Paradigm Lost: The Rise of U6

[daishi5]

However, there is no magical place to go, or thing to learn. It's more than just automation. Someone above the displaced workers has to want to invest in said displaced workers, since basically every option involves spending money into making a worker for another field (while less so than dedicated training, on the job training still incurs such costs). If actual costs of living remain high enough, along with government impediments (new hires aren't exactly cheap), unemployment may continue to grow, despite a workforce being available. Much of the capital that upstarts could use to help fix the problem is going elsewhere. You could manage to find some market that might be good to produce things for, but still not have any way to serve it.

They did not become useless because of automation (Chinese workers are no more or less robots than US workers). They became useless because they were discarded as producers, but still left to be consumers of the same classes of goods they used to be part of producing. When technology makes things easier, you can produce and consume more, as long as the rewards for the production increases are reinvested back into the people that were displaced by it. That hasn't been happening for a few decades now, in the US. As long as it keeps not happening, the OP's vision of the future (the present, but worse) will be seen, until we get enough civil unrest to shake things up.

Instead of a new innovation creating a situation where those with capital are thinking, "what can we do to make money with this new potential workforce," they have been thinking, "what can we make cheaper in the third world, to sell at slightly lower prices, but also slightly higher margins, to these guys who are continually making less of any real value?" Meanwhile, as wages have been stagnant, but costs have been rising, the people have been thinking, "man, I wish I could get this cheaper," instead of, "why is this all getting to hard to pay for, these days?"

Compounding this, of course, we owe other countries, and our future selves (deficit), way too much, compared to what we actually offer anyone (including our future selves).

There is no magical place to go. I know that there are things people want that we are not making yet, but I don't know what they are. If I did, I would be starting a business and hiring people. As people find ways to make stuff cheaper with less people it frees the other people up to make even more stuff, so everyone can get more stuff. The current economic climate seems to have thrown a great wrench in that though. But, there doesn't seem to be any good reason for this current economic crisis to last long term.

 

[hal2kilo]

You could also quit bitching about China and try selling products of your own. Lots of countries buy all their shit from China and still have a positive trade balance.
http://en.wikipedia.org/wiki/List_of_sovereign_states_by_current_account_balance

Balance in billions of dollars (positive means they are making money, negative means losing money)
China 296.2 (no surprise here)
Germany 109.7
Norway 59.983
Netherlands 52.522
Sweden 38.797
Switzerland 28.776
Canada 12.726
Austria 12.012
Finland 11.268
......
......
...............
United States −380.1 (worst trade balance in the world)


I was curious what Germany sells so much of. Apparently their main exports are machines, cars, chemicals, metals, food, and clothing.

Over half of those countries you listed are unionist socialist contries. That can't be true according to the laisse faire capitalist crowd.

 

[Cerb]

But, there doesn't seem to be any good reason for this current economic crisis to last long term.

Short of revolution, why not? It took decades to get here, and there are many laws and regulations that must change, else any boom will just bring about another bust, and it be even worse than this one.

 

[SammyJr]

Short of revolution, why not? It took decades to get here, and there are many laws and regulations that must change, else any boom will just bring about another bust, and it be even worse than this one.

This is the new economy. Boom and bust. Next up: Green jobs, followed by another great recession, followed by: another bubble!

 

[Jhhnn]

But, there doesn't seem to be any good reason for this current economic crisis to last long term.

Keep telling yourself that, if you can.

 

[soccerballtux]

There is no magical place to go. I know that there are things people want that we are not making yet, but I don't know what they are. If I did, I would be starting a business and hiring people. As people find ways to make stuff cheaper with less people it frees the other people up to make even more stuff, so everyone can get more stuff. The current economic climate seems to have thrown a great wrench in that though. But, there doesn't seem to be any good reason for this current economic crisis to last long term.

I, and I think many others, are of the opinion that there are fewer and fewer "stuffs" that we can invent and make that people want.

This is why the economy is not turning around.

 

[CycloWizard]

I, and I think many others, are of the opinion that there are fewer and fewer "stuffs" that we can invent and make that people want.

This is why the economy is not turning around.

Of course, by definition, there are fewer things which may be invented now than before. However, it's doubtful that the number of useful inventions is finite, let alone small enough that it will be achieved in the next 100 generations. The problem is twofold:
1. Financial incentive for invention is down (including legal obstacles to receiving said incentive), and
2. People are too stupid to be able to invent things that haven't already been invented. This is due to the rising bar for inventions which naturally occurs due to increasing complexity of technology, which in turn is counteracted by an increase in available baseline knowledge.

 

[Moonbeam]

Of course, by definition, there are fewer things which may be invented now than before. However, it's doubtful that the number of useful inventions is finite, let alone small enough that it will be achieved in the next 100 generations. The problem is twofold:
1. Financial incentive for invention is down (including legal obstacles to receiving said incentive), and
2. People are too stupid to be able to invent things that haven't already been invented. This is due to the rising bar for inventions which naturally occurs due to increasing complexity of technology, which in turn is counteracted by an increase in available baseline knowledge.

I doubt this. The more that is invented the more there is to invent and the more there is to invent from.

 

[DrMrLordX]

Sorry it took me so long to return. Almost too much to reply to here.

First of all, thank you for the commentary with respect to what may be my mis-use of the term "demand" with reference to the classic concept of "supply and demand". This could make my argument take on two possible forms, namely that either a). I believe that humanity will reach a point at which they will stop asking for new things/thinking up new things to want or b). I believe that humanity will have infinite need/desire for new things, but limited ability to actualize said need/desire due to the leverage afforded to those currently beneficiaries of wealth consolidation.

Really I was more aiming at b). Let us not make the mistake of assuming that everything that ever will be invented, has already been invented.

That being said, I think Cerb has hit on many of the points that I was trying to make, the main one being that people who have been discarded from the workforce were once responsible for buying much of what industry, worldwide, can produce, and that industry as a whole still depends on them to buy something. We Americans are using extra effort plus borrowing to keep buying things, and where that fails, both we Americans and the industrial sector have problems (read: the bubble bursts).

All those discarded workers are probably good for something, but whatever it is, we're becoming worth less and less as workers, and it's becoming less and less reasonable to expect that we'll continue to survive so long as we are expected to be workers. We have to be something else, and if we want there to be any kind of economy at all between now and the time where the industrial sector can provide everything everyone would ever need (and much of what they would want) for practically nothing, then "the discarded" must find some way to continue buying what industry has to offer, and industry must, in turn, continue finding reasons to invest in us so that we'll have money to buy what they make.

The one thing that discarded, disaffected workers-turned-worthless can do that is of worth is produce and raise the next generation of people that can still do something, as workers, that's worth something on the labor market. From us comes the n% of people like Cyclowizard over there who can continue to compete. Well, partly anyway . . . obviously not ALL skilled workers come from the poor and disaffected, but some do.

Investing in our ability to continue producing the workers that industry needs to carry on might be a good place to start. In fact, I think this is already happening to a minor extent . . . just watch PBS Kids programming sometime, and look at all the companies investing in shows that make math and science "fun" for young viewers. Intel puts money down on several PBS programs (Design Squad, for example), as does Northupp Grumman. I think that's more of a PR move in some ways, but still, it's a sign of the times and all that. That investment is probably rather small, and may be a strategically wise one in the long run for corporations that plan to stick around for awhile.

There are likely numerous other examples of seemingly well-meaning corporations involved with community investment and public investment with a long-term eye towards cultivating a better future pool of employees.

How does that help the unemployed/underemployed worker today? Really, it doesn't, though it's a nice thought to think that maybe one of your kids will be a hotshot engineer eating everyone's lunch and bringing home a massive paycheck that will help take care of mummy and daddy while everyone else languishes on what's left of the public dole (or worse). Maybe, just maybe, the strongest corporations of the future will form private/public partnerships that will allow them to invest in the community's ability to continue to produce the competitive minority that will drive innovation, leaving "the unwashed" on the sidelines to watch the heavies fight it out at the top of the economic food chain.

Think of it being sort of the same thing as major sports leagues investing directly or indirectly in the bush leagues and minors that feed talent to them and keep their sports going. In the end, most people involved in said sport wind up as fans watching from the sidelines, but an extraordinary amount of sporting activity goes on at the sub-professional level in the name of identifying and developing talent. Obviously the leagues aren't anywhere near being large enough to keep us all employed at some level engaged in this pursuit of the next big athlete, but that's just one industry.

 

[Cerb]

Of course, by definition, there are fewer things which may be invented now than before. However, it's doubtful that the number of useful inventions is finite, let alone small enough that it will be achieved in the next 100 generations. The problem is twofold:
1. Financial incentive for invention is down (including legal obstacles to receiving said incentive), and
2. People are too stupid to be able to invent things that haven't already been invented. This is due to the rising bar for inventions which naturally occurs due to increasing complexity of technology, which in turn is counteracted by an increase in available baseline knowledge.

#1, yes. #2, no. The first sentence of #2 is correct, but that is not because of things having been invented. It is because we have bad families, and a primary school system that does not value any human feature related to the processes involved in invention and discovery.

 

[CycloWizard]

I doubt this. The more that is invented the more there is to invent and the more there is to invent from.

That's impossible, of course. If there are x possible inventions, then someone invents something, there are now x-1 possible inventions. The number of apparent inventions (which is what you are talking about) does seem to increase with every invention, and I agree with you that this seems to be the more relevant number since there is little reason to believe that x is finite, and infinity-1=infinity.

 

[CycloWizard]

#1, yes. #2, no. The first sentence of #2 is correct, but that is not because of things having been invented. It is because we have bad families, and a primary school system that does not value any human feature related to the processes involved in invention and discovery.

It is also true that many more obvious things have already been invented. I can no longer claim the wheel is a new invention. It was very novel for the guy who first invented it and a huge leap forward, but that leap required significantly less technical knowledge than most inventions today.

 

[Cerb]

It is also true that many more obvious things have already been invented. I can no longer claim the wheel is a new invention. It was very novel for the guy who first invented it and a huge leap forward, but that leap required significantly less technical knowledge than most inventions today.

You make the assumption that a wheel is obvious. If it were so, it would have been used in every single society we can find evidence of. It appears obvious entirely because we have never been without it. Synthesizing the wheel, and applications for it, would not have been a simple matter, at some time when it was new. No useful thing that has yet been invented is an obvious invention, no matter how simple it has been.

As these inventions become common, it becomes easier to build on them. There may, at some distant future, be all the inventions ever possible, but we are so far from such a limit that it may as well not matter.

FI, the television was made by multiple people, around the same time, all using basically the same sources of separate scientific knowledge, and all using common parts and tools, in rickety sheds (clearly, there was a necessary critical mass of knowledge for this kind of device). But, their childhood basically gave them all of the technical knowledge up to the early 1900s. Before they would even begin research that would help them make such a device, they would have an ingrained understanding of the world, and human technology, that the greatest minds of a hundred years before would never be able to possess.

 

[CycloWizard]

You make the assumption that a wheel is obvious. If it were so, it would have been used in every single society we can find evidence of. It appears obvious entirely because we have never been without it. Synthesizing the wheel, and applications for it, would not have been a simple matter, at some time when it was new. No useful thing that has yet been invented is an obvious invention, no matter how simple it has been.

As these inventions become common, it becomes easier to build on them. There may, at some distant future, be all the inventions ever possible, but we are so far from such a limit that it may as well not matter.

FI, the television was made by multiple people, around the same time, all using basically the same sources of separate scientific knowledge, and all using common parts and tools, in rickety sheds (clearly, there was a necessary critical mass of knowledge for this kind of device). But, their childhood basically gave them all of the technical knowledge up to the early 1900s. Before they would even begin research that would help them make such a device, they would have an ingrained understanding of the world, and human technology, that the greatest minds of a hundred years before would never be able to possess.

I think you're arguing the same point I was. The wheel was about as obvious to the guy who invented it as the next CPU design is to Intel engineers. By "more obvious," I simply meant things requiring a lower level of scientific knowledge to achieve the invention. Since our scientific knowledge has progressed so far (largely due to the innovations of previous inventors which demonstrate or utilize scientific principles), it now takes a larger chunk of one's life to pick up the already-understood science.

 

[DrMrLordX]

Another thing to consider here is that, even if you do manage to produce a new product, open a new market, and employ people in the production, sale, and distribution of said new product, the ratio of net total amount wages/labor expenses you're going to pay out versus the gross profit you'll earn selling said product is probably going to be lower than it would have been for a new product generating similar gross profit in even the near-past.

If I develop a design schematic for a widget, do I a). take on hefty loans, hire engineers to prototype it, draw in additional investors, and then build a business from the ground-up to produce and market the product, or do I b). send it to a foreign firm to be prototyped, green-light production, and then sign a contract with a firm already possessed of an international marketing apparatus to produce/market/ship the product to any and all available markets?

If your answer is a)., welcome to the 20th century. You're in the past. Solution b). may offer lower net profit for me, the inventor, but the speed at which I can make an idea into reality and then hit the market is much higher, which is absolutely vital to making sure that my brilliant new invention saturates inventories worldwide faster than similar products resulting from parallel invention or simple technology theft. Of course I'll have to revise/update my new, wonderful product every 3-6 months to continue to push off tech thieves, but that's life folks. With China being the way it is, they're going to rip off your invention eventually, so you may as well make it a moving target.

Anyway, point being is that if you expect today's disaffected manufacturing employee to move on to new industries after being cast off by old ones that have automated, you should expect them to find that the new industry will be filled with players operating along the lines I've listed above (or something similar). Most of the jobs that might be generated from new product development are going to be snatched up by people who are already in the business of making dreams come true (and who leverage a good deal of technology to make that happen efficiently, with as little reliance on human labor as possible). There will be very few slots available for people who just lost their jobs.

 

[ebaycj]

I was about $85k in debt from undergrad loans + interest accumulated during grad school (since I wasn't cool enough to have my education subsidized by the government). I make right around $100k now. Seems like a pretty good ROI to me. Oh, and I made my skillset unique enough that no one else in the world can do what I do.

Apparently I'm one of twelve Americans left that realizes that the world doesn't owe me anything and if I want a stable job, I have to do something which will allow me to maintain a stable job in the face of competition. Why would you expect job security if your only skill is attaching one nut to one bolt all day every day? People dropped out of my high school to make a quick buck at $27/hour in the local factories. They're not doing so well now that the factories are all closed (or, more accurately, relocated to Mexico). Who could have seen that coming? They want want want, but there's no rationale for GM continuing to give them more money. The last time they went on strike for more pay was the last day the factory closed. If they wanted GM to play ball and meet their demands, they had to make it economically advantageous for GM to do so. Was it right or wrong on their/GM's parts? It doesn't make any difference. The bottom line is an equation (or, more frequently, a nonlinear optimization problem) which states whether it's a better decision to keep a plant open in the US or open a new one in country X. Maybe if people here would stop ascribing morals or feelings to simple math, they would understand the reality of the situation. But that could just be my education talking.

Bull Fucking Shit.

Unless your skillset consists solely of stroking your own ego.

 

[CycloWizard]

Bull Fucking Shit.

Unless your skillset consists solely of stroking your own ego.

Yes, you're right. There are plenty of people in the world modeling reactive electrodiffusive mass transfer in polyelectrolyte systems to generate nonlinear mechanical property gradients in vivo, thereby rendering an efficacious treatment for a condition which affects literally every human (and primate) on the planet. It's only a matter of time until someone in a call center in India will be doing my job.