I’m mostly positive about Andrew Yang but it’s frustrating to know he would point to something like this and scream “automation” when GM’s downsizing has more to do with outsourcing and a slowing market than anything remotely related to robots taking over jobs.
The difference between automation and outsourcing is that automation can actually save domestic jobs. Labor costs are lower in other countries and that is likely to continue, so for US workers to stay competitive they need to be more productive and justify the higher compensation. Which is what automation does -- you get more cars for the same number of labor hours, justifying the higher wages.
That means you get a choice between losing some jobs to reduced labor requirements from automation but keeping the remaining ones, or losing all of them to foreign labor competition. Which may itself use automation regardless of what you do domestically.
You can also get net job gains from automation in markets subject to the Jevons paradox. You make each widget cost 50% as much by reducing jobs by 50%, but that causes people to buy ten times as many widgets, so you really end up with five times as many domestic jobs. Or five times as many foreign jobs, if the other country automates and you don't.
I follow your point, but I'm not sure the research or my personal experience proves that to be true.
In some cases, automation leads to net job growth (e.g., there are more bank tellers now than before the invention of ATMs), but I think that is the exception rather than the rule. Especially in manufacturing, automation absolutely guts jobs. A line that was run by dozens can be run by a just a couple. The balance is so far to one side I think it's hard to make a case that automation saves many jobs. It seems to me that the paradox you bring up would only apply to very limited use cases; I don't know many products people would want to increase consumption on scale with the job loss for that to work. But I may be biased by my automation experience in high dollar products.
Example: I know of an onion farmer who recently automated. Even if all other onion farmers automated im not going to 5x my consumption of onions, and that's a low cost product
The point isn't that all markets work like that, it's that it can, in a way that outsourcing can't. Even if outsourcing results in lower prices which increase demand, the additional jobs then go to the country the jobs were outsourced to, not to the original country.
You're also looking at the overall market rather than a single company or country. If you automate before your competitors, the result is that you can produce onions for 20% the original price because you need 20% as many workers per kilo of onions. Even if people buy exactly the same total number of onions at the lower price, they now buy 25 times as many from your company and your country because you have the best price on the world market, so you hire five times as many domestic workers.
If other countries do the same thing then you're back to parity and everyone requires 20% as many jobs to produce that many onions, but you still have more domestic jobs than if they automated and you didn't, because in that case you would end up with zero flat rather than at least keeping 20% of the original workforce.
I'm following your point, but it's more of a "lesser of two evils" arguement than saying automation creates net job growth. Its not even growth its just lessened job loss.
As the efficiency continues to improve, if demand doesn't follow suit the will be an inevitable job loss. The factories I witnessed automation come in did not ever bring those lost jobs back. Sure, in the short term the displaced workers were sometimes moved to a different plant, but those jobs are almost certainly getting automated in the future too.
It's much easier to picture robots and automation than go into complicated discussions about outsourcing and market forces. Main stream media gives Yang less than 2 minutes to explain his platform when he appears on TV so he has to distill it down into sound bites. The next Democratic debate is going to be another reality TV squawk fest with 10 candidates on stage prepped to throw oneliners and soundbites.
They are subtle but there. Automation means the productivity is local - albeit concentrated in the automatees and implies an upwards trajectory to quality - giving a competitive edge. The industry is still there and likely growing stronger and more concentrated in skill.
Outsourcing implies going to the lowest bidder and less investment locally with fewer peripheral jobs. It is also "brute force" and commoditization. Inevitably the destination nation will develop competition which may be able to compete with the abroad nation who will have little special on them. It risks the loss of the industry even as an outsourcer.
screaming automation doesn't bring up the specters of xenohpobia/nationalism etc. besides that, the image of robots taking all the jobs is evocative and easy for the average person with little to no understanding of economics to respond to.
