The elephant in the room I don't hear people discussing is the impending spectre of deflation. If the labor supply diminishes what happens to aggregate demand? Judging from the example of Japan, demands implodes as fewer people buy goods and services because they aren't working! This deflates the currency and pushes the economy in recession.
Most of the developed world is sloughing off huge portions of its working populations. For example, Italy is set to halve its workforce in the next decade. There are huge economic, social, and political ramifications.
You are correct. It is going to suck living in a developed country unless you have enough money to be financially independent. Deflation is a very likely outcome as the standard of living in the first world countries will decrease, and we will be meeting the third world countries in the middle.
I have to disagree about the demographics. The job market will not improve. It will continue to deteriorate.
China may have a growing middle class, but there are over 1 billion people in India and 1.1 billion people in Africa which have yet to be brought into the middle class, and companies will take advantage of this army of reserve labour.
By the time these countries have been exploited, then robotics will have taken over and most everyone will be unemployed.
Once fully automated, are the owners of the robots going to be even richer than today, and the rest of the world population left to live in misery, or will there be a revolution (peaceful or violent) which forces redistribution?
> By the time these countries have been exploited.
While I agree with many of your points, and certainly there are many people who get exploited. But overall, if employers and employees are agreeing to mutual employment terms without coercion, then by definition it is not exploitation.
Additionally, things robotics and 3D printing are different than events like the industrial revolution which a large amount of capital was required. The owners of robotics and computing will be much more distributed and require less capital.
Brining people into the middle class with the modern infrastructure and stability that comes with is a really great thing. Robotics will only augment the quality of life for these people, freeing up massive amounts of human potential.
> But overall, if employers and employees are agreeing to mutual employment terms without coercion, then by definition it is not exploitation.
However, not all coercion is someone putting a literal gun to your head. Labor is systemically coerced due to having an inferior negotiating position.
It is called exploitation when it is much more important for the employees to get (and keep) the job so they can survive, especially when people are living paycheck-to-paycheck. They can't afford to negotiate, because even trying to do so might get you denied the job, and not be able to eat.
Absolutely spot on! Nobody talks about it, and it is a very important issue. In the US, the balance of employer/employee power is heavily tilted in the employer's favor.
This is where you insert of the arguments about basic income to balance the employee / employer negotiating position and progressively ward off the failing of market economics while scarcity goes away.
The example I like is the farming revolution. There was a point when only 97% of people worked on farms. Now that's flipped. Only 3% of people work on farms. Are those 97% without jobs and nothing to do? No, of course not. The economy expanded and new industries emerged that nobody expected. The (farming) machines unlocked massive amounts of human potential. I don't expect the robotic/software/3D revolution to be any different. I'm pretty optimistic about what's coming.
Right. Part of what's missed is that we don't need great GAI to get rid of lots of jobs; weak "AI" / deep learning / related automation techniques get us a long way there. We have existing examples in law document review, article topic summarization, etc.
Another thing which is often missed is how complementarity may play out for certain jobs: it's NOT going to necessarily be "program / robot replaces every job X", but instead "program / robot allows one person to do the job previously done by 50." You can still have massive unemployment without getting rid of every worker doing a certain job (and their job may change more to be a machine guide / manager / error corrector.)
An example I see all the time now is in supermarkets. You have self-checkout lanes that are overseen by one person. It used to be 5 lanes staffed by people. Now you only need one to intervene when something goes wrong. 5 workers have become 1 without eliminating the job "register person" completely. Instead, they've changed into "auto register checkout manager" while everyone else got the ax.
And on the topic of register checkout manager, you can easily see the natural progression towards the elimination of the profession entirely.
The registers get more self sufficient as the software matures. The security systems become cheaper and more accurate to eliminate the lackluster security effect a clerk has standing there. The clerk is removed entirely. Then the shelf stocking is automated with computer vision and maybe magnetized sticker guide rails in the floors.
And then people realize its stupid to go to a store to buy stuff when you can virtually tour a mall of everything and have whatever you want shipped to you. You order it, it goes through computers without ever interacting with a person, and a manufacturer ships you it instantly.
And that process gets automated too. The transport goes from self driving autos transporting your goods using standardized automated transfer mechanisms to your automated mailbox to a fabricator in your own home that comes from Star Trek.
None of that (besides the fabricator part at the end, thats going a bit heavy) is nothing novel or even new. It exists. It just takes market pressure and time to make it economical to implement and for culture to accept it. Because it is more efficient, and it will inevitably happen because its better in every way except the "but people aren't doing it!" angle. It does not take AI sentience to move boxes or see dirt on a floor through dictionary lookup and fuzzy logic processing.
In the developed world, I think we'll be seeing the hybrid approach for the next few decades at least, but yes, we will get past that to your fully automated vision. Also, the non-evenly distributed future effect means we'll likely see that vision in SF in, let's say, 2100, but won't see it in Flint, MI until 2150. It is coming, though.
"This is the first technology that automates the power of the human mind."
Writing (and later, indexing) automated and enhanced memory.
Calculators automated computation.
Computers have automated a lot.
You can say these have only automated specific pieces of "human mind" functionality - but I assert that this is not really different from how a tractor only automates specific pieces of "human muscle" functionality.
McAfee and Brynjolfsson deal with why the robot revolution will likely be unlike previous tech revolutions in their books. Here are a couple of articles on it:
>While I agree with many of your points, and certainly there are many people who get exploited. But overall, if employers and employees are agreeing to mutual employment terms without coercion, then by definition it is not exploitation.
Right. Employers and employees agree to mutual employment terms without coercion. That is the world we live in. Also, consumers make rational choices to maximize their happiness, advertising exists to inform people of products and give them more information to rationally make decisions, and competition between rival corporations drives down prices and makes everything better for consumers. Employees can negotiate better wages because if they don't like it at one job, they can leave and find another employer who will face no repercussions for hiring them.
It's too late to edit, but I should add that really, what we want here is the per capita rate of factory workers locked inside factories so they can't leave. You know, because of the contract they entered into as rational economic agents without any coercion.
Still waiting on what the per capita rate of that for the US is.
Lets think this through in terms of goods and services.
Supposing jobs are all fully automated, we will have two categories of good in the world - robots and consumer goods. Presumably the rich own the robots and direct the robots to produce consumer goods which are sold to the non-rich.
Why is this "misery" for the rest of the world? If we redistributed, then people would now own some shares of Robot Production, Inc. How does that eliminate "misery"?
How will those non-rich people buy consumer goods if they have no money?
Our current economic system does not work in an age of increasing automation. The gains in wealth are being further concentrated in the hands of a few.
There is an answer to this dilemma -in the form of a guaranteed living income for all - but we seem to be rapidly moving in the opposite direction.
> How will those non-rich people buy consumer goods if they have no money?
How will those rich people sell consumer goods if the poor don't have money?
> Our current economic system does not work in an age of increasing automation. The gains in wealth are being further concentrated in the hands of a few.
Absolutely true. I'd like to think that you and I are both as clueless as the agrarian citizens at the dawn of the Industrial Revolution. And maybe we are. But something about this wave of automation seems quantitatively different than the last one—as though there's no new economic sectors to replace those that are being automated away
> There is an answer to this dilemma -in the form of a guaranteed living income for all - but we seem to be rapidly moving in the opposite direction.
I like to frame that as a negative income tax, rather than a guaranteed income. It seems like less of a "government program", which might help it sell. The beauty of a negative income tax is that it can be easily† adjusted as needed to suit an evolving economy. It's not a separate program that is established and lives on. If (US) brackets are [10, 15, 25, 28, 33] (i think?), the new brackets could be [-50, -10, 0, 10, ...], with a 20k starter. So if you do absolutely nothing, you get 20k. If you make an additional 5k a year on the side, you'd be "taxed" at -50 on that and end up with 27.5k. At some level as your earnings increase, the subsidy fades off and is replaced with taxes.
†Technically-speaking, maybe not politically. But then again, this whole thing is a pipe-dream at present.
> How will those rich people sell consumer goods if the poor don't have money?
But how will the poor have any money if they have to pay money to the rich in order to afford basic necessities.
Also, if they had money they wouldn't be poor, now would they?
Another way to look at it is, just look at what happens at extremes -- really poor in developing countries. Well, lucky for the rich and powerful, it turns out the poor have kidneys, muscles, blood, the can work for the rich, they can sell their bodies to the rich.
So have no fear, the rich will figure out a way to take advantage of the poor even after the poor don't have any pieces of green paper or stamped metal circles left.
> as though there's no new economic sectors to replace those that are being automated away
Before, it was always "I'd like to build houses / learn to plumb / build widgets in a factory, but I need food, so I'm tilling land".
Now its "I'd like to do pretty much anything, but nobody will pay me to do it, because the robots are better at everything I can do".
Unless your labor is intellectual, your function in society as a bag of meat with limbs and a bunch of neurons that make you very easy to program instructions into is going the way of the horse in the early 20th century.
Money is irrelevant. The question is actually, "how will these non-rich people obtain consumer goods if they produce nothing of value to trade for them".
That's a good question. If the rich are not producing goods for the non-rich, then they must be privately interacting with their robots. That's economically equivalent to the rich and the robots not existing at all.
So what stops the non-rich from forming their own perfect inequality-free economy?
What are the rich going to do with the vast tracts of land that they apparently claim, and then let lie fallow? Remember, in this hypothetical, all the rich need to do is provide for their own consumption.
This scenario being described here is exactly the scenario described in Atlas Shrugged - the rich (and their robots) all retire to Galt's Gulch and the rest of the world goes to hell. It's surprising to see so many Ayn Rand fans in one comment thread.
Except that isn't playing out. There is no motivation to move to Elysium or Galt's Gulch because it takes a lot of money and effort to transport the worlds elite to one place.
And to be elite is to be superior to peers. A huge part of the ethos of power is that you need the powerless to prove your position.
The rich and powerful already own tremendous vast swathes of the world under the control of governments recognizing private property rights. (adjusted for land value, because I'm mostly talking about owning inner cities, but they also own the industrial complexes and megafarms). Again, supply and demand sets in, and when you use real estate as an investment and asset and are constricting its supply in most parts of the world as a source of revenue and profit, you aren't going to give that away any more than you will give away the robots.
The property market is as bad as the labor market in how concentrated power is becoming. And property is not competitive at all since its a fixed resource and the value of it is only relative to its location which cannot be reproduced or innovated upon. Easily, at least.
So if we have a distributed Galt's Gulch (e.g. some expensive towers in NYC and SF), how does that change things? How does a rich person owning a brownstone on my block prevent me from selling my labor to other non-rich people?
When you discuss rich people owning inner cities, those inner cities have value because people want to live in them and have resources to trade for the right to live there. In this hypothetical dystopia, no one will have any resources to trade for living space, so those inner cities will become valueless. (Or perhaps the rich will enjoy walking through uninhabited cities.)
There is plenty more land available at low cost in other locations - Detroit, Kansas, etc. What prevents the non-rich folks from building their own industrial complexes and inner cities in those locations? The rich and their robots can entirely occupy the abandoned city of Manhattan, but what prevents non-rich people from buying up $5,000 houses in Detroit and building a new utopia there?
I'm confused. Why do the rich use law enforcement to interfere with the non-rich economy?
I can see why they might have law enforcement (or robots) vigorously police the borders of their mansions, but that's a different question. And there is no point having law enforcement exploit the non-poor (e.g., slavery) since robots do the job just as well.
> Why do the rich use law enforcement to interfere with the non-rich economy?
Because they will see the confiscation of land and resources by the non-rich (a necessary step to establishing a new economy from which they won't be excluded) as a threat to themselves.
Remember we are dealing here with irrational, imperfectly-informed people, not with perfectly-informed, perfectly-rational frictionless spherical humanoids in uniform economic motion.
Why would they care? As long as they are left with sufficient amounts to provide for their own (miniscule) consumption, they have no reason to stress. And why is confiscating land and resources a necessary step?
Except that isn't how you get rich or powerful, or stay rich and powerful. You do not give away your power, and land is power. Look no further than the middle ages and the age of serfdom to see the extreme of the power you can have owning land.
You repeatedly appeal to one specific irrationality, and don't explain why that irrational behavior (as opposed to many others) will occur.
Nor do you explain why redistribution is necessary. Assuming the masses can control law enforcement well enough to impose redistribution, why can't the masses also simply prevent the rich from harming them and form their own economy? Let me guess - more finely tuned irrationality?
It seems like your alleged irrationalities conspire in odd ways to make your very specific policy prescription the only possible solution. [edit: my mistake on this paragraph, I did indeed confuse you with another poster.]
The rich don't just own robots, they also own the mines, the factories, the railroads, the self-driving transport trucks and the cargo ships. The non-rich don't own any of that stuff. So how are the non-rich going to make anything?
Essentially this hypothetical is a scenario where the rich have "gone Galt" (stopped producing useful things for the rest of the world). Your fear of the rich abandoning the rest of us to our own devices is very Randian.
Except the rich do not just leave to paradise to never return. At the sign of wealth to be had, at profit to be made, they probably will return to reap the fields and use their market-destroying automation power to crush "competition".
That, and as has been said elsewhere, I highly doubt the elites just go to an island. Ownership of land is a tremendous wealth, and while the elites have captured it they will not relinquish it willingly.
How will the rich make any profit? The premise underlying this conversation is that the labor of the non-rich humans is completely worthless. Robots do everything they can do for less money.
So the rich may swoop in, use robots to produce goods for their own consumption, and then leave. But how does this prevent non-rich humans from producing goods for other non-rich humans? The rich have no incentive to compete with those human producers, since the consumers have nothing of value to buy with.
You seem to be suggesting that the rich will direct their robots to fulfill the needs of non-rich humans for no personal gain. Is that correct?
Markets are power and owning markets is a power unto itself. If the poor create their own markets, those markets are vulnerable to the elites using their technology to usurp the market until the poor are helpless again.
I am in no way saying the rich will use robots for the social commons. They will use robots to maximize their power in the world. Just like today, controlling the market is controlling discourse, and if the elites ascend beyond market scarcity they will still want to control the market of the poor should one emerge.
Natural resources (including land) are not going to be fabricated. They may be synthesized through nanotechnology at some point, but you still need raw materials, and it is unlikely even post-scarcity it will be more economical to endothermically manufacture abundant elemental metals found on Earth than by just sending a fleet of robots to harvest it.
Without resources, the poor cannot create. Without land, they cannot farm or mine or harvest. The rich already own the vast majority of both, and have absolutely no incentive to relinquish that ownership even if they no longer need it, because demonstrably today the vast majority of the rich already do not need their wealth and power, but want it.
What specific action do you believe the wealthy will take when they "usurp" the non-wealthy markets? Provide goods that the non-wealthy consumers want at lower prices than non-wealthy producers? Given that the non-wealthy consumers have nothing of value to the rich people, why bother?
Certain monkeys have markets, the primary goods being food and sex. When are we wealthy humans going to "usurp" monkey markets and try to gain "power"? When are we, the wealthy humans, going to start spitefully consuming garbage, wild fruits and insects simply because monkeys also want these resources? When will we, the wealthy humans, claim all the forests and kick the monkeys out?
You've postulated a world where non-rich humans are as economically useless to the rich as monkeys are to modern day humans. In the real world, we don't generally engage in any of the behaviors you describe.
Certain monkeys have markets, the primary goods being food and sex. When are we wealthy humans going to "usurp" monkey markets and try to gain "power"? When are we, the wealthy humans, going to start spitefully consuming garbage, wild fruits and insects simply because monkeys also want these resources? When will we, the wealthy humans, claim all the forests and kick the monkeys out?
Who says we have to spitefully "usurp" the monkey markets? Don't we do enough damage by casually destroying their habitats and driving their species into endangered status or even extinct?
Same goes for wealthy people. You don't have to ascribe an utterly destructive mentality to them in order to explain the harms of what they do. All it takes is simple pride; the pride they have for the companies they've grown, the profits they've amassed, and the technologies they've developed. To then say we want to take those things away and redistribute them to the public for the greater good is to make that person into our public enemy. Why wouldn't they do everything in their power to hang on?
You've ignored the real question yet again. One more time: "But how does this prevent non-rich humans from producing goods for other non-rich humans?"
Is it really your belief that after the rich go galt, the non-rich have no possible way to survive except by robbing them? That's a surprisingly Randian view.
It's simple, really. Picture an apple orchard, as it operates today. Hundreds or even thousands of migrant labourers employed to tend the orchard and pick the apples at harvest time. Now imagine small aerial drones which have been developed to harvest the apples automatically and bring them to the warehouse.
Extrapolate this idea across a vast array of industries and you begin to see a pattern: huge numbers of jobs which have been replaced by automation. Where will all of these people go? Who will they work for?
Now imagine a time much further into the future. Unemployment has skyrocketed. Millions of people are starving and they can't afford the apples they used to pick for a living. So what? They decide to "invade" the orchard and steal the apples for themselves! Ahh, but drones come to the rescue again! Machine-gun wielding aerial drones patrol the orchard day and night, efficiently defending the property from any and all would-be thieves.
How does this prevent the former apple-pickers from growing their own apples? On whose land do you expect them to grow?
They can grow apples on other land. The world is hardly overpopulated and the rich don't own anything close to every parcel of land. Heck, the rich have no reason to even waste drones defending their surplus landholdings, just as most owners of large tracts of land don't typically defend it against deer.
As long as the non-rich don't interfere with the drones harvesting apples for consumption by the rich, why would the rich care what they do?
Further, you seem to think the rich own most land. They may own most parcels of currently valuable land (e.g. Manhattan) weighted by land value, but that's not remotely the same thing. There are large amounts of land in the world which are currently laying fallow because there is no current use for them. E.g., Detroit is more or less abandoned (but well suited for industry), as are large amounts of flyover country which were formerly used for farming.
> By the time these countries have been exploited, then robotics will have taken over and most everyone will be unemployed.
Do you think the world is running out of problems to be solved? I don't particularly, so automation doesn't concern me per se. I am concerned that we need to address mobility and people's chances to learn new things, so that people are able to work on whatever problems need working on.
> The global population grew at a rate of almost 2% a year throughout the 1950s, the 1960s, the 1970s and the 1980s. That slowed to a rate of between 1% and 1.5% a year in the 1990s and 2000s and that rate of change is now forecast to fall relatively quickly...The working-age share rose strongly for the 40 years to 2012...An ONS report of 2014 found that UK real wages in the 1970s and 1980s grew by an average of 2.9% a year. That fell to 1.5% in the 1990s, and 1.2% between 2000 and 2010...
According to the article's own data, rising real wages have occurred during a time of increasing population and an increasing share of the population being working-age, and slowed as population growth slowed. But the article goes on to argue
> A smaller workforce though should raise demand for workers
but doesn't this contradict the very evidence cited in the article?
You don't own that non-robotic/robotic factory - only sub-percent of the population does, neither you can tax them properly - tax 'optimization'. Thus redistribution is not happening today and there is not going to happen. Most of today's redistribution is from earners income tax, not from business.
And less workers means less people from whom to redistribute.
How about the impact of automation on jobs. Will this finally mean that we have robots perform more of the drudgery work? Maybe a return to artisans lovingly crafting luxury goods?
You can already get lovingly handcrafted luxury goods if you want them. They're expensive, and they're not going to get cheaper.
If I need a new wallet I can buy a cheap one which was mass-produced in a factory for ten bucks, or I can buy a nice one which was also mass-produced in a factory for two hundred bucks, but if I want one that was lovingly hand-crafted by an artisan over a period of a week and a half I've gotta pay a week and a half's skilled wages, and there aren't that many people with the money and the desire to surround themselves with pointless proof-of-work.
> Maybe a return to artisans lovingly crafting luxury goods?
Return?
At no point in human history have more people been wealthier than today, even as a percent of the population. Today, the artisans are already the rich who need not fend for their survival. Never has there been a time where the major of people need not sweat their brow to eat the next day, at least according to the economics of their time.
The rich have always enjoyed the luxury to pursue whatever interested them, including culture. And like I said, despite the doom and gloom, we have more rich people today than ever. Its just we also have way more poor working class who are getting worse with no correction in sight or reason.
If one is in a non-routine job that requires creativity, the human touch, synthesizing (currently) difficult concepts together, etc. then the job market is going to be great for a while. Software developers (particularly, as several recent papers indicate) with great communication skills and high emotional intelligence, "designers" (used very broadly - could be anything from art design to system design), marketers, artists of various kinds (though this will be subject to the superstar effect), politicians, certain kinds of teachers (I'm including everything from the creators of tutorials to Sal Khan-types) and various types of business owners/managers will be in good shape for a while. Anyone in these categories willing to become non-stop learn-for-lifers (http://www.nytimes.com/2012/09/22/business/to-stay-relevant-...) will likely be OK. So yes, your negotiating position may actually improve a great deal.
If one is in an a "routine" job (as defined by Autor), one should be thinking very carefully about the next few decades. Upskilling, becoming autodidacts, and most importantly agitating for political change will be things that this group needs to engage in (the former two to stay relevant; the latter to keep eating.)
I suppose it would if there was perfect liquidity in the entire job market as a whole, and if the effect size was large. In practice, I'd expect aspects local to your area and industry to dominate any kind of macro trend like this.
There are less people competing for less jobs because people have less money to stimulate demand.
You won't build a widget factory if nobody can afford widgets. The negative effects of deflation outpace the potential negotiating power of having lower workforce participation.
Most of the developed world is sloughing off huge portions of its working populations. For example, Italy is set to halve its workforce in the next decade. There are huge economic, social, and political ramifications.