Luddites Revisited ... 'Second Machine Age has begun'
an interesting present day redux ... from
(snip)"LONDON – At the start of the Industrial Revolution, textile workers in the Midlands and the North of England, mainly weavers, staged a spontaneous revolt, smashing machinery and burning factories. Their complaint was that the newfangled machines were robbing them of their wages and jobs.
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The Luddites’ rampage was at its height in 1811-12. An alarmed government sent in more troops to garrison the disturbed areas than were then available to Wellington in the Peninsular War against Napoleon. More than a hundred Luddites were hanged or transported to Australia. These measures restored peace. The machines won: the Luddites are a footnote in the history of the Industrial Revolution.
Thomas Paine spoke for middle-class radicalism when he said, “We know that every machine for the abridgment of labor is a blessing to the great family of which we are part.” There would, of course, be some temporary unemployment in the technologically advancing sectors; but, in the long run, machine-assisted production, by increasing the real wealth of the community, would enable full employment at higher wages.
That was the initial view of David Ricardo, the most influential economist of the nineteenth century. But in the third edition of his Principles of Political Economy (1817), he inserted a chapter on machinery that changed tack. He was now “convinced that the substitution of machines for human labor is often very injurious to the class of laborers,” that the “same cause which may increase the net revenue of the country, may at the same time render the population redundant.” As a result, “the opinion entertained by the laboring class, that the employment of machinery is frequently detrimental to their interests, is not founded on prejudice and error, but is conformable to the correct principles of political economy.”
Just consider: machinery “may render the population redundant”! A bleaker prospect is not to be found in economics. Ricardo’s orthodox followers took no notice of it, assuming it to be a rare lapse by the Master. But was it?
The pessimistic argument is as follows: If machines costing $5 an hour can produce the same amount as workers costing $10 an hour, employers have an incentive to substitute machines for labor up to the point that the costs are equal – that is, when the wages of the workers have fallen to $5 an hour. As machines become ever more productive, so wages tend to fall even more, toward zero, and the population becomes redundant.
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However, over the last 30 years, the share of wages in national income has been falling, owing to what MIT professors Erik Brynjolfsson and Andrew McAfee call the “second machine age.” Computerized technology has penetrated deeply into the service sector, taking over jobs for which the human factor and “cognitive functions” were hitherto deemed indispensable.
In retail, for example, Walmart and Amazon are prime examples of new technology driving down workers’ wages. Because computer programs and humans are close substitutes for such jobs, and given the predictable improvement in computing power, there seems to be no technical obstacle to the redundancy of workers across much of the service economy.
Yes, there will still be activities that require human skills, and these skills can be improved. But it is broadly true that the more computers can do, the less humans need to do. The prospect of the “abridgment of labor” should fill us with hope rather than foreboding. But, in our kind of society, there are no mechanisms for converting redundancy into leisure.
That brings me back to the Luddites. They claimed that because machines were cheaper than labor, their introduction would depress wages. They argued the case for skill against cheapness. The most thoughtful of them understood that consumption depends on real income, and that depressing real income destroys businesses. Above all, they understood that the solution to the problems created by machines would not be found in laissez-faire nostrums."(snip)
I must assume that this article was prompted by today's news release that, for the next World Cup, large numbers of 'security robots' will be deployed in place of 'human' police. Obviously, this announcement follows on the heels of other recent announcements regarding the use of robots for mall / museum security, 'driverless' vehicles being allowed on certain US roads, automatic fruit and vegetable harvesting machines, automatic hamburger assembling / cooking machines, and a host of other 'leaps' in technology now enabling more traditionally 'human' jobs to be eliminated. In fact there is a thread about robot sex dolls elsewhere in this forum !!!
I would also add that, at near zero interest rates, the ( borrowed ) capital cost for any company to purchase a robot / automation is declining.
And I'll make the embarrassingly obvious point that, when a 'human' job is replaced by a robot / automation, the 'fruits' of labor that formerly flowed to the 'human' worker now flow to the owner corporation and its stockholders.
Re: Luddites Revisited ... 'Second Machine Age has begun'
The problem is that the standard work week is stuck at 40 hours. At one time it was 60+ hours, then it went down as productivity went up. So far France is the only country whose government seems to get it that the 40 hour week is not the perfect, permanent work week length. When productivity goes up, then either consumption has to go up, or hours worked has to go down, or a combination of the two. But at some point, it's hard for consumption to go up without more leisure time in which to consume.
Re: Luddites Revisited ... 'Second Machine Age has begun'
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The problem is that the standard work week is stuck at 40 hours. At one time it was 60+ hours, then it went down as productivity went up. So far France is the only country whose government seems to get it that the 40 hour week is not the perfect, permanent work week length.
Well, some pundits would point out that the USA is quickly moving toward a 28 hour 'standard' work week !!!
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When productivity goes up, then either consumption has to go up, or hours worked has to go down, or a combination of the two.
For better or worse, there's a third option. When productivity goes up, but the 'fruits' of that increased productivity flow primarily to ( already ) rich business owners and stockholders, as opposed to 'human' workers, then the ability to consume is constrained. Yes a CEO and a 'human' worker both need to buy houses and cars. And yes a CEO might buy a Mercedes Benz or a mansion versus a Chevy or a suburban bungalow ... but it is still just one car and just one house. Similarly, although a CEO may choose to eat filet mignon and lobster versus hamburgers and filet-o-fish, one person can only eat so much. And robots replacing 'human' workers don't consume anything beyond electricity and hydraulic oil.
By an extension of your logic, a large portion of increased robot 'fueled' productivity no longer gets channeled toward immediate consumption ( since 'human' workers are no longer receiving paychecks ), and instead gets channeled toward increased capital formation on the part of the business owners and stockholders. However, unlike the 'First Machine Age', deploying that capital toward new business ventures won't result in the hiring of large numbers of 'human' workers. And also, unlike the 'First Machine Age', 'new wealth' created by those new business ventures won't be shared with 'human' workers ... creating a problem regarding the 'human' ex-worker's future ability to consume.
Re: Luddites Revisited ... 'Second Machine Age has begun'
Yes the reduction in the work week (as an adjustment to higher productivity) can't come with a proportional reduction in pay.
Yes the increase in consumption may be skewed towards the wealthy. But there are not that many wealthy, and there are practical limitations on how much they can consume. This is what caused the depression of the 1930s. In the period 1980 - 2008 we avoided another underconsumption crisis because both the government and non-wealthy people consumed based on massive borrowing. The Obama stimulus kept the crisis of 2008 from being as bad as the Great Depression.
The wealthy try to "consume" more by capital expenditures (means of production). But obviously, that creates more production that needs consumption, so it ultimately just adds to the "problem". Ironically the country that's doing this most stupidly (consuming by building more infrastructure and means of production) is "Marxist" China. They have a desperate need to reduce pollution, provide old age pensions and improve typical medical. But somehow they can't seem to find a way to reorient their system to serve the population's true needs.
BTW do you have a link to pictures of you / your avatar?
Re: Luddites Revisited ... 'Second Machine Age has begun'
.....the more we change the more we stay the same.
Re: Luddites Revisited ... 'Second Machine Age has begun'
And this is why "trickle down" economics doesn't work. The super-rich don't spread it, they hoard it.
Re: Luddites Revisited ... 'Second Machine Age has begun'
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Originally Posted by
Melonie
Well, some pundits would point out that the USA is quickly moving toward a 28 hour 'standard' work week !!!
No we're not!
http://www.marketwatch.com/story/no-...ted-2013-07-19
Re: Luddites Revisited ... 'Second Machine Age has begun'
^^^ that point was vaild ... for one month last summer !!! If you take a deeper look, the 'transition' is a bit more obvious ...
http://www.advisorperspectives.com/d...since-2000.gif
However, I'll certainly agree that there are still more full time jobs than part time jobs. But then again, a major motivator of the shift to part time jobs has been postponed again for another year ( i.e. requiring businesses to provide health care benefits for full time employees but not part time employees ). And the chart doesn't add in the growing percentage of Americans whose reported part time working hours are now zero point zero ( i.e. no longer in the official 'work force' ).
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Yes the reduction in the work week (as an adjustment to higher productivity) can't come with a proportional reduction in pay.
Houston, we have a problem !!! Obviously, rich business owners and stockholders aren't going to voluntarily continue to pay 40 hours worth of hourly wages to workers now reduced to 28 hours per week. Just as obviously, rich business owners and stockholders who deploy capital to install robotics and automation are not going to voluntarily continue to pay hourly wages to workers whose jobs will be eliminated. In both cases, this leaves the affected workers with less money, thus less money available to fuel future consumption. Arguably, the only ways that 'human' workers are going to be able to 'leverage' higher wages and thus fuel higher future consumption would be to A. be in a position where their labor becomes a 'scarce' commodity versus a commodity in great surplus ( i.e. back to World War 2 ), and/or B. drive the cost and/or availability of robotics and automation up to the point where 'human' labor is less expensive ( i.e. back to the Luddites ).
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the more we change the more we stay the same
Indeed, certain pundits make the case that we're approaching a 'new feudalism' ... where the 0.1% of 'rich and powerful' hold virtually all of the capital and decide how that capital will be deployed ... where the next 9.9% provide 'skilled services' to those 'rich and powerful' and their enterprises ... and where the remaining 90% have, as economist David Recardo put it, been rendered 'redundant'.
Arguably, this same situation existed in ancient times, during the Roman empire, during the 'dark ages' etc. The main difference today is that priests / monks have been replaced by software engineers / bankers, that the bottom ~40% of the population are no longer literal slaves but 'debt slaves', and that modern medicine + lack of recent 'full on' wars haven't allowed the 'redundant' population to be reduced in the same manner as earlier times.
from
(snip)"I never understood how the wealthy elite could think that the impoverishment of the working class could be a good thing until I ran across the story of Plutus the other day.
Plutus, the God of Wealth, was blinded by Zeus so that he would be able to dispense his gifts without prejudice for things like need. When a couple citizens of Athens decide to give Plutus back his sight, the Goddess of Poverty intervenes. She tells them that she is the source of all progress in the world, and that if poverty was eliminated it would destroy civilization.
That's when I realized that the High Priests of Economics aren't actually worshiping a Volcano God. They are worshiping the Goddess of Poverty.
"Thus you dare to maintain that Poverty is not the fount of all blessings!"
- Goddess of Poverty, 388 B.C.
"In a little time [there will be] no middling sort. We shall have a few, and but a very few Lords, and all the rest beggars."
-R.L. Bushman
Neofeudalism is a concept in which government policies are designed to systematically increase the wealth gap between rich and poor while increasing the power of the rich over the poor. It's a party-neutral idea. There is no cabal pushing the plan, merely the sum effect of pressure from the wealthy elite.
Those policies can be seen today. Just look at the fact that earned income are taxed at a higher rate than unearned income, and the repeal of the inheritance tax.
Other ways are harder to measure but no less real, such as white collar criminals receiving slaps on the wrist, while the poor feel the full weight of the law. It's a system with two sets of rules, one for the rich another one for the poor, and that is the definition of neofeudalism.
Another manifestation of neofeudalism is the growing power of corporations, that leave the poor dependent on private interests more powerful than the government, a situation resembling traditional feudal society.
Currently the top 1% of society own 40% of the nation's wealth. The lower 50% of the nation have the mean assets worth less than $28,000. The richest 10% are worth, on average, 143 times that, or $3.976 million."(snip)
(snip)"Neofeudalism isn't just about the powerful taking over everything. It's about conditioning the poor to accept their designated role in society, even fighting to defend the ability of the wealthy to exploit them. It requires working people to do things that are against their own interests, and nowhere is this more true than in our current economic system.
How is it that we have a politico-economic system in which the government's explicitly stated goal is to entice people to take out loans for houses and cars they don't even need? 150 million cars on the road and we must keep buying new ones? Millions of vacant housing units and we need to build new ones? Homes so full of Chinese junk that half of it goes into off-site storage, and we need to shop more? For whose benefit? Ever heard of debt-slavery? How about feudalism?
Here's an even better word: peonage. It always amazed and confused me how everyone in America is obsessed with their credit rating. It's almost as if people don't realize that credit equals debt. Debt is something that people have feared for thousands of years, because unlike Americans today, historically debt was always associated with another scary term - slavery. Debt bondage, indentured servitude, slavery, they all mean the same thing. Yet somehow the establishment has convinced us that the ability to "manage" our slavery is something to be proud of. They even have a rating system for it.
I'm not being facetious. Being heavily in debt means you don't have the freedom to quit your job. People who have lost their job are unable to move because the enormous debt tied to homes they can no longer afford.
Being tied to a piece of land is the definition of serfdom."(snip)
Admittedly, this Huff Post author is not exactly 'objective'. But many of the author's points have merit nonetheless. However, as an oversight, and being a topic of particular interest to dancers and camgirls, the author failed to add 'student loan debt' to his treatise on home mortgage debt, auto loan debt etc. leading to 'debt bondage'. Perhaps the author wished to avoid addressing the distinct possibility that, while the standard paradigm stated that investing in a college education was supposed to qualify and catapult someone presently in the bottom 90% into the 9.9% of 'skilled service' segment, today the 9.9% 'skilled service' segment is arguably already full !!!
Thus taking on student loan debt and becoming qualified for a 'better' socio-economic position may no longer actually translate into achieving that 'better' social-economic position. At least the heavily indebted home or auto buyers DO get to enjoy their new home or auto ... for a while ... in exchange for willingly entering into 'debt bondage' !!!
Re: Luddites Revisited ... 'Second Machine Age has begun'
Technology and a capitalist system is always disruptive impacting investors, owners and workers alike. The alternative is of course much worse so it is up to a representative government to manage the change and disruption to workers. Manufacturing went to China and technology and the support industries were to provide new 21st century employment replacement. Unfortunately, employers will always migrate to the cheapest labor and the likes of Microsoft and others soon found it profitable to move those very same jobs to India. Welcome to the global economy, adapt or get left behind is our first challenge but the new economy has also led to the hyper-aggregation of money and with that power to a few of the super rich.
The system has to change once again to be more representative and I for one believe in term-limits for our politicians.
Re: Luddites Revisited ... 'Second Machine Age has begun'
^^^ well, I'll steer away from political comments. But your point about the global economy is well taken. The same pundits would point out that US doctors must now compete with 'imported' doctors from India., that US engineers must now compete with 'imported' engineers from China, that US factory workers must now compete with factory workers in South Korea, etc. Thus, in theory at least, Americans will experience downward wage pressure until the point where the 'purchasing power' of their paycheck is the same as that provided to similar workers in India, China, South Korea etc. If this happens, the US standard of living faces significant future declines.
Re: Luddites Revisited ... 'Second Machine Age has begun'
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Originally Posted by
Melonie
^^^ well, I'll steer away from political comments. But your point about the global economy is well taken. The same pundits would point out that US doctors must now compete with 'imported' doctors from India., that US engineers must now compete with 'imported' engineers from China, that US factory workers must now compete with factory workers in South Korea, etc. Thus, in theory at least, Americans will experience downward wage pressure until the point where the 'purchasing power' of their paycheck is the same as that provided to similar workers in India, China, South Korea etc. If this happens, the US standard of living faces significant future declines.
Agreed but if our system and workers can survive the transition I do believe we can compete very well once China and India establish a real middle class.
And I"m not being political about terms limits, it obviously would apply to both parties but it's an effort to limit access by super rich and lobbyists that are perverting our system. You already have the likes of the super rich like Tom Perkins suggesting the rich should have more votes based on the taxes they pay. He said it a joke but it was a trial balloon.
Re: Luddites Revisited ... 'Second Machine Age has begun'
If everyone in America had eyes and minds as open as you two, things could get better very quickly.
Re: Luddites Revisited ... 'Second Machine Age has begun'
I'm not sure we really have that much disagreement.
It was seen, to a strong degree in "dictatorships of the Proletariat" and to some degree in Fabianist governments in Western Europe, that when government is given the power to enforce more economic fairness, it can become just another heartless, self-serving actor that steps all over people.
I doubt if the answer is ultimately political. I think it all depends on the majority of individual people deciding they are going to take a more positive, win-win approach to life and others. If that happens, I think the economics and politics of a healthy society would sort themselves out, one way or another.
Re: Luddites Revisited ... 'Second Machine Age has begun'
Quote:
Originally Posted by
Melonie
No, that point has been valid since 2010. Your chart supports it. Since 2010, the percentage of the workforce working full-time has increased by one percent and the percentage the workforce working part-time has decreased by one percent.
Quote:
Originally Posted by
Melonie
However, I'll certainly agree that there are still more full time jobs than part time jobs. But then again, a major motivator of the shift to part time jobs has been postponed again for another year ( i.e. requiring businesses to provide health care benefits for full time employees but not part time employees ). And the chart doesn't add in the growing percentage of Americans whose reported part time working hours are now zero point zero ( i.e. no longer in the official 'work force' ).
There's no basis for your claim that the policy you're referring to is a "major motivator" of the shift to part-time jobs, other than you disagree with it. As I said in a previous post, many businesses are finding out that over the long-term, having many part-time dissatisfied employees ends up costing the business more, not less, as a result of lost business. Walmart recently moved 35,000 workers from part-time to full time after seeing this. Home Depot also found out that have large numbers of part-time employees isn't good for business.
http://www.forbes.com/sites/rickunga...ler-after-all/
Re: Luddites Revisited ... 'Second Machine Age has begun'
Re: Luddites Revisited ... 'Second Machine Age has begun'
^^^ Thanks slowpoke ... that graphic tells the 'whole story' about those seeking college degrees as a hoped for means of improving their socio-economic situation.
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Since 2010, the percentage of the workforce working full-time has increased by one percent and the percentage the workforce working part-time has decreased by one percent.
True enough. However, the larger point was that full time jobs are ( still ) down 2.5% from historical averages, while part time jobs are ( still ) up 2.5% from historical averages, in terms of percentage of overall working population. The 1% movement post 2008 will need to continue on current trend for the next 10+ years to return to the point things were at pre 2008.
Re: Luddites Revisited ... 'Second Machine Age has begun'
There is a very big demand for people in STEM fields if you have the right skills, at least there is in Technology. I work in a STEM field, and the hiring managers I know have a very hard time finding people with the skills they're looking for. Here's one example where someone placed an anonymous post on a message board stating that he is a mobile engineer with experience in IOS and design, looking to leave a start-up, and got 7 job offers from his anonymous post.
http://www.businessinsider.com/7-job...-secret-2014-2
Re: Luddites Revisited ... 'Second Machine Age has begun'
^^^ no doubt that CERTAIN skills within the STEM fields are indeed in very high demand. However, some of these jobs are 'short' of willing applicants for a reason !!!
One growing issue for engineers and technicians is mandatory travel requirements. Lots of qualified applicants do not want to deal with the prospect of being 'on the road' for weeks at a time ... and especially so if trips to customer sites etc. come with extremely short notice.
Similarly, another growing issue for engineers and technicians is 24/7 accessibility. Lots of qualified applicants do not want to deal with phone calls, call-ins etc. throughout their nights and weekends.
Also, arguably, a consequence of the 'Second Machine Age' will be an increase in travel mandates and 24/7 availability for the engineers and technicians needed to install and maintain the increased automation. Or put another way, vegetable farmers may have just as big of a problem finding technicians to repair and maintain their automatic harvesting machines as they used to have finding human labor to manually harvest their vegetables !
Along similar lines, some medical positions may be in 'remote' areas, may involve arguably 'hazardous' working conditions ( i.e. prisoners ), etc.
The point of course is that, even with relatively high pay rates available, some of those iconic STEM jobs really aren't all that 'great' when the non-money aspects are factored in.