First, there are plenty of jobs, but not enough people that have decided to develop themselves enough to have the skills to do them. For example (a real life one, unfortunately for me): I need a biopsy of a mass near my heart, but the current waiting time for this procedure here in Seattle (at both major hospitals) is two months.
What we do have is plenty of regulations that constrain the supply of physicians, services, medical supplies, insurance, and everything else needed to perform operations. It is one of the most un-free markets in America, with predictably disastrous results. Sure, those laws prevent a few people from being duped by charlatans, but they also prevent people like me - who are willing to sit on the phone for hours and days, and willing to do research for weeks on end - the possibility of a longer life.
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There are also plenty of regulations that are limiting career mobility, both in medicine and in other fields. An example of this is that anything that makes it hard for employers to fire people also makes it more costly for them to hire different people (because that new person is an unknown, and therefore risky, as the employer has to hold onto them longer, even if they aren't willing/able to produce.)
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EDIT: I'd like to add that the idea that some people are destined to be doctors (and some aren't) is completely wrong. I was a premed in college (molecular biology degree, worked in a research lab on campus full-time for two years after graduating), and I gave up on the MD track after talking to a few younger doctors. They all told me to quit while I could because they were all in 200k+ in debt, and couldn't switch out of their careers because of it, and they were miserable (tons of useless paperwork, not a lot of progress either in research or with patients). So I went into software, where you don't have to convince a committee to give you permission to make a new app.
That's like saying there's plenty of room for musicians if you're Mozart.
The amount of investment required to develop yourself for a target field has grown astronomically, but that's been coupled with a push down in wages. I know lawyers who spent a fortune for their degree, passed the Bar, and make barely more than minimum wage.
Regulation isn't causing this; automation is causing this.
To see why that is true, imagine we lived in a sports-based economy. In such a marketplace, I would be a flop. You could supply me with the world’s best instruction, and I could endlessly strive to improve my skills. But, alas, on the gridiron or basketball court I would never command even a minimum wage. The brutal truth is that an advanced economic system, whether it be geared to physical or mental skills, will leave a great many people behind. --Warren Buffett
There must be more than two alternatives, though? Surely we can have a 21st century economy to match 21st century challenges?
I don't know what that might look like yet - but I think we will know in a decade or so. Currently there's a storm of protest from those being left behind (Trump in the US, Brexit in the UK), and it won't be long before different solutions will be tried for these - eg UBI, direct democracy, charter cities, etc. Eventually, one of these solutions will stick and look obvious in hindsight.
Also there is an argument that even if everyone objectively does better under a particular system, increasing inequality is still a bad thing. To take just one example, access to money may be correlated to access to better outcomes from the criminal justice system (eg rather than the facts of the case).
If we're examining it from the perspective of advancement, and we know that political restrictions on economic development (i.e., regulation) slow development (compare the development delta of periods in 19th century with today), what we end up with is an infinite number of mixtures between freedom and controls.
What I'm telling you is that there are some controls we have in place today that are helping to kill me, and it is almost perceptually obvious that an alternative (freedom) is possible, and that is what we should move toward.
Freedom from political and economic controls is good for those that want to work and think. It doesn't do much for those who can't or won't, but so what? Those people that work and think are the source of everything, and they have the right to priority. (Consider the effects on societies where the complete opposite principle is in action: the Soviet Union, Dark Ages Europe, Nazi Germany, Chavismo in Venezuela, Maoist China, ... possibly America in 20-40 years?)
On the one hand you argue for a free market approach (less regulations and hence more doctors) but then you also argue for a meritocracy (those who work and think should get priority). Both of these are definitely not democratic, and for the time being democracies are the preeminent social construct with massive momentum behind them. Changing that abruptly would be seriously destabilizing for the entire world.
Changing that abruptly would be seriously destabilizing for the entire world.
You're absolutely right about this point, which is why benefits need to be removed over time. (People that have expected a Social Security check, and have paid into it their entire lives can't be expected to react just as they reach retirement. However, a 25-year-old can be told, "save for your own retirement, because this won't be there for you.")
Having said that, controls can be removed instantly, and to very positive effect. Even a partial relaxation could massively improve things! Imagine how much better my situation would be if the federal government had, in 1999, decided not to keep restricting the number of medical residents allowed to enter/be funded each year. (https://www.aamc.org/advocacy/gme/71178/gme_gme0012.html)
Disingenuously left out of your arguments here is the fact that a medical education costs a hell of a lot of money, and your economic measures would remove the ability to study medicine from a lot of people who might be willing to learn, but don't have massively rich parents. Deregulating university fees, getting rid of social security, and so fourth massively reduces the number of people who are able to study medicine.
First, this is way out of line. I'm going to reply anyway, but please don't do this kind of thing in your next reply.
Second, instead of treating it like a black box that has a fixed cost that we have to accept, take a medical education apart the way Musk would do when figuring the ultimate cost of one his cars or rockets:
Putting people in a room, books in their hands, and having them sit in front of a lecturer is not actually that expensive. I won't name names, but two medical students I knew in the last fifteen years actually skipped most of their lectures, studied straight out of the book and did just fine.
It is true that the hands-on aspect of medical training is more expensive, but people in much poorer countries manage to do it.
Even if you managed to show that this education outlined above is inferior to the ones available today, right now I'd still be overjoyed to see a doctor educated in this manner. It's better than waiting two months (note that this is not even for treatment - it's just a biopsy!) while I can feel this thing getting bigger, with sharper pain as time goes on.
Finally, what is the point here? An more economically "equal" society, or a society where people like me don't die waiting in line for care? I stridently advocate for the latter.
> Finally, what is the point here? An more economically "equal" society, or a society where people like me don't die waiting in line for care? I stridently advocate for the latter.
So only the amount of economic value a person can produce should decide the value of the persons life, is that what you are saying? The more money you have, the more your life is worth? This kind of neoliberal ideology sounds absolutely horrible to me. Just because you have the ability to produce more than some other person doesn't mean that your life is more important. What you are experiencing now with the wait is nothing compared to what poor people would have to endure in the system you advocate.
What you are experiencing now with the wait is nothing compared to what poor people would have to endure in the system you advocate.
First, you do realize that not everyone that goes into the hospital today comes back out alive, right? There are a lot of things medicine can't yet cure - today - for any price.
Second, if you block high-priced medical advances, you are also blocking the low-priced ones that inevitably follow in a free market.
Just as UNIX workstations sold for tens of thousands in the early 1990s, and were supplanted by desktop computers costing a tenth as much in the following decade, expensive medical technology would become cheap quickly under freedom.
We haven't seen this happen with most of medicine because of the controls placed on it. For example, I learned (via this thread) of a new machine that administers anesthesia. Its use would make my biopsy $1800 cheaper, in addition to reducing my wait time (you can't have an endoscopy without general anesthesia): https://www.washingtonpost.com/business/economy/new-machine-...
This device was ready to go six years ago, but the FDA rejected it initially (under pressure from anesthesiologists). Three years later, after much foot-dragging, it finally approved it. And yet today it's not available in most places because the American Society of Anesthesiologists lobbied hard for a "narrow indication" and "restrictive guidelines."
Note that it's not up me or my doctor as to whether or not I might opt-in to this. Nor is it even a choice that can be made by any of the local hospitals around me (I would shop around if it would help, believe me!) What happened here is a direct and inevitable consequence of regulatory control over which innovations are permitted to enter medical use. (The only tool the government has in regulatory matters is more regulation or less. Therefore there is no way to prevent regulatory capture in a mixed economy except to steadily de-control it.)
What good is it to me that the device has been vetted more? Every minute I wait allows my condition to worsen, increasing my risk of death.
The facts I've outlined here are not just some "neoliberal ideology" intended to offend you. This is a thing that I (and hundreds of thousands of other people like me) need desperately. All I'm advocating for is a society that recognizes the life-saving role of freedom in medicine. And I'm advocating for that only because nothing else could possibly work.
You can't just throw your hands up in the air and say "to heck with early adopters, they shouldn't be allowed to pay more to be a year ahead!" If the government forced all the tech companies to do that, tech would be about as slow to improve as medicine currently is. This is because there would be no money put into the right hands (and it is a constantly changing group of people and organizations), at the right time to make the technology steadily improve.
I don't have enough knowledge in this area to say if the current regulations have done any good, but I'm sure there are legitimate reasons for those regulations in many cases.
But my problem isn't really with freedom in the medical field, I can support that if it really saves more lives. What I don't agree with is the way you propose to make this freedom happen. Determining who is worth saving and who is not by the amount of money they have is something I can't support, and it's what would happen with a free market approach. You say that is the only way to achieve what you want, but I don't believe so. We could increase public funding, for example.
By the way, have you looked into getting what you need from abroad?
"Finally, what is the point here? An more economically "equal" society, or a society where people like me don't die waiting in line for care? I stridently advocate for the latter."
this is a false dichotomy. To get more doctors you need more people who can afford the education. Not less. I'd say check your privilege- Any of those options you listed for getting an education still take a vastly greater amount of resources, than you are giving credit for. You can't study out of a book if you don't have a house to live in.
as for whether my comment was out of line, I'd say if your argument is to take away government subsidy for infrastructure, force people to pay for their own education, leaving out the basic costs of the education is a critical part of the argument you left out, and for a transparently self serving purpose.
That is not the right advice for any human being, no matter where they start.
I'm fighting for my life right now - a life I had to strive for. I don't take a moment for granted, even with the pain and the uncertainty that I'm under right now.
I paid for my education (UW-Madison, class of 2011). I've never wanted anything but to earn my place in the world.
You say that I'm motivated by a self-serving purpose? You're goddamned right that I am. I have the moral right (like anyone else) to strive for existence, your ideas be damned.
Sorry, I misread your original post. 180 degrees off from what I thought you wrote. In your link, it looks like putting a cap on residents that can join educating hospitals is in place as a measure to save on medicare costs.
it seems like training doctors is the sort of thing a country should be pouring more money into, as an investment in the future.
The problem with SS is that if the 25 year olds don't keep paying, there's no money to give to the 75 year olds who paid their whole working life. The money THEY contributed is long ago spent.
It's much harder to tell the 25 year olds to keep paying FICA and save for their own retirement.
If 25-year-olds are in a booming economy (a result of decreasing the economic controls), the taxes won't hurt nearly as much. Also, the knowledge that those are getting phased out and are a one-time thing will help a great deal.
The end result is a society where entire generations of people stop viewing each other as burdens and resources (young and old), and instead as individuals, with their own lives and responsibility to lead them to be the best they can be. That is a just society.
(Hat tip to Don Watkins for the phrase "burdens and resources")
IMO, it would take a very strong economy and very selfless generation to contribute 12.4% of their earnings over a lifetime and get nothing. They'd have to save well over a third of their earning power to have a hope of retiring. (12.4% that FICA is taking and giving to someone else, 12.4% for their own private replacement version of it, and at least 10% to replace what would today be their own supplemental retirement [today's 401k/403b/IRA/investments].) That's seriously into Mr Money Mustache territory!
IME with people, knowing that they are the only ones in history getting so screwed and this is a one-time thing will NOT make it OK nor reduce the feelings of burdens and resources.
(I do like that phrase a lot. I also wish you a good medical outcome, ofc.)
Nope. It isn't just, it is the jungle. A wise man once told me, "you must push the cart when you are young, so that you may ride it when you are old."
Our older generations must be looked after by the younger, instead of just discarded when their utility is below market average.
Your scenario works when everyone is on a fair and equal playing field, however for those that are disadvantaged, you are quite literally saying they must starve or be killed for the good of society. That my friend is a cruel world, and not one which I wish to strive for.
That's true only in the case of economic scarcity. If there aren't enough jobs around (because of automation) then scarcity is no longer the driving force and we need to look to economic systems that were not scarcity constrained (for example, the potlach societies of papua new guinea).
I think you missed the point. What I read from the statement is that Warren was not good at sports (arbitrary discipline not matching his forte for illustration) so he would suck in an economy focused around it. What he implies is that a lot of people suck at most of the fields that are in great demand, but also come with requirements that they just can't adjust to.. Especially with advanced age and with the disciplines commanding a certain amount of effort to master them (think years or decades). Most people are not very flexible and even the flexible people have their limits to adopt as the professions get more demanding on the menial side of preparation.
ps. I wanted to imply that professions and sought for jobs change faster than generations pass in recent times, which adds to the challenge of training people (especially with the still used model of train once, execute until pension model).
pps: oh, and low level grunt work for the folks that don't fancy studying is contracting fast, which compounds the problem.. you'll always have quite a few of these and they do have an impact.
No, I understand that, but the problem with his analogy is that he's deliberately picked a field where one person's success is matched equally by another person's failure. He's overstating his case by projecting the image of the work economy being like getting dunked on by Lebron James day-in day-out.
I have blue collar friends and relatives that would describe their working life as getting dunked on by Lebron James day-in day-out.
When jobs go offshore that is an example of "one person's success is another's failure"
Depending on the sport, there is frequently prize money at stake, so while you're not actively giving money to the winner, you're all competing for a fixed prize.
But beyond that, the more salient point is that unlike in sports, in the real world, for me to win does not necessarily mean that you have to lose. Every time I make a shot in basketball, I've increased the "value" of my team and also decreased the value of my opponent.
Sports is zero-sum in the way that there's a fixed amount of money to be distributed from ticket sales and TV rights.
That money goes to the top few hundred athletes/clubs/franchises in every sport - doesn't matter whether there are a million or a billion aspiring players.
Pertinently, active investment management - Buffett's forte - is similarly zero-sum in the way fees on managed assets accrue, although the stock market as a whole isn't.
Your ignoring golf for example where the winner / loser split is not 1:1. Also, regular session games in many sports are simply gateways to playoffs so the number of winners = slots in playoffs.
More importantly it's entertainment. A close game is better in the long term than annual blowouts. Making the occasional loss highly valuable.
Sure, winning and losing is zero-sum, but the payout isn't. Lebron is still going to get that $27 million / year from his contract, regardless of whether or not the cavs win anything. (or whatever team he's decided to switch to most recently, haha. I barely follow these things)
There is no robot that can knock me out (safely so that I wake up when everything is done), snake a thing down my windpipe, poke through the exact right spot in my bronchial tube and into my mediastinum (a name for the bag that my heart), and retrieve a chunk of whatever surrounds my aorta.
But here I wait, while people capable of doing this (or at least capable of learning how to do it - and that's a lot of people) also wait. That's regulation.
My view is that the times when Capitalism has been a long leash it ends up being wildly destructive. I love fire for cooking, forest fires not so much. I certainly don't think that the reason we don't have more jobs in America is that businesses are so hard pressed with labor laws. I just don't see that.
What I have seen, over and over again, are that employers are realizing that they're now in the cat seat and become nothing less than abusive, deeply abusive, to their employees as a result. Once they see how many people apply for new openings and realize how unlikely it is that current employees will quit in this environment, they become mini-dictators. It's an interesting phenomenon.
All that aside, I do wish you good health and hope that you can get the treatment you need soon.
All that aside, I do wish you good health and hope that you can get the treatment you need soon.
Thank you (and I mean that quite sincerely).
Practically speaking, though, how will I get treatment? Intervention from the government is the only reason I'm waiting for care right now. (See my comments in other posts on this thread - I establish this in great detail if you consider my posts together.)
Capitalism creates a winner-take-all market as time progresses. As it becomes harder to enter the market for new comers(See Tesla, also try starting a company to build airplanes) you will see powerful monopolies emerging. That doesn't end well on the longer run.
Also Free Market economy seems to play along with popular choice, so pokemon go and cure for baldness is likely to get prioritized above space budget.
"..become nothing less than abusive, deeply abusive, to their employees as a result .."
As an employer I find this surprising. I spend a lot of time and effort trying to be good to my staff. I find that a well taken care of staff delivers better results than a poorly taken care of staff. I admit I am doing it in my own self interest, but even acknowledging that it still is about as opposite to "deeply abusive" as I could imagine. I spend a third of my life with the people at work, how could that be pleasant if it was abusive?
I hope you can find a workplace one day that makes you feel appreciated. Life is better when that happens. For everyone.
There's no robot that can write cronjobs for the place I work at, but with my oversight, those cronjobs are force multipliers, allowing little old me to do the job of dozens of people if we had to run those things manually.
Automation doesn't mean a 100% reduction of staff, but merely a significant reduction in staff. There's plenty of automation snaking its way into surgeries.
Those cron jobs are just manual management of automation. If you take a few steps back, it doesn't seem too unlikely that that can be automated as well (as a recent example, Kubernetes has automated away a whole swath of what recently required manual management of individual server automation).
Do you know what I would give to help make this a reality? I would literally drop $10k, in cash, right now, to get faster treatment.
I have the money - I worked my ass off to earn it (while sick, no less!) What I (and the experts that would use this machine on me) don't have is the political freedom to use it as we see fit.
This thing could literally save my life. A team invented it, tested it, and it's just sitting there. I'm just sitting here.
can you apply to professors/researchers in those technologies to be a test subject? sometimes the academics have a hard time recruiting willing subjects.
How much does doing that pay? How much does being a finance guy on Wall Street pay (or at least have the allure of paying)? How much does being part of a trendy startup in SV pay (or at least have the allure of paying)?
Doing the job you want done takes a lot of hard work and study. Being in Finance or startup world can reward better, with less effort.
One can visualize a future in which disposable robots are very small and remotely controlled, capable of liquefying specific organic substances or dispensing drug doses.
I had two reactions to your comment. One, in which I assume you meant it in a way that was optimistic and benign. Two, in which it described a Matrix-like dystopia.
Lawyers working on minimum wage...that's something new! Last time I've checked the free market rules didn't apply on law practioners due the "prestige" issue. How does automation affect lawyers anyway?
A large amount of low-level scutwork at major law firms involved manual discovery -- going through boxes and boxes of documents looking for something incriminating.
Electronic discovery -- both scanning docs to electronic versions, and then processing them through search, and more recently, AI, to find evidence for plaintiff/prosecution or defense -- has replace a tremendous amount of that.
Lack of funds to support legal work is another element in reducing lawyers' wages and hiring.
A friend's mother worked in a high-level consulting agency. Her time was billed out at $1000/hour, and she got less than 10% of that. Still a good wage, but she wasn't getting the lion's share of the fee.
Sometimes the only way to do such "expensive" work requires significant support. Things like their legal protection against liability, mandatory requirements to have X to do Y in a jurisdiction, and other sorts of things can really eat into the revenue of a small business or sole trader.
Exactly. The trick to billing $1000/hr is finding someone who'll pay it, and having the connections to get in front of them, and their trust that its $1000/hr well spent, which entails no small amount of theatrics on the part of a corporate shield.
In addition to what the others have said, it's also more difficult to strike out on your own due to 'having no replacement'. If a corp is reliant on you and you're part of a collective, then something happens to you, the collective will replace you. If you're on your own, a corp will be much more reticent, as the proverbial hit-by-a-bus scenario will leave them high and dry.
Disclaimer: this is only how I've had it described to me; I frequent the small end of town :)
I remember hearing about this a number of years ago, when the offshore radiologists were in Australia. But there's nothing to keep those jobs from moving to cheaper radioligists in India. And when they get too expensive ... to the cheaper country of your choice.
But, don't worry, it will still cost thousands of dollars for that procedure. The overall price doesn't go down, only who gets what share.
It is a huge investment, though, at least in the USA.
Edit: to your point, those jobs haven't been "automated away". As of now, they still exist somewhere, just (soon enough) not in the USA.
>Regulation isn't causing this; automation is causing this.
Neither regulation nor automation is causing this. Political-economic suppression of labor and productive enterprise in favor of rent-seeking is causing this.
Let's imagine an alternate universe in which different political choices were made. For instance, in the alternate universe, Elon Musk started a techno-progressive political party and swept into power in 2008, with a program calling for:
* Massive housing construction in urban areas
* Full repair of our famously-crumbling infrastructure
* Intercity Hyperloops for America's coastal corridors
* Light-rail and subway construction in the major cities
* Rural broadband everywhere
* Single-payer healthcare
* Reducing the underlying costs of health-care through better disease prevention
* Reducing the underlying costs of health-care through regenerative medicine designed to fight (and someday stop) aging-driven disease and death
Now, the major economic impact here is going to be massive, truly humongous amounts of growth in the state sector, most of it spent directly on employing people to reduce the carrying costs of the economy, increase productivity, and serve immediate human needs. Most of the specific projects to do so are things that we, in this universe, recognize and understand; the more radical projects that we don't already understand how to accomplish promise radical returns.
Putting aside how Elon Musk pays for it all, it would absorb a lot of what is, in our universe, excess labor in the construction and STEM R&D sectors. It would raise wages in the most direct way possible: by buying up labor and paying it to do stuff. It would also increase demand for manufactured goods, leading to either more manufacturing employment or more automation R&D.
That alternate universe is the economically normal universe -- this is what we've been fooled into forgetting. In that universe, unemployment, low growth rates, and low returns on investments in physical production indicate that useful inputs to production are lying fallow, useful stuff that could get done is not getting done.
Our universe is the weird one, in which relatively high unemployment and low growth are considered the normal state of affairs, with corrective intervention to use the idle resources sounding weird or impossible. The simplest reason someone would actually prefer our universe to Elon Musk's high-tech, job-filled, high-wage alternate universe is because they want labor to be cheap because they make their money from rents on monopolies, land, natural resources, and access to capital, and expensive labor is a threat to rents in general.
> Putting aside how [President] Elon Musk pays for it all,
facepalm you can't compare the side effects of a massive government spending plan without looking at that!
It'll all come out eventually. Either we borrow, and tax our future generations, or we tax more businesses now, which would also repress business activity and American competitiveness.
There's a few items that could be solved with the market. Like: Remove city's zoning laws with a federal mandate, to encourage the market to build urban housing. You don't need the gov. to do it, just remove the limitations. Disallow internet providers from offering kickbacks to condo/apartment managers to open up the market. We should probably tax semi trucks & cars with snow tires more, because they're the ones that cause 90% of the damage to highways.
In order to justify light-rail & subway construction, we really need to look at the costs involved. And the costs are getting out of hand, and are way more expensive in the US than in other countries. http://www.citylab.com/commute/2011/11/1-billion-doesnt-buy-...
>There's a few items that could be solved with the market. Like: Remove city's zoning laws with a federal mandate, to encourage the market to build urban housing. You don't need the gov. to do it, just remove the limitations. Disallow internet providers from offering kickbacks to condo/apartment managers to open up the market. We should probably tax semi trucks & cars with snow tires more, because they're the ones that cause 90% of the damage to highways.
I completely agree. Rigorous antitrust enforcement is another major program I would pursue, alongside every measure to reduce and eliminate economic rents.
>It'll all come out eventually. Either we borrow, and tax our future generations, or we tax more businesses now, which would also repress business activity and American competitiveness.
Or we invest in infrastructure and R&D now to make the profit later. You know, like every sane country in history prior to the Reagan Revolution.
>Your Massachusetts background is showing.
No, I wasn't proposing my ideal economic program. That would start with a lot more of Karl Marx and Henry George. I was pointing out the ways in which actually-existing systems which we once actually used actually dealt with unemployment -- real things, not ideals.
My whole point, facepalm, is that we've been so thoroughly indoctrinated with neoliberalism that we've managed to forget how the golden age of Western capitalism (1940s-1970s) actually worked.
Hmmm. I'll agree to antitrust, but with a caveat. Most monopolies are government-enforced in the first place. Through some means or another, the government grants a business or group of business privileges above the other, usually through making it difficult to entry a market. Natural monopolies just aren't that bad--- they get to be natural monopolies because they're efficient and they're granted consumers good products at good prices.
> Or we invest in infrastructure and R&D now to make the profit later. You know, like every sane country in history prior to the Reagan Revolution.
But, do politicians ever get away from deficit spending? In order to follow the Keynes playbook you suggest, we need to take in a surplus eventually to pay off loans. And if we're taking this money from a larger economy the deficit spending has created, then Keynes' strategy also relies on the money being well spent. It's not enough to have employed people, they have to be projects that do help the economy and help wealth creation. Digging a hole & filling it up will not generate the profit we can skim in the future. And I question the ability of the government to spend money well.
In general though, it just becomes an engineering/finance problem. (And whenever we can turn an emotional political problem in a boring engineering/finance problem. that's a good thing.) I suspect that highway expansions are usually worth it. Subway and light rail are questionable. I agree that subways are really awesome to ride, but the true cost of subways are masked from the consumer. The $2.75/trip new yorkers pay is about 40% of the actual cost. https://tcf.org/content/commentary/in-defense-of-the-cheap-s... (I suspect that they're only looking at operating costs, not capital costs.)
> No, I wasn't proposing my ideal economic program. That would start with a lot more of Karl Marx and Henry George.
I know you weren't, I was just noticing a pattern in your thinking anyway. :) I'm pretty Austrian so..... yeah. TIL Henry George though, he seems like a cool guy: http://www.economist.com/blogs/freeexchange/2015/04/land-val... Anything to motivate cities to develop more is good in my book!
Well, that period also required a lot of the rebuilding due to the destruction wrought by WWII. Sadly it seems the idea of 'creative destruction' to unstick markets and lead to innovation also seems to apply to real world infrastructure (in this case requiring real world destruction).
One reason infrastructure projects are so expensive in the US is the Davis–Bacon Act. Yet another example of government intervention in markets with 100% predictable negative side effects.
Yet I'm sure there are many people in favor of "prevailing wages" while bemoaning the fact that we don't invest enough in infrastructure.
America got out of the Great Depression and WWII with deficit spending. Sure we wouldn't be able to spend as much as then, but $900 billion could go a long way towards paying for these projects http://theweek.com/articles/624334/how-world-war-ii-reveals-...
The thing is--- when does the deficit spending stop?! Our economy is doing decently now, and we're still deficit spending. I don't think that our political system is structured in a way where we can responsible deficit spend and then take back the surplus in the future.
I particularly enjoy how reasonable they're trying to be in the initial paragraphs and how it descends into insanity as you scroll further down.
Clearly their propaganda has evolved as it become more and more accepted as reality, but their prescription remains the same "all government intervention is bad". They just have to work a great deal harder to justify that.
Musk is just your stand-in for techno-progressive visionary, but given that you included Hyperloops this hypothetical platform should also include solar panels for every roof, the nation's powergrid rehauled to support electric vehicles, and a new Space Race...
Well yes, exactly. Point being, a lot of this stuff is sufficiently expensive in the short-term that no investor will commit to it, but pays off big time in the long term.
I've had this suspicion that I've been meaning to look into to find out if the numbers match up. The biggest growing industries to me seem to be the service industry and entertainment. Both of these are really superfluous. If is true, I see this as a symptom that we have fewer useful jobs and are pushing people into these superfluous jobs--kind of a sign that soon we'll have more people than jobs.
More to your case, the more specialized jobs get, the more difficult it is to transition in and out of. Liquidity of skills comes up a lot in history. I've heard the U.S. specifically makes it really difficult for doctors trained in other countries able to practice here. Usually, if there's an under-supply of a skill someone steps in to remedy it.
So why if there's demand for certain jobs, why there aren't more programs to train more of them. It seems like many businesses aren't willing to take on people unless they have the exact skillset where years ago they'd be willing to train people at the business' expense (another feeling I haven't looked into if it's true).
So why if there's demand for certain jobs, why there aren't more programs to train more of them.
Medicare (i.e., the federal government, congress) sets de facto limits on the number of new residents that are trained each year.
"The Balanced Budget Refinement Act of 1999 (BBRA) increased the limit for rural teaching hospitals to equal 130% of each rural teaching hospital's 1996 resident count (BBRA Section 407)."
Debates on these matters constantly criticize the few elements of freedom in our existing system. Rarely do people acknowledge any of the controls and regulations that have been in place for decades, and have brought us to our current crisis...
I do wish that was brought up. However, government provided healthcare or not (and Medicare or not), I think healthcare should be closely regulated (maybe by professional organizations if not the government). I can't find the citation, but I was reading that as doctor density increases, the number of procedures increase even though the outcomes are the same. It's also pretty obvious that as Baby Boomers start retiring, we're going to need more medical professionals. The demand for those services probably won't show up until it's too late to train them so it'd be good to incentivise people now (although, it might be too late already).
Professional organizations generally advocate against lowering barriers to entry to their market. Delegating regulatory controls to a professional organization has to done very carefully.
My understanding is that in the US, this is one reason why there is a limited supply of new physicians. Of course the health care industry is quite complicated with many conflicting and interacting incentives and regulatory distortions to a true free market.
If entertainment is superfluous then you have an enviable vision of man kinds purpose. As far as I can tell amusing ourselves until we die is our whole deal. Entertainment isn't superfluous, entertainment is the truest and most important industry we have.
Maybe it's just my vision of man kind's purpose. I was speaking as entertainment as a profit driven industry, not entertainment all together.
Also, in talking to friends, when I used "service industry" it may not have conveyed what I thought it did. I grew up in a tourist area and service industry was used for people who worked in restaurants and hotels.
The natural conclusion for this future lack of jobs for many people is basic income. I'm confident if people didn't have the 9-5 they would be writing books, putting on plays, and preparing food for each other--just not necessarily for maximizing profit.
I feel for you - this kind of thing just shouldn't happen.
I think that medicine is a bad example of the point you are trying to make though... It has a lot of embedded costs and roadblocks that aren't really related to regulation.
For example - the procedure you describe is highly specialised, and can only be learnt in certain places. Say there are 4 people that can do this procedure at a hospital. Attracting a doctor who can do the procedure is often a complicated task. In a highly specialised field thay may need to be incentivised, which also costs money. It is very difficult to control where doctors work - they invariably want to work in large established centres, which are already saturated (and so they don't work full time, they end up taking small bits of work here and there). This problem isn't necessarily solved by training an order of magnitude more - increasing the true training capacity of the health system is actually very hard, and takes a long time. Pumping up the inflow of trainees at one end just means that competition increases, doctors spend more time optimising for selection onto programs and working in certain places rather than doing their training. They also develop a sense of entitlement due to the high debt and difficult and competitive training ie they feel like they should be able to work wherever they want to work, not where they are forced to go.
There is limited space in the endoscopy suites usually - increasing capacity means building a new suite, buying all the equipment, paying the nurses, rostering another anaesthetist. The added cost is easily more than a million dollars just to get started, without the doctor even doing any procedures. There could also be other bottlenecks like sufficient recovery areas and clerical staff. This high threshold means that an overloaded service will languish for long periods before capacity is increased.
It is true that medicine is expensive, but so is setting up the technology for a major cloud provider (on the scale of Amazon), or a car coordination platform/system like Uber.
The difference is that the tech examples I've provided have not had the ability to progress (and the financial reward for doing so) regulated out of them.
The wait time for this is not something that just happened yesterday, and what I'm saying is there's a systematic reason for it that goes deeper than just the nature and cost of the people/equipment/training.
An example of this from another field:
In a 10-year span during the 1880-1890s, J. J. Hill coordinated and financed the construction of a transcontinental railroad, without any government aid. This was done without the benefit of bulldozers, tunnel-boring-machines, automated track-laying equipment, etc.
Today, Seattle's transportation authority says that it'll take 25 years for it to put down six miles of rail between Ballard and downtown.
I'd be dead for sure in 1890 (no CT scanners, etc.), but the rate of progress has definitely been restricted. And the difference is just in our ideas, not things, or any inherent rule in nature.
When J.J. Hill did his thing, there was no landowners to argue with (comparatively). In Seattle, there must be a thousand landowners to consider in that 6 mile stretch. Each one with their own view of the need and cost/benefit analysis of the 6 mile improvement. Eminent domain is not without legal challenge of course, so this drags out the timeline. Underfunded court systems move slower than desired, adding to delays in the process.
The 'regulations' would be about safety, electrical wiring, setback etc, which just define how things should be done for the most part and do not add time. It is dealing with all the vested interests of the property owners involved, and the sheer number of them. I am a property owner myself; if the city came to me a decided that my house was in the way of a new freeway on ramp, you had better believe that I am going to want my day in court to fight it. I have the resources to drag it out as long as possible - with extensions, delays, studies, blah blah blah. It does not take much thought to understand how to slow things down in court. I am sure there is a youtube video for it.
Would you protest if your own house was to be destroyed by the 6 mile change? I assume you live in the Seattle area or you would not know about the statement. So if your own person domicile was to be destroyed, and it was a beloved place with a lifetime of memories for you, would you be complacent about its destruction or would you fight it tooth and claw? (I would fight)
I think the overwhelming majority would fight. And then it takes 25 years to go 6 miles. It is not regulation but property owners. Specifying the diameter of a ground rod in an electrical panel does not slow things down, it speed them up by removing the need to think about it. Just build to code - someone else has figured it out. I don't need to calculate loads of the panels versus the density of the square root of the moon yesterday - I just sink in 2 ground rods 20 feet deep and 40 feet apart and am happy that someone else did the math. Life is an open book test, the printed regulations are the answer key.
Those are funding caps, which aren't quite the same as limits.
I'm not aware that there is anything stopping private hospitals funding residency slots. Hospital systems with hundreds of millions of dollars of profit could easily afford to fund a few residencies.
Medicare is probably a pretty smart and fair place to pull the funding from (it's a broad based tax and key patient focused component of the US healthcare system), but it certainly isn't the only entity with money.
> There are also plenty of regulations that are limiting career mobility, both in medicine and in other fields. An example of this is that anything that makes it hard for employers to fire people also makes it more costly for them to hire different people (because that new person is an unknown, and therefore risky, as the employer has to hold onto them longer, even if they aren't willing/able to produce.)
In all 50 states, you can fire people easily unless:
1) You are blatantly discriminatory AND the people who are discriminating against can deploy legal muscle to their benefit.
2) The employer voluntarily entered into a contract with employee(s) that restrict the employer's rights.
There are no "regulations" involved beyond #1 in firing people. Its why almost everyone is fired for the generic "performance" reason. Its pretty much immune to criticism unless you are blatantly discriminating.
However, in reality, all of it can be covered by a boilerplate employee contract that makes you effectively at-will and provides negligible protection.
> What we do have is plenty of regulations that constrain the supply of physicians, services, medical supplies, insurance, and everything else needed to perform operations. It is one of the most un-free markets in America, with predictably disastrous results. Sure, those laws prevent a few people from being duped by charlatans, but they also prevent people like me - who are willing to sit on the phone for hours and days, and willing to do research for weeks on end - the possibility of a longer life.
Sounds like a pitch for medical tourism (traveling to another country for certain kinds of medical procedures at a fraction of the cost of the US)
More to the point, with the phenomenal centralisation of control of global capital (~45 firms, per a Swiss national science foundation report a few years back), that increasingly affects all new business capitalisation.
That's a false equivalence. How could you be sure that your 'doctor' has any idea that they know what they are doing. Market mechanisms don't work with this kind of information asymmetry.
Labor laws are just moving the risk from the employee to the employer. In an ideal world the employee would be compensated more for higher risk so nothing would change. But in the real world most employees won't realize that so we (supposedly) decided to implement labor laws.
There are plenty of jobs for sure. Look at how much better we could make the developing world if someone was willing (are you?) to work those jobs.
Is the "infinite work hypothesis" finally ending??
The answer to "what happens to workers being replaced" has always been "they'll find jobs elsewhere, every time you make a job redundant you create other new jobs", what I've seen called the "infinite work hypothesis" where there will always be new work and the problem is agility, job training, not demand.
There's a huge to-do list of jobs that need to be done at almost every level, from design and build of significant infrastructure in most countries around the world, to community-level support work.
It would be perfectly possible to retrain the long term unemployed for all but the most difficult design and management elements.
They're not done because the metrics of Wall St deem them "not profitable" - which means traders can't make quick gains out of them.
Allocating labor on the basis of whether or not traders and stock owners can profit in the short to medium term turns out to be an unintelligent way to strategise an economy.
> There's a huge to-do list of jobs that need to be done at almost every level, from design and build of significant infrastructure in most countries around the world, to community-level support work.
But not the money to pay for these jobs.
> It would be perfectly possible to retrain the long term unemployed.
But who pays for this training?
> Allocating labor on the basis of whether or not traders and stock owners can profit in the short to medium term turns out to be an unintelligent way to strategise an economy.
Most companies are not publicly traded. These companies are not hiring the unemployed because they either don't need them or can't afford to (negative return on investment). The bottom-line matters to Mom & Pop stores as much as it does to big Corps.
This is wrong, in my estimation. Money exists right now that is lying idle, and moreover the more money is used, the more becomes available.
The past decade saw an enormous effort to dump money into the economy, to no avail. Nor is this new, there is even a name for this sort of thing: https://en.wikipedia.org/wiki/Liquidity_trap
The problem is not the lack of money, the problem is that vast majority of capital is controlled by a small group of people with limited vision and pecuniary interests.
These people will never allocate capital towards the enormous list of demands that go unfilled every day; nor should we expect them to. No one will build a road in your shitty small town just for your good health.
The more we structure our economy to produce this situation (concentration of wealth), the less we will find that unexpressed demands are being met by that economy.
We, the society, make the money. We could decide today that this is financed, either through printing, or through taxing. No theoretical problem.
Practically, those with the most resources have decided that they don't think we should take of those resources to support those with the least resources. But there's nothing inevitable about that. Historically, elite that are too powerful and too uncaring about the masses, end up on the guillotine/firing line/bottom of a pit.
I don't think anybody pays them "to remain unemployed". But in most countries they receive social welfare while out of work.
You could have them go break large rocks into smaller rocks if you have an ideological bent against people being unemployed but unless those rocks can be sold to somebody for more than what unemployment benefit is there's no incentive.
Edit: Agree with the comments below. Rather than being idle there's many ways society could harness the skills and manpower of the unemployed for socially value adding, but perhaps not financially profitable, ventures.
But not the money to pay for these jobs....But in most countries they receive social welfare while out of work.
See the contradiction here?
We could put these people to work engaging in labor that is valuable, but not as valuable as the cost of their welfare. I.e. pay them $7.25/hour to do $5/hour worth of labor (net cost to society = $2.25/hour).
Yet we don't. Instead we pay them to play video games (net cost to society $7.25/hour).
I would like to see something like that. Not as a replacement for welfare or unemployment compensation, but as a program where anyone who needs a job right now for whatever reason can get one easily.
In the Portland area we have a large park (many square miles) that's being over-run by English ivy, and that's not going to be fixed without a lot of people going out and pulling it up by hand. If the city were to pay a bunch of workers with nothing better to do minimum wage it might be a lot cheaper than paying a team of regular permanent employees, and it could address part of the unemployment (and possibly some of the homelessness) problem.
There is a tiny flaw in your reasoning. I will give you a hint as to what it is. Prison inmate workers may earn about $4.73/day in the US.
If you pay someone $7.25/h to do nothing, that might be considered an incentive payment to not do work that does net harm to society.
While it would always be better to pay the $7.25 for something that might benefit the economy less in absolute terms, there is no "zero" that can be used to calculate a "net" cost of social welfare. Playing video games is not plowing a large vehicle through a crowd of people, or mixing fertilizer with #2 fuel, or strapping tiny backpacks filled with thermite and moisture-sensitive primers to bats, or cooking meth, or cooking krokodil desomorphine, or turning tricks in the park bathroom, or pooping in the neighborhood swimming pool.
One person can be very destructive, or at least thousands of dollars worth of annoying, before anyone would bother stepping in to check them.
Strangely, generous welfare isn't preventing Islamic terrorists from blowing up Europe on a regular basis.
But lets take your claim as given, namely that some classes of people are so dangerous if we don't pay them they'll harm us. If I thought you were right, then I'd probably turn to the Brexiters and Trumpkins for a solution. Are you really claiming that the poor are basically just gangsters and terrorists?
Hungry and/or angry people commit more crimes. That's just axiomatic. Desperation will cause those who had formerly been following all the rules to try something different in order to improve their situation. So social welfare as a bribe mainly helps that marginal fraction that would only shoplift if they absolutely couldn't pay. And there are a lot of people like that. It won't do anything about those who would shoplift for thrills, even if they could buy the whole shop, and it won't do anything about those who would light it up just to watch it burn. Those are relatively few.
I'd estimate at least 90% of people living under the poverty line would never choose to commit a violent crime or property crime if their survival needs were assured. Malum prohibitum crimes and regulatory infractions are another story. Having more money means you can smoke higher-quality marijuana, and usually with less police interference. Having more money means you can pay speeding and parking fines without spending any nights in the county jail.
"Poor people" are not just one big homogenous group. They have their righteous saints and their sleazy lowlifes, and everything in between, just like every other economic class. The former deserve society's help, whereas the latter can sometimes be bribed to behave better.
Welfare doesn't stop the terrorism that still happens in places that have welfare, because those terrorists aren't murderously mad about being poor. It certainly stops food riots, at least until the system collapses. The crime in the Chavez-unraveled Venezuela is quite different from terrorist activity in Europe.
As a nitpick, it's not axiomatic that hungry and angry people commit more crimes. It could certainly be true, but it's not so self-evident that the claim requires no proof.
Also, what's the point of making a quantifiable estimation (your "90%") if you have no actual data behind it? Just say you believe something based on observation; throwing out a nice round percentage to describe your belief, even as a figure of speech, does a disservice to real attempts to quantify phenomenon in a discussion.
It may be "axiomatic", but is it true? Personally I'd feel far safer walking through dharavi (in fact I go here semi regularly) or bhaiganwadi than Baltimore or Tijuana. Yet the latter two are vastly richer. I also passed through a slummy area in Kuala Lumpur, never felt unsafe.
Are my perceptions wrong? Do you have any evidence to support your claim?
Also, why can't vigorous policing - rather than paying tribute to violent criminals - also solve the problem?
What "welfare" are you talking about? I don't know of any social assistance in my state that goes to individuals who can work but aren't working. Medicare would be close, but in practice that's very difficult to qualify for, and covering health care is a far cry from "pay[ing] them to play video games."
I don't see how that's a relevant response to my comment, as it doesn't answer my question. It's not really a matter of public policy, unless you're suggesting we some how legally prevent people from supporting family members who aren't working.
My point was that even if the state doesn't pay someone to sit around, and play video games all day, in a high-unemployment economy, family members will. Either that, or the person in question dies homeless.
I think the implied answer here is you increase taxes, thereby funding the jobs for unemployed people and also making it harder for families to afford to support the unemployed.
> The Japanese government is doing exactly literally what the parent comment describes - paying people to dig up and break apart rocks
That's actually not the same thing. The parent comment's "have them go break large rocks into smaller rocks" carried the connotation of useless make-work. Your link describes a facet of concrete production, which is hardly useless.
> Your link describes a facet of concrete production, which is hardly useless.
Here is the key part of the article: "critics claim this is merely a reversion to the LDP’s traditional policy of pork-barrel spending on concrete structures"
Concrete itself has no inherent value. In Japan concrete is being used to ruin the natural environment as part of government make-work schemes, with very little discernible material benefit:
No, I'd like the government to stop paying people to do nothing, and instead pay them to provide government services. Rebuild our crumbling infrastructure, provide child care to working women, left wing types have a huge laundry list of things they'd like the government to do more of.
I'd also like to replace as many (currently overpaid) government workers with welfare types as possible. Why pay $50k/year to a unionized govt janitor when you can just order someone currently on welfare to do the same job for no extra money?
I agree that shutting down certain criminal organizations may be politically infeasible, since they can hold us hostage to keep their gravy train running.
When I say they are criminal organizations, I refer to organizations with rates of disability fraud as high as 97%.
Don't know the details about US but around here government uses private contractors to build infrastructure. Using the unemployed would be competing against said contractors and make their employees unemployed instead.
OP's point was they can do useful work but that useful work is not deemed worthy by the cult of the green pyramid with the eye so non-cult members pay the bill.
Someone has to, otherwise you pay for more people to house people in jail... (one way or another; retrain the poor for jobs that exist, enact a Basic Income Guarantee, make being poor a crime, or try to starve the poor which will drive them to crime).
> Allocating labor on the basis of whether or not traders and stock owners can profit in the short to medium term turns out to be an unintelligent way to strategise an economy.
And yet, this turns out to be the most succesful strategy civilization has used so far.
Well, technically allocating them based on whether stock owners can profit in the long term is the most successful strategy civilization has used so far.
It's just that to survive to the long term you have to get through the short and medium term, where a lot of froth and misallocation happens.
(This is not unique to this point in history, BTW - during the Rennaissance-era Age of Exploration and Second Industrial Revolution, there were also massive speculative bubbles, ventures that didn't work out, misallocation of capital, and outright fraudulent schemes. Most of them were swept away in the periodic financial panics. One way of looking at the situation today is that you have governments who are determined to avoid a panic at all costs, but the process of panics & financial crises is what sweeps short-term-oriented people out of the market, so without them they can offload the costs of short-term thinking onto the taxpayers.)
>you have governments who are determined to avoid a panic at all costs, but the process of panics & financial crises is what sweeps short-term-oriented people out of the market
Exactly, which turns these "short term bubbles and money-grabbing schemes" into long term institutionalized parasitic organizations which slowly erode the foundation for small business. A healthy forest sees many small forest fires to clean out the dead brush. Without these small fires, a major fire event can wipe out a forest.
The most successful strategy civilization has used thus far is to allow market forces to operate in that portion of the market where business can be profitable and healthy competition encourages good behavior, and to tax wealth and provide government jobs to do those things that need to be done, but either aren't profitable or the private sector would not be able to provide adequate quality of service for everyone that needs it.
Many political arguments arise from disagreements over whether a given task is best handled by market or the government, but there are few who would prefer to live in either a pure government-run society or a pure unregulated free market with no government services.
Well... we don't have a real long track record and past performance isn't indicative of future gains. I agree with you, but we are kind of speeding into the unknown. Which like any adventure is risky.
Hunter gatherers were real stable for a long long time. One person, or even a fairly large group of people couldn't cause much trouble.
We're moving much faster, which again i think is cool, but it's much riskier. An obvious one, there are enough nuclear weapons to wipe out humans in a few hours. I don't think nuclear war is coming any time soon, but we've only been at this 'high tech' stuff (i'm picking agriculture, neolithic revolution) for about 10,000 years. Wealth of nations is around 250 years old - traders are much older of course, but 10k seems like a good upper bound. Can we avoid nuking ourselves for 10k years? I sure hope so.
Anyway, there are existential risks, and other, less dangerous things like world wars that have the potential to be much worse than a guy with a club.
Also, there's not much incentive in the system to not wreck the system. For, example "The big short" is a fun movie. "Too Big To Fail" is a much more in depth look.
I guess, my point is, That strategy is a powerful tool. It's not a pat answer to all the world's woes. It's wise to treat it like any other dangerous piece of equipment. Be aware, be alert. It's ok to take a little more time with power tools to avoid cutting off an arm.
> It's ok to take a little more time with power tools to avoid cutting off an arm.
This is what I find interesting about the Amish. They are not, as I understand things, truly anti-technology, they are anti-adopting every new thing as soon as it's available.
I wonder if they're the ones who are going to have the last laugh if/when this house of cards tumbles (although in all likelihood it'll probably be the Sentinelese).
>And yet, this turns out to be the most succesful strategy civilization has used so far.
The period in which the American economy was growing most was when it was also most organized. The post-war consensus was about scientific management of industry and the economy, not about free markets and profit maximization; that dogma only took hold in the 80s (both in business schools and in politics), and it has been a steady downhill since then from the relatively sunnier period of high-level management. The American economy was heavily planned through most of that period (mostly through the military), and the beleaguered stump remains in the form of public funds for research and development flowing into private industry (the Internet, biomedical research, semiconductors, defense, etc).
What short-term profit mostly succeeded at doing was producing the largest and most rapid accumulation of private wealth and power the world has seen in a century.
A lot of people look back on the period from 1945 to 1970 as a golden age of growth under a more left-leaning economic regime than today. It sounds like you are one them, based on your "let's organize the economy" enthusiasm.
The problem with that is that the post-WWII period was much different than today. Pretty much every other advanced economy besides the US had been economically devastated by a long and bloody war. The US didn't have to be competitive to compete against a Germany or a Japan where people were boiling shoes to eat the leather or catching rats for meat. They only had to be relatively competent. Also, both before and after WWII, scientists flocked to the US, fleeing from repressive and doomed regimes. US R&D got a huge boost from these people.
Another question is just how "organized" the economy actually was back then. Most of the really complicated regulations like Sarbannes-Oxley were still far in the future in the 1940s. By the time the EPA was created in the 1970s, the US was already well on its way to stagflation and economic incontience. Tax rates looked high back then, but just like today, most truly wealthy people found ways around paying them.
Of course the government has a role to play in funding research and moderating some of the excesses of capitalism. But to argue that some bureaucrat can just push a button and bring back the golden years of the 1950s is a leftist fantasy.
I'm not advocating going back to 1950 or having planned economies (I am rather an anarchist), I am merely pointing out that it is wrong to suggest an orientation to short term profit makes the best economy.
Most economic debate occurs in spherical cow land because it ignores the political realities of the debate. Sure it would be possible to have a wise, far-sighted government that invested in exactly the technologies that were needed for the future. But once the government is a source of patronage, politicians have a huge incentive to funnel off the money to their friends and cronies. In the end, it is usually better to leave the government small and accept that there is some long-term planning you'll miss out on.
In the same way, if we could have a benevolent dictator, he would certainly govern better than our crappy government. But dictatorship is inherently unstable because the most ruthless person seizes power. So the dictator could not stay benevolent for long. Better not to have the dictator, even if it means having a less efficient government.
I think you are mis-attributing our current trajectory. Most of the scientific developments that are now powering the US knowledge economy came out of government (ARPA, etc.) funded labs.
Allocating R&D funds based strictly on "whether or not traders and stock owners can profit in the short to medium term" is relatively new in the US (although you could argue it was the norm before we became a superpower). Our most exciting projects still come from outside that model -- crazy billionaires that want to go to Mars, meager NSF/NASA budgets, and things that mutually benefit Defense/DARPA and the economy.
I think that increasing R&D allocation increases labor demand, both within those projects, and from capital investments that are derived from them. I think that investors are yet to demonstrate that they are capable of valuing the sorts of large scale (historically government funded) R&D projects that have been fruitful in the past.
I always wonder, how people can associate effectiveness, success and other positive things with the current developments. The price of the progress, as we experience it today, is enormous. Exhaustion of natural resources, severe climate change, not to mention societal costs. We see a rapid rise in violence across continents and this seems to be just the beginning. I can easily see the western world turning into totalitarian cyber-police states within the next ten years, just to protect against all those humans who are left disillusioned, without jobs, perspectives or with bullshit jobs and basically a life, that some of them will happily trade away for some moments of meaning, when they detonate themselves in a crowded place.
Can you provide more detail about the rapid rise in violence across continents you mentioned? Is that measuring it in absolute terms or proportional to the population it occurs in?
exhaustion of natural resources? hmm. natural resources are INFINITE by definition since the universe is infinite. what is limited are "reserves". panicking about reserves dwindling is what Tim Worstall calls the 'No breakfast fallacy'
we dont look at our refrigerator which is running out of milk and worry that the world is running out of milk. we know that there is an entire ecosystem of farmers , truckers and supermarkets producing milk for us. the confusion between reserves an resources is common
The clear difference being that in your example, you don't need a large reserve of milk as fuel and materials to reach the next available milk supply.
Natural resources which are accessible are being consumed at high rates, and access to further resources will likely require the use of existing reserves put toward that goal.
This argument was true for every civilizational strategy until it was not successful. “Why build pyramids? Because it is the most successful civilizational strategy used so far.”
Just the Chinese and Indian cases seem more than enough data to make this case. Both economies stagnate behind the world trend until they open up free markets, at which point their economies explode and a billion people are lifted out of abject poverty nearly overnight. There is an arguable case for strong welfare states, but true socialism has literal mountains of evidence against it.
China and India are heavily state-managed and in no sense are they genuine laissez-faire free markets. China still thinks of itself as Communist.
True socialism - on the soft European model - has literally mountains of evidence for it.
The basic problem is maximising productive - i.e. innovative and practical - activity, and not allowing the economy to financialise, which replaces actual activity with meaningless proxy casino activity.
Capitalism on its own concentrates wealth and chokes off its own air supply. Government management on its own ossifies into bureaucracy and oligarchy.
There's a sweet spot between the two where government provides stable markets, seeds R&D, and prevents excessive concentration of wealth and power, but talented and inventive individuals are still rewarded for talent and invention, and the cost of entry for new business ideas is as low as possible.
Exactly. In the US, right now, paved roads are being downgraded to gravel* because interests aren't willing to allow the money be spent to keep up public infrastructure.
> There's a huge to-do list of jobs that need to be done at almost every level, from design and build of significant infrastructure in most countries around the world, to community-level support work.
Infrastructure overinvestment is extremely destructive to the environment, and at least in Japan and China has led to economic problems:
>It would be perfectly possible to retrain the long term unemployed for all but the most difficult design and management elements. They're not done because the metrics of Wall St deem them "not profitable" - which means traders can't make quick gains out of them.
Part of the reason that training is not profitable is that there is no real way for companies to recoup money spent on it. If you spend large amounts of effort training someone, you still have to pay them the same salary as someone already trained, or your competitors will hire them away.
No, we would need to retrain them to do something that is valued. For which services/products do you think you're missing and would be ready to pay for if we were to retrain the unemployed?
> For which services/products do you think you're missing and would be ready to pay for
This isn't an individual virtue thing, it's a government/society thing. But there's lots things that could be valued, especially infrastructure stuff, for instance:
1. Better quality roads that are better maintained
2. Catching up on neglected maintenance of public infrastructure (e.g. bridges, etc).
3. New water projects in California needed to meet current demand. I recently read that no major projects have been undertaken since the 70s even though the population there has greatly increased.
4. List mile fiber to homes, even in rural areas.
5. Better public transit.
6. Building redundancy into critical infrastructure systems where it doesn't currently exist.
7. etc.
That's just a bunch of random stuff I listed off the top of my head. If unemployed people are sitting idle, why shouldn't society pursue projects like these or similar?
>> every time you make a job redundant you create other new jobs
That is false on its face. If you buy a robot to replace a welder, you indirectly employ the people who design, build, and maintain that robot. True, and those are higher paid jobs than the welder. But at the end of the day, the person running the factory where said robot is used did an analysis and concluded that it was cheaper to buy the robot than to employ the guy it replaced. That means fewer total man-hours in the workforce, since those man hours are billed at a higher rate and are still lower TCO.
TL;DR - if your TCO goes down by employing higher paid people you have caused a net-loss in jobs. TCO ~= rate*man_hours so if TCO goes down while rate goes up...
TCO goes way down -> price of product goes way down -> sales go up because price is lower.
It doesn't always happen that way, but sometimes it does. uber is a good example. By reducing cost of car rides, I pay someone to ride in their car 10X the amount I used to.
If Americans wanted to live a 1916 lifestyle, not many of us would have at work. But we buy a lot more stuff and use a lot more services.
We've automated away nearly every job people did in 1875's America. But we all still have jobs.
I don't think anyone claimed that the new jobs would be replaced one to one with jobs maintaining the new technology, just that some of the new jobs would be in maintaining the new technology and some would be in new industries that we haven't even thought of. For a big historical example of this, look at the decrease in labor usage for farming over the last couple centuries. Where did all the people who used to work in agriculture go to? Like 1% of them now remain on the farms, maintaining the technology that displaced the other 99%, who are now dispersed across whatever other modern industry that we didn't used to have (and, we'll note, the pundits at the time highly doubted that most of the 99% being displaced on farms would find be able to find alternative positions).
Anecdote: My brother-in-law has worked at the same factory for 20 years now. Their efficiency has probably increased 10x in that time. They are producing more than they used to, with a lot less workers.
It is not false on its face. The goods produced by the now robot welder reduce their cost; freeing up capital to flow to some other industry either as profits or lower prices. That factory isn't a closed system.
Yes, but now lower prices for welded goods mean some combination of people can afford to buy more stuff, and more capital is available for ventures that previously wouldn't have been funded.
That assumes that it would be profitable to fund those ventures. But as supply increases and prices are driven down by automation, it becomes less profitable to fund ventures in general. It becomes relatively more profitable to charge rent on things that can be monopolized. Therefore, fewer ventures get funded, leading to even fewer jobs. As the demand for rentable capital increases, its prices increase, and therefore the rents. Fewer jobs means that labor rates decrease, resulting in lower pay for those remaining.
With higher rents and lower pay rates for fewer jobs, people cannot afford the consumer goods even though they have become cheaper with the increased supply. That decrease in demand further drives down the prices such that even with maximum automation, that business is no longer profitable. The people maintaining the robots get laid off. What happens then?
There hasn't been infinite work for quite a while now; I've heard the theory that Japan invaded Manchuria in 1931 so that they'd have something to absorb their industrial productivity -- because they were running low on domestic stuff for factory hands to manufacture.
Of course, it didn't help that wealth was very heavily centralized in Japan -- the eight zaibatsu families, the Cho:shu and Satsuma fiefdoms (the army and navy respectively), and the imperial family owned probably a majority of the country's wealth, and the common people were too poor to buy very much or stimulate the economy...
Certainly. Didn't mean it would be easy but that's the trick with all social and cultural change. You just keep at it until everyone thinks you were right all along.
Or, we simply wait out the next few centuries. Reproduction rates in many developed countries have dipped below replacement. Maybe the total world population will decrease in our time.
This is the problem with our current first world financial system, it is predicated on constant growth. Even the slightest hiccup in growth leads to serious consequences for the over leveraged and make no mistake most of our safety nets are over leveraged and dependent upon unrealistic gains when faced with a stagnant to declining population.
The Great Aging is underway, the EU last year had more deaths than births and will for the foreseable future, Japan has been there for a little while and China's working age population is already in decline. Africa, the Middle East/India and parts of South America are the only places experiencing actual population growth, when immigration is not taken into the equation. With Demographics and Automation deflation is the likely outcome. The Central Banks are trying all they can to prevent this from happening in the near term by spending Trillions of dollars to prop up economies and drive interest rates lower to eek out some inflation. They seem not to care whether growth is actual demand growth or simply a mirage in terms of inflation. The central banks are doubling down their efforts and will be even more accomodative in the next few years when the growth they continue to state is right around the corner never materializes.
Unfortunately I do not see a way out of this without the developing nations taking care of themselves.
People seem to have a lot of faith that a drive or urge to reproduce is not something that can be selected for and transmitted through generations, either genetically or culturally, in human beings. If it can be selected for, it will be, and very rapidly, by simple math.
While it is true that the fertility rate goes down with increasing wealth, this may only be true up to some point. With wealth increasing even further the fertility rate seems to start rising again. Whether it crosses the replacement rate again is up for debate. See the chart on the Wikipedia article for income and fertility [1] for an illustration.
As it stands now the EU has more deaths than births every year for the foreseeable future. When birthrates have been below replacement level for over 30 years it would take a massive baby boom to right the pyramid, but what good would that do? We don't need the population we used to and those babies wouldn't be productive for at least 20 years and as it stands now many of them would be as much of a drain on the state as the retired
I am not arguing that population growth would be a good thing, the population growth rate has to become essentially zero at some point. A constant plus or minus one percent per year means extinction within less than 2000 years. Overpopulation will resolve itself by starvation or resource wars, underpopulation seems actually more dangerous in the long run. But I am relatively sure that we will manage to avoid extinction due to a bad fertility rate.
And the population structure will probably become something like a rectangle then, almost everybody becomes 80 or 90 or whatever and dies within a relative narrow window. Setting aside radical changes like getting hit by an asteroid or discovering the key to eternal life.
I really only wanted to point out that it is not absolutely certain that increasing wealth surely leads to a decreasing population. If all work is done by robots and nobody is at risk of a shortage of good and services, what would people compel not to spend some of their years raising three children?
1) Eventually, and probably pretty soon (within 100years), that there obviously won't be jobs for everyone. Automation, progress(efficiency gains) and increasing population makes it inevitable.
2) That a general "goal" of society is do away with jobs. In any traditional sense. To me we've been approaching that ever since agriculture provided ability to support specialists (those who don't spend time gathering/producing the food/resources they need). Such as scientists, artists and soldiers. The jobs keep moving "up" the ladder (away from production). Previous low-rung jobs get reduced in number by efficiency or replaced via automation. The end of this trend is that all basic needs are met by 0 to a tiny fraction of a percent of human labor and rest are all free to pursue specialist activities such as science, art, and killing each other.
1) Seems to be increasing accepted. However, it looks like we're still on the early side of it, and the transition is going to be difficult. There will likely be a time when there are nowhere near enough jobs to go around, and not enough aid for the unemployed.
2) I wouldn't say this is widely accepted. On any topic about Universal Basic Income, one of the common refrains against it is "the dignity of work", and that labor gives purpose in life. I don't agree with that necessarily, but it seems to be a view held by a sizable segment of the population. You'll also see it come up in situations where welfare is mentioned.
If 2 is true our politics (at least in the U.S.) haven't caught up. We have to be comfortable with the idea of simply giving money away to people who are not earning it, or giving them more than the market would otherwise bear.
One of the ways we could do that is by making university tuition free, to say "well, if you can't get a job, you can always spend your time thinking instead." Instead we're restricting access to univerisities more and more based on the idea that a university education is only about getting a job and you should have to have "skin in the game".
We've been making it harder, not easier, for people who aren't working to access the collective product of society, and we're all poorer for that.
1 is perhaps widely accepted. It's been widely accepted for at least 150 years, and hasn't noticeably been coming true. (Though some would argue it has since 2008, or even since 1970).
2 doesn't actually argue that the goal is to do away with jobs, just with low-end jobs. I'm not sure that it's as widely accepted as 1, but I think it's more true than 1 is.
2) I have some issues with (though I agree with the general direction).
I would still describe science, art, etc. as a job (or at least any successful system will have to). There is a big difference between saying, "let's give people money, and hope they spend their time painting or writing", and saying "let's give people money contingent on their painting, writing, etc. with some of their time". In both cases, we don't strictly need the work, but one carries the connotation of laziness. That has proven to be a large sticking point in the current discussion.
As others have mentioned, there is a big difference between living in a system where basic needs are met and getting to that system. In particular, it has never been clear to me why we assume that people in power decide to accommodate the number of people we currently have. If the number of jobs is a problem, a despot can do the hard work of finding a system that works with fewer jobs or they can engage in population control by other means, hoping to delay the onset of the problem.
Job is kind of a hard definition. Being compensated seems to be the main difference between job and; hobby, charity (working for "free"). Entrepreneurial endeavors lie in a muddy middle ground.
With increasing efficiency and automation "needs" will become increasingly cheap, approahing free. I believe without needing compensation just to survive, many will chose not to have jobs. They may, and probably will, still work.
To some extent. I think what the parent was getting at was that these could be pursued without worrying about the job being the most financially sensible choice available.
For anyone who has a theory that involves making new jobs and retraining people, consider these cases:
A) 50 something factory worker whos job along with the other 100 folks he works with, have been eliminated by automation or some other sort of efficiency.
B) 30 something software engineer who's field (except for research) has been eliminated by AI.
"A" is something most of us have the luxury of had waving away with "retrain them to be surgeons and leave their homes behind and move to someplace else for work".
"B" hasn't happened (yet) but what would you do if it does? It's not so easy easy to dismiss is it?
Lack of work is a structural problem. The landed gentry of our time don't even need the surfs anymore so it's even worse in some ways.
It is also a location problem. If you have bought a house but can't sell easily or don't want to move then you can't go to a place in the United States that has more jobs. For example right now in Grand Forks ND there are walmart jobs $14-$18 an hour and apartments for super cheap (with electricity included) for $450 and up.
As someone who lived in Grand Forks... I would rather do the same job for $7 an hour just about anywhere else. The weather, floods, wind, and lack of anything to do around there make it a very un-desirable place to live.
Well if AI can replace software engineers then it can probably obviate many other jobs as well, meaning there would have to be greater societal restructuring than just some out of work engineers finding new careers. If you are 30 and you're worried your job will be automated away before you retire (but before universal income), perhaps you should get a head start by learning new skills that are harder to automate.
I wonder what your alternate theory that fixes the unemployed 50 something factory worker is? Legislation that ensures job security? Pension? Severance?
Which skills, for example, are harder to automate? You may have already seen this YouTube video as its a couple years old, but its premise is that we need to start thinking about what to do when large swaths of the population find themselves unemployable through no fault of their own (since over 45% of the workforce holds jobs that are easy targets for automation in the near future).
Considering the amount of data it takes to train an A.I., there isn't much threat to it taking human related jobs quickly, even less so in emerging industries.
You could hand wave about 10 years from now all the software jobs are replaced by A.I., but there will be entirely new industries in place that we can't really conceive of right now.
Case in point: Imagine if someone told you in 2006, that there would be a $70 Billion mobile app industry consumed by over a billion people worldwide, using some fantastic new device that's only vaguely similar to the flip phone in your hand.
I feel like ancient civilizations a lot of times turned to art once their societies leveled off. Large structures, pots, roads, figures, clothing, etc.. I believe art is unlimited resource and we could have an economy running purely on art. Isn't a large portion of the economy already running off of art? Movies, games, tv, media, events. I actually feel there even a lack of art right now in terms of food, furniture, products in general. I'd pay for objects with more thought put into them, but there isn't enough people today to dedicate their time to art. With all these menial jobs taken up, maybe even more people will turn to custom crafts and trades. Where what I'm paying for is the creativity and uniqueness of the objects I'm buying.
I think about this a lot. John Adams said "I must study politics and war that my sons may have liberty to study mathematics and philosophy. My sons ought to study mathematics and philosophy, geography, natural history, naval architecture, navigation, commerce, and agriculture, in order to give their children a right to study painting, poetry, music, architecture, statuary, tapestry, and porcelain."
The problem isn't the supply; it's the demand. There are many, many artists out there. You want custom furniture? Go online and you'll find people who will make it. The problem is that not enough people can afford it. Not enough demand at an appropriate price point means that the artist starves.
Hell, I used to make handmade jewelry boxes from exotic woods. Once I realized what I would have to sell them for to get any realistic value on my time, thoughts of making that my fulltime job went flying out the window. Instead it was more fun just giving them to friends and family.
Ironically, I've found (this was with Blacksmithing) that the higher the price, the better it sells. The high price itself creates a sense of value, and makes the object worth more in its exclusivity. Of course, there's a ceiling, but up to that point there's a lot of wiggle room in which to part fools and their money.
> there isn't enough people today to dedicate their time to art.
The vast majority of art usually isn't profitable. There are only so many people, families, businesses and organizations that will commission portraits, sculptures, lavish architecture etc. Look at how many graphic designers there are who have to essentially do free work just to get considered for hire so they can do a campaign to sell laundry detergent.
> With all these menial jobs taken up, maybe even more people will turn to custom crafts and trades. Where what I'm paying for is the creativity and uniqueness of the objects I'm buying.
There's etsy where artists and stay at home moms try to tap in the craft and 'artisanal' product market. There are many people trying to do just that.
I doubt that's sustainable, especially given that you have people like 'starving artists', 'starving writers', and of course game programmers who throw themselves at projects working eighty hours per week.
Anything that people likes to do tended to be oversupplied.
In a world with no demand for labor, there is an implication that the cost of goods would be dominated only by supply scarcity. For commodity goods, they would essentially be free.
200 years ago a real shirt would cost you ~$2000 in today's currency (land -> sheep -> farmers -> spinsters -> dyers -> weavers -> tailors). Now a decent shirt costs $40.
Eventually artsists won't starve, even with minimal income. Ideally, hopefully.
Creativity and uniqueness might not be the sole domain of people. Our digital children are learning fast, and they are pretty creative from what I have seen so far.
Both the article and the paper aren't very good; they're trying to infer too much from macroeconomic data. They implicitly assume that labor is more fungible than it is.
Reality is that we just don't need that many people to make all the stuff. US manufacturing output is at an all-time high (output has recovered completely from the 2008 recession). US manufacturing employment peaked in 1979. Imports are 26% of US consumer good consumption.
What are people doing? Here's US employment by sector.[1] It's worth spending some time with this table. Incidentally, "information services" dropped from 2.2% in 2010 to 1.8% in 2014, and is still dropping. No, going into computing isn't a good move. The only area with big growth is "health and social assistance", which reflects an aging population. (Mining was up from 2010-2014, but that reflects the oil and gas boom. That's already collapsed.)
The United States has a very skewed view towards work and individual employee production. At some point in time, cultures must shift to realize that two individuals at 40 hours per week can do the work that one individual at 70 hours per week is performing. The key here is incremental corporate profits must shift from shareholders to employees through aggregate increases in employee costs (2x the employees, half the hours for each). Realistically - this problem is a matter of greed at the business owner level.
Are there lots of jobs that produce value above minimum wage? It's a tough question...
There are ways to solve some issues in a low barrier for entry style. Finland has mandatory return payment on all bottles and cans sold. This has resulted in a cottage industry of bottle collectors who target public outdoor events and places where people hang out.
So those people perform a valuable service and nobody needs to really coordinate anything.
But it would be a very bad way to depend on for livelihood. Somehow these worlds need to meet...
It seems like there are 2 things that can be done:
1) Make it easier for new firms of all kinds to open and create job. (Less occupational licensing requirements, etc)
2) Reduce the cost/burden of employment. (If someone has the choice to hire an employee in SF and Texas, they'll choose Texas since the laws are more business-friendly)
For #2, if by "business friendly", you mean anti-employee. Despite all this hoopla about California being "business unfriendly", it still leads in startups and innovation. Mainly because a lot of the talent wants to be in a place where they have freedoms, and don't have to worry about business taking their work done on off hours.
At an extreme it is. (The buckets aren't so black and white)
Look at France. The costs of firing employees is so high, that companies on the margin choose to hire elsewhere. They only hire after extensively validating the employee. It's much harder to convince an employer to "give me a shot" because they can't back out of the decision easily. It helps the employees already hired, but hurts the ecosystems.
Other laws which force good behavior on everyone at a relatively low cost can help the ecosystem. (Voiding non-competes is one, getting rid of child labor is another)
Somewhat. But there's friction from moving jobs around.
An oversimplified way to view it...
Let's say I can get $100/hour of value out of an employee. As long as I can get $100/hour of value from them, I'll hire them. Now let's say that there is $10 of regulatory burden. (Hard to fire, etc) Then I'd need $110/value to hire someone. Now let's say it costs me $5/hour in communications overhead for people out of town.
Then we have 3 scenarios:
1) $110+ in value - I can hire in either place. I prefer the HQ if the resource in CA is $5/hour cheaper. (Or measurably better)
2) $100-$105 in value - I hire in the other place.
3) Up to $105 in value - No hiring.
Lowering the regulatory burden to less than $5/hour adds to the amount of jobs people have.
Note - it's never really this simple, but it illustrates the idea that someone has to bear additional costs. When the employer and employee split it, relationships that used to net out with higher employment can end with higher unemployment.
We did a scenario planning project where you put together human trends and factors to try and predict several versions of the future 10 years from now.
In one of our scenarios was a future where humans bounced from job to job (high turnover, low unemployment) and skills-based education was cheap and easily accessible. Some of the factors leading to this was the "established"-education bubble bursting, increased automation, and less desire for consumers to own assets while still having access to them (variable sharing economy).
A #2 type of future might not be that unrealistic.
I'm not sure what you're trying to get at but a race to the bottom among municipalities and states to try and attract businesses is already happening and has been for some time. My point is that this won't actually solve the problem posed so much as redirect it somewhere else.
#2 solution isn't about moving existing jobs, it's about lowering the barrier to entry for new jobs, since demand isn't fixed and variability will increase.
You will always have tug-of-wars between municipalities (e.g. Applebee's HQ between Missouri and Kansas) - but businesses in states or munis with a low barrier to entry for new jobs can fulfill and capitalize on variable demand faster.
If Texas offers me some really sweet incentives so I go and establish my business there (or move an existing one there) instead of California I haven't exactly created twice as many jobs as I would have otherwise, have I?
Or 3) Since automation is making capital more productive at the expense of labor--tax a portion of the productivity increase and distribute it to labor.
Not an economist but my thoughts on the topic are that society can make changes to accommodate this. This isn't a catastrophe, we just need to prepare. I think this needs to/will happen:
* labour will change from people having only one main skill to having multiple skills ("jack of all trades, master of none" will become "jack of all trades, master of fewer")
* this will be made possible by the fact that technology makes is easier to (re)educate yourself and also to tailor education exactly for your needs (c.f. university course unbundling, what if you could take different courses at different school based on which fits your needs (kinda like, mooc, yeah, I know mooc aren't the runaway success we'd hope for but give it time))
* we probably will not get rid of the issue that you have to pick a skill(s) when you are fairly young and you don't know if those skill will still be useful when you have to leave the workforce
* basically, people will have to learn a couple of skills pretty well and hope that the future jobs will require a particular combination of your skills (and if you are lacking some skills, you should be able to pick up new skills easily)
* it will become standard for people to keep learning
* i also think that the "default" unemployment rate might rise but unemployment will be more temporary for the single unemployed people
My view as someone who strongly believes in technological progress, I would guess I would summarize my advice as "you have to know how to leverage technology not to be outpaced by technology" but this isn't exactly anything novel.
The trend here is that humans will become ubiquitous learning machines, valued for their ability to fulfill variable demand.
Automation works well through economies of scale to fulfill large, steady amounts of demand. A.I. works well when there is a lot of existing data or logged activity to train on. For new, variable, or niche demand markets, Humans will be unique in that they can fill the demand faster than A.I. or robotics.
No. I've worked some people to try and come up with product ideas to fit this type of future, but it's at least 5-10 years off, and dependent on factors like the current title-based education system being replaced by something more skills-based.
> * it will become standard for people to keep learning
That won't happen, humans don't work that way and it ignores the reality that many people will simply be incapable of learning enough to be more valuable than a machine. Machines will put a floor on value and people who can't exceed that floor (which will be most of society at some future point) won't have jobs they can do.
This is fundamentally an issue with the educational system. Change the system the rest will follow. Saying that humans don't work this way is like saying that nothing heavier than air will ever fly.
> incapable of learning enough to be more valuable than a machine
I don't think that AI and human intelligence will ever completely converge.
> Machines will put a floor on value and people who can't exceed that floor (which will be most of society at some future point) won't have jobs they can do.
I think that this breaks down to your interpretation of the world. I think that the world is a "fractal". Like notice how much specialization is going on.
There is, I think, ultimately a problem with having to unlearn old skills which is difficult. If nothing else, you end up with a workforce in a particular area, say, if retrained, who bring in very widely divergent backgrounds on how to do something.
This might not be all bad if your goal is to mix and match methods and come up with something better. But that's rarely a firm's primary goal. Rather it's to have a uniform workforce, performing a uniform process, producing a uniform product.
As you climb up through the complexity of tools, tasks, products, and processes, this seems to increase. I suspect it hits the tech world rather hard (it may be a reason for the intense battles over editors, languages, frameworks, operating systems, revision control, etc., etc.).
That is: the problem isn't the educational system, it's us.
(There are other reasons to believe that education isn't a driver of economic growth, including the rather inconvenient fact that education seems to trail economic growth rather than lead it.)
I'm of several minds on AI, but a thought intruding increasingly on my awareness is that it's quite likely that programming will be among the first-affected employments. The training set is intrinsically amenable. Wether this proves an augmentation or a replacement remains to be seen.
> There is, I think, ultimately a problem with having to unlearn old skills which is difficult.
Picking up new skills at a level that puts you in competence with AI is just as difficult. As you age and your responsibilities increase and mind plasticity decreases, your capacity for learning decreases almost asymptotically.
You simply cannot make 40-50-60 year olds learn new skills and expect any ROI on it.
Most great ideas generally run face flat into the big wall of human biological limitations.
To take a fairly trivial example, in driving, when braking on a wet or slippery surface, in an age before antilock brakes, the recommendation was to pulse the brake pedal, to keep the wheels from locking up. With antilock brakes, the advice is to apply firm, steady pressure -- the ABS itself will apply the pulsing far more rapidly and accurately than any human could.
That's an example of skill-unlearning which you're demanding of the hundreds of millions of drivers who've had decades of experience with the former method.
I could toss out numerous other examples -- practices, tools, techniques, rules of thumb, etc., which, having already been learnt, are now counterproductive.
The young have the advantage of only needing to learn something. The old have the task of both unlearning and learning. Interestingly, that's a point that Alvin Toffler made in Future Shock, a book I've yet to read completely, but have skimmed in part.
Even with equal brain plasticity, the more experienced person is at a disadvantage.
> This is fundamentally an issue with the educational system. Change the system the rest will follow. Saying that humans don't work this way is like saying that nothing heavier than air will ever fly.
No, it isn't. Check out a book called the Structure of Scientific Revolutions to see how humans really work; even the best and most intellectual of us age and die clinging to old ideas we just can't unlearn. Any future that relies on most people continually learning new and ever changing skills is a future only possible in fantasy.
> I don't think that AI and human intelligence will ever completely converge.
They don't have to, what I said applies even without strong AI. This notion that AI is only disruptive when it reaches human level is not well thought out.
> I think that the world is a "fractal".
I think that statement carries no real meaning; I could snazz it up and say I think the world is a quantum fractal, but it's still just technobabble with no meaning.
The operative word there is "might." Greece has free education. Their educated youth are fleeing as fast as they can. Not very profitable. All that free education also somehow failed to prevent their chronic debt crisis and general decline. It's almost as if economic prosperity is more involved than just distributing free stuff........
Except the actual cost of college is not free, and for a lot of material covered in colleges it is an extremely inefficient way to convey that information, in both time and monetary cost.
A large part of the problem is that, in a glut of labor, employers use degrees as litmus tests of commitment rather than ability. If you can just ignore anyone who doesn't have a bachelors, you will, because why not? But that doesn't mean the bachelors is, at the macroeconomic level, worth it to society to push everyone to get.
>Then the government should either directly employ people or else provide them with an income, or some combination of these.
It is interesting to see that, in the early 21st century, communism is becoming palatable again.
Could this be due to all of the old communist states either ceasing to exist or (for instance, the case of China) changing into something quite unlike their former sleves? In short, did we forget about those states?
Unless the US went communist in the 1930s, government employment, even for the express purpose of creating jobs, wouldn't constitute communism.
Besides that, if there is really not enough demand for workers, and there is never going to be, the alternative would seem to be a permanently unemployed underclass.
> Unless the US went communist in the 1930s, government employment, even for the express purpose of creating jobs, wouldn't constitute communism.
I came across this interview recently:
HG Wells:
> My visit to the United States excited my mind. The old financial world is collapsing; the economic life of the country is being reorganised on new lines.
> Lenin said: “We must learn to do business,” learn this from the capitalists. Today the capitalists have to learn from you, to grasp the spirit of Socialism. It seems to me that what is taking place in the United States is a profound reorganisation, the creation of planned, that is, Socialist, economy. You and Roosevelt begin from two different starting points. But is there not a relation in ideas, a kinship of ideas, between Moscow and Washington?
> In Washington I was struck by the same thing I see going on here; they are building offices, they are creating a number of state regulation bodies, they are organising a long-needed civil service. Their need, like yours, is directive ability.
Stalin:
> The United States is pursuing a different aim from that which we are pursuing in the USSR. The aim which the Americans are pursuing arose out of the economic troubles, out of the economic crisis. The Americans want to rid themselves of the crisis on the basis of private capitalist activity, without changing the economic basis. They are trying to reduce to a minimum the ruin, the losses caused by the existing economic system.
> Here, however, as you know, in place of the old, destroyed economic basis, an entirely different, a new economic basis has been created. Even if the Americans you mention partly achieve their aim, ie, reduce these losses to a minimum, they will not destroy the roots of the anarchy which is inherent in the existing capitalist system. They are preserving the economic system which must inevitably lead, and cannot but lead, to anarchy in production. Thus, at best, it will be a matter, not of the reorganisation of society, not of abolishing the old social system which gives rise to anarchy and crises, but of restricting certain of its excesses. Subjectively, perhaps, these Americans think they are reorganising society; objectively, however, they are preserving the present basis of society. That is why, objectively, there will be no reorganisation of society.
> Nor will there be planned economy. What is planned economy? What are some of its attributes? Planned economy tries to abolish unemployment. Let us suppose it is possible, while preserving the capitalist system, to reduce unemployment to a certain minimum. But surely, no capitalist would ever agree to the complete abolition of unemployment, to the abolition of the reserve army of unemployed, the purpose of which is to bring pressure on the labour market, to ensure a supply of cheap labour. You will never compel a capitalist to incur loss to himself and agree to a lower rate of profit for the sake of satisfying the needs of the people.
Governments creating work for citizens is not the defining feature of communist states, nor is it the defining feature of the normative ideology of communism.
In the mid-west we have programmers 2 years out of school making $100k in places where the CPI is 90. What if we just have a massive misallocation of resources and people should be learning how to program, nurse, become doctors, plumbers, HVAC, or all the other jobs that pay incredibly well?
Training for those jobs takes time and resources. Not everyone who has lost their existing job will be able to invest those things at possibly getting another one.
Also, if you send a bunch of people into those fields, the cost of labor will drop, and they won't pay incredibly well for long.
Software engineers provide immense value, I highly doubt there is any misallocation, however with other jobs, what if their wages are suppressed because of the lack of a strong market presence and intense competition prevents wages from rising.
At Emblem 21, we analyze not just the time, material, and energy costs for economic activity, but also the complexity components as well. Every economic activity consumes and yields complexity. This complexity is difficult to measure given its contextual nature, but it is encoded into the pricing of the transaction itself.
Currently working on very advanced neural networks to detect the edges of this contextual complexity.
Autonomous labor doesn't destroy jobs because the autonomous labor is also a consumer of complexity, energy, and time.
Greetings. Our corporate structure is undergoing a fundamental transition (from a software contractor to a holding company) and we're still deciding on presentation and community outreach.
...which is to say we have plenty of researchers but no social team. :)
Our primary goal is the formation of autonomous labor by helping put the institutional periphery into place: legal review, trade agreements, economic policy study, political and memetic steering, and financial innovation. Robots just won't automatically take all of the jobs. Humans are very good at cutting their own throats collectively and we very much account for this.
We have three private tech projects at this time that cover the UAV and theoretical mathematics space.
I feel like the "infinite jobs" idea is too foundational to American culture to be completely removed. The very definition of "prosperity" includes having a job. The definition of "success" includes having a job.
I've described it before about how deeply American culture has a "work problem" and that it is as much a religion as anything. We don't call it a "Protestant Work Ethic" without reason, and lot of what you hear people say about jobs and work these days wouldn't sound much different from what the Puritans (who get credit as some of the earliest American colonists) preached as core to their way of life.
To some extent as the culture has gotten less dogmatic in some areas, the dogma of work has only entrenched further. (To many people the big corporate passive aggressive notes from belly of HR about the "good of the company" are the closest to people's weekly and/or daily sermons that they'll see.)
There are a lot of people, pundits especially, that see work as a moral obligation and the lack of work as a sin. I think it will take as much as anything else a new wave of religious thinking to move American culture past some hangups into a future with fewer "jobs" available. Or a redefinition of a lot more hobbies and crafts as "jobs" and "work". (I'm not sure which would be easier. There are stigmas in both directions.)
> To many people the big corporate passive aggressive notes from belly of HR about the "good of the company" are the closest to people's weekly and/or daily sermons that they'll see.
Oh wow. I've not thought about that culture in such a light. Perhaps that's why I have always found those "sermons" a bit creepy? I think you have a great point here.
> Or a redefinition of a lot more hobbies and crafts as "jobs" and "work". (I'm not sure which would be easier. There are stigmas in both directions.)
100% agreed. I know quite a few artists who are branching off into freelance, using the internet to their disposal (patreon, gofundme, etsy, etc.) who have been chided for not "having a real job" or looked down upon for choosing to have a part time "real job" to make time for their craft / art. Yet, they make respectable income. This phenomenon for artists in general may not be new, of course. I just like to imagine how the internet may help change or eradicate the stigma of it not being "good enough".
When my own brother decided to go down this path, I was a bit concerned, and the truth is most of my positions as a sysadmin until recently were very corporate. I was appalled at myself for even thinking things like, "But this isn't going to build a career for him. Why is he even taking this chance? This seems stupid of him."
I'm now wondering if my exposure to this 'corporate dogma' may be related.
For the "The End of History" hypothesis to work, the basis for capitalism supposes infinite growth to provide opportunity and prosperity for people. But capital has decided growth is too risky in many markets. It's a shame we've structured our society and economy to be dependent on the whims of capital.
The rise of automated looms and spinning jennies clearly mean that the farms aren't going to be sufficient to provide employment for people, who are in turn going to turn to vice and sloth. And, as we know, when the old way is exhausted there is no new way forward. I propose that we be suspicious of the looms and especially of the people who make the looms.
jobs are the cost of satisfying human economic desires. we want to minimise costs, not increase them.since nobody knows what sort of jobs will exist even 5 years from today, there is no point in speculating and wringing hands.
who saw the rise of zumba dance teachers? theres atleast a million of them today and they dont need high education or be employed in silicon valley. did president clinton with all the information available at his disposal have the foresight to plan for an app economy for his citizens or imagine how internet search would be something different than what lycos offered?
>jobs are the cost of satisfying human economic desires. we want to minimise costs
That's an excellent perspective. There's a major barrier though.
Even if we produce enough that everyone could satisfy their desires and then some with a cost of only 34 minutes work per week (<2% of a 40 hour work week - parallel to the fact that less than 2% of the population now works in agriculture to produce more than twice enough to feed everyone), we would still demand that everyone must work at least a bare minimum of 40 hours or else they don't deserve to live. That's our culture.
But there would be no demand for that work. So what would the people do? And more importantly, why do we demand that they do it? That becomes a philosophical question, not an economic one.
It's impossible that there is simply nothing in the world that needs doing.
Exactly how to make sure that things that need doing, are done, is what economics and politics are about, but any "job shortage" is because of inefficiencies along some spectrum, not actually ever a natural state.
The word "job" as used here is a technical term. It doesn't mean "anything that needs doing". It doesn't mean "anything I find enjoyable or worthwhile". It actually means "activities that someone will pay me money to do because I can do it better, faster, or cheaper than anyone or anything else, including machines." (For the purpose of this discussion there's also an implied meaning of "someone will pay me enough money for those activities that I can purchase adequate food, shelter, and discretionary items so as to have a reasonably comfortable existence.") That set of activities appears to have peaked in per-capita terms and is probably on a decline which will accelerate rapidly in the future.
So yeah, you're right that this problem is inherently an economic problem, not an "I don't know what to do with all my free time" problem. That doesn't make the problem any less urgent or less difficult to solve. It's actually incredibly difficult to solve because it'll involve rejiggering our social contracts, which will probably take several generations to complete.
I think many of these articles about jobs or lack there of and solving the problem dont take into account human nature. It is much more complex than just "economy".
What if? You create them, of course. The f..king main reason that exists something called economy and polítics is to solve people's living problems, not to create stupid zillionaries.
What we do have is plenty of regulations that constrain the supply of physicians, services, medical supplies, insurance, and everything else needed to perform operations. It is one of the most un-free markets in America, with predictably disastrous results. Sure, those laws prevent a few people from being duped by charlatans, but they also prevent people like me - who are willing to sit on the phone for hours and days, and willing to do research for weeks on end - the possibility of a longer life.
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There are also plenty of regulations that are limiting career mobility, both in medicine and in other fields. An example of this is that anything that makes it hard for employers to fire people also makes it more costly for them to hire different people (because that new person is an unknown, and therefore risky, as the employer has to hold onto them longer, even if they aren't willing/able to produce.)
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EDIT: I'd like to add that the idea that some people are destined to be doctors (and some aren't) is completely wrong. I was a premed in college (molecular biology degree, worked in a research lab on campus full-time for two years after graduating), and I gave up on the MD track after talking to a few younger doctors. They all told me to quit while I could because they were all in 200k+ in debt, and couldn't switch out of their careers because of it, and they were miserable (tons of useless paperwork, not a lot of progress either in research or with patients). So I went into software, where you don't have to convince a committee to give you permission to make a new app.