Distribution of Wealth in a Robot-Driven World

An anonymous reader sent another piece by Marshall Brain. He continues his examination of a society where most manual labor is performed by machines, idling a large fraction of the current workforce. See his previous piece for background.

Comments

Almost insightful..

[fadeaway]

I thought that the article was rather well thought through until reaching this:

What if the way to achieve the strongest possible economy is to give every citizen more money to spend? For example, what if we gave every citizen of the United States $25,000 to spend? $25,000 sounds impossible the first time you hear it, but consider the possibility.

Putting aside the laugability of the idea of a capitalist government giving each person a years worth of middle income wage for a moment - it would be great if that could work, but it wouldn't. Price inflation would be rampant. Bread would cost $500 a loaf.

Unless some form of government inforced price fixing went into play (ha!), the money would just shoot right back up the tree.

Re:Almost insightful..

[Lemmy Caution]

There's a certain level at which inflation would occur, but that's only if there's scarcity at the supply end. The concern is radical oversupply/overcapacity and underemployment, caused by mass redundancy and automation. It's sort of a game-theory no-win situation where no company would benefit from hiring anyone (because they have automated most of their functions) and thus there's inadequate wealth to generate demand. It's quite plausible, and it may even be a bit of what we have now.

Re:Almost insightful..

[Minna Kirai]

If the government were to seize money and then redistribute it, that's called.. oh I dunno..

ANY GOVERNMENT AT ALL.

As you noted, a government has no money of its own. The only way a gov can do ANYTHING is to seize and redistribute from the citizens.

The only government which never redistributes wealth does NOTHING; they call that anarchy.

Re:Almost insightful..

[An Onerous Coward]

Actually, no.

Price inflation would happen. But it would be a huge equalizer. If we assume that $25,000 is the current household average, then giving every household another $25K will double the amount of money in the economy, hence we will assume the doubling the price of all goods and services (not the 250x increase you propose).

Now that everything costs twice as much, the person getting by on $10000 a year now has $35000, which amounts to $17,500 in pre-inflation dollars. In short, he just got a pay raise.

Meanwhile, the family which once earned $1,000,000 a year suddenly finds everything twice as expensive, lowering their effective income to $500,000.

Further, whatever debts you owed could be paid back much more easily in an inflationary economy. If a loaf of bread really costs $500, then you could pay off all your student loans by baking thirty loaves of bread. Inflation has always been better for debtors than for creditors. Read up on the whole "gold standard" politics of the late 1800s. It's dry reading, but relevant.

Finally, you ignore the overall thrust of the article: He is proposing this plan because, in the world he envisions, there is a vast amount of wealth being created by robots, with all the wealth going to the owners of the robots. Average schmoes are locked out of that stream because they can no longer provide any services that the owners would exchange their wealth for, because a robot can do unskilled (and even low-skilled) labor better, faster, and cheaper.

America has never been a purely capitalistic government. The government has taken it upon itself to do things like divy up land, control imports and exports, build armies, and a host of other things rather than let "The Market" find its own solutions. Every regulation is an affront to the ideal of a purely capitalistic marketplace. This state of affairs is A Good Thing. Would we want to live in a world where Biggasse Corp could dump their toxic waste on the outskirts of Smelterville, MI because its residents were too poor to make it expensive to do so? Where any amount of pollutants could be flung into the atmosphere because the corporation doing the flinging didn't have to bear the costs that pollution imposes on the rest of us? There are places where capitalism works, and places where it doesn't. The entire point of the article is that we're about to run up against a situation where capitalism Does Not Work.

Who can make predictions like that?

[exp(pi*sqrt(163))]

People predicted the working week would decrease dramatically over the last half-century. We now seem to work much harder. People predicted a paperless office. On the contrary we use more paper than ever because we can print on it so damn fast! Who knows what the outcome of more robots will be? Judging by the last 50 years it'll mean more and harder work for all of us.

History repeats itself?

[strider3700]

In the 1960s, the split was closer to 60/40, with 80% of the population making 60% of the income, and the richest 20% of the population making 40%. [ref] Between 1960 and 2000, the income split has gone from 60/40 to 50/50.

Perhaps I'm wrong but haven't we seen this before a few hundred years ago. I'm thinking of the poor unwashed masses rising up and overthrowing the rich elite minority. The french revolution, the american war of independance, the russians also killed off their royalty if I remember correctly. These days the people are the business leaders, and not royalty but they still have the same outlook on life. I wouldn't be too surprised to see the same thing happen again. When you leave people with nothing and no hope they have very few real reasons to not die for a cause. Keep the masses happy and comfortable and they don't want to risk losing that.

Look at the past 20 years to predict...

[John Seminal]

How are we, as a society, going to respond to this robotic revolution? If we handle it properly, the arrival of robots could be an incredibly beneficial event for human beings. If we do not handle it properly, we will end up with millions of unemployed people and a severe economic downturn that will benefit no one.

Most buisnesses will do whatever it takes to make more of a profit. If the robots are cheaper than people, they will use robots. I doubt that most buisnesses consider the effect on employment or workers morale in buisness decisions. With NAFTA, many USA jobs that paid over $20 an hour left for Mexico where they pay a small fraction.

Re:People will adapt

[tambo]

Quit your whining. This is a good thing people and it's an example of what makes capitalism great.

Sure... if you subscribe to the theory that a class-based culture is a healthy thing.

If you've read this gentleman's writings, you'll glean that this isn't just another routine shift in employment - we're heading toward a watershed event, a singularity. In the past, as old industries became obsolete, the work force laid off from one profession got dumped into the "generic labor" pool... y'know, the Walmart greeter, etc. What Marshall Brain is arguing - quite insightfully - is that the "generic labor" pool itself will be obsolesced, which has never happened before. What happens when the only jobs are those that you need serious skill and training to perform? What happens to the 90% of the population who has no such skills and can't develop them?

Moreover, and even worse: People claim all the time that the economy has survived everything before it, and will adapt. But some trends, promoted by such shifts, have just continued to go in an unhealthy direction. One of them is the concentration of wealth: the increasing percentage of resources owned by a tiny fraction of society. Another is the shift in wealth from individuals to corporations - never before has the economy dealt with gargantuan bodies like AOL-Time-Warner.

The impact of these trends is unknown, and ominous.

I suspect that we're heading toward a two-class society, comprised of the working skilled and the unemployed masses. Already, these two groups exist and rarely interact, but the differences are growing more visible stark by the day.

- David Stein

Re:People will adapt

[sydb]

What no one saw was that freeing up the most important capital, human labor, from inefficient application to the task of growing food for other purposes. What those who looked at the farms failing and saw disaster were missing was that now the farmer was able to go to the city and be basically as well off working in a factory, and that the farmer's children would go on to become doctors or lawyers or engineers or skilled laborers. Indeed, the industrialization could not have happened without the farm failures.

True, but you miss the point of the article, which is that the upcoming wave of automation won't just make farmworkers or industrial labourers or any other arbitrary sector of the working population redundant, it'll make damn near everyone redundant. It'll be a long wave, but it's coming. Damn, I was in an internet cafe an hour ago. Last time I was in they had staff, who would take your payment and give you a ticket for your purchased time. Tonight they have vending machines. OK, it's a trivial example but I was surprised.

We are heading towards a world where the only use for people is thinking up what to do next, and as plain as your nose, that isn't a job for everyone, not when we have seven or eight billion people in the world.

Mass automation is a huge opportunity and also a huge risk for billions of people. It has to be managed, not left to the whims of the market, which will be increasingly controlled by fewer and fewer extremely wealthy people.

If we continue to do what we did yesterday to meet the problems of tomorrow, we are destined to fail at every step. Mankind cannot rely on the market of the last millenium to meet the dizzying challenges of the new one. And if think it's all pie in the sky, look at the pace of change right now. It's only going to accelerate.

Too late

[Minna Kirai]

"Most manual labor performed by machines"?

It already is! Recall that work is measured in joules (distance of mass per time). Then look outside the window at a modern European or American nation.

Where are all the joules (work) coming from? Not by human effort! 90% of it is from machines. Look at all the energy that goes into driving North Americans to their Labour Day holidays!

Some might disagree and say that all of the output of these machines isn't "work", as does the article author when claiming that 50% of modern work is in service industries (like McDonalds). That's because he's already accepted an altered definition of work that excludes non-human efforts.

Take the perspective of a 17th century economist and ask what tasks account for most of the "work" done in a nation- the list includes plowing, digging, hammering, sewing, scrubbing, and chopping (amoung similar things). Today all but one of those (scrubbing) are performed by machines. As Roblimo mentioned last week, agricultural food production is the only really important job. The US makes 5x more food than it did a century ago by employing 10x fewer people.

The time when most work is performed by machine has long since come. A more accurate description of the question facing us in the future (as addressed by the article) is: What happens when unskilled jobs cease to exist?

Nobody really does anything anymore

[Jonas the Bold]

Very few people actually make anything anymore.

Most poor people don't make anything: Truckers, people who work in stores really just help move goods around. Same for people who work in restaurants.

The middle class people all sit in cubicles. God knows what they do, but they sure as hell aren't making anything.

The upper class are businessmen, lawyers and doctors. Doctors keep people alive longer, businessmen move money around, and lawyers, as far as I can tell, have no function at all.

Nobody really needs to do the vast majority of today's jobs.

Re:Nobody really does anything anymore

[asr_man]

Well said Eeyore the troll. Let's just all curl up and die.

The only insight I gained from your post was about your mental state at the time. It was not connected to reality. You got the higherachy all right, but WTF does it mean that nobody needs to do these jobs?

I need to live in a house. I need that truck to deliver the lumber. I need that lawyer to close. I need that person in the cubicle to setup my insurance accurately. I need that doctor to help when my family is ill. I need that businessman to provide me a job so I can pay for it all. And god knows I need those people in restaurants at the end of the workday when we're all too whacked out to cook.

Which is why we have problems with terrorism

[HanzoSan]

When wealth isnt distributed, crime goes up, terrorism goes up, etc etc.

The idea that we can fight terrorism with bombs isnt very smart, in the end the only way to solve this problem is with jobs, education, etc.

This isnt going to work because I refuse to give up my job to fight terrorism.

We could have had this already by now...

[Murdoc]

But political and business leaders won't let it. Scientists and engineers in the 1920's and '30's determined that not only was this type of society possible, but also but also necessary in order to be able to distribute the vast amount of wealth that machines were capable of producing for us. They even developed a soundly logical and rational model of society that would allow this to work.

The problem of course is that in order to enact this "society of abundance," you need to abolish all the relics of scarcity. Mostly this means money, and by extention, political control of technology. Think of what happened in the Great Depression. Factories were producing so many products (like food) that there was plenty for everyone, but because the money used to distribute it was still scarce, the value dropped below the margin of profitability. No one could make money selling it, thus no one made money. Add to that people losing jobs to these machines and you have a society that has enough for everybody, but no one can afford even the dirt-cheap prices. You can't sell air, it's too abundant. If we pollute it enough, however, we will be able to because it will be scarce.

So the question is not a matter of when will technology be advanced enough so that this can happen, it's how can we tell enough people that this kind of life is already possible, and circumvent political and corporate attempts to stop it from happening because they will lose all their "power" and "control"?

There is a reason that the most popular social movement of the '30's nad '40's is now completely unknown to people today. It's because it just might work.

We are at the dawn of a new world. Scientists have given to men considerable powers. Politicians have seized hold of them. The world must choose between the unspeakable desolation of mechanization for profit or conquest, and the lusty youthfulness of science and technique serving the social needs of a new civilization. - Albert Einstein

Please cite your source...

[idontneedanickname]

The above is copy and pasted from Robotic Nation... Which is another piece written by Marschall Brain. It's linked at the top the of this article in fact.

Be more careful when you're plagiarizing. :)

As big a watershed as leaving Agriculture behind

[benwaggoner]

Honestly, I don't see robots as being as big a deal as the transition from an agricultural to an industry society! As the previous poster said, in the last century the jobs that 90% of people had had FOR THE ENTIRE HISTORY OF CIVILIZATION went away in a couple of generations. Now THAT'S a watershed.

Also, rapid change erodes static classes, it doesn't save them. If what the jobs look like change every generation, you'll have a lot more social mobility between generations. Class is already an extremely fluid thing in America, in a way that they really wouldn't be considered "classes" by a 19th century Brit, and definitely not by an 18th century Javanese.

Re:Tax and Spend

[ornil]

Well, you know, this money the government takes from us is used for something. A significant part is wasted of course, but most of it goes toward something most people would consider useful, even if it does not provide you with any direct monetary benfit. Like supporting the army, or interstate highways, or funding research, or even education (federal loans, for example). Also it is used to provide services to the poor, including paying welfare to those who don't work. And, you know, it provides even those of us who would never need welfare with a useful service. One reason is that otherwise we would have the world revolution that Marx promised us 150 years ago.

So those taxes may be necessary, because if it were left up to you, you would probably not be able to procure these services. Remember, Americans actually pay less taxes than most other people in the developed world.

Re:Resdistribution

[Anonymous Coward]

Churchill may have said it best with, "We contend that for a nation to try to tax itself into prosperity is like a man standing in a bucket and trying to lift himself up by the handle." Karl Marx realized this as well, in stating, "There is only one way to kill capitalism -- by taxes, taxes, and more taxes."

"Politicians never accuse you of 'greed' for wanting other people's money --- only for wanting to keep your own money."

"America's abundance was created not by public sacrifices to 'the common good,' but by the productive genius of free men who pursued their own personal interests and the making of their own private fortunes. They did not starve the people to pay for America's industrialization. They gave the people better jobs, higher wages and cheaper goods with every new machine they invented, with every scientific discovery or technological advance -- and thus the whole country was moving forward and profiting, not suffering, every step of the way." [Ayn Rand]

"In general the art of government consists in taking as much money as possible from one class of citizens to give to the other." [Voltaire]

What has gone wrong

[fnj]

"America's abundance was created not by public sacrifices to 'the common good,' but by the productive genius of free men who pursued their own personal interests and the making of their own private fortunes. They did not starve the people to pay for America's industrialization. They gave the people better jobs, higher wages and cheaper goods with every new machine they invented, with every scientific discovery or technological advance -- and thus the whole country was moving forward and profiting, not suffering, every step of the way." [Ayn Rand]

She was absolutely dead-nuts right at the time. But lately it seems the corporations, with fiduciary responsibility only to the stockholders, have turned into evil monsters, exporting jobs, discarding workers like yesterday's trash, yet somehow enriching those at the top more and more, often just for being there, to an outrageous, absurd extent.

I used to think we were headed for 1929. Now I think maybe we are headed for October 1917.

Re:I'm going to *so* get modded down for this, but

[eric76]

I've always felt that trying to eliminate the undesirable and banal jobs for which you need little skill and intelligence is good for society; of course, I consider myself in the 5%.

I think that society is at its best when everyone has something constructive to do. Some of these undesirable jobs are the only jobs that some people can handle.

Having something constructive to do and being responsible is, for many people, possibly nearly everyone, the only thing that keeps them civil. It's no accident that the value of human life is cheapest in the areas with the greatest unemployement.

Re:Won't happen

[bluGill]

Look at vietanam and Afganaston before you say that too loudly. Sure there was a lot of external assistance, but then the American revolution got a lot of assistance too. (Mostly from France, which was at war with England)

Civil wars are very hard to win because you don't know who will stay on your side. General Robert E. Lee of American Cival war fame was offered the job of commander of the Yankee forces, but instead took the job of the confederate forces because he liked that side better, and suddenly the rebels had one of the best generals of the war on their side.

There are a lot of guns out there. I don't know how Europe would do, but in the US there are at least as many guns as people, and most are in fireable shape, with amunition. Hard to win a war when you are not sure who is the other side. Nukeing your own people isn't a good idea. Local forces can still win a revolution or civil war, but because local forces don't need your fancy supply lines and communications, they are honest supportive citicians until you come to town. With modern transportation a rebel can attack miles from home and still be at work the next morning. One crossover general can run the whole thing from his secert internet connected bunker, using pgp to make sure communication goes works. Of course the other side has plenty of advantages, but if they will help is debatable, and really depends on the actual situation.

hmm. a few important flaws

[evilWurst]

This article's meat is based on some critical assumptions - flawed ones.

Firstly, like most doom-and-gloom technology-obsoletes-humans and technology-steals-jobs articles, the writer assumes all these jobs will be replaced *instantly*. This is clearly wrong, for several reasons.

First, the major corporations that'd be buying the robots are risk-averse. They'll let someone else try - and be burned by - such a scheme before they try it themselves. This might take place over ten or more years.

Secondly, he assumes that this entire block of jobs can be replaced all at once, which is also clearly wrong. They all require varying sophisticated levels of working artificial intelligence. Unfortunately, we cannot assume robots will become capable of handling *all* these jobs at the same time. AI is like nuclear fusion power plants, in ever since the 1950s experts have been saying "it'll be ready in 10 years", and ten years later they're still saying "it'll be ready in 10 years", and so on. It is likely that improvements will continue to be incremental, as they have been so far with industrial robots. Robots capable of taking voice orders from anyone who walks in the door, making your burger, and working the register are the kind of robots that will be perfected *last*.

Third, he assumes that a robot worker will be cheaper than a human worker, and that the rise of robots will not create any jobs to replace those jobs they displace. This is also clearly wrong. Human replacement will take more than a 1-to-1 ratio at first, as the first ones will not be as versatile as humans - they'll be more customized towards doing a specific task. Checkout line robots won't also be pulling shopping carts out of the parking lot and stocking the shelves, you'll need a few custom bots for each job. If the cost of buying and supplying power to a bunch of robots is more than the cost of a minimum-wage human employee, the robots won't get bought. Plus the diversity of robot types would slow the economy of scale of production, keeping the prices up until their widespread adoption.

When robots DO start to become worth buying, they'll need humans to keep them in service - robot repair is a hard enough AI problem that, again, that'd be the *last* type of job robots would be able to replace. As an additional bonus, the human repairmen would probably make a better salary than the minimum wage jobs being lost. There will also, of course, be a spike in the number of robot engineers and robot programmers and robot company advertising firms and robot company markters and salesmen and managers and so on. There will be more business for insurance companies - hey, you want to protect that robot investment! bots make great vandalism targets and it'll probably be illegal for them to defend themselves. There will be more business for lawyers - hey! this robot rolled over my foot, this robot dripped oil in my burger! - as, again, we expect the first models to be imperfect. And as human jobs would be those requiring more skill, there would be more teaching jobs.

Fourth, he forgets that such a massive change in our economic structure would also likely affect the minimum wage. If there are no grunt-work jobs left, then the new jobs would require a level of skill such that the minimum wage would be raised quite a bit - a huge benefit to those human workers with jobs one tier up from those being filled by robots.

Fifth, he doesn't look long term enough. Total automation of all the grunt work would increase the overall efficiency of the system to a level where it would become attractive to shift our economy to a slightly different system altogether. Sort of a hybrid socialist one - hey, if the farms are nearly free to run, might as well give every citizen some free rations of staple foods every month. If construction is nearly free, why have homelessness? Give those who can't afford a house a one-room economy apartment. The economy would still be capitalist at heart - because if you want to improve your situation, you'v

Re:The Future:

[TheSync]

What really scares me is how IGNORANT of ECONOMICS most Slashdot users are. You folks are generally pretty educated about technology and science, but you have no clue when it comes to economics.

We live in a world where the expansion of the free market has transformed a planet of people whose daily challenge was to feed themselves, into one where we see poverty going away rapidly. In 1950, only half of Americans had indoor plumbing. Now even some of the poorest Americans have microwave ovens and television sets, let alone indoor plumbing.

Not only has the super-rich West been moving forward. In 1970, the percentage of humanity living at under $2 per day was 40%, under $1 per day was 16%. By 1998, less than 20% of humanity lived under $2 per day, and less than 7% live on under $1 per day (all measurements in 1985 dollars).

We have a long way to go still. But thanks to economic liberalization in countries such as India and China, these numbers are expected to continue dropping.