I apologize in advance, this is going to be long and I will be forced to post it in multiple parts. TL/DR version is: We aren't worse off because of technology advances that increase production and decrease labor, but we do need to rethink how we allocate income at some point because eventually the value of labor no longer plays its long-standing role as a source of income.
We have a society where income is mainly derived from 2 sources. One is ownership of capital ... interest on cash or bonds, dividends on stocks, rent from property, etc. The other source is selling your own labor.
Redistribution of wealth by government is a source also, but hasn't been a primary source in capitalist nations, but rather a safety net.
As technology advances (along with a build up of infrastructure) there is a strong tendency for capital to capture more of the total income, and labor less. It's not a bad thing, it means that overall we are more productive with less work. However, since capital tends to be concentrated in the hands of a few, this tendency does create greater income inequality.
I'm not making a socialist philosophical argument here ... I'm just pointed out facts. I lean toward objectivism as a philosophical preference. But objectivism at its most essential is about recognizing reality.
The argument from the right will be that as technology increases people just adjust to different jobs. However, as the labor needed decreases in value, and numbers, the pay decreases ... less total income captured by labor. Calculating whether the "size of the pie" has increased at any given time by enough to offset the loss in "size of the piece" captured by labor is too complex, subjective and political for any agreement.
All of that said, as this trend continues, and that share captured by labor gets smaller and smaller, at some point the speed of decrease in the value of most labor gets cataclysmic for anyone counting on labor rather than capital ownership. If you understand supply and demand economics and just how much leverage is lost in negotiating a price when additional supply is added without additional demand, this should make sense.
Quote: (01-16-2017 04:12 PM)Rob Banks Wrote:
Quote: (01-16-2017 12:45 PM)Edmund Ironside Wrote:
Don't think of the employment market impact as binary, think of a continuum where less and less human labor is needed over time, which shifts the balance of the labor market. Less people are needed, the share of net economic value captured by capital vs labor increases. It's been happening, it continues.
(That is, of course, part of the wrongness of massively importing labor (blue collar via illegals, white collar vs H1B and the like) since automation at all levels is already working against labor rates.)
By that logic, if human labor was eliminated entirely (or nearly eliminated) in a world where machines performed all the labor for us, almost everybody would be unemployed and starving to death.
It makes no sense to think that if human labor were all performed by machines, that we would be worse off instead of better off (economically speaking).
We have a society where income is mainly derived from 2 sources. One is ownership of capital ... interest on cash or bonds, dividends on stocks, rent from property, etc. The other source is selling your own labor.
Redistribution of wealth by government is a source also, but hasn't been a primary source in capitalist nations, but rather a safety net.
As technology advances (along with a build up of infrastructure) there is a strong tendency for capital to capture more of the total income, and labor less. It's not a bad thing, it means that overall we are more productive with less work. However, since capital tends to be concentrated in the hands of a few, this tendency does create greater income inequality.
I'm not making a socialist philosophical argument here ... I'm just pointed out facts. I lean toward objectivism as a philosophical preference. But objectivism at its most essential is about recognizing reality.
The argument from the right will be that as technology increases people just adjust to different jobs. However, as the labor needed decreases in value, and numbers, the pay decreases ... less total income captured by labor. Calculating whether the "size of the pie" has increased at any given time by enough to offset the loss in "size of the piece" captured by labor is too complex, subjective and political for any agreement.
All of that said, as this trend continues, and that share captured by labor gets smaller and smaller, at some point the speed of decrease in the value of most labor gets cataclysmic for anyone counting on labor rather than capital ownership. If you understand supply and demand economics and just how much leverage is lost in negotiating a price when additional supply is added without additional demand, this should make sense.