blue bits. red rocks.

robotic nation

Making the unemployed miserable arguably increases labor supply, as workers become less choosy and more willing to take whatever job they can find. But the US labor market in 2014 isn’t constrained by supply, it’s constrained by demand: given what firms can sell, they have no need for as many hours of work as workers are willing to give. So make the long-term unemployed more desperate; so what? They can’t do anything to increase the amount of work demanded, and in fact their reduced purchasing power reduces labor demand. Supply, Demand, and Unemployment Benefits

It’s a shame that economists fancy themselves scientists, but they don’t deal with history. They don’t look at how technology is deployed. Simon Head

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Do you ever write about all the journalists who have been “early retired” out of our careers? I’m 52 and lost my job in 2007 when I was 45, not realizing it was the end of my career, too. But that’s when the newspaper industry started bottoming out and I was never able to find another job. After ripping through my 401K (minus half, because the poor apparently deserve to have half their savings taken when they’re unfortunate enough to be poor) and trying to fight cancer without healthcare, I got near-death enough to qualify for Medicare. Lucky me. I now make an under-the-poverty-line income thanks to having been employed for 25 years. But my calling is gone. He Used To Be Someone Once

afloweroutofstone asked: On the subject of "in fifty years, maybe 20% of people will have jobs"; this is referred to as the Luddite Fallacy. Although technology can destroy older jobs, it can also raise productivity and create jobs in other places. For example, telephones put the telegram industry out of business, but the phone industry became a powerhouse of its own. If technology led to long-term rises in unemployment, the industrial revolution would have made us all unemployed.


Ooooh, it’s “referred to” in the passive voice as a capital-F Fallacy! Thanks for this anecdote, but I’m going to suggest that the current technological change (where more-routine jobs are replaced by computers) differs qualitatively from previous technological change (where low-skilled jobs are replaced by high-skilled jobs and complementary machines). Here’s some supporting quantitative evidence with plenty of helpful citations.

It’s become commonplace for skeptics to discount economic concern over technological advancements displacing workers, by brandishing the oft-cited bromide about the Industrial Revolution as a counter-lesson. (And also, frequently, by lobbing the way off the mark “luddite” smear.) But this charge is complete folly, for so many reasons, and I’ll just briefly enumerate a few here:

  1. As jakke points out — optimists place their stock in the Historical fallacy, that the future will play out just as occurred previously.

  2. But this obscures that the Industrial Revolution was an unprecedented and unrepeated prodigious point in history. For almost the complete entirety of human history, income per person remained relatively constant. Then, post-1800, it shot up in stratospheric style. Today’s technological progress doesn’t appear anything remotely similar. This is not a controversial economic theorem — outside of a few pollyanna-ish rosy eyed dreamers, economists and historians of just about all political and philosophical stripes are in consensus here.

  3. But even if the metaphor for the Industrial Revolution is accepted, there still is a great deal obfuscated in the picture, ironic too, especially as the cheerleaders for this type of thinking are typically laissez-faire libertarian loving louts — that a great deal of social upheaval beset nations gripped by the Industrial Revolution. It’s effects were far reaching, leading to measures like public education, social safety nets, massive public investments in infrastructure, transportation, energy, communication systems, etc. And the epoch to epoch transformation was not a smooth one, with blood and bodies spilt.

  4. I could write a lot lot more, but let me conclude this short missive with the most galling truth — the blind faith that all shall be well is based on nothing more than hand waving a trust me pronouncement. By those who in one breath exhort all the merits of science, industry, markets, etc., but in the next hold up merely mindless allegiance that things will just work out. In a sense, it is true — ultimately, our culture and society either adapts and thrives, or disintegrates and tears down. But that’s certainly not a case for political quietism.

Software substitution, whether it’s for drivers or waiters or nurses … it’s progressing. … Technology over time will reduce demand for jobs, particularly at the lower end of skill set. … 20 years from now, labor demand for lots of skill sets will be substantially lower. I don’t think people have that in their mental model. Bill Gates

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