
All around the world, labour is losing out to capital - rndmize
http://www.economist.com/news/finance-and-economics/21588900-all-around-world-labour-losing-out-capital-labour-pains
======
l33tbro
On the subject of robotics supplanting human toil, Ray Kurzweil recently said:

"In my view, it will lead to richer lives, and longer lives, but I would put
an emphasis on the richer part. And I’m not just talking about financial
riches. Life is getting [better] as we enrich our lives with technology. You
can see that now—a kid in Africa with a smartphone has access to more
information and human knowledge than the president of the United States did 15
years ago. People were lucky if they could get a book 100 years ago. We’re
going to continue that expansion. Music is going to be richer. We’re going to
have virtual reality experiences we can enjoy. All different forms of human
expression, art, science, are going to become expanded, by expanding our
intelligence." Source: [http://www2.macleans.ca/2013/10/14/how-nanobots-will-
help-th...](http://www2.macleans.ca/2013/10/14/how-nanobots-will-help-the-
immune-system-and-why-well-be-much-smarter-thanks-to-machines-2/)

He's infinitely more intelligent than me, but I fail to comprehend how a world
without human labour could possibly lead to a richer experience.

~~~
alaskamiller
Kurzweil and other olds like him believe in the Star Trek future. They believe
in a beautiful utopia future that is unlockable by abundance. That's why 3d
printing and virtual reality are so exciting for them.

A meme back then was from Buckminster Fuller, renowned architect, thinking,
and systems analyst--what they used to call hackers back then. Fuller made a
proclamation that in the future we will reach a point in society where a
person will only need to work 1 full work to generate enough value that lets
them live for the rest of the year.

How crazy is that?

Well when you have replicators and automation to do all the work, you have
more time to focus on other things.

For example say you want to be an artist. To do so you endeavor on the artist
path, living the artist lifestyle. You don't work a 9 to 5 so that you can
focus on your art, because of that you don't have a lot of money, and thus you
live the hipster way. In the cheaper edges of a big city, you work entry level
retail jobs, and you're constantly at the edge of failure.

Many of us like to create art, but because we don't want to live that kind of
poor lifestyle we don't pursue what our passions are. We're misfit, square
pegs in round holes of society.

You absolve people of toil and now you have no fear. Without fear you create
more. When you try more you do more.

J. K. Rowling credits her completion of Harry Potter based on England's
welfare system. They removed her anxiety and fear by helping her out when she
had no job. Because of that she took the plunge to write Harry Potter.

Imagine if all 7 billion of us are free to try, really try, at art. Think of
the industrial revolution. Think of the internet revolution. None of that will
compare to the next wave and all that new activities will bring.

That's how the world is enriched by removing work.

Or, we can all end up reverting back to living in caves.

Who knows.

~~~
homosaur
So the entirety of English society helped pay to make Rowling incredibly
wealthy. That seems like a pretty massive concentration of wealth for little
benefit to society as a whole aside from some nice pablum to digest.

~~~
lostlogin
I don't know what she and her creations have since paid in taxes in the UK,
but I'll wager a dollar that it exceeds the monetary cost to the country.
Hell, compared to some uses of the tax payers money, I'd say that a lot of
value was gained.

~~~
pjc50
You're absolutely right. Rowling has explicitly stated in the past that she
hasn't and won't use tax avoidance structures, so she will have paid 40%
income tax on most of her income from the books.

Plenty of UK bands from the 60s to the 90s have mentioned unemployment
benefits as being an important factor in allowing them to exist before they
got famous.

------
firstOrder
So then there is the question Marx posted a century and a half ago - what do
capitalists do with the money they make? Only so much can be spent on
mansions, and even that is an investment. They can bury some precious metals
in the backyard if they want. But then the rest of it will all go to capital
spending.

What is the result of capital spending? More commodities. But who will buy the
commodities? Workers. But they can't afford them, they just lost a round in
the capital/labor fight. So kick the can down the road, have the workers go
into debt to buy the commodities. That works for a little while, but then the
problem becomes worse and a bigger collapse will happen at the next crisis.

Despite just coming out of the "worst recession since the Great Depression",
the Federal Reserve etc. did save the US economy for now. I'm of the belief
that sooner or later the world economy is going to hit the skids and even
Keynesian New Deal measures won't bring things out of it. Only time will tell
of course.

~~~
oscargrouch
That was also the Marx prediction, lets see if he was right..

Its not just economics, but also the human nature; we have to change the way
we see and interact with the world, resources, other people..

The "Use everybody, everything, and profit whenever you see a chance" mantra
is a social cancer, and will end badly for everybody.. even the ones running
the show and laughing of everything

------
dnqthao
Marx predicted it long time ago.

"According to Marxist analysis, class conflict within capitalism arises due to
intensifying contradictions between highly-productive mechanized and
socialized production performed by the proletariat, and private ownership and
private appropriation of the surplus product in the form of surplus value
(profit) by a small minority of private owners called the bourgeoisie."

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

------
a3n
People can only buy so many things, particularly people who aren't rich. The
more robots that make our things, the less labor is needed, and the less
things we can buy.

As long as we're focused on individual consumers buying things for themselves,
there will be fewer and fewer jobs available or needed to make those things.
While it may happen elsewhere, I'm very pessimistic about anything like a
basic income happening in America.

But without basic income or a job, there's no effective mechanism to
distribute cash. You need a job to receive cash.

Yet there could be many jobs available if we shifted the focus of our
consumption from individual needs, and put some of that focus into community
needs. Large projects. Infrastructure improvement and operation. Solar power.
Transportation.

Just get it into our mindset that we're building and operating big stuff.
Because providing for our individual needs will not provide jobs for most of
us.

~~~
graue
You're describing a cultural and economic shift towards collectivism and away
from individualism, which, to me, seems no more likely than basic income.

I think it may take decades for basic income in America to go from
unthinkable, to radical, to controversial, to reasonable, to seemingly
inevitable, to reality. But that's all the more reason to start talking about
it now. Let's get the ball rolling!

------
asperous
I just want to point out that Marxism was started as a response to the
Industrial Revolution. [1]

If you guys think that machines are going to decrease our standard of living--
that the separation of (production value)/wages is going to cause poverty--
you have to prove to me that the same thing happened during the Industrial
Revolution.

[1] Karl Marx: Communist as Religious Eschatologist

~~~
amerika_blog
Most revolutions replicate what they rebel against. Marxism was just an
extension of French Revolution logic (1789) and not surprisingly, has followed
a similar path: executions, social engineering, fanatical militarism and
finally internal turmoil brings it down.

~~~
oscargrouch
You are making the classical mistake, equalizing Marxism to the political
scene executed by the Soviet Union..

The marxism is much more sophisticated and deep; I think maybe trotsky could
make a better socialism.. but even than probably away from the Marx vision

But you know, politicians will always think about their own selves in the end
of the day, no matter what they say, as long people believe in them..

So, in the day we have real altruistic people on power, things might change
for the better... Socialism requires a much more sophisticated politician
type.

But let me make clear, that i dont defend pure left or pure right.. if nature
teach us something is decentralization and and micro-management..

If a government has the tendency to concentrate power, its like a dead body to
the crows... it will seduce only the people with fetish for power, and control
over the lives and destinies of others..

Thats why the history of world politics has been a greek drama where the
weak(and sadly the majority) always lose in the end

~~~
gaius
No _you_ are making the classical mistake of thinking the combination of
Marxism and human nature can play out any other way. The Sovs even knew this
themselves, hence their trying to create New Soviet Man (and predictably
failing).

~~~
eli_gottlieb
Except, of course, for the fact that the attempt to create the New Capitalist
Man has been every bit as much a failure, but we all pretend it's been a wild
success because that's the ideology our rulers demand.

~~~
oscargrouch
Your well made point, make a pretty depressing observation that we still live
under the Positivism umbrella (adored and used by "our rulers") where role-
models serve as "guide" to shape ordinary people by the owners of the
institutions of power at their own will, so they can be easily manipulated.

Our society doesnt even get into the Nietzsche philosophical level were we are
free of this State+Capital controlled lobotomization ideology where human
beings are far away from their freedom and humanity.. which is our fuc$##%ng
natural rights for start

Its sad that the people that has shaped the last century has listened more to
Comte than Nietzsche..

------
adventured
This is going to get drastically worse, as capital becomes able to remove most
human labor from the production equation using robotics in the next few
decades.

I've yet to see a solution to the seemingly inevitable outcome of traditional
human labor dropping to nearly zero value. And or why we'd want to prevent it
from happening, given the upside to robotics.

The only way to stop (slow down?) the rise of robotics, is to place arbitrary
restrictions on machines to hamper their value proposition. I expect
politicians all over the world to begin attempting this before another decade
goes by.

Will we see a dramatic increase in the formation of unions as a defensive
response? Most likely.

~~~
riggins
_Will we see a dramatic increase in the formation of unions as a defensive
response? Most likely._

I'm struggling to follow how a union could help this situation. What would
happen? Workers would go on strike if their firms use robots? Seems like that
would just push the owner to accelerate robot orders. My guess is that unions
are pretty useless in the face of automation. Does anyone know any precedents?

I agree in spirit though. What I think is likely is the rise of populism. I
think the battle will have to be waged in the political arena.

~~~
zzen
I think we all know the precedent:
[http://en.wikipedia.org/wiki/Luddite](http://en.wikipedia.org/wiki/Luddite)

And yeah, if it gets really bad, violent protest is just a more extreme
continuation of unions.

------
_Adam
What I don't understand is why humans are so obsessed with labor. Robots are
doing stuff for us, and some people are actually complaining about it. To me,
this seems really sad. It's like they're saying "I'm so worthless, I can't
even compete with a robot."

Maybe that's true for some people. If so, then the problem isn't robots, the
problem is that there are people who are less useful than robots. For a human
to survive in the era of intelligent machines, he/she needs to have unique
skills that are not possessed by robots. If they don't have those skills, they
need to find them.

For those in the tech industry, those skills are already there. It will be
decades, or longer, until we can automate software/hardware engineers.
Entrepreneurship is another unique skill that will be even harder to automate.
I believe that once machines are capable of conceiving, starting, and
operating businesses, they will no longer be called machines.

What we must never forget is that humans aren't intrinsically special. We just
happen to be the most capable organisms on the planet right now. The current
rate of technological progression suggests that this will eventually change.
When it does, we'll need to adapt or we'll go extinct.

If we cannot adapt to this reality, we will simply end up serving as the
spawning ground for a new species (biological or otherwise) that will make
humans obsolete. If we survive, it will be as little but a historical
curiosity.

To adapt, we cannot look at robotics and automation as an enemy. It IS the
future - we need to accept it, exploit it, and ultimately incorporate it into
ourselves.

~~~
krapp
>Robots are doing stuff for us, and some people are actually complaining about
it. To me, this seems really sad. It's like they're saying "I'm so worthless,
I can't even compete with a robot."

That's not what they're saying. The labor market isn't automatically going to
expand to accommodate their need for employment. "Finding" new skills all too
often means amassing a crippling amount of loan debt (in the US at least), to
enter a job market which simply has no room, nor a desire to find room, for
the population it put so much effort into letting go.

Humans may not be intrinsically special, but being biased towards human
survival, _as_ a human being, should not be difficult to understand.

------
pmb
Minimum guaranteed income can not get here soon enough.

~~~
paul_f
For what? Living deserves an income? Can I opt out?

~~~
erikpukinskis
It's only fair. Before the State, people were born into a _homeland_. Just by
virtue of being born, you were entitled to a share of the natural resources
around you. (Of course without a state, murder and such are allowed on a who-
can-get-away-with-it basis. That's the downside.)

When the state stepped in and seized control of our homelands, and then said:
"This person, with this piece of paper, now owns these resources", essentially
creating out of thin air the concept of "wealth", they took upon themselves a
moral responsibility to see to it that wealth was distributed in a way that
everyone gets at least a living share.

The current system, where you are either born into a dynasty with resources,
or you are for all intents and purposes enslaved to people who are (albeit
with some small chance of moving between groups) fails at that promise, even
though the poor largely fulfill their end of the bargain by making themselves
available for labor. Many go without their basic needs taken care of. A basic
income would fix that. The situation is absurd, and it's an utter waste of
human capital to throw talented "low" class kids into the thresher.

~~~
philwelch
I'm not actually sure that's how it worked, though I'm sure that's a common
anarchist mythology. States arrived along with agriculture, but hunter-
gatherers had very similar, and much smaller groups with their own structures
of authority, control, and social norms. In-group and out-group dynamics were
more prevalent as in-groups did not, by definition, exceed Dunbar's number.
Things like in-group murder were undoubtedly discouraged and punished. And
when resources grew thin, violence and warfare against other groups was
prevalent.

Agriculture was generally borne of desperation and scarcity, and cultures that
adopted agriculture also adopted government and notions of land ownership. It
was still a pretty raw deal compared to being a hunter-gatherer though,
especially since hunter-gatherers were still better at warfare than farmers so
from time to time a group of hunter-gatherers might show up and take whatever
they wanted from you.

But even among hunter-gatherers, there were no human rights. You had to work,
you received your share, but only if the hunter-gatherers from around the way
didn't run short on resources and showed up one day and killed all your men
and captured all your women.

------
netcan
Articles like this tend to get lost in our desire to fit the world into our
favorite grand philosophyy (philosophical framework, ideology, metanarrative -
take your pick.) Since these philosophies are so ambitious, they need to deal
in very big concepts like imports or automation-technology. The counter points
are equally abstract. Each comes with its own vocabulary like labour/capital
(being used similarly here to the Marxist workers/means of production).

I don't have a general problem with big abstract theories. They can be useful.
They can also be blinding. Worse, they can lodge themselves as a person's
political identity. Realistically, they are very imperfect and we should
probably use a bunch simultaneously to try an understand a trend like this
one.

Here's an alternative vocabulary that IMO is relevant inasmuch as economic
growth takes the form of of new technological product (smartphones, internet).
Who/how many get to consume the new products. IE, airlines get invented. How
many people get to use them? Personal vehicles proliferate. How many people
get to own one.

From that perspective, a lot of recent growth is remarkably equitable.
Cellular phones penetrated right down the worldwide income ladder. In 10-20
years they outpaced earlier technologies like cars & electricity. Now most of
the world gets to use them. PCs, the internet & smartphones are available to
most of the lower income people in above medium income countries. I would say
that overall, the common person gets more access to new consumer technology
than a decade ago.

Another framework I would like to see used would focus on freedom to make
choices, specifically lifestyle choices. How many people choose to take a
different job, change careers, work less, etc. I'm not sure how one would go
about quantifying this.

I'm not saying this should be the primary method of looking at the economy. I
am saying is that if using different frameworks leads you to different
conclusions, be suspicious of all of them.

~~~
l33tbro
Blinding irony being the "cool detachment to all theories guy" persona you
project here being equally as abstact as those you observe.

~~~
netcan
That's a little hostile. What exactly is rubbing you the wrong way about my
comment? Here's the jist of what I am trying to say.

(1) I don't know if people are better or worse off now than before. (2) I'm
don't think we have a very good quantifiable way of deciding that argument.
(3) Many arguments of intelligent people are trying to provide an answer to
this question smells a lot like intelligent people trying to fit their world
into their philosophical framework. (4) The answer to that question (or some
aspects of the answer) may be subjective or at least a bad fit for the
economic vocabulary we typically use to tackle it. IE, Has the value of a
median family car gone up over the last 50 years because its objective quality
has improved or has it gone down because the the people buying them grew up
expecting to own one whereas their grandparents found themselves able to
afford one, exceeding their expectations when growing up.

Any specific statement you find objectionable?

------
tokenadult
It seems silly to discuss changing shares of a whole output of a national
economy devoted to labor rather than capital expenditures, without an even
greater emphasis on increases in the overall national output. After all, I
could just as well argue that all around the world, men are losing out to
women, as more equality of rights is achieved. But what's really happening
(thanks in no small part to steady economic growth all around the world) is
that both men and women have more choices in lifestyle and family roles than
ever before. Today's laborers are for the most part vastly better off than
they were in the year of my birth, and they have every expectation of becoming
still better off as the years go by, all around the world.

------
rumcajz
If, thanks to technology, 10% of people are able to produce all the goods, 90%
won't get paid. With most people not having money, only 10% of goods will be
needed from that point on. And thanks to the new technology, only 1% of people
will be able to produce that. Which means only 1% will have money. Thus, less
goods would be needed. And so on. The cycle ends when the last human being
dies of hunger.

Options:

1\. Ban the technology, Amish-style 2\. Cut working hours 3\. Introduce some
new kind of re-distribution, such as basic income

~~~
ef4
We've already been through waves of technology even more dislocating than the
one you describe.

If you told a farmer in 1813 that, in the future, less than 5% of the
population would be needed to grow all the food, he would assume that the
other 95% would be mostly unemployed and starving. But he would be wrong, for
the same reason that you are wrong.

As long as there are unmet desires, there is _necessarily_ more work to do.
When increasing productivity frees up capital and labor, it gets applied to
create entirely new industries. Just because you can't imagine what they might
look like (any more than our 1813 farmer could imagine what many of us do for
a living) doesn't make them any less likely.

It is a logical impossibility that technology throws the bulk of the
population into poverty -- either they have access to all the cheap robotic
goods, in which case they are not poor in any meaningful sense, or they don't
have access to the cheap robotic goods, in which case _the robots are not
competing with them_ in their ability to sell to each other.

~~~
alwaysdoit
One problem is that work requires something to work on or with. For the most
part, people don't really create out of nothing--they add to and build upon
what already exists. They need land to farm, or materials to build with, or
computers to work on. Even writers need languages to write in. As property
becomes held more and more by fewer and fewer, and even intellectual property
is becoming increasingly locked up there's less and less that is physically or
intellectually available to build upon.

------
Rogerh91
The problem as I see it right now is that capital-holders are treated very
well because capital can slip through borders, while labour is a bit more
tricky, because it comes with the implication of having an extra person
around...

In an open border world, the balance would be more equalized, but that is more
theoretical than practical at this point.

The recent rounds of QE are a great example of this. Those were basically made
to inflate asset prices for capital-holders, because economic policymakers are
conditioned to placate capital. Case in point: 90% of shares in public markets
are owned by 10% of Americans. The hope was that some of this benefit would
trickle down, as the infamous term goes---unfortunately that hasn't happened,
so far.

So now we live in unequal times not seen in America since the late 20s.

pre bust:
[http://www.nytimes.com/2007/07/15/business/15gilded.html?pag...](http://www.nytimes.com/2007/07/15/business/15gilded.html?pagewanted=all&_r=0)

post bust: [http://finance.yahoo.com/blogs/daily-ticker/income-
inequalit...](http://finance.yahoo.com/blogs/daily-ticker/income-inequality-
enemy-economic-growth-robert-reich-142150436.html) (big ups to Shiller)

There's a couple of ways to go about resolving this, from heavy handed
government intervention to restrict capital, to loosening government
restrictions on labour movement.

There's outside the box thinking too, from how Iceland forgave those holding
good homes rather than those holding bad debt to opening the pool of capital
to a wider pool of people in the vein of equity crowdfunding---

this is a very pressing issue, and there are tons of solutions out there. I
think the one constant is that if technology is going to play a role in
solving this, people need to be given equal access to that technology, and the
knowledge required to understand it. discuss and spread code!

------
mrmagooey
Sometimes I wonder if any new investment that I make in my skillset is just
buying me a few more months of profitable employment at some point around say
2050. The loss of employment for less skilled labour is happening now, but I
see no reason why eventually all labour could be supplanted by increasingly
efficient machinery/robotics (for physical tasks), and AI for
information/services tasks.

Capital is increasingly producing greater returns than labour, and market
pressure is causing businesses to invest in capital as a result... but what
does the economy do when labour cannot produce or earn, and hence cannot
spend?

~~~
bad_user
I see people in this thread discussing efficiency brought by technology,
however people are missing an important factor for the drive to automation -
employment taxes.

Given our economic crisis, the IMF for example is forcing governments to raise
taxes to insurmountable levels. In our country, many companies have to resort
to tax evasion just for survival and now the government is trying to shove new
taxes down our throats (because hey, let's not target the big tax evationists,
but rather the stupid fucks that paid their taxes until now).

So when the taxes you have to pay for producing goods or services exceed your
other operational costs, what do you do? Well, governments aren't taxing the
usage of robots yet. Bingo.

I think we should be glad that automation happens. Because it's better for a
factory to remain in your own country, even if fully automated, then it is to
be outsourced to China. Even an automated factory generates local jobs, either
directly (engineers, cleaning people) or indirectly (connected industries).

------
tjmc
The biggest issue here is that it's the middle level jobs that are being
automated, which makes it increasingly harder for low skilled workers to work
their way up over time. There was a good article in The Atlantic that
discussed this a while back [1].

I'm not sure what the solution is, but increasing erosion of the middle class
doesn't sound like a good thing.

[1]
[http://www.theatlantic.com/magazine/archive/2012/01/making-i...](http://www.theatlantic.com/magazine/archive/2012/01/making-
it-in-america/308844/)

------
hudibras
The next logical step is to increase taxes on capital, starting with an
increase in the capital gains tax.

Of course the Economist doesn't mention this... EDIT: Oops, maybe they did.
Good for them.

~~~
bodyfour
There was also a piece in the leaders section (i.e. the more "editorial" area)
of this week's issue on this topic. There they specifically call for "a
narrowing of the difference between tax rates on individuals' income from
capital and labor"

------
marvin
Doesn't this more or less imply that you have to save and invest in order to
take part in economic growth? I agree that this is a problem which should be
attacked with political means, but that doesn't mean it is impossible for
someone to live within their means and save.

Obviously this doesn't apply to every demographic group in the world, but a
large amount of people can get an account with a cheap online stockbroker and
buy ETFs with the surplus of their paycheck.

------
frank_boyd
If you think things through:

1\. We were all born with the same rights.

2\. Therefor, we should all _have_ (and keep) the same rights.

3\. Yet, we don't have all the same wealth (money=rights) - FAR from it.

How come we accept that people who were born more lucky than others get to
have more rights? When we were all born equal?

How come society still accepts this basic and too obvious hypocrisy?

~~~
RivieraKid
> We were all born with the same rights.

The concept of "rights" is just some set of rules the society has agreed on.
Nothing else. It's not something you get born with. If the society decides to
completely redefine rights, they could, for example, remove the right of
freedom of religion.

> When we were all born equal?

We obviously aren't.

------
bcoates
> The Organisation for Economic Co-operation and Development (OECD), a club of
> mostly rich countries, reckons that labour captured just 62% of all income
> in the 2000s, down from over 66% in the early 1990s. That sort of decline is
> not supposed to happen.

Has the fraction of people supported by capital as opposed to labor stayed
constant over that time period? I know OECD countries have been aging, it
wouldn't take that much of a demographic shift towards retirees and other non-
laborers to account for the change.

------
alexeisadeski3
Robin Hanson and Tyler Cowen have the most well reasoned visions of the future
of the global economy.

Hanson predicts _virtually all_ human wages moving to near zero in the long
run.

[http://www.overcomingbias.com/2013/05/robot-econ-
primer.html](http://www.overcomingbias.com/2013/05/robot-econ-primer.html)

[http://www.overcomingbias.com/2013/07/me-on-pbs-off-
book.htm...](http://www.overcomingbias.com/2013/07/me-on-pbs-off-book.html)

------
polarix
Does anyone have a graph showing (per country labor share) * (per country real
gdp) over time?

It would appear to me that if _that_ quantity is actually increasing, then
this is an interesting curiosity and alarming in that we don't understand it,
but not actually an outright disaster, as the pie would still be growing fast
enough to feed labor more in real terms.

------
NewCam
I wonder if this is caused by union membership decline and the increasing
power of lobbyists?

------
jheriko
"the rich get richer and the poor get poorer..."

unsurprising common sense. :/

------
DannoHung
Too bad the robots didn't eliminate the shitty jobs first.

------
tehwalrus
the UK's is actually the same, on a graph where the rest fall. I wonder what
that means is different about us?

------
alexeisadeski3
It's nice to see that the Economist is finally channeling Marx.

Such trash.

------
NN88
when wasnt that true?

~~~
eru
Have you read the article? The proportion of GDP paid out to labour vs capital
had been stable for quite some time. So the answer to your question is: almost
all the time so far.

------
michaelochurch
This is one reason why I find the consumer debt phenomenon disturbing.

Until 1975 or so, there was a symbiosis between the capitalists and labor. If
labor was impoverished, products weren't bought. Henry Ford learned this: by
paying his workers well, he made it so they could afford his products. The
middle class was built because, without it, industry would fail.

Widespread consumer debt-- which went from being associated with failure
(excluding mortgages and a first car, and a very small amount for college that
could be paid off fully in 1-2 years) to a commonplace occurrence-- made it
possible for the consumption (and, more relevantly, consumption _costs_ ) to
grow while wages remained flat, putting the working classes further into debt
and subordination.

That's what's happening now. Even if you're fiscally responsible, you compete
(on the housing market, and for higher education) with the masses who are, in
general, utterly the opposite. It is somewhat of a brilliant (if malignant)
divide-and-conquer strategy.

------
berntb
Seeing this 11 hours later, it devolved into a political fight. Sad.

A simple, alternative hypothesis:

With the opening of India, China, etc the world has gotten a really, really
large increase in work force -- but (not yet) an equal increase in capital for
investment. Supply/demand -- the price for the increased resource (workers)
goes down.

------
amerika_blog
Perhaps because "capital" is composed of the products sold because labor is
willing to pay for them? These two sides aren't as cleanly drawn as people
might like to think. The preferences of individuals drive the economies of the
world (except in North Korea).

~~~
Volpe
No, the preferences can be controlled (marketing), or even forced (addiction).

No one ever thought "I need coca-cola", it was a created "want" invented
purely through marketing and addiction...

EDIT: typos

------
vvjia
love and give a vote

------
triplesec
All around the world, ursine mammals defecate in forests.

I suppose though that it's a good thing that the Economist is at least talking
about it.

