
Sympathy for the Luddites - jaysonelliot
http://www.nytimes.com/2013/06/14/opinion/krugman-sympathy-for-the-luddites.html?smid=fb-nytimes&WT.z_sma=OP_SFT_20130614&_r=0
======
draq
Basic income for everyone does indeed seem reasonable to me. If new technology
drastically reduces the amount of labour, it seems obviously fair that
everyone should be eligible to profit from its benefits. If 2% of the
population can provide food for the whole society, maybe another 30% (a number
to be drastically reduced by new technology) needed to maintain the social and
economical infrastructure, then we will have a majority of people whose
economic output is not required. Those people, e.g. children, retirees,
handicapped, people with illness, etc. need means to live a decent life. To
excessively burden the relatives of those people seems to be an arbitrary and
cruel neglect of the society to care for its members.

The argument against basic income is the same as for IP laws. Without money or
legal constructs to monetize their products, people have no incentives to
work. Maybe we need better incentives for working and creating things.

~~~
msandford
I would argue that it's not obviously fair that everyone should profit from
it. What incentives do people have to make new technologies that drastically
increase labor if they cannot be paid for inventing them? People should only
invent to serve their fellow men, and receive no compensation for their
efforts?

If they do deserve compensation for their efforts, how do you do that aside
from "capitalism"? In a capitalist society if you can make more things from
less resources, you should (everything else being equal) reap higher profits.
That's your compensation for your invention. In the absence of such a
mechanism, what is the fair price for an invention? Who decides?

~~~
ecopoesis
The incentive to work is you make more money.

Everyone gets basic income, regardless of other income. It isn't taxed because
taxing what the government gives just so it can redistribute again later is
stupid.

If you earn additional income above the government provided basic income, you
pay taxes on it, on a sliding scale. The more you make, the higher the rate
you pay. The rich who work for their wealth are still rich, but the gaps
between their wealth and the "poor" who only receive basic income is made
smaller, and no matter what, everyone has enough to live.

~~~
msandford
Sure, but who decides what the right number is for a basic income? No matter
what number you pick there will be a portion of the population who sees that
number as "good enough" and will cease to work.

As the basic income grows, more people will choose not to work. This is good
as it reduces the supply of labor, thus increasing the wages of those who do
work. But it also reduces the amount of income available for taxation, as this
basic income isn't taxed. And as the tax base is reduced through a higher
basic income, more money is needed to pay that basic income. That drives up
the tax rate. It wouldn't be terribly difficult to find yourself in a
situation where the math simply doesn't work.

This analysis also neglects the increase in prices that might accompany such a
system. The higher the basic income the more likely you are to see an increase
in prices that guts the effectiveness of the basic income.

~~~
dllthomas
_" Sure, but who decides what the right number is for a basic income?"_

I addressed a very similar question in an earlier thread on topic
([https://news.ycombinator.com/item?id=5658967](https://news.ycombinator.com/item?id=5658967)).
It's short and directly applicable enough I'll just copy:

Like any policy question, the answer is:

Ideally, the level will be set to what will produce the best outcome based on
our current understanding of the world, where the precise parameters under
which 'best' is determined is negotiated through a fair political and/or
economic process.

In practice, the question is how we best approximate that. The shape of that
should be informed by economics, and will likely depend on the particular
country.

All of that said, I agree it's a key factor to look at when assessing a
particular BI proposal; I don't think it's an unanswerable question.

~~~
msandford
Okay, I get it. I think it's basically unanswerable but I'm happy to agree to
disagree.

~~~
sp332
Maybe we won't get it exactly right, but I think the answer is greater than 0
which means right now, we're doing it wrong.

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

[1]
[http://en.wikipedia.org/wiki/Basic_income_guarantee](http://en.wikipedia.org/wiki/Basic_income_guarantee)

[2]
[https://news.ycombinator.com/item?id=5656249](https://news.ycombinator.com/item?id=5656249)

------
john_b
In many ways I think the industrial revolution has made us forget a very
important historical fact. Prior to industrialization, "labor" was often
little more than serfdom. "Labor" in the purest sense didn't own anything, but
was simply a necessary component for the wealth-producing activities of those
who did. Laborers only had one economic move: to offer their time and hands in
the service of those who owned things (land, a shop, a ship, etc) in return
for a wage. That wage, effectively their value as laborers, was determined by
the law of supply and demand. All the industrial revolution did was to vastly
increase the demand for labor.

However, the ancient fact that one's existence as more than a serf required
ownership of something did not change. The living standards of serfs simply
improved dramatically. Those living standards still depended on the demand for
labor being high and/or the supply low.

When technology reduces the demand for labor, while the supply increases due
to population growth, it's easy to think that the economic sky is falling. But
since none of us have lived in a pre-industrial revolution era, we are
accustomed to thinking of wage-earning labor as an economic strategy that is
more common than ownership of property, and just as valid. But historically it
has been a specialized and risky economic strategy, and as the demand for
labor-intensive physical products decreases it should not be surprising if
those who are dependent on this economic strategy suffer. It may be tragic,
but it's certainly not a new tragedy.

If you want long term economic security, own something.

~~~
socialist_coder
>> If you want long term economic security, own something.

So your solution is to tell labor that they should turn into capital? That is
what you tell the millions of people who will be unable to find a job that
pays a living wage?

Come on.

~~~
dragonwriter
> So your solution is to tell labor that they should turn into capital?

Progressive automation, it is at least arguable, makes that an essential part
of any long-term solution. Labor as the key to income for the vast majority of
the population may well not be a long-term viable option.

Of course, arguably, basic income / negative income tax is just an incredibly
way of turning everyone into (at least, in part) capitalist living off what
they own; what you own is a dividend-producing share of the commons. At a
minimum, its a way of reducing the need to engage in wage labor to meet
survival needs, and increasing the ability to direct efforts _towards_
becoming a capitalist.

~~~
DanHulton
I REALLY like the way you phrase this.

Perhaps that could even be a way to sell it to the populace so that it can't
be immediately struck down as "worse than communism".

------
decasteve
We should stop using the term "highly skilled" when it really means "highly
specialized". The trouble is we are still using school, from kindergarten to
university (and beyond), as a system to turn people into highly specialized
automatons. And the trouble with automatons is they get automated. A few have
been lucky during the course of the industrial revolution to pick the right
skill to specialize in, and at the right time, but examples abound when you
pick the "wrong" specialization, just to see it subsequently automated.

I never really understood what Buckminster Fuller was trying to get across in
his Operating Manual for Spaceship Earth, until recently. The amazing thing is
he addressed these concerns quite presciently in the 1960s--he saw this
coming.

The only advice I can give is always be learning and adapting and apply it in
creative and entrepreneurial ways.

------
ef4
This problem is inherently transient. The worst case is that it takes a full
generation for skills and customs to adapt.

Skills like "reading" and "writing" were once the province of highly-educated
specialists. They became mainstream when the economic incentives made them
critical to have. People learn what they need to learn -- especially if they
start as children.

It's entirely appropriate to worry about how we can help people during this
painful transition. But we need to be careful not to turn this temporary
problem into a permanent one by creating cultures of dependence.

~~~
rquantz
_People learn what they need to learn -- especially if they start as
children._

Mass literacy is very much the result of concerted efforts by the state to
provide universal education -- it didn't just come into being.

Moreover, the point of the article is that we are in a time where education,
whether self- or school-directed, can't solve the problem, because the
productivity benefits of technology are going almost entirely to those with
capital, rather than labor, i.e., the people doing the learning. You can argue
with whether that is the case, but be aware that when you say "people will
learn what they need to learn," you are actually stating the argument that the
OP is already rebutting.

~~~
TDL
"Mass literacy is very much the result of concerted efforts by the state to
provide universal education..."

This isn't necessarily accurate. The U.S. was a highly literate society before
the advent of state sponsored, public education. State sponsored education did
indeed increase the literacy rate because many states forced parents to send
children to school.

[http://nces.ed.gov/naal/lit_history.asp#illiteracy](http://nces.ed.gov/naal/lit_history.asp#illiteracy)

~~~
rquantz
You're right, I should have said "universal literacy."

~~~
marknutter
I would be cautious to say we have universal literacy today, even with
universal education.

------
bcoates
Krugman's trying to juggle two contradictory viewpoints: one (the Luddite
view) holds that the purpose of work is to _have something to do_. The Luddite
petition is arguing that allowing these people to fall into idleness simply
because there is a more effective machine to do their job will be toxic to
society. This is somewhat confused by the Luddites also throwing out a lot of
half-baked economic arguments, but those can be safely ignored in hindsight.

Krugman then proposes a solution from an entirely opposite viewpoint: that the
purpose of work is to _produce useful things_ , and if the constant disruption
of jobs is the cost of efficiency, we should just give the affected a handout
to provide for their needs.

But because the guaranteed income doesn't solve the Luddite's complaint, it
misses the point entirely.

~~~
guelo
Where do you get that the Luddites' only complaint was having something to do?

“How are those men, thus thrown out of employ to provide for their families?”
asked the petitioners.

~~~
bcoates
They answer their own question: with a retraining process that will leave
their children behind as untrained bums.

They semi-accurately predict a future where employment is sufficiently fluid
that nobody is securely enough situated at a job that they can train their
children into it.

------
YokoZar
On the other hand, perhaps it's entirely possible that creators of technology
will notice this large swath of available labor and create technology to make
use of it.

An important point about the Luddites is that while expensive weavers were put
out of work by machines, those machines functioned by employing greater
numbers of (vastly lower paid) unskilled immigrants.

If you put a 150k salary expert out of work by creating a piece of technology
that requires two 70k workers, you still profit.

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

~~~
thufry
This article is specifically about how your "useful" subset of the 1% creates
technologies which benefit humanity in the long run, but harm large numbers of
individuals in the short run, and what to do about that. Your "destructive" 1%
doesn't even factor into this article yet you feel entitled to come in here
and rant about them.

~~~
gngeal
_how your "useful" subset of the 1% creates technologies which benefit
humanity in the long run, but harm large numbers of individuals in the short
run_

I think you forgot to add "in the current economical/social system". The
technology never hurts anyone objectively, it always helps. It's us, humans,
who decide that someone should be punished for the technological progress.
("You've been replaced by a machine, go eat cake. To celebrate our newly
redoubled productivity, we'll let you starve.")

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

~~~
gems
It still takes time to retrain, even if the education is free.

------
msandford
Yeah he definitely identifies a problem but does not address any of the knock-
on effects of a guaranteed minimum income, namely the incentive to not work
rather than to work.

What he's arguing is that we should pay people not to work the same way we pay
farmers not to grow corn, to ensure that the price is kept high enough for
those who do engage in working/farming to earn the "right" amount of money.

It's a noble goal to be sure, to ensure that everyone can feed their families
and live a comfortable-enough life and such. I don't argue with his intentions
one iota.

The problem for Krugman is that taxing is his hammer and every problem in the
world looks like a nail. It's far easier to exhort "we must do something!" and
to use the force of law to do SOMETHING than to figure out a better solution
to a very real problem.

I am of course in some ways a hypocrite since I can't think of any solutions
myself off the top of my head.

~~~
anigbrowl
Actually, the idea of a basic income (under the rubric 'negative income tax')
was favored by economists like Milton Friedman as well (see
[http://en.wikipedia.org/wiki/Negative_income_tax](http://en.wikipedia.org/wiki/Negative_income_tax)
for an OK overview). The underlying concept here is not so much fairness as
that there's an opportunity cost to society in having people engaged in the
sort of work they're not especially well-suited to in order to meet the basic
needs of survival.

~~~
msandford
I never argued against this for "fairness" nor did Krugman mention the
societal opportunity cost.

It's more an issue of signaling. People won't go through the pain necessary to
learn a new skill if there's no incentive. High wages are encouragements to
endure the discomfort inherent (for most) in change necessary for the
rebalancing of the labor force. Low wages signal that the skill is not in high
demand (relative to supply) and that there may be other more opportunities
more attractive.

The negative income tax reduces the incentive to move from one segment of the
labor force to another and could be analogous to a tariff, in a way.

~~~
anigbrowl
It's equally arguable that people won't engage in time-consuming activities of
uncertain return if there's too much financial risk. 'Lack of demand' is often
a stumbling block for new technologies that are ahead of their time.

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

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

~~~
eropple
_> the FDA (yes, it's an entitlement -- see how hard it is for a little guy to
compete when the hurdles are so high)_

Would you like to try Ed's Patent Elixir? I promise it won't kill you. It's
from a little guy, just tryin' to compete.

~~~
wissler
If you're too foolish to do some vetting of what you take, you shouldn't
compound that foolishness by stripping away others' right to take novel drugs
that might, say, cure their cancer, etc.

~~~
eropple
I'm not foolish enough to not vet what I take. Or I like to think I'm not. But
I _can 't vet what I would take_, because I'm not an expert. Therein lies the
problem.

And, no, no free-market solution solves this without people fucking _dying_.
Back to mises.org with this silliness, please.

~~~
wissler
The fact is that what another person chooses to take is none of your business.
You use fearmongering as an irrational pretext to usurp someone's right to
choose what they do with their own body, and sadly, that fearmongering works.
It just doesn't work on reasonable people, who are in the minority.

------
tomjen3
Again? What has it been? two months since we last had a round of these "unlike
all the other times where we said that things were really different, this time
it really is different" opionions bullshit (no it isn't any different this
time).

Can we please just let it be just this one article, this time?

