I think the most important task for the government is to handle oncoming automization in a good way.
The current trend with robotics and automization is fewer and fewer workers being necessary for the functioning of society. The end-point as I see it is one of two societies—either the fruits of automization are used to bribe the unemployed masses from rioting, or they’re used to wall off safe places so that the people who own and run the robots don’t care about riots.
Obviously, I’d much rather have the first case than the second.
We’ve lost, by my count, 1,394,100,000 jobs in the US in the last two hundred years. You may notice that is a larger number of jobs than people actually exist; this is because, if all those jobs actually existed, we’d still be farmers. (Value calculated by dividing current median income in the US by an estimation of sustenance income necessary to a lifestyle appropriate to, say, the 1700′s. Not terribly accurate, as it doesn’t account for the increased value of leisure time, or the automation of non-economic tasks; the actual figure in these terms may be as much as 30x rather than 9x the labor force. Additionally, I didn’t include the massive reduction in work hours over the past two hundred years, which could as much as double that figure again)
The challenge isn’t to figure out how many jobs automation will eliminate; it’s already eliminated nine times more jobs than there are people doing jobs in this country. That’s what permits our high standards of living; each person is enjoying the fruits of the labor of at least eight additional counterfactual people whose jobs are being performed by automation.
The challenge is to figure out to what extent this trend can continue; there’s obvious room for improvement in that most of the world still has substantial improvements to be made to its standard of living. The challenge is to figure out whether or not the most fundamental tenet of economics—that demand is unlimited—holds true.
The challenge is to figure out whether or not the most fundamental tenet of economics—that demand is unlimited—holds true.
Even if demands are unlimited, the problem is that automation will drive down the costs of a lot of labor to where regulatory and transaction costs make hiring most people more trouble than it’s worth. It’s not that there won’t be labor people want done, it’s that machines will out compete most people in those tasks, making then economically unviable.
Which is exactly what happened for the other 1.4 billion jobs that don’t exist anymore in the United States.
What you fear has been feared for a hundred and fifty years, since automation started to seriously replace workers. Instead of driving us to a dystopia, however, it’s pushed us into a relative utopia.
What you’re proposing isn’t new. The implication you aren’t addressing is that the trend of -new- jobs, previously not worth employing someone to do, but rising at the margins with increased specialization, arising as workers were freed from old ones will suddenly cease.
Machines used to compete on brute strength and endurance. Mankind always used to have advantages in intelligence, communication, sensation, and precision control. All of those are under attack in ways they have not before.
In short, people are rapidly losing a comparative advantage versus machines. The real problem comes when the opportunities for profit from using machines overcomes the opportunities for profit by employing people. The accelerating rates of improvement in technology will make that more and more the case.
Actually, machines used to compete on strength. They required constant maintenance, however; many people were mutilated fixing the machines while they were still running. That was last century.
Then they began competing on precision control; that’s been on the rise for the past century.
Communication has been the story of the last thirty years. Sensation, similarly, has been rising for the past twenty years. Intelligence is still in the works.
At no point in this process did machines lead to mass unemployment; indeed, employment has -increased- over the past century, as women have begun entering the workforce.
Your proposition ultimately comes down to this: You can’t imagine what we’ll be doing next. I have only this to say: The person who -can- imagine, that person will be the next billionaire, or possibly even the first trillionaire. It shouldn’t surprise you that you can’t imagine what jobs will keep billions occupied over the next century, if you could you would be the extremely exceptional case.
Your proposition ultimately comes down to this: You can’t imagine what we’ll be doing next.
No, my proposition comes down to this:
In short, people are rapidly losing a comparative advantage versus machines.
What comparative advantage will people still have? How big is that market? How many people likely to be out of work can fill that market?
Really good robotic hookers and “escorts” are a ways off. There will be work there for a while, but not everyone would be in demand in that market.
There’s no reason every person has to have economically viable capabilities, particularly in a regulated economy where there is a minimum cost threshold through regulations. Some people now, don’t. Babies don’t.
I always thought demand was limited by factors such as the size of one’s stomach the speed at which clothes wear out or go out of fashion, and most importantly income among other things. I’m actually kind of surprised to hear that unlimited demand was a fundamental tenet of economics.
I always thought demand was limited by [..] and most importantly income [..] I’m actually kind of surprised to hear that unlimited demand was a fundamental tenet of economics.
The problem seems to be confusion as to what economists mean by demand and “unlimited demand”. What they mean by demand is not a static number but a demand curve relating how much of something you would buy depending on its price, i.e., not just what you’re buying now but also what else you would buy if you could. Thus by “unlimited demand” they mean that there is always more you would buy if you could afford it.
Historically it has never worked out that way. When a society gets richer the people eat more and better food, buy more clothes, live in bigger houses, buy cars and appliances, travel more, and so on. Based on the behavior of rich people we can see that a x10 or even x100 increase from current wealth levels due to automation would just continue this trend, with people spending the excess on things like mansions, private jets and a legion of robot servants.
Realistically there’s probably some upper limit to human consumption, but it’s so far above current production levels that we don’t see much hint of where it would be yet. So for most practical purposes we can assume demand is infinite until we actually see the rich start systematically running out of things to spend money on.
I think the most important task for the government is to handle oncoming automization in a good way.
The current trend with robotics and automization is fewer and fewer workers being necessary for the functioning of society. The end-point as I see it is one of two societies—either the fruits of automization are used to bribe the unemployed masses from rioting, or they’re used to wall off safe places so that the people who own and run the robots don’t care about riots.
Obviously, I’d much rather have the first case than the second.
We’ve lost, by my count, 1,394,100,000 jobs in the US in the last two hundred years. You may notice that is a larger number of jobs than people actually exist; this is because, if all those jobs actually existed, we’d still be farmers. (Value calculated by dividing current median income in the US by an estimation of sustenance income necessary to a lifestyle appropriate to, say, the 1700′s. Not terribly accurate, as it doesn’t account for the increased value of leisure time, or the automation of non-economic tasks; the actual figure in these terms may be as much as 30x rather than 9x the labor force. Additionally, I didn’t include the massive reduction in work hours over the past two hundred years, which could as much as double that figure again)
The challenge isn’t to figure out how many jobs automation will eliminate; it’s already eliminated nine times more jobs than there are people doing jobs in this country. That’s what permits our high standards of living; each person is enjoying the fruits of the labor of at least eight additional counterfactual people whose jobs are being performed by automation.
The challenge is to figure out to what extent this trend can continue; there’s obvious room for improvement in that most of the world still has substantial improvements to be made to its standard of living. The challenge is to figure out whether or not the most fundamental tenet of economics—that demand is unlimited—holds true.
Even if demands are unlimited, the problem is that automation will drive down the costs of a lot of labor to where regulatory and transaction costs make hiring most people more trouble than it’s worth. It’s not that there won’t be labor people want done, it’s that machines will out compete most people in those tasks, making then economically unviable.
Which is exactly what happened for the other 1.4 billion jobs that don’t exist anymore in the United States.
What you fear has been feared for a hundred and fifty years, since automation started to seriously replace workers. Instead of driving us to a dystopia, however, it’s pushed us into a relative utopia.
What you’re proposing isn’t new. The implication you aren’t addressing is that the trend of -new- jobs, previously not worth employing someone to do, but rising at the margins with increased specialization, arising as workers were freed from old ones will suddenly cease.
It’s not exactly what has happened.
Machines used to compete on brute strength and endurance. Mankind always used to have advantages in intelligence, communication, sensation, and precision control. All of those are under attack in ways they have not before.
In short, people are rapidly losing a comparative advantage versus machines. The real problem comes when the opportunities for profit from using machines overcomes the opportunities for profit by employing people. The accelerating rates of improvement in technology will make that more and more the case.
Actually, machines used to compete on strength. They required constant maintenance, however; many people were mutilated fixing the machines while they were still running. That was last century.
Then they began competing on precision control; that’s been on the rise for the past century.
Communication has been the story of the last thirty years. Sensation, similarly, has been rising for the past twenty years. Intelligence is still in the works.
At no point in this process did machines lead to mass unemployment; indeed, employment has -increased- over the past century, as women have begun entering the workforce.
Your proposition ultimately comes down to this: You can’t imagine what we’ll be doing next. I have only this to say: The person who -can- imagine, that person will be the next billionaire, or possibly even the first trillionaire. It shouldn’t surprise you that you can’t imagine what jobs will keep billions occupied over the next century, if you could you would be the extremely exceptional case.
No, my proposition comes down to this:
What comparative advantage will people still have? How big is that market? How many people likely to be out of work can fill that market?
Really good robotic hookers and “escorts” are a ways off. There will be work there for a while, but not everyone would be in demand in that market.
There’s no reason every person has to have economically viable capabilities, particularly in a regulated economy where there is a minimum cost threshold through regulations. Some people now, don’t. Babies don’t.
I always thought demand was limited by factors such as the size of one’s stomach the speed at which clothes wear out or go out of fashion, and most importantly income among other things. I’m actually kind of surprised to hear that unlimited demand was a fundamental tenet of economics.
The problem seems to be confusion as to what economists mean by demand and “unlimited demand”. What they mean by demand is not a static number but a demand curve relating how much of something you would buy depending on its price, i.e., not just what you’re buying now but also what else you would buy if you could. Thus by “unlimited demand” they mean that there is always more you would buy if you could afford it.
Historically it has never worked out that way. When a society gets richer the people eat more and better food, buy more clothes, live in bigger houses, buy cars and appliances, travel more, and so on. Based on the behavior of rich people we can see that a x10 or even x100 increase from current wealth levels due to automation would just continue this trend, with people spending the excess on things like mansions, private jets and a legion of robot servants.
Realistically there’s probably some upper limit to human consumption, but it’s so far above current production levels that we don’t see much hint of where it would be yet. So for most practical purposes we can assume demand is infinite until we actually see the rich start systematically running out of things to spend money on.