want that anyone who isn't working now could supply.
Conversely, if there was an oversupply of labor prices would come down. Note that I said labor is scarce, not that there is a shortage.
The fact that prices remain high suggest people are choosing not to work, not that their labor is worthless and they can't find any job. Why do we need a BI if labor is valuable and people are merely lazy? Why do we want to make a scarce resource even scarcer?
One important, central consideration must remain that labor is local. Surely some cities in the US have a labor shortage, and the worse it gets the more financial pressure it puts on the unemployed elsewhere to somehow manage the opportunity cost to immigrate. But the workforce participation rate is at a twenty year low, it is below 1960s levels before women even entered the workforce en masse, and it is continuing to decline.[1]
I'm also curious who is "lazily" not working, and somehow still eating and sleeping under a roof. And then I'd also argue that if you can find people that are refusing to work minimum wage and instead prefer to be homeless, that is probably because they have no negotiating power in wage relations because... there is a glut of labor. If there is work to do, that is valuable, prices will rise to find supply. If the prices will not rise, then you do not have actual demand, you have desire. Money is the only thing that speaks in economics.
In the macrospective economy, I would like to see evidence of unsupplied demand at the minimum wage for child care or construction workers. My father works construction, and there is a tremendous glut of foreign laborers in our area (Eastern PA) that drive wages down straight to the minimum with no benefits. There is a shortage of skilled labor in the industry, but only because the hiring practices of firms has prioritized the unskilled cheap workers and thus drove talent westward. So now there is a shortage of skilled workers, but only at non-competitive pay rates that the skilled workers left because there was a labor glut, with firms simultaneously unwilling to raise rates back up to attract them back.
The vast majority of poor people (75% or so) don't work and are not seeking work yet have consumption of approximately $20k/year/consumer unit. Where do you get the idea that people will be homeless if they don't work?
In the macrospective economy, I would like to see evidence of unsupplied demand at the minimum wage for child care or construction workers.
It's pretty easy. Offer child care for $7.25/hour and see if anyone tries to hire you.
> This confirms what I said - people don't want to work. Workforce participation rate = (working + seeking work) / population.
The majority of the decline in participation is not some magical "nobody wants to work anymore" because people are on average poorer than they were 30 years ago. If...
> People on public assistance.
This is true, then losing workforce participation of millions would cripple our economy if productivity were actually related to peak utilization of human labor. I do recognize the increase in social security disability participation, but 9 million does not make a near 20% drop in participation rates. It is certainly a contributing factor, though.
> It's pretty easy. Offer child care for $7.25/hour and see if anyone tries to hire you.
If there were unfilled positions I would find them online on job sites, but I'm not finding examples. Additionally, remember that 7.25 is not a living wage in many areas, and people have to make the moment to moment decisions whether working at or near minimum wage is worth it if you are still insolvent doing it versus seeking more lucrative income with that time.
> Where do you get the idea that people will be homeless if they don't work?
My mother was effectively days away from homelessness last year, she quit her job in 2012, did not seek additional employment for two years, by being a property owner was ineligible for most welfare, and was being forclosed on for property tax collection. We got to experience the real options she had on where to live - there was no public housing available for at least 18 months, she might have been eligible for subsidized rent but she was not going to get free money for living and the process to get social security disability is not as easy as people on HN like to make it sound.
Here is another thought - if people are dropping out of the labor force and using welfare as a substitute, UBI is in every possible way superior. Social security disability is a disincentive to work, because you lose benefits if you do. The same thing happens at every welfare cliff in the current broken system. I argue personally for UBI because of the negotiating power it gives workers, the capacity for it to normalize the cost of labor against the human cost it incurs rather than exclusively the rarity of the skills necessary to perform it, the normalization of economic stability enabling people to be more entrepreneurial, the extreme amount of social stability it would create to correct for growing wealth inequality, and the extreme simplification of an out of control welfare state bureaucracy.
But obviously valuable work is not going undone. If there were valuable work to be done that nobody were doing, I or any other active market participant would weigh whether pivoting to in demand jobs were out there was economically worth it, and capital really wanted it done, it would raise the price to find someone to do it.
If the marginal value of labor is as low as it must be to prevent the rapid expansion of wage offerings for work done, it means the work not being done as little or no marginal value according to the wills of capital, and we aren't actually losing any economic efficiency having people drop out of participation because the work they would have done, if any, would have been of negligible significance.
You can revoke laws. In fact, this whole discussion is basically about revoking minimum wage laws. How useless of an argument would it be to say "paying less than minimum wage is already illegal, so we can revoke the anti-collusion laws?"
The trouble with supply and demand is that people can't exactly stop eating for a few months if they can't find work that pays as much as they'd like, so as long as there are more people who need jobs to eat than there are jobs it can't do much to stop the downward pressure on wages - which in turn means that it's in business owners' interests to make sure this is true. (Why do you think there's really so much pressure to cut welfare in countries like the US?) If anything, decreasing prices could increase supply as people are forced to work multiple jobs in order to afford food and shelter.
Minimum wage obviously doesn't affect Google engineers, it affects the unskilled labor with near-limitless supply that you have mentioned. The idea is to prevent that kind of labor from becoming basically slavery.
>"it affects the unskilled labor with near-limitless supply that you have mentioned."
That "near-limitless" supply is the actual problem. Horrible as it may sound, but we're already talking about people and people's labour as a resource.
Unless you allow the market to regulate the supply, you'll always have an imbalance. In fact, we make it worse by letting it get to this point. If we were to let the market work on it's own now, with no government interference, people would probably be dying in droves from starvation (assuming charity doesn't help them along).
Attempting to make everyone's life not miserable (with e.g. minimum wage laws) skews the market and allows individuals to have (or have more) children than they would if they were living in a tough market. If occurring naturally, this sort of effect would be very subtle and not be a cause for misery. But, since we've already propped up a large population that would not have occurred ordinarily, we're stuck in a situation where outcomes are unthinkable.
I'd even argue that it's a self-reinforcing cycle at this point. The over-abundant supply pushes the wages down, making the situation even worse were it not for welfare/minimum-wage hikes. I think as a society, we have a moral obligation to wean this tap off, minimizing the harmful effects as the market adjusts while at the same time removing the perverse incentives that caused us to get to this point in the first place.
Slavery is forced labor. I don't see anything forced here. Salaries for unskilled labor are driven down by lack of demand for unskilled labor, and nothing can be done about that.
What can be done is adjusting employees' skills to the areas where demand is still high. Coding bootcamps are one obvious possibility, but there are others. Everyone can learn new things.
You, personally, can help these people, too. Hire an Uber (I am sure it helps many people survive; I had my share of tough times, and I'd sure could have use it as some source of income; unfortunately, it was before Uber was a thing where I live). Buy something on Etsy. Spend money locally. Etc, etc.
If you have to accept a pitiful wage in order to barely subsist, that is effectively forced labor. In practice, the only alternative is to starve. Which is why a labor market without basic income or some other kind of safety net is not a free market at all.
Not everyone can learn everything, but even if that were possible, if everyone in the world knew e.g. how to code decently, coding would be a minimum-wage job too. There is just not enough demand for jobs to make everyone valuable, and automation is just making this more pronounced.
This is why world population growth is dramatically slowing down (not exponential, not even linear — it is now sublinear, and expected to stop completely around 2050).
"a labor market without basic income or some other kind of safety net is not a free market at all"
No, you're just redefining "freedom". It does not mean "freedom from consequence from choices". It means "lack of compulsion to make particular choices".
>Google can't hire a decent software engineer for, say, $30000/year, because other companies will immediately offer more, and supply of talented software engineers is quite limited, even globally.
Did you somehow miss the massive wage fixing lawsuit google just recently lost? Your hypothetical wouldn't happen because google has deals with its competitors to artificially deflate wages.
I think you mightve picked the absolute worst example to defend your point
You think people are not entitled to employment? Are they entitled to survive? Are you going to be the one to break the bad news?
Let's find out what happens when you tell large segments of the population they have no right to a livelihood. I am going to wager the cost to the wealthy will be much higher than an increase in the minimum wage.
Maybe you're confusing (as many do) entitled with having the freedom to do something.
Entitled: believing oneself to be inherently deserving of privileges or special treatment
If I don't qualify in any way for a job at your business, let's find out what you say when I force you to hire me because of an argument that I'm inherently deserving of that job. I'll just sit on my butt all day, and you pay me. Sound good?
In case this is not obvious to you... to be entitled to employment (or anything) means someone must provide it. If nobody is voluntarily hiring a man, you would force someone to hire him because this man is entitled to employment?
How would you feel if I told you that there's someone I know in need of employment and YOU must hire him? Oh, and if you don't, I'll fine you or lock you up.
People were never entitled to employment. The very notion of a job as the primary mode of earning one's living was born relatively recently, some 200 years ago (then, it meant mostly manual labor). It survived the transition to information economy, but current AI progress may finally put end to it.
This is as inevitable as the appearance of middle class during the first industrial revolution. The progress cannot be stopped.
I assume everyone who argues that there's no right to employment is also arguing in favor of a guaranteed income - decoupling survival from employment.
Then why do only 4% or so[1] of workers in the US make the minimum wage? Wouldn't, by your logic, far more employers pay people at minimum wage if their only goal was to pay people the lowest amount legally possible?
You're using an inadequate notion of what a "good argument" is in this context. You have not made an argument for why a price floor is necessary or desirable. I could just as easily say, "The good argument for having a maximum 'price of bread' is that without it, bread prices will be pressured up, because every bakery on the planet wants prices as high as possible, and they generally have the means to achieve it." You can say that all you want, but you haven't provided a justification that it's actually true, or that the situation warrants legislation of one interest over the other. You haven't given a justification or any consideration to the tradeoffs involved.
Do you know what happens when real countries try to impose a limit on the price of bread? Starvation. The Soviet Union tried to establish a limit on the price of bread. Since the actual cost to grow wheat, bake bread, and transport it to cities was high, the supply chain couldn't make a profit (or even break even) selling at the government-specified price. So they stopped, and mass food shortages resulted. That's what happens when you tamper with the economy. Gorbachev finally fixed the problem by transitioning away from a planned economy to a free market: http://www.nytimes.com/1990/05/23/world/evolution-in-europe-...
By allowing the price of bread to rise significantly, bakers and bread suppliers could finally turn a profit (i.e., not take a loss) selling bread, and so they began to do so. This is how the market forces of supply and demand lead to efficiency and achieve the right outcome. For example, if a crisis happens, then food becomes scarce; when food is scarce, people are willing to pay a high price for it; and because people are willing to pay a high price, this creates an incentive for people to go to extraordinary lengths to provide food there and reap the benefit of that high price.
If you establish a price floor, then you're tampering with the economy in a complex way. You had better be prepared to reason about the economic deadweight loss (e.g., unemployment, shortages) that will result, and you should be prepared to provide a thorough justification for why the benefit of that legislation justifies the cost you're imposing on the economy through deadweight loss.
Equating jobs to slavery is an outrageous argument, and disingenuous. Slavery is the act of taking away someone's freedom and forcing them to work for you without choice. Jobs are a free market - anyone is free to work a job that's offered to them, or not. They can quit and look for a better alternative. That is the market pressure that forces wages up: if employees have a better option, they'll take it.
> Do you know what happens when real countries try to impose a limit on the price of bread? Starvation. The Soviet Union tried to establish a limit on the price of bread.
Too simplistic. France had significant limits on bread prices until 1987, and starvation did not ensue.
http://www.lesnouvellesdelaboulangerie.fr/propos-des-regles-... (in French) was the best summary I could find, and it's not very detailed. But it does mention that from 1978 "prices could be freely selected by each producer" (so were not before), but with (from 1979 until 1987) various limitations such as maximum prices, agreed increases, no-price-change-allowed, etc.
> I could just as easily say, "The good argument for having a maximum 'price of bread' is that without it, bread prices will be pressured up, because every bakery on the planet wants prices as high as possible, and they generally have the means to achieve it."
You could certainly just as easily say that, but there's an obvious reason why it isn't true: so long as there are multiple suppliers and it's possible to produce bread in quantities sufficient to more than supply the population, each supplier can benefit from undercutting the prices offered by the others and capturing a larger share of the market, and this drives down prices to relatively near the cost of production. (As for the case when it's not possible to produce enough bread, take a look at the history of rationing during wartime and why it existed.) This argument simply doesn't apply to the comment you're replying to.
A race to the bottom only happens with fungible goods, where any price differential is sufficient to completely dominate purchasing logic. There is a very broad spread in the quality of bread, and people's purchasing decisions are heavily weighted by product marketing.
That rather depends on how much people can afford to spend on bread. At least here in the UK, there's been a massive rise in the popularity of discount supermarkets like Aldi and Lidl which sell their own off-brand products that's gone hand in hand with the economic crisis. Also, it doesn't require a complete race to the bottom to ensure that bread is available at a reasonable price and the existence of premium brands doesn't cause non-premium bread to disappear.
>You have not made an argument for why a price floor is necessary or desirable.
I'm pretty sure that's all I did. Your inability to see that is on you.
>"The good argument for having a maximum 'price of bread' is that without it, bread prices will be pressured up, because every bakery on the planet wants prices as high as possible, and they generally have the means to achieve it." You can say that all you want, but you haven't provided a justification that it's actually true, or that the situation warrants legislation of one interest over the other.
No. You have provided that justification. You just said what the justification for maximum price of bread is. But those businesses don't have the means to achieve maximum bread price. And if bread was being sold for billions of dollars per slice, the price almost certainly would be regulated down. For exactly the arguments you've made: without it bread becomes absurdly expensive.
>The market forces of supply and demand create pressures both up and down on wages, and an equilibrium between them is what allows markets to be efficient.
Efficient at what? Efficient at reaching equilibrium. Not efficient at meeting the goals of society, which involve complex moral and political conditions not captured or measured by any market.
>Equating jobs to slavery is an outrageous argument, and disingenuous.
It is not. Especially with wages being systematically driven down to below what is necessary for survival. The minimum wage was created because there were real problems caused by not having it. Negative wages have existed in a "free" market.
The way to stop downward wage pressure is for people to control how many offspring they have. I hear a lot of utopian talk here about leisure economies and basic incomes, but how about some utopian talk about a world where no child is ever born into a family without a plan for that child's future?
Well, I just don't know what to say to this. Sounds like the kind of thing someone who gets paid well above the minimum wage would say.
Check out this Wikipedia article https://en.wikipedia.org/wiki/List_of_minimum_wages_by_count... and sort by Hourly Nominal in descending order. Australia, France, New Zealand, Ireland, Belgium, United Kingdom, Netherlands, Germany, and Canada all have minimum wages above the US.
All of those countries have government funded health care systems that blow the US's out of the water. All of those countries do a better job at educating their citizens.
> In reality, what tends to happen when you increase minimum wage is that businesses lay off workers. They only have so many dollars to spend on wages while remaining profitable.
The US really does seem like some strange experiment in how not to do economics and democracy.
If it's so bad, why do so many people want to live in the U.S.?
Annually the USCIS gets about 6 million applications (that's in total, including permanent and temporary immigration claims). That's 0.08% of all the people on Earth (not including those already in the U.S.). Is it really fair to say a lot of people want to live there?
That is why the refugees flee to the western world in general.
The reason why they go to Germany over France or Austria, though, are the liberal refugee politics and the misinformation that is constantly produced by the people smugglers.
I hear what you're saying. As a means of "helping out the working class", it's stupid and simplistic: "workers aren't paid enough? Mandate they get paid more! Problem solved!"
The problem, of course, is that there are many ways to save money by screwing workers (eg worsen the working conditions) and if the market price is below the min you set, employers will just shift into those other ways.
A more robust solution -- as opposed to playing whack-a-mole over all dimensions of worker screwing -- would be to a) make their options more transparent and b) restrict supply somehow.
That's why -- counterintuitive as it may seem -- I actually think it's a step forward, what LA is considering: a system of "minimum wage OR be represented by a union" (which helps with a/b above). It gives a "release valve" for excessive minimums that allows for some market pricing while also proving a check against the things advocates really care about: worker mistreatment.
A minimum wage by itself is a clumsy fix for a more complex problem.
They only have so many dollars to spend on wages at current profitability levels.
But as a business owner, when the cost of your inputs increases, the question you're faced with is not "how can I keep my current profitability levels" (which is often not possible anyway) but "how can I maximize profit given the new environment".
For example, if you're the owner of a restaurant with one or two or even four servers, you often can't fire any without significantly affecting your level of service, which could lose you even more money than you would save in salaries.
As far as I know, the literature on the subject is pretty much inconclusive, with studies pointing to a significant negative effect, while others indicate a negligible or even slightly positive effect.
If you really haven't ever heard a good argument in favor of an enormously popular economic policy that's been endorsed by hundreds of lauded and respected (even nobel-prize-winning) economists then you haven't been looking, or you're using it as a cheap rhetorical appeal to suggest you are correct without argument. I hope it's the first scenario since then you are simply ignorant and not malicious which is no crime, in which case a simple google of "minimum wage" should suffice.
In the employment "negotiation" for low-skilled workers the businesses have all of the power and the workers have none. Businesses have run a successful propaganda campaign (and sometimes employed illegal thugs to wage a campaign of violence and intimidation) against the union movement whose goal was to give workers bargaining power through collective action and boycott so they are not completely abused and exploited. Some of their successes include, for example, the weekend, which without regulation or collective action would not exist.
The union movement has mostly died and so the government forces an absolute minimum the worker can give the business in the "negotiation" which is as much of a negotiation as an offer at gunpoint is, because the government knows without it businesses would take everything and we would quickly devolve into sweatshops/de facto slavery.
There are plenty of places in the world where there is no minimum. If you want a society that runs on sweatshops and slave labor just move. Unfortunately you can't have that in a healthy free democratic society, so most western democracies have chosen the latter.
People don't have an inherent "fair market value" -- their "fair market wage" as you say is simply a measure of how much the wealthy owning class can exploit their wealth and power in an ultracapitalist system in which all of the rules favor them.
If there are fewer people with your skills, you are harder to exploit, so your wages are higher -- until immigrants are imported to remedy the efficiency problem which is your living wage.
Are you saying that business employ an excess of labor? I do not believe this is the case. I understand that higher costs hurt business -- but higher costs come in many forms. Increases in rent, in commodities. But only when the workers ask for more is it unsustainable.
I simply reject the notion that businesses employ excess labor and we will see mass lay offs as a result of the min. wage increase. If this were the case, you could point to Seattle and demonstrate but I do not think you will be able to.
Just to be clear, the article you link to, in the very first paragraph says "It’s too soon to tell for sure" which is much less certain than when you say "has caused a massive loss of jobs"
The conservative government here in the UK has put the minimum wage on a steep upward trajectory. This is not a conservative vs left-wing (or liberal as you like to call it) thing.
The more important distinction is between those who keep holding on to paid work as the main or only moral basis for deserved income and the other camp that tries to move away from that principle.
There are conservative, left-leaning and libertarian people on either side of the debate.
You must be aware that "conservative" means something somewhat different in the US compared to the rest of the world. I agree that it's rather silly and exceptionalist of us, but the fact remains that Americans who identify as conservative are very likely to want to reduce public support.
I am aware of that, but I find it interesting that being for or against basic income is not an ideological constant to the same extent as many other policies.
What's interesting is that those who ascribe some sort of moral (or maybe just sentimental) value to being in work are currently a majority on the left and on the right. That goes for the US as well as for Britain.
Here you go: the minimum wage exists to depress rents. Rents always rise until tenants are making whatever minimal profits will keep them in business. Enacting a minimum wage law takes money from the landlord and gives it to the workers, at the same level of minimally attractive profit margins.
Anyone claiming to definitively know the results of increasing minimum wage is talking out their ass. The economic effects of minimum wage increases are complicated and situation dependent. I think the people making 'back of the envelope' economic' here are being intellectually irresponsible.
I personally think that the minimum wage is a bad solution to the problem of providing a minimum income to our citizens.
By requiring people to hold a job to receive an minimum income, we create a glut of 'un-skilled' workers and we drive the price of that 'un-skilled' work down to the price floor created by the minimum wage. This means that jobs people don't want to do aren't being automated because there is so much cheap labor.
By creating a minimum wage price floor, we also eliminate the ability to offer jobs that don't produce enough capture-able value. (E.G. investigative journalism or child-care for low income workers). This means we are forced to automate jobs that people do want to do, but that are unfeasible due to the minimum wage price floor.
By gradually switching from a minimum wage to a minimum income, we can fix the current inefficiencies in the job market while solving the same problem.
A hike in the cost of labour was the reason why the industrial revolution happened in Britain vs India.
Even today, the cost of labour is so little in India that there is no need to innovate in robotics,AI etc.
To me the question should be framed as - do we want minimum wage workers to be slaves ? This is essentially the argument being made.
If robots are actually cheaper then why haven't they being deployed yet ? Having done research in robotics when I was younger - there are more productive use of roboticist's time then to go after minimum wage service workers. Its non-trivial to exchange a waiter with a robot, and we already have "ready made" food - so why do people still go restaurant ?
The only thing a hike in minimum wage is going to do is cut into the profits of restaurant owners, landlords and big chain corporations.
The article makes a number of arguments as if stating accepted facts, when much of it doesn't even logically follow.
>Some low-wage work would be reallocated out of the relatively low-social-value restaurant sector and into things like child care and home health assistance, for which there is ample demand.
If this is true, then what is preventing it from happening now?
>we are able to produce everything we need with less labor, we can afford to let people work less.
The tired old utopia argument. Robots will do everything while we all sun on the beach.
Firstly, this ignores the fact that people spend their time working because they need money, not because there is work to be done.
Secondly, If we are making things with less labor, then there is less demand for labor and, thus, lower wages. Yet, the producers realize higher profits. The actual result is not utopia for all, but the wealth divide that we see now.
>Most restaurants would keep longer hours (they're paying for the rent and the robots anyway), meaning many workers would get a raise and change shifts.
Not sure where any of the leaps of logic packed in there originate. The entire statement is completely irrational.
>advanced robo-restaurant technology would itself be a valuable American export good, and people would be employed in designing and selling it
Complete sleight of hand. We're talking about the effect on low wage workers, not highly skilled robotics designers and sales engineers. The people who are displaced are very unlikely to gain employment designing the robots that are replacing them.
This article ignores several key points. Robots are expensive and would need to be custom made for each restaurant to replace humans. Also, there would be missing the human touch, making a restaurant visit cold and automated. No more "service" and personal touches. You get what you get.
The immediate issue is, who pays for the increased labor cost? You do. And, no, it won't just add a dime to your bill. My labor cost has gone up 150% since I started in this 30 years ago as an investment. All my material costs are also up at least that same amount. The unit cost to you of one of our products was $4 back then. Today it is $8.
I now feel I hire better people but I hire fewer of those people and, currently, won't hire teenagers cause they're unreliable but the quality of person I need to run with this light crew is hard to find, more due to the stigma of working fast food than the actual pay (though that's part of it).
The customer is price sensitive. The customer likes the human touch. If restaurants go robotic, the most popular restaurants will be those without one, and while the idea of raising pay to $15/hour is great, someone has to pay for that, and that someone is you.
This is a very sane point of course, and you are right that the consumer, and perhaps the low wage earner (in cases of the McDonald's type restaurants) now loses his extra wage to extra meal costs, so it is self defeating.
The problem though is that your costs are not driven up just by wage costs, but by many other things that are not helping the low wage earner. So the self defeating part of the "rising cost past to the consumer" is only a fraction of what makes life miserable for those who are at the bottom. Increasing there pay directly helps them 100%. And so it is still a net win.
Those "other things" mean the cost of food, paper, cleaning supplies, etc. that make a restaurant run. Those same materials are made by low wage earners who, if given $15/hour, will drive up the cost of the supplies I use, thus increasing my operating costs.
I don't want employment, and hell no I definitely don't want full employment, just the opposite. I want us as a species to transition to a leisure society with the ick automated away, and the only jobs humans do being ones humans would love to do for the sheer fun of it.
Because a minimum wage has a loophole for "not employed at all", it isn't good enough. A Basic Income has no such loophole, and will allow poor people to reject awful jobs, forcing them to be automated.
I'm curious about this. In your ideal above, how would one go about pursuing their dreams without an ability to earn excess capital through labor?
For example, my goal is to have a nice house on 50-100 acres. I also really enjoy jet skiing and boating with my family - especially from a nice lakefront rental with a private dock.
I can't fathom how I would pursue those goals in a 'leisure society'... Or as a prole would I be expected to just accept my assigned housing, only use public transportation, and put my name in an annual lottery for one of the state run vacation compounds?
An approach I've considered is, that the living allocation by default is just comfortable. You'd be able to get allocated a city apartment or a rural house. But this is coupled to a delegation based "liquid" direct world democracy where you can either direct your surplus yourself, or delegate it to someone (or some organization). And recursively they can delegate it too.
So suppose you were Elon Musk and you said, I want to build a colony on Mars, you'd probably be able to draw the interest of large delegating entities who would grant resource priority to the program so it could make rockets, and other entities would have projects that needed launching, and so forth.
Or compare a smaller project, if you were a marine biologist and you wanted to equip a boat and go study penguins, there would be some delegating entity that would care about penguins, and you'd get your boat.
Perhaps even if you just wanted a particularly beautiful house, you'd be able to draw enough aesthetes to your cause.
But if you were just a jerk who wanted a mansion, well, probably not.
[Edit: for clarity, you could conceptualize this system as something like crowdfunding, except global, recursively delegated, and directing resources directly instead of money.]
So that doesn't really answer any of the scenarios I posed. You do manage to imply that I'm a jerk for wanting a nicer house/vacation/recreational vehicle than I'm allocated by the state, so that tells me something...
Sounds to me like if I wanted to buy a jet-ski in your world, I'd have to find a bunch of people to 'delegate' their 'surplus' to me. Perhaps I could perform some function for them in return? Say, that sounds a lot like labor... So I could work for money. Got it.
In a total leisure society, how do we pay for Basic Income? Where does the government get the money to give out to everyone?
I agree with you. But I think its not about Basic Income, but the idea of Basic Utility/Survival where we can supply basic needs for free, via automation etc.
> Where does the government get the money to give out to everyone?
The exact same place they get it right now - they pull it out of thin air by fiat. (involving a quasi-government agency ("the fed") as a proxy is optional) Money hasn't been zero sum up since the gold standard.
Governments already define most aspects of money, and they can change it as needed, such as when Nixon declared that the dollar was no longer convertible to gold.
You can't comment like this here, regardless of how wrong or ignorant another commenter seems. We ban accounts that do personal attacks. Please re-read the guidelines and post only comments that are civil and substantive.
If you think that's "retarded", I suggest studying more macroeconomics and the history of the dollar. I suspect money doesn't work they way you think it does.
Minimum wage hikes are tough pills to swallow, but they are a reaction to lack of wage increases over time.
If the lowest wages had followed the s&p or management comp. over the last decades then this would be a non-issue. Weak labor/low organization and the fact that many bought the myth of "trickle down economics" has kept the lowest wages where the 1% wants them.
As for automation: if there are gains from automation they are likely there already. I Mercedes builds cars much differently in the US compared to Germany despite big differences in labor costs.
One difference that is immediately noticeable with high labor costs is not in industry but in services 1) more self-service such as self checkout at grocery store, self-checkin at airport 2) no non-essential services such as greeters, bag-packers, 3) DIY is common
It's amazing how pushing technical boundaries is seen as worthy challenge, but helping the those who are struggling with basic needs is seen as impossible and an irritating overstep by the government.
What happens when automation displaces a sufficient portion of the unskilled workforce that their value is less than 'minimum wage'?
In an increasingly technical and automated society, what do we do about those who cannot adapt or become skilled enough to work in the increasingly technical workspace? We can either manufacture menial, useless jobs or admit to ourselves that HAVING to work is not necessary. We NEED to begin exploring Universal Basic Income to learn how to accommodate this in the future. It's either that or we let those who can't join the workforce suffer.
I don't know that we're there yet, but we will someday. Sooner than we think.
> Even better, to the extent that we are able to produce everything we need with less labor, we can afford to let people work less.
I'm doubtful. From what I've seen it just means that those who do have full time jobs are expected to work more. Why employ two people for 20 hours a week when you can have one person for 40hrs a week? For most industries the managerial and administrative overheads are less with fewer staff who work longer hours.
> but has not really succeeded in shedding much light on where innovation comes from or what policies support it.
Deirdre N. McCloskey might have something to say about that in her tomb 'Bourgeois Dignity: Why Economics Can't Explain the Modern World'[1][2]. tl;dr her argument is that the ability to bring innovation to market, profit, and be dignified in doing so is the factor that brought about the modern world.
And besides, we only have to look at other developed nations with liveable minimum wages to see that it hasn't caused an automation revolution. Where I live, Australia, has an adult minimum full-time wage of $17.29[3] and has an unemployment rate of 5.8%[4] (for some definitions of 'unemployed').
A liveable minimum wage isn't going to cause an automation revolution. The Automation Revolution is going to be what causes the automation revolution, and for that to happen we're going to need cheap general purpose robots trickling in to the second hand market.
When a business can buy a general purpose robot for less than 5x the annual salary of a full-time employee, and it can learn new skills as easily as a human, we'll be close. It's looking like that's a way off yet.
Australia is being fueled by huge external stimulus from China, which won't last forever. It's not the best example to use. Some of the mature European democracies provide much more useful data.
This[1] says "The mining sector represents 7%[31] of GDP; including services to mining, the total value of the Mining Industry in 2009-10 was 8.4% of GDP.", and "Despite the recent decline of the mining boom in the country, the Australian economy has remained resilient and stable." - We'll see how long that lasts. It's certainly given me pause when considering to take out a home loan. Am I going to have a job in 5 years time?
From my friends in Australia (academic economists) I hear that China's impact on housing now exceeds the impact on any other sector. Australia has effectively become mainland China's money laundering hub.
We haven't seen an automation revolution in Australia because the Australian tech sector isn't nearly as developed as that in the US.
Consider the fact that we are already seeing an automation revolution in the US with certain types of labor, e.g. driverless cars. Raising federal minimum wage will be like pouring gasoline on that fire.
> We haven't seen an automation revolution in Australia because the Australian tech sector isn't nearly as developed as that in the US.
But we haven't seen an automation revolution in the US either, so I'm not sure what you're saying here. Some sources[2] claim Australian's are early adopters of new technology.
I wouldn't say "we are already seeing" an automation revolution in the US with regard to driverless cars. I'll be reviewing this opinion ever six months though. It certainly looks like there's a race to full automated driverless vehicles, but we're not there yet. Not en mass.
This NPR article[1] shows truck driver is the most common job is most states in the US. Self-driving trucks are going to be disruptive.
It seems like with regards to restaurants, this would only mostly apply to fast-food restaurants. Raising the minimum wage doesn't really appear to have an effect on servers given that the majority of their pay is from tips and they are effectively legally paid less than minimum wage anyway.
Furthermore, it isn't supposed to be a living wage. You're not supposed to be a single mother of 3 supporting yourself working at McDonald's. The minimum wage is supposed to be for those new to the work force and then you're supposed to better yourself and get a higher wage job. Where's the incentive to invest in yourself to earn more if you're making $15/hr for menial work?
That is an old dead horse. What job folks are 'supposed' to have according to middle-class morality is irrelevant. Today only about one minimum-wage worker in 10 are teens. A third are over 35. They haven't had a raise in 7 years. We're talking 25 million people who can't pay basic bills.
And we're not going to make them into 25 million more engineers or programmers or anything else really. There aren't enough jobs in the entire rest of the economy for these folks to fill.
It isn't going to get better by itself. Now Carl's wants to automate the counter. Banks are automating, expected to reduce head count by 30%. These things happen across the industry, those folks aren't earning minimum wage, they're out of a job.
Before computerized elevators, there were manually operated elevators. Before automatic telephone switchboards there were manually operated telephone switchboards... Those things were relatively modern.
Future people will say: before automated kitchens there were manually operated kitchens, before automated cleaners there were janitors, before self-driving cars there were manual cars... and so on.
The domain of tasks that can only be done reliably by humans is shrinking. Humans are being pushed to do more complex things. But that doesn't scale infinitely. Robots eventually will be able to do better.
Agreed. It's interesting that this thread is almost entirely about low wage earners. Truck drivers were added to the conversation, but the truth is it's not about low wage earning, but about rote working.
In 10-20 years, i'd expect
The job of accountant being pretty much wiped off the map for humans. Turbo Tax, et. al, was a nascent first step.
Doctors, Nurses, Hospital Administrators, Staff will be significantly pared down, and given much more commoner positions, as I can go down to Walgreens, sit in the gene therapy booth and cure my own cancer, hiv, leukemia, als, etc. etc. Perhaps Baby docs will survive the longest... that's kind of icky even for a robot.
Dentists? Higentists? I'd expect in that period of time, we will be able to regrow teeth beyond the first set of adult teeth... so, really what's the point of your job function.
Middle Management? Various surveys suggest people actually would prefer to report to a computer, rather than a human, and really, will it be that hard to believe that middle management can't be done via robot? That's a good number of people without jobs.
Bus/Train/Plane Drivers, gone soon as well.
Almost all manufacturing jobs will be gone.
As automated surveillance reaches its crescendo, surely police forces can be significantly trimmed, even without the introduction of robocop.
And on and on...
If you want a job in the near future, start planning for one that is highly chaotic. But with everyone fighting for those jobs, don't expect much in pay.
Well the truck driver's work is not only to drive. Also to do maintenance on the truck, inventory and such. How do you change a flat tire on a self driving truck? You will still need some alternative. That alternative can be automated, sure... but it's a problem yet to be solved.
Thought experiment. If the government will start forcing your employer to pay you, lets say 70% more than you currently make beginning next month (if they want to keep you), would you be worried about losing your job?
Oh, and let's not forget, nobody else will be allowed to hire you from that point on if they don't pay you at least that amount that your current employer will be forced to pay you from now on.
And the other thought experiment: you're currently making 70% more than somebody who holds significantly less responsibility than you do, and has significantly less skill than you.
If the salary their position pays is increased to match your salary, what are you going to do?
I think what you're going to see with any minimum wage hike is that businesses who have thin margins, namely restaurants and small stores, will be forced to go out of business or be forced to degrade their quality of service. Labor costs are for any business the biggest line-item expense. Spending on "robo waiters" or what have you is a big upfront capital expenditure, and I doubt many restaurants will be able to finance it. But it's not just small establishments: even Walmart is very exposed to these wage hikes. While it appears like they have lots of money, a lot of how they do what they do is based on cheap labor.
In SF, after they boosted the minimum wage, I observed a few stores go out of business. I'm all for people being paid more, but I doubt people losing their jobs altogether was the intended consequence.
Another thing I observed was the price of eating out in SF rose considerably. I remember feeling shocked that for a simple lunch (certainly not a luxury), I paid over $30. Things like that hurt people on the lower end of the economic spectrum, especially since poorer people are very sensitive to food prices.
The sad thing is: after taxes, if somebody is working the maximum hours they can without being a full-time employee (which very few minimum wage earners are), this would only net them an extra $450/mo. at most, which doesn't seem like it would be enough to have a big impact on somebody's life.
Perhaps I am cynical, but I don't see these wage hikes as having a net positive impact. What drives up wages is a shortage in the labor supply and businesses that need more skilled employees who they are willing to train and keep for awhile. A minimum wage hike just gives businesses more reasons not to hire people.
Yeah admittedly that judgement largely depends on where you live and the cost base. In my opinion, that wouldn't buy you much in SF or NY. For somebody located outside of a city, it could have a much bigger impact.
- To work in a city, it has become increasingly beneficial to live in close proximity or inside a city.
Therefore, an increase in minimum wage, while certainly helpful, is going to have less of an impact than one would hope, simply because those who work minimum wage jobs have a higher cost of living by needing to be close to cities in order to work those same jobs.
But of course, San Francisco is hardly a good representative of the state. What happens when the Dairy Queen in Fresno is required to pay the local teenagers $15 an hour, or around $30K a year, to sell ice-cream cones? My guess is that there's going to be one less Dairy Queen in California and those teenagers will be out of a job.
Automation will change the job market structure, i.e. what jobs and wages are available, which will have two major effects:
1. Change in income distribution and therefore inequality (not necessarily for the worse, but it seems likely). People often say that automation will result in unemployment, but that's only true if the minimum wage is fairly high. The real danger is rising income inequality.
2. Change of the fraction of GDP that goes to labour (as opposed to capital). Again, seems like it will be a change for the worse. The share of labour has been slowly decreasing for some time.
Automation unless the becomes the norm will never complete replace humans. For example, number of places allow you to place an order via an app, but customer with the awareness and ability to do so will just stand in line waiting. Plentiful amount of additional explains, but the point is customer, not business decide what they want, and customers often herd or group think.
"Right now the retirement age is rising from 65 to 67, and most people think it will have to go up to 70. If robots can do a lot of the work instead, we could put it back down to 65 or even to 62 while still growing the economy. "
Assuming everything else stays the same, if a swarm of robots enters the economy and starts doing a shit-ton of everyone's work at a tiny cost, then productivity skyrockets and we all start collecting unlimited social security checks starting at age 62.
But everything else won't stay the same.
Consumers will start to demand more from the businesses and governments that use these robots. Businesses that don't get more robots -- or more expensive robots -- will be left behind. Pretty soon the productivity miracle disappears and we all have to work until we're 70, just like before.
> Robots are going to pay the social security tax.
Those robots are owned by business owners like half of the people commenting in this thread, and, like the comments already show, they’ll push for 0 taxes on their robots.
They’d rather have people die than to increase the costs of their products by a few dollar.
Although now that I think about it, I wouldn't put it past some politicians to come up with a plan to tax businesses for automation as a way to counter the SS shortfall. Kinda like taxing miles driven now that cars are so efficient the gas taxes don't work anymore.
Robotic fast food restaurants have been built. Check out AMFare, from American Machine and Foundry, deployed in 1964.[1][2] Automatically produced a range of meals (burgers, hot dogs, chicken, fries, shakes) comparable to most of McDonalds' business. This worked, and served real customers for a year, but was never deployed beyond one test location. Apparently it wasn't cost-effective. AMF returned to their more successful product, automated bowling alleys, which they still make and operate.
There's a startup trying to do a burger machine now.[3] Typical pretty web site, no installations. Last updated in 2014. McDonalds deployed a robotic kitchen in Phoenix AZ last year, and it hasn't been heard from since.[4]
Looking at the trade magazine of fast food, QSR (https://www.qsrmagazine.com), there's not much talk about kitchen automation. Even when they discuss a higher minimum wage, they barely mention automation[5]
Most of the newer systems look less effective than the AMF system from 1964. What's happened instead is movement of more processing upstream. The AMF system took in potatoes and bulk ground beef to make french fries and hamburger patties. Today, french fries are cut in a big plant elsewhere, and patties are pre-formed and shipped refrigerated. A fast food operation today is a final assembly plant.
One idea that did not catch on was automating fast food managers out of a job. Hyperactive Bob [6] is a system from a decade ago which watched images of customers lined up and lines at the drive-through, then decided how much food should be cooked ahead of orders. (That's the definition of fast food in the industry - is food cooked for inventory?) The company is still in business, but they mostly sell outdoor displays for drive-throughs.
So robots are not a threat to restaurant employment in the near term. Maybe 10 years out, but not yet.
I think that's roughly right. The big-picture trajectory of automation is also, from where I see things in AI, not that sensitive to minimum wage levels, at least if we're talking anything near the levels that have been proposed so far.
California, for example, is proposing to raise the minimum wage from $10 to $15 by 2022. That annualizes out to 7% a year, or probably around 5% in real terms, assuming current ~2% inflation rates persist. That's just fiddling at the margins with the economics of automation, not a revolutionary change. Tech improvements are looking for orders of magnitude cost and productivity improvements, not +/- 5%. A wage floor going up 5% a year will, at most, move up projects which were already a sure thing, making them economically feasible a few years earlier than they would have otherwise been. But it's not going to make things feasible that are currently an order of magnitude on the wrong side of economic feasibility, or that are currently too unreliable to deploy at all. And those are the kinds of changes that major progress in automation is driven by.
> What about the workers thrown out of jobs by the new robo-waiters? Many would get new jobs, though the way this would work is often ignored.
> Most restaurants would keep longer hours (they're paying for the rent and the robots anyway), meaning many workers would get a raise and change shifts.
No, the workers are now fired. They don't get a raise.
> The advanced robo-restaurant technology would itself be a valuable American export good, and people would be employed in designing and selling it.
Yes, but not the people we just fired.
> Some low-wage work would be reallocated out of the relatively low-social-value restaurant sector and into things like child care and home health assistance, for which there is ample demand.
If there is ample demand for such things, and those things pay better, and typical restaurant workers are qualified, then we should already see a mass exodus from restaurant work. We don't. Thus one of these things isn't true.
> Since poor people are now making more money...
You have not given any evidence to support this.