Free market and global competition require a strong social safety net. Agree?

[DucatiMonster696]

Actually it only had to do with the fact that we already had a strong globalized economy in place, the fact that it was capitalism was just happenstance. Once again your reading comprehension fails you.

You are ignoring the fact that at the time the world itself was split into two competing economic systems as stated by the author of the article you presented.

It was not a true global economy in the sense that we know of it today as barriers to competition were still very much in place due to the two dueling superpowers.

There were many nations that sided with the model of free market capitalism practiced in the US and others that followed the route of planned socialist economies. In addition many of these planned economies were also propped up by the USSR due to massive inefficiencies, especially in the Eastern European bloc of Soviet allied/dominated states which further compounded the economic problems of sustaining such a flawed economic system by the USSR.

As for my "ideaology", why don't you tell me what my ideaology is? Who was my pick to be the president in 2012? Please tell me, because plenty of people here know who it is.

Clearly you felt the need to use an assertion of my "ideology" and now you're raging hard because I imposed the same bullshit statement that you were flinging in a attempt to disprove my points without actually addressing them in full context.

 

[woolfe9999]

At which point that worker will have to retrain to make himself suitable to a market where there is need of his service.

You're missing the entire point of automation. It is true that technology both creates and destroys jobs, but if it doesn't have a net negative effect on jobs, then the technology is pointless because the purpose is to save on labor costs. So, for example, you automate a factory and lay off 90% of those who work on the factory floor. But you have to hire some people to maintain and service the machines. As well, you're supporting jobs for the people who designed them. However, the net jobs destroyed *must* be greater than the net jobs gained or the company saved no money by moving to automation. Total net job destruction is the point of automation.

"Re-training" is therefore not the solution. Automation will reduce the total number of jobs available in the economy so you can't retrain for jobs that do not exist. Or more precisely, you can re-train and not find a job, or find one, but displace someone else into the unemployment rolls.

Furthermore, the kinds of jobs created, and the kinds of jobs not affected, by automation, tend to be brain intensive white collar jobs. Not everyone is able to do those kinds of jobs. You can't retrain the factory worker, janitor, store clerk or house cleaner to be the person who designs the machines that replaced them, or to be doctors, lawyers, or CPA's. It doesn't work that way. Automation reduces the blue collar sector, and not everyone is able to competently perform outside that sector no matter how much training they receive.

I would say that would cause the prices of house-cleaning, retail check-out, customer service, education, personal training, construction, and all aspects of industry, to plummet. Anyone who uses these services will find they no longer have to pay so much for them, and will have that money freed up to pay for other things.

Yes, such goods and services would massively plummet in price. Which is meaningless for the huge percentage of people who have no income and no safety net. It doesn't matter if you can keep your house clean for three years by purchasing a single $200 robot instead of $2000 for human house cleaners if you have no money.

People who previously worked in those sectors find they can't get acceptable prices for their labor, since what used to cost $100 a month now costs $10. They move to a sector where they can get paid acceptably.

Again, you miss the point. The total number of jobs in the economy diminishes with automation. People do not create jobs by the act of looking for jobs. That isn't how it works. Let's put it this way: when machines do all the physical labor, there is no physical labor left for humans to do. It's that simple.

I assume you mean that everyone on the planet could easily live a middle class if not wealthy lifestyle if they could find a job.[

Yes, that is exactly what I mean, and exactly where the problem lies.

How does increasing automation of tasks lead to decreased employment? How did the advent of the ATM figure in causing unemployment? Labor goes where there's pay for it. In your scenario, there's no longer any pay for it in the sectors you mention. Other sectors, such as those required to build all these robots for example, will need labor to build and design robots.

Technology in the long run will kill net total jobs. There's no escaping it. It will also shift existing jobs toward those which require higher cognitive functioning.

Take e-commerce for example. The reason you can buy stuff cheaper online is that they don't have the same physical plant (which costs construction jobs) or employees (which costs retail jobs). So that's one way that technology kills jobs. Now add to that these automated check-out stands that you're starting to see in super-markets. That's more retail jobs lost. Those people can't all migrate to the new jobs created by these technologies because there aren't as many of them and also because they may not be qualified even with retraining.

The economy doesn't just automatically create new jobs to compensate for lost jobs. There must be an economic reason for the jobs. The economy will create net total jobs when economic growth outpaces population growth. But we're going to need some immense and sustainable economic growth, way over-paced to population growth, to counter-balance the jobs which have been and will continue to lost due to automation.

I think that's a mistaken conclusion. How do we "sit" on a super-abundance of resources? Is that to say someone is hoarding it?

More or less, yes. Either the resources are physically hoarded, or they aren't mined/harvested/manufactured to begin with because there is a lack of demand due to an enormous percentage of the population being out of work.

Your question is kind of like asking how do we ration oxygen, now that it's so plentiful? Rationing and distribution only becomes necessary when there's a scarcity of something. That's what prices are for.

What I'm really talking about is the social safety net, and the basis of the conservative objections to it. It's based on "we keep what we earn" and "the people receiving my tax dollars are lazy." The trouble with that line of argument is that "lazy" isn't relevant when the economy simply will not support full employment.

Let's just stipulate, arguendo, that welfare recipients are mostly lazy. So let's yank their benefits. That might make them get off their asses really fast, right? So what is that going to do when the jobs aren't there? Many won't find jobs, and the ones who do will simply displace others. Once again, you don't create jobs by looking for them. It doesn't matter if some of them are lazy or even if all of them are. In an economy that will not employ everyone, a certain number of unemployed is inevitable, and we have to decide what to do with those people. We can either call them lazy and let them starve, or not. Either way, they aren't getting jobs.

This problem I'm identifying with the conservative objection to the safety net is only going to become larger and larger over time as automation eliminates jobs. That's what I'm trying to say.

- wolf

 

[DucatiMonster696]

You keep going back to comparisons of outputs, but I don't really dispute that in the post-war environment, the US produced more wealth than the USSR. That isn't the issue. The USSR could feed its people in the post-war period.

Just being able feed your own people doesn't mean that this ability did not came at a huge cost in terms of the standard of living in the USSR. Maintaining a high standard of living is why the free market system was/is considered such a success on top of just being able to feed citizens. Even Karl Marx admitted that benefits of capitalism is that it is able to reduce the cost of living and sustain a high standard of living.

The economic system employed in the US not only has kept people feed but it has drastically improved our standard of living compared to what occurred in the USSR where being feed meant that you just accepted whatever was available or given to you and had no say in demanding more or better quality goods or services. Therefore narrowing the discussion to a single point "They were able to feed their people" ignores the reality of the cost of them being able to meet this goal and how it effected everyone in the former USSR.

I don't see anyone making that argument. It's a strawman. I feel like you're forgetting my original point that you responded to.

That also sounds like a strawman.

Where is the straw man when you have major left wing political figures such as Nancy Pelosi stating in their own words that sustaining unemployment checks (aka safety nets) beyond their end date was akin to stimulating the economy? This is at the core of every argument that helps to keep "Safety nets" in place when others seek to remove, limit or modify them after they have been shown to have detrimental effects, be farm subsidies, medicare, social security, welfare, etc.

The funny thing is you are basically proving my original assertion is correct. In a future situation where we can easily provide advanced goods to all citizens, like we can with food today, many conservatives and libertarians will argue that we can't and shouldn't.

Its not arguing that "We can't and shouldn't", it is an argument that being able to sustain any high level of production requires that prices be set to cover and convey the costs behind said production and consumption of resources which involves and stems around the inherent scarcity of resources in society and the economy for various reasons.

 

[Infohawk]

Just being able feed your own people doesn't mean that this ability did not came at a huge cost in terms of the standard of living in the USSR. Maintaining a high standard of living is why the free market system was/is considered such a success on top of just being able to feed citizens. Even Karl Marx admitted that benefits of capitalism is that it is able to reduce the cost of living and sustain a high standard of living.

The economic system employed in the US not only has kept people feed but it has drastically improved our standard of living compared to what occurred in the USSR where being feed meant that you just accepted whatever was available or given to you and had no say in demanding more or better quality goods or services. Therefore narrowing the discussion to a single point "They were able to feed their people" ignores the reality of the cost of them being able to meet this goal and how it effected everyone in the former USSR.

Don't act like the eastern bloc was only able to provide food. They were the second world, not the third world. Anyway, there is no need for you to focus on the Soviet Union. If you want to act like they were living in mud huts and living in an agrarian economy where all resources had to be spent producing food to survive, it ultimately doesn't afffect my position. Food stamps show today that it's not a big deal for the US to provide food to its population. We have sent people to the moon. We have food production down.

Where is the straw man when you have major left wing political figures such as Nancy Pelosi stating in their own words that sustaining unemployment checks (aka safety nets) beyond their end date was akin to stimulating the economy? This is at the core of every argument that helps to keep "Safety nets" in place when others seek to remove, limit or modify them after they have been shown to have detrimental effects, be farm subsidies, medicare, social security, welfare, etc.

You are changing the topic. I am not discussing Nancy Pelosi or even stimulus.

It not arguing that "We can't and shouldn't"

Well that was the argument I was addressing that can be found in this thread and in general among libertarians.

 

[bfdd]

Are you willing to take one of those cheap labor jobs? Why would anyone want to reduce their standard of living that dramatically as long as any alternatives exist?

Yes I would be, in fact I think pretty much everyone is getting paid to much in the USA. It's lulzy what can net you 50k+ a year in this nation.

 

[Infohawk]

Yes I would be, in fact I think pretty much everyone is getting paid to much in the USA. It's lulzy what can net you 50k+ a year in this nation.

That's unusual. Most people would not want to be reduced to a third world standard of living before having the government try something else.

 

[QuantumPion]

You're missing the entire point of automation. It is true that technology both creates and destroys jobs, but if it doesn't have a net negative effect on jobs, then the technology is pointless because the purpose is to save on labor costs. So, for example, you automate a factory and lay off 90% of those who work on the factory floor. But you have to hire some people to maintain and service the machines. As well, you're supporting jobs for the people who designed them. However, the net jobs destroyed *must* be greater than the net jobs gained or the company saved no money by moving to automation. Total net job destruction is the point of automation.

That is only true if there is zero economic growth (e.g. in a socialist country). In the free world, automation leads to increased productivity and standard of living. The displaced workers would eventually get another job, more training, and more education which is more productive and a greater net benefit to society. This is how the middle class moved up from being 18 hr/day manual laborers to 12 hr/day factory workers to 8 hr/day office workers through the late 19th and early 20th century. Using your logic, the factories in the 1800's would be outlawed because they take jobs away from the guild/union shops. We'd be stuck in the dark ages still.

 

[Infohawk]

That is only true if there is zero economic growth (e.g. in a socialist country). In the free world, automation leads to increased productivity and standard of living. The displaced workers would eventually get another job, more training, and more education which is more productive and a greater net benefit to society. This is how the middle class moved up from being 18 hr/day manual laborers to 12 hr/day factory workers to 8 hr/day office workers through the late 19th and early 20th century. Using your logic, the factories in the 1800's would be outlawed because they take jobs away from the guild/union shops. We'd be stuck in the dark ages still.

I'm pretty sure he's talking about a point in time when the vast majority of human needs will be met by robots. Comparing it to a time in the past when there was tons of human work left to be done isn't that helpful.

 

[bfdd]

That's unusual. Most people would not want to be reduced to a third world standard of living before having the government try something else.

Because you and I disagree on how far down it will go and how "bad" it will be.

 

[fskimospy]

That is only true if there is zero economic growth (e.g. in a socialist country). In the free world, automation leads to increased productivity and standard of living. The displaced workers would eventually get another job, more training, and more education which is more productive and a greater net benefit to society. This is how the middle class moved up from being 18 hr/day manual laborers to 12 hr/day factory workers to 8 hr/day office workers through the late 19th and early 20th century. Using your logic, the factories in the 1800's would be outlawed because they take jobs away from the guild/union shops. We'd be stuck in the dark ages still.

He doesn't want to outlaw them, where did you get such an idea?

The rest of your post just proves him right, you just described a decline in need for labor between the 1800's through the present through the shortening of the average workday.

The natural and inescapable result of sufficiently advanced technology is full unemployment. This is not a bad thing, this is just reality.

 

[the DRIZZLE]

You're missing the entire point of automation. It is true that technology both creates and destroys jobs, but if it doesn't have a net negative effect on jobs, then the technology is pointless because the purpose is to save on labor costs. So, for example, you automate a factory and lay off 90% of those who work on the factory floor. But you have to hire some people to maintain and service the machines. As well, you're supporting jobs for the people who designed them. However, the net jobs destroyed *must* be greater than the net jobs gained or the company saved no money by moving to automation. Total net job destruction is the point of automation.

"Re-training" is therefore not the solution. Automation will reduce the total number of jobs available in the economy so you can't retrain for jobs that do not exist. Or more precisely, you can re-train and not find a job, or find one, but displace someone else into the unemployment rolls.

Your argument is based on the implicit assumption that output remains fixed. In fact, as production becomes more efficient we increase output we produce more output from the same base of capital and labor. The economic history of the last 250 years indicates that not only does output per capita increase over time due to technological improvements, but also that the "invisible hand" does a pretty good job of creating new jobs to replace the ones made obsolete by technological advancement.

That said, I do think there are some serious structural problems with our labor market that could be improved with some creative government action, but the typically solution of increasing the duration of unemployment benefits and increasing welfare is a sub-optimal solution at best because it changes people's behavior in undesirable ways.

 

[woolfe9999]

Your argument is based on the implicit assumption that output remains fixed. In fact, as production becomes more efficient we increase output we produce more output from the same base of capital and labor. The economic history of the last 250 years indicates that not only does output per capita increase over time due to technological improvements, but also that the "invisible hand" does a pretty good job of creating new jobs to replace the ones made obsolete by technological advancement.

That said, I do think there are some serious structural problems with our labor market that could be improved with some creative government action, but the typically solution of increasing the duration of unemployment benefits and increasing welfare is a sub-optimal solution at best because it changes people's behavior in undesirable ways.

No, my argument does not assume that output is stable. In fact, it assumes that output increases. Any economic growth which exceeds population growth will create net new jobs, and we can expect this to happen. The problem is as productivity gets higher, there are fewer jobs per unit of economic activity and the arc of technological progress suggests that higher productivity will eliminate more jobs than economic growth will add because it's already been happening and it will have even more impact as time goes on. This might not be a problem if the result was that everyone worked but worked fewer hours, say 20 hours per week, because the goods they purchase will be a lot cheaper. The problem is that there's a tendency for technology to eliminate physical labor in particular, meaning the more likely scenario is a whole lot of people of average or under genetic intelligence not working at all, while the more genetically intelligent continue to work full time. Which in turns creates a problem of how we distribute these abundant and cheap resources to about half the population when they have no income or safety net.

I'm not buying that the "invisible hand" takes care of everything. That sounds a lot like faith to me. Technology has already eliminated vast numbers of blue collar jobs. To an extent, we have amped up higher education and trained new generations of people for white collar work. We were able to do that because once upon a time almost everyone did physical work, and many of those people were quite intelligent and would have qualified to do white collar work. So when technology eliminated their blue collar jobs, they could transition to white collar. But those people were the ones who were capable of more brain intensive work. There's a threshold below which we're dealing with people who can only do physical work, and these days those doing physical work are as a general rule not ever going to be able to transition to white collar. We've already done as much of that as possible, and some - mostly conservatives, in fact - are even plausibly arguing that we're taking it too far by encouraging unqualified people to pursue higher education. The conservatives want them to go to trade schools to pursue blue collar jobs which may not exist in the future, while the liberals want to educate them for white collar work that they cannot do now.

So technology will inexorably continue to eliminate physical work, and we can't really retrain these people for more cognitively intensive jobs the way we could when 90% of the population did blue collar work and lots of those people were smart enough to transition to white collar. Your "invisible hand" will not turn someone with the IQ of your average janitor into a doctor or engineer, not in today's world.

- wolf

 

[Infohawk]

Because you and I disagree on how far down it will go and how "bad" it will be.

Then you're not really responding to what I was saying. What I was saying is that I didn't think that the people who salivate at the chance to deregulate everything and have certain people work for third-world wages would actually want to take those jobs. People tend to think it's someone else's problem.

 

[Atreus21]

You're missing the entire point of automation. It is true that technology both creates and destroys jobs, but if it doesn't have a net negative effect on jobs, then the technology is pointless because the purpose is to save on labor costs. So, for example, you automate a factory and lay off 90% of those who work on the factory floor. But you have to hire some people to maintain and service the machines. As well, you're supporting jobs for the people who designed them. However, the net jobs destroyed *must* be greater than the net jobs gained or the company saved no money by moving to automation. Total net job destruction is the point of automation.

"Re-training" is therefore not the solution. Automation will reduce the total number of jobs available in the economy so you can't retrain for jobs that do not exist. Or more precisely, you can re-train and not find a job, or find one, but displace someone else into the unemployment rolls.

Furthermore, the kinds of jobs created, and the kinds of jobs not affected, by automation, tend to be brain intensive white collar jobs. Not everyone is able to do those kinds of jobs. You can't retrain the factory worker, janitor, store clerk or house cleaner to be the person who designs the machines that replaced them, or to be doctors, lawyers, or CPA's. It doesn't work that way. Automation reduces the blue collar sector, and not everyone is able to competently perform outside that sector no matter how much training they receive.



Yes, such goods and services would massively plummet in price. Which is meaningless for the huge percentage of people who have no income and no safety net. It doesn't matter if you can keep your house clean for three years by purchasing a single $200 robot instead of $2000 for human house cleaners if you have no money.



Again, you miss the point. The total number of jobs in the economy diminishes with automation. People do not create jobs by the act of looking for jobs. That isn't how it works. Let's put it this way: when machines do all the physical labor, there is no physical labor left for humans to do. It's that simple.



Yes, that is exactly what I mean, and exactly where the problem lies.



Technology in the long run will kill net total jobs. There's no escaping it. It will also shift existing jobs toward those which require higher cognitive functioning.

Take e-commerce for example. The reason you can buy stuff cheaper online is that they don't have the same physical plant (which costs construction jobs) or employees (which costs retail jobs). So that's one way that technology kills jobs. Now add to that these automated check-out stands that you're starting to see in super-markets. That's more retail jobs lost. Those people can't all migrate to the new jobs created by these technologies because there aren't as many of them and also because they may not be qualified even with retraining.

The economy doesn't just automatically create new jobs to compensate for lost jobs. There must be an economic reason for the jobs. The economy will create net total jobs when economic growth outpaces population growth. But we're going to need some immense and sustainable economic growth, way over-paced to population growth, to counter-balance the jobs which have been and will continue to lost due to automation.

More or less, yes. Either the resources are physically hoarded, or they aren't mined/harvested/manufactured to begin with because there is a lack of demand due to an enormous percentage of the population being out of work.

What I'm really talking about is the social safety net, and the basis of the conservative objections to it. It's based on "we keep what we earn" and "the people receiving my tax dollars are lazy." The trouble with that line of argument is that "lazy" isn't relevant when the economy simply will not support full employment.

Let's just stipulate, arguendo, that welfare recipients are mostly lazy. So let's yank their benefits. That might make them get off their asses really fast, right? So what is that going to do when the jobs aren't there? Many won't find jobs, and the ones who do will simply displace others. Once again, you don't create jobs by looking for them. It doesn't matter if some of them are lazy or even if all of them are. In an economy that will not employ everyone, a certain number of unemployed is inevitable, and we have to decide what to do with those people. We can either call them lazy and let them starve, or not. Either way, they aren't getting jobs.

This problem I'm identifying with the conservative objection to the safety net is only going to become larger and larger over time as automation eliminates jobs. That's what I'm trying to say.

- wolf

At the basis of your argument lies the assertion that at some point, whole swaths of society will have literally nothing to sell, particularly their labor, no matter what they do to change that. No retraining will acclimate them to the new situation.

First, I have a hard time accepting this. We've never once in our history come up against such a problem, despite the steady march of technology. I don't accept that technology destroys net jobs. It moves jobs out of one sector where they are no longer needed and into another where they are. One would think that if this were true, then as not only the population increased but technology advanced, we'd be seeing a steady increase in the unemployment numbers commensurate with technological advancement.

Furthermore, there's a market for what people want. Not everyone wants to be waited on by a machine. A Winn-Dixie near where I live had automated checkouts. Now they don't. Turns out they weren't cost effective because people were only using them as a last resort, which put pressure on the human cashiers, which pushed the company to hire more humans and remove the automated checkouts. I don't know if that's a larger trend, but to say that absolute domination by machines of sectors which require menial labor is inexorably our future is not necessarily certain.

Secondly, your scenario is so broad as to be almost unanswerable. You're making predictions about something we have no reason to suspect is even 200 years away. People thought in the 20's that by now we'd be on other planets. We don't even have flying cars yet.

To expect an answer to a scenario which due to its remoteness and vagueness you can tailor to frustrate any argument against it, is kind of unfair. It's unfair to assume that the world will change so much, yet people don't change with it; the kind of technological advance you're talking about doesn't happen overnight. Is it not possible that people will adapt as technology adapts?

Third, and as corollary to the second point, your scenario packages within it the challenge not only to solve future poverty as a result of whatever development, but also simply to solve poverty in general: The conditions you're talking about, (people being permanently unable to find a job), exist already. No one is against safety nets for those who are truly disabled, but despite safety nets, despite any human attempt to solve it, poverty will be with us. Someone even in the best and most humane society will suffer for lack of food or water.

The economy is not some entity that we bend to our will. It's not an entity in the first place. We make the economy. It is the sum total of our trade. I suppose that is why I don't understand your scenario at a fundamental level. You seem to view the economy as a horse, and people as riders of it in a rodeo. To me, it's just what I buy and sell.

 

[MooseNSquirrel]

To paraphrase Milton Friedman: When you pay people to be poor, you will have lots of poor people.

To quote a founding father:

“I hope we shall crush… in its birth the aristocracy of our moneyed corporations, which dare already to challenge our government to a trial of strength and bid defiance to the laws of our country."

“May (July 4) be to the world, what I believe it will be -- to some parts sooner, to others later, but finally to all -- the signal of arousing men to burst the chains under which monkish ignorance and superstition had persuaded them to bind themselves, and to assume the blessings and security of self-government. That form (of government) which we have substituted, restores the free right to the unbounded exercise of reason and freedom of opinion. All eyes are opened, or opening, to the rights of man. The general spread of the light of science has already laid open to every view the palpable truth, that the mass of mankind has not been born with saddles on their backs, nor a favored few booted and spurred, ready to ride them legitimately, by the grace of God.”

 

[Steeplerot]

Even Karl Marx admitted that benefits of capitalism is that it is able to reduce the cost of living and sustain a high standard of living.

LOL, where do you all get this stuff from? Das Kapital comprehension fail.

Not that you would have ever read Marx, I would love to see you try to explain your interpretation.

By the way, your idea of eastern bloc living is propaganda, I saw more poverty here as a kid in the 80s reagan recession back then.

We had no homeless, and people were fed well, and you could tell your bosses off if you were underpaid or treated badly.

The long lines you see in the Bloc were the late 80s after Chernobyl drained the economy and perestroika undermined the system. Or its ANCIENT stuff from one of the world wars when the CCCP was literally being invaded.

You have a lot to learn about life growing up listening to propaganda.

Corruption is a problem for all economic systems. Capitalism or Socialism have nothing to do with a efficient transparent government and a respect for a society of justice and laws.

Sorry to pop your pre-made right wing fantasy world.

Say what you will, Eastern Germany was not without major faults, but imo the police dicked with you less then nowadays in the USA. We had no shit like the patriot act (that they enforced) Hell, taken a look at how militaristic your local police forces have become in the USA? I never saw freaking darth vaders beating the shit out of kids.

If it happened it was a worldwide scandal.

Americas big problem nowadays is we have no one to compete with. Now the capitalists are in vulture mode and picking the bones of the peoples government of the USA people fought for apart piece by piece. They know damn well the Red Army is not going to invade anything anymore to threaten their power grab.

This is just my opinion and experience, other Americans grew up in the 80s also with East German/American parents.

Growing up in the DDR
http://www.photologix.nl/useuropeans/index.php?post=338

 

[JockoJohnson]

I have some familiarity with the welfare system here in Canada - it's not more money than what you'd earn at a minimum wage job, and it's also extremely humiliating. You are essentially treated as an untrustworthy child in that you must be constantly checked up upon to demonstrate that you are trying to find work. Really our starting point should be whether or not the welfare queen is a fictional archetype (or in other words, are people really staying on welfare on purpose in significant numbers).



That seems like a good idea; as I understand it one of the benefits to your state model is to allow each one to be an experiment-in-a-box. Might as well make use of that built-in feature.

In the US, at least in urban areas, it is a badge of honor. Welfare queens do exist. I can't say for sure how many but my nephew's mother is one of them. She keeps popping out a kid from a different daddy every few years to stay on the payroll. No responsibility what-so-ever. I can't imagine she is the only one in the US but, being honest, I don't know what percentage they make up of those on welfare.

So, you are right..it may not be worth imposing more restrictions on all those on welfare if only a small percentage are abusing it. It would be interesting if a real in-depth study was somehow performed to see.

 

[Infohawk]

In the US, at least in urban areas, it is a badge of honor. Welfare queens do exist.

I don't really buy the badge of honor part. Welfare queens originally was a term used during the first Reagan campaign to describe someone engaged in fraud (and it was hyperbole for the most part). Someone who defrauds the system is a different type of problem.

The reality is that welfare queen is basically a term targeted at poor black women. There are a lot of issues confounding the problem when you look at a certain segment of that population, including drug problems.

 

[woolfe9999]

Good discussion. It gets to increasing levels of complexity as we move further down this rabbit hole, so I'll try to limit myself to one more lengthy response.

At the basis of your argument lies the assertion that at some point, whole swaths of society will have literally nothing to sell, particularly their labor, no matter what they do to change that. No retraining will acclimate them to the new situation.

First, I have a hard time accepting this. We've never once in our history come up against such a problem, despite the steady march of technology. I don't accept that technology destroys net jobs. It moves jobs out of one sector where they are no longer needed and into another where they are. One would think that if this were true, then as not only the population increased but technology advanced, we'd be seeing a steady increase in the unemployment numbers commensurate with technological advancement.

What you're arguing here is essentially the faith based assumption that things fundamentally do not change. If we didn't have a problem in the past, we won't have it in the future. Vague assumptions that things will just automatically and organically shift around to compensate is not an adequate approach to analyzing the issue I've raised. You have to understand WHY we've been able to compensate for the jobs killed by technology in the past in order to project whether we will continue to compensate in the future.

That improving technology will continue to kill jobs, particularly blue collar jobs, indefinitely into the future isn't really debatable. What IS debatable is 1) the time frame, i.e. how quickly does the technology progress, and 2) to what extent will our economy compensate the way it has in the past. The first of these is pointless to debate here because neither of us knows how fast it will progress. That's a subject for futurists who are often wrong anyway. The second point, however, which is the main objection you raise to my argument, is something we can meaningfully discuss.

In the United States, we have seen a historic shift in jobs from blue collar to white collar over the past 100 years. That much is plain historic fact. The specific mechanism is broadly this: 1) technology is introduced which reduces the need for physical human labor; 2) this then decreases the costs of goods which in turn, 3) increases demand causing economic growth which in turn, 4) creates more jobs.

It's a feedback loop. It isn't infinite, however, for the following reason. Much of the money freed up by cheaper goods has gone to the services sector. People can now better afford doctors, lawyers, accountants, money managers, and other highly paid service professionals. We in turn have successfully expanded our educational infrastructure to accommodate this growing demand: more colleges and universities, expanding the capacity of existing ones, and providing government backed student loans. So while the blue collar sector shrinks, the white collar sector expands, and since those jobs pay better, we now have higher wages AND cheaper goods. There is no doubt that technology has greatly improved our standard of living, particularly throughout the 20th century.

But we're reaching the limit of this compensating mechanism, for reasons I've explained in my posts above. Conservatives in particular are starting to make the following rather accurate observation: liberals want everyone to go into higher education (because they see the technological future as demanding it), and hence they want to provide loans for everyone to do so, yet we're starting to push people into it who do not belong there. The ugly truth is that there are differences in genetic intelligence among human beings. The argument is that if we keep loaning more and more people money to go to college, many of these unqualified people will either flunk out, or barely get by, but end up working low paying jobs which do not require the education they received, then defaulting on said loans, bursting this "education bubble."

While I'm skeptical that education is a bubble that will burst, because I see some differences between the situation with the housing market and student loans, I do agree with the premise that we're reaching the ceiling percentage of the population able to be trained for brain intensive work. The liberals correctly observe that technology creates the need for a more and more educated populace, but the conservatives correctly observe that genetic limits put a cap on how much of this we can accomplish, and that we're now showing signs of reaching or even exceeding that cap. Yet this is the very compensating mechanism that has offset the job elimination caused by automation. So we're reaching an impasse.

There's already evidence of this as an economic trend. In a global recession, corporations lay people off to cut costs, and in a particularly severe one, they are cautious in how they increase production once the recovery is underway and demand starts to perk back up. They can either a) hire back the expensive American workers, b) offshore to countries with cheaper labor, or c) invest capital in machinery to replace human workers. During the recession, off-shoring has continued apace or slightly diminished, while capital investment in machinery has reached all time highs, and the economy is adding jobs but at a lower pace than the amount of economic growth suggests it should.

http://online.wsj.com/article/SB10001424052970204468004577164710231081398.html?wpisrc=nl_wonk

http://blogs.ptc.com/2012/03/01/economic-recovery-spells-more-automation-less-jobs-in-manufacturing/

Many economists believe we are headed for higher structural unemployment in the longer term, and I agree with them. This recession has simply accelerated an existing trend. Some of it is off-shoring, but off-shoring is a problem that naturally diminishes over time as the developing world improves its standard of living, which is happening year by year. Automation will not stop killing jobs, and absent a populace with genetically boosted intelligence, we can't compensate for it to the same extent that we used to.

Furthermore, there's a market for what people want. Not everyone wants to be waited on by a machine. A Winn-Dixie near where I live had automated checkouts. Now they don't. Turns out they weren't cost effective because people were only using them as a last resort, which put pressure on the human cashiers, which pushed the company to hire more humans and remove the automated checkouts. I don't know if that's a larger trend, but to say that absolute domination by machines of sectors which require menial labor is inexorably our future is not necessarily certain.

You're missing the point of automated checkout. It isn't about what the customer wants. It's about saving on labor costs. Both major super-market chains (Safeway and Albertsons) here in CA adopted these about 3 years ago. Started with 2, then 4, now 6 machines per store, with the human checkers progressively disappearing. And what's happening is that people prefer to have someone else do the checkout for them but there are fewer people to do it, so the lines at the human checkout stands are longer, causing people to go to the machines which had no lines. Now the machines are getting lines which are shorter than the human checkout lines, but lines nonetheless. Bottom line is that it's inevitable and the consumer will go along with it because it means the food is cheaper.

It's like the old full serve vs. self-serve gasoline. Full serve was nice and everyone would take it if it didn't cost more, but it does and now it's largely a thing of the past. Same thing is starting to happen with retail checkout, and it will continue to progress nationally even if it appears in fits and starts in certain stores or locales, because the technology only gets cheaper and better.

Secondly, your scenario is so broad as to be almost unanswerable. You're making predictions about something we have no reason to suspect is even 200 years away. People thought in the 20's that by now we'd be on other planets. We don't even have flying cars yet.

No, my predictions are grounded in present day reality. This isn't Ray Kurzweil opining that we'll have strong AI which will take over for humans even in brain intensive tasks by 2045. I discount that as too speculative and probably too far off to bother considering right now. What I'm talking about is what has already been happening: replacement of physical human labor by machines, and also certain limited forms of non-physical labor by computers (customer service comes to mind.) It's already happening and there is zero reason to believe it will not continue to progress. The exact pace of it is debatable, but we aren't talking about when we reach a theoretical end state because the problem I identify gradually increases by degrees as time goes by.

To expect an answer to a scenario which due to its remoteness and vagueness you can tailor to frustrate any argument against it, is kind of unfair. It's unfair to assume that the world will change so much, yet people don't change with it; the kind of technological advance you're talking about doesn't happen overnight. Is it not possible that people will adapt as technology adapts?

If you believe Kurzweil, it's possible that humans will have cybernetically and/or genetically enhanced intelligence which could solve the problem I identify above, but then he also believes that AI's will take over the jobs that require intelligence. The bottom line is that the problem I am discussing is grounded in what's already happened and continuing to happen, while these solutions are more in the realm of science fiction and likely further off.

Third, and as corollary to the second point, your scenario packages within it the challenge not only to solve future poverty as a result of whatever development, but also simply to solve poverty in general: The conditions you're talking about, (people being permanently unable to find a job), exist already. No one is against safety nets for those who are truly disabled, but despite safety nets, despite any human attempt to solve it, poverty will be with us. Someone even in the best and most humane society will suffer for lack of food or water.

I take it for granted that there will always be non-zero poverty. I think technology can diminish it to near zero by making goods so cheap as to be virtually free, but we need new economic and political paradigms to accommodate the future that technology is leading us toward.

The economy is not some entity that we bend to our will. It's not an entity in the first place. We make the economy. It is the sum total of our trade. I suppose that is why I don't understand your scenario at a fundamental level. You seem to view the economy as a horse, and people as riders of it in a rodeo. To me, it's just what I buy and sell.

Curiously, your first sentence undermines the argument you make in the rest of the paragraph. In any event, I do think we can exercise control over the economy, but we may need some paradigm shifting because we are facing material realities that make existing paradigms outmoded. I believe the free market will likely continue indefinitely, yet the argument that we should limit the safety net because it breeds laziness and people should "pull themselves up by their bootstraps," problematic today because we already have permanent structural unemployment in this country, is going to become increasingly absurd as its moral underpinning continues to wither away as technology progressively creates higher and higher structural unemployment. To the contrary of what conservatives today desire, we're going to need a greatly expanded social safety net, not a diminished one.

- wolf

 

[Atreus21]

Good discussion. It gets to increasing levels of complexity as we move further down this rabbit hole, so I'll try to limit myself to one more lengthy response.

What you're arguing here is essentially the faith based assumption that things fundamentally do not change. If we didn't have a problem in the past, we won't have it in the future. Vague assumptions that things will just automatically and organically shift around to compensate is not an adequate approach to analyzing the issue I've raised.

The most remarkable thing about the market is that we've been able to achieve things that we don't even understand, as Matt Ridley pointed out. No one, literally no one, knows how to build a computer mouse from start to finish. The amount of people involved in the manufacturing of a single computer mouse is labyrinthine; maddeningly so.

My point by that example is that when you say, "Vague assumptions that things will just automatically and organically shift around to compensate is not an adequate approach to analyzing the issue I've raised," it sounds as if you're describing precisely the invisible hand. In using a (largely) free market, we are subjecting ourselves to precisely that "automatic and organic" compensatory mechanism you reference. Free markets, by their nature, move resources where they're most needed by mechanisms beyond anyone's direct control. So far that compensatory mechanism, despite our inability to control it, has been more than just adequate; by any measure it has advanced the world to levels of prosperity well beyond any other economic system.

But we're reaching the limit of this compensating mechanism, for reasons I've explained in my posts above. Conservatives in particular are starting to make the following rather accurate observation: liberals want everyone to go into higher education (because they see the technological future as demanding it), and hence they want to provide loans for everyone to do so, yet we're starting to push people into it who do not belong there. The ugly truth is that there are differences in genetic intelligence among human beings. The argument is that if we keep loaning more and more people money to go to college, many of these unqualified people will either flunk out, or barely get by, but end up working low paying jobs which do not require the education they received, then defaulting on said loans, bursting this "education bubble."

While I'm skeptical that education is a bubble that will burst, because I see some differences between the situation with the housing market and student loans, I do agree with the premise that we're reaching the ceiling percentage of the population able to be trained for brain intensive work. The liberals correctly observe that technology creates the need for a more and more educated populace, but the conservatives correctly observe that genetic limits put a cap on how much of this we can accomplish, and that we're now showing signs of reaching or even exceeding that cap. Yet this is the very compensating mechanism that has offset the job elimination caused by automation. So we're reaching an impasse.

There's already evidence of this as an economic trend. In a global recession, corporations lay people off to cut costs, and in a particularly severe one, they are cautious in how they increase production once the recovery is underway and demand starts to perk back up. They can either a) hire back the expensive American workers, b) offshore to countries with cheaper labor, or c) invest capital in machinery to replace human workers. During the recession, off-shoring has continued apace or slightly diminished, while capital investment in machinery has reached all time highs, and the economy is adding jobs but at a lower pace than the amount of economic growth suggests it should.

http://online.wsj.com/article/SB10001424052970204468004577164710231081398.html?wpisrc=nl_wonk

http://blogs.ptc.com/2012/03/01/economic-recovery-spells-more-automation-less-jobs-in-manufacturing/

Many economists believe we are headed for higher structural unemployment in the longer term, and I agree with them. This recession has simply accelerated an existing trend. Some of it is off-shoring, but off-shoring is a problem that naturally diminishes over time as the developing world improves its standard of living, which is happening year by year. Automation will not stop killing jobs, and absent a populace with genetically boosted intelligence, we can't compensate for it to the same extent that we used to.

...

I take it for granted that there will always be non-zero poverty. I think technology can diminish it to near zero by making goods so cheap as to be virtually free, but we need new economic and political paradigms to accommodate the future that technology is leading us toward.

- wolf

In truth I don't know how to respond wholly to your prediction.

I suppose a minor objection to your argument is that intelligence does not equal competence, nor does education equal competence. Also, I think there's a very big difference between education and job training. People can be trained for white collar professions without a college education.

In any event, if your prediction is correct, then perhaps at some point we will have to have an extremely large safety net for such people. But I still instinctively recoil at the suggestion that this will occur. I can't accept that raw IQ is going to dictate such an inordinate amount of a person's economic value.

 

[werepossum]

I've thought about this for two days, read all the posts, and I'm still largely unable to take a position. On the one hand, a safety net is something a civilized nation absolutely must develop once it is able to afford it. On the other hand, a safety net is a powerful disincentive to provide labor at low rates, which greatly limits our ability to compete with poor nations in free trade. In theory that's a self-fixing problem; the poor nation becomes relatively wealthy from providing labor and it's citizens no longer work cheaply. In practice, global arbitrage combined with a lack of technological barriers means that corporations can shop around from nation to nation while providing each nation's workforce with the latest production technology and bribing nations' leaders to keep wages artificially low. And in addition, nations like Red China, with near-total control over a population socially geared to obeisance, can keep those wages artificially low virtually without limit, whereas our ability to borrow is NOT without limit. No nation can long consume more than it produces.

I do largely agree with Wolfe though that technology will exacerbate the problems with global arbitrage. BobberFett made an excellent post on that some time back. This has two convergent problems, the first being that we need to re-train more workers just as we need fewer workers. This is just worsened by cheap imported goods. The second is that as increased productivity increases our society's wealth, the safety net must get more luxurious, looking increasingly like an enticing hammock. The wealthier a society, the better it must provide for those on its dole. Three generations ago, the dole meant a room at the County poor house, donated second-hand or cheap clothing, decent but boring food. Now we're arguing over whether broadband Internet or cell phones are "human rights".

The traditional answer to technology's increased productivity is to cut working hours. If nearly everyone's hours are reduced, more people are needed, labor becomes more highly valued, the least skilled are brought more in line with the more skilled, and nearly everyone enjoys a higher quality of life because the increased productivity offsets the lower hours worked. Problem is, with global arbitrage we're competing with much cheaper labor in much more permissive (read: less expensive) environments using largely the same high tech manufacturing equipment. Cutting our work hours is suicidal.

Thus the dilemma as I see it. We must have a safety net. Yet the safety net makes global arbitrage much more dangerous.

 

[Pr0d1gy]

To continue to insist that our workforce be competitive with those in oppressive nations is a joke, especially on the bottom end where they can violate human rights to demand inhuman amounts of productivity for a pittance of what our minimum wage is.

 

[MooseNSquirrel]

Why do you hate free enterprise Prodigy?

 

[Pr0d1gy]

Why do you hate free enterprise Prodigy?

I hate the lies that have been spread around this country by the power elite over the last 50+ years. I hate the bullshit they spew to justify moving jobs out of this country while begging for tax exemptions, loopholes, and individual decreases in the name of creating more jobs only to see the majority of the new jobs are at McDonald's. I hate seeing these same people say that the American workforce is not competitive when it is their cost cutting measures that turned the American worker's output into shit that even Americans would not buy, and then turning around and blaming the American worker saying they are not productive enough and are lazy....which is the most absolute of bullshit.

I hate that what we call free enterprise is a system built on backroom deals, insider trading, and elitist scumbags that use both to surpress competition. I hate that this country no longer embraces intelligence but fears it, ridicules it, and tries to drive it out. I hate that the best and the brightest no longer run this country, not the businesses, banks, or government that have ruined the lives of countless millions for no reason other than envy. Yeah I said it. Envy. Not greed, but envy is what drives these people. No matter how much they have they want more because some Saudi prince has more than them, or some friend of theirs in business does, or some guy on the Forbes list. It's a pathetic joke that it has come to this.

I hate that the American people have bought into all the free enterprise propaganda to the extent of believing that they really are nonproductive and create shoddy works. Meanwhile they are paying some illegal to do that same job much worse than you did for a fraction of what they would have paid you and they don't even care because they no longer stand behind their products, or else they sent the production to another country to cut costs to a point where they can just do a massive recall and still make money hand over fist.

I hate that these same people have used the events of 9/11 and everything after to basically remove everyones' pensions, have stopped offering insurance in many fields altogether, and wages have fallen and frozen for millions of people; meanwhile these asshole get richer and richer everyday. I hate that so many Americans are still buying into this shit while the UN is getting ready to take all of our guns and turn us into a 3rd world production nation of slaves. I hate that the leaders of free enterprise allowed foreign bankers to commit an economic coup on this country that has left it nearly crippled and vulnerable to foreign entities.

More than anything I hate that free enterprise has become a tool of the right that they use to push fear on the general public. If you don't vote for us there won't be any jobs! The very fact that these officials even say the things they do shows their contempt for America, from Bush saying the Bill of Rights is "a piece of paper" to him saying to a divorced mother of 3, ''You work three jobs? … Uniquely American, isn't it? I mean, that is fantastic that you're doing that.''