Deflation is the collapse of prices. If in future cheap energy and high degrees of automation led to most goods and services being "priced near zero" as OP said, that would be extreme deflation. Reducing the money supply can create deflation, but deflation can also occur even if the money supply is constant or growing (for example because of technological progress).
My point is just that in that circumstance - prices extraordinarily low, unemployment extraordinarily high - we would probably institute a basic income to avoid mass suffering (and attendant costs).
Even with extreme deflation, the unemployed will be severely undernourished (feeding into the destructive cycle of hunger and poverty), unless a basic income were instituted. Happy now?
I am arguing that it wouldn't be necessary to make it illegal to work extra hours (unless the putative civilization has reached the environmental limit).
Here in the US and most other advanced economies, we have partially detached income from labor via social policies (so that the unemployed are often not literally starving). We may have to totally detach them when faced with the combination of extreme deflation and extreme unemployment.
I think what matters to the point is whether or not there is a surplus now, not whether or not there might be one in the future. Even if all arable land is exploiting using what we would call conventional agriculture there is no guarantee of unlimited productivity.
For example, one of the largest and most advanced centers of agriculture, the Great Central Valley of California, has began to experience a decline in productivity. Maybe future hybrid conventional / sustainable approaches will be developed and deployed and productivity will recover - I don't know. Really we don't know what is the true environmental limit.
They are sitting on significant (even record breaking) reserves, but these were only acquired by relying on the ultra-cheap credit coming out of the advanced economies' central banks. There are a lot of reasons not to reinvest those reserves. One is the preference of some shareholders for dividends, but also severe overcapacity in manufacturing has caused a big decrease in the return on investment.
Cash reserves / liquidity and absolute profits aside, the rate of profit has been in decline for about 40 years. Basically over ~1973 - present we have have seen (1) collapse of the profit rate, leading to (2) suppression of labor as an attempt to recover lost margins, all accompanied by (3) continued productivity growth. Why the rate of profit fell is of course debated, but chronic overcapacity is a very likely candidate. That position is argued here by UCLA economist Robert Brenner. Everyone should read that paper (at least to skim and check out the graphs). Even if you disagree with his diagnosis for the financial crisis (and actually he offers no prescriptions), the analysis of the historical economic data and global economic actors during 1973 - present is outstanding.
Nevertheless, people do work 60-80 hours per week (although the US average is 33 hr/wk). Some work such long hours due to norms and drive (e.g. in law and finance) and others out of necessity (the working poor).
Again, why not? The working week used to be much longer than 40 hours. In fact, when the industrial revolution began, the average labor per person per week soft up to 60 - 80 hours and then gradually fell to its current level (about 33 hours / wk. in the US).
Across the advanced economies, working hours continue to fall. France has reached 30 hours, while the Netherlands has already got to just 27 hours.
I initially thought along the same lines as the GP's question: what happens as the proportion of the population needed for essential labor becomes smaller and smaller?
Ultimately, a system where the only way to obtain goods is via remuneration for "essential" labor must give way to one where all human occupations are remunerated, from child-rearing to all of the arts and sciences. This process is already underway, as a higher and higher proportion of demand shifts to the service and creative sectors, and as scientific research comes to be seen as an end in itself (perhaps due to its beneficial side effects). Eventually currently undervalued labor, such as raising children, the production of art and pursuing personal happiness might supported as well. What we consider a hand-out today could be seen as payment due for helping maintain the fabric of civilization.
If labor productivity continues to grow and thus induce systemic overcapacity, it seems inevitable that that excess capacity eventually employed by society. In science fiction the solution has been the destruction of wealth or the imposition of permanent war, but in real life less drastic responses such as shortening the work week or institution of a basic income seem more likely.
I was also heavily influenced by Vonnegut's Player Piano, which got me thinking about the (supposed) paradox of detrimental progress, as well as Economics of Global Turbulence by Robert Brenner, which taught me the impact of that paradox functions in the global economy. In this paper (free PDF) Brenner succinctly restates the book and extends its analysis up to the recent economic crisis. The data and astute analysis of economic actors over the past 50 years are enlightening, even if one disagrees with his diagnosis (severe and chronic overcapacity in manufacturing). Everyone should understand at least how the global economy has actually behaved since the end of post-Depression / post-War growth in the late 1960's (systematic collapse of the corporate rate of profit even in the face of supply-side economics, labor suppression and continued productivity growth).
TFA makes it sound like they were surprised to find that individual bowls were ever used for a specific item. In other words, that the ancient people were capable of using multiple bowls to prevent their ingredients from mixing...
To build on your point, the corporate rate of profit has been almost continuously in decline since the early 70's. Labor suppression, productivity growth and cheap credit have kept them going so far...but who knows for how much longer.
The conclusion is probably going to be the detachment of income from labor.
Progress is bad for us right now precisely because we allow workers who have been displaced by technology to starve (or nearly so). We should try and alter our economy so that increased efficiency actually benefits society.
Most likely the reduction in unemployment after the shortening of the work week would discourage workers from finding a 2nd job because 1) the tight labor market would cause their existing wages to rise and 2) the new jobs opened by the shorter work week would be taken up by unemployed.
That said, the reduction should be gradual, so as to further discourage taking additional employment as the work week gets shorter. The point isn't to make people happier, it's to distribute income more equitably. You want the new hiring to go to the unemployed...I'd advocate 2 hour reductions every 2 years for 20 years or something like that.
Capital has pulled the wool over your eyes. The long work week serves to increase the size of the reserve labor force (the army of unemployed), and helps perpetuate labor market conditions detrimental to workers (cheap, easily replaceable labor).
With regard to your last point, it is true that corporations have boosted their falling profit rates (not profits, profit rates) by suppressing labor, but it has only led to weaker and weaker aggregate demand.
Slashdot Mirror
Deflation is the collapse of prices. If in future cheap energy and high degrees of automation led to most goods and services being "priced near zero" as OP said, that would be extreme deflation. Reducing the money supply can create deflation, but deflation can also occur even if the money supply is constant or growing (for example because of technological progress).
My point is just that in that circumstance - prices extraordinarily low, unemployment extraordinarily high - we would probably institute a basic income to avoid mass suffering (and attendant costs).
Even with extreme deflation, the unemployed will be severely undernourished (feeding into the destructive cycle of hunger and poverty), unless a basic income were instituted. Happy now?
I am arguing that it wouldn't be necessary to make it illegal to work extra hours (unless the putative civilization has reached the environmental limit).
Here in the US and most other advanced economies, we have partially detached income from labor via social policies (so that the unemployed are often not literally starving). We may have to totally detach them when faced with the combination of extreme deflation and extreme unemployment.
I think what matters to the point is whether or not there is a surplus now, not whether or not there might be one in the future. Even if all arable land is exploiting using what we would call conventional agriculture there is no guarantee of unlimited productivity.
For example, one of the largest and most advanced centers of agriculture, the Great Central Valley of California, has began to experience a decline in productivity. Maybe future hybrid conventional / sustainable approaches will be developed and deployed and productivity will recover - I don't know. Really we don't know what is the true environmental limit.
Sure, if the prices really drop to zero. But otherwise we would probably institute a basic income.
They are sitting on significant (even record breaking) reserves, but these were only acquired by relying on the ultra-cheap credit coming out of the advanced economies' central banks. There are a lot of reasons not to reinvest those reserves. One is the preference of some shareholders for dividends, but also severe overcapacity in manufacturing has caused a big decrease in the return on investment.
Cash reserves / liquidity and absolute profits aside, the rate of profit has been in decline for about 40 years. Basically over ~1973 - present we have have seen (1) collapse of the profit rate, leading to (2) suppression of labor as an attempt to recover lost margins, all accompanied by (3) continued productivity growth. Why the rate of profit fell is of course debated, but chronic overcapacity is a very likely candidate. That position is argued here by UCLA economist Robert Brenner. Everyone should read that paper (at least to skim and check out the graphs). Even if you disagree with his diagnosis for the financial crisis (and actually he offers no prescriptions), the analysis of the historical economic data and global economic actors during 1973 - present is outstanding.
Nevertheless, people do work 60-80 hours per week (although the US average is 33 hr/wk). Some work such long hours due to norms and drive (e.g. in law and finance) and others out of necessity (the working poor).
Again, why not? The working week used to be much longer than 40 hours. In fact, when the industrial revolution began, the average labor per person per week soft up to 60 - 80 hours and then gradually fell to its current level (about 33 hours / wk. in the US).
Across the advanced economies, working hours continue to fall. France has reached 30 hours, while the Netherlands has already got to just 27 hours.
I initially thought along the same lines as the GP's question: what happens as the proportion of the population needed for essential labor becomes smaller and smaller?
Ultimately, a system where the only way to obtain goods is via remuneration for "essential" labor must give way to one where all human occupations are remunerated, from child-rearing to all of the arts and sciences. This process is already underway, as a higher and higher proportion of demand shifts to the service and creative sectors, and as scientific research comes to be seen as an end in itself (perhaps due to its beneficial side effects). Eventually currently undervalued labor, such as raising children, the production of art and pursuing personal happiness might supported as well. What we consider a hand-out today could be seen as payment due for helping maintain the fabric of civilization.
If labor productivity continues to grow and thus induce systemic overcapacity, it seems inevitable that that excess capacity eventually employed by society. In science fiction the solution has been the destruction of wealth or the imposition of permanent war, but in real life less drastic responses such as shortening the work week or institution of a basic income seem more likely.
I was also heavily influenced by Vonnegut's Player Piano, which got me thinking about the (supposed) paradox of detrimental progress, as well as Economics of Global Turbulence by Robert Brenner, which taught me the impact of that paradox functions in the global economy. In this paper (free PDF) Brenner succinctly restates the book and extends its analysis up to the recent economic crisis. The data and astute analysis of economic actors over the past 50 years are enlightening, even if one disagrees with his diagnosis (severe and chronic overcapacity in manufacturing). Everyone should understand at least how the global economy has actually behaved since the end of post-Depression / post-War growth in the late 1960's (systematic collapse of the corporate rate of profit even in the face of supply-side economics, labor suppression and continued productivity growth).
Thanks, I was just hedging against the undervaluation of happiness.
Why? That wasn't necessary when the work week was gradually reduced to 40 hours.
TFA makes it sound like they were surprised to find that individual bowls were ever used for a specific item. In other words, that the ancient people were capable of using multiple bowls to prevent their ingredients from mixing...
There is more than enough food in the world to feed everybody.
In fact, there is not enough. The era of the global food surplus has passed.
[1] PBS article and interview with the director of the World Food Program.
You mean, inflation without growth.
To build on your point, the corporate rate of profit has been almost continuously in decline since the early 70's. Labor suppression, productivity growth and cheap credit have kept them going so far...but who knows for how much longer.
If there really were such extreme deflation, the unemployed would still starve.
I know, I hate it when the citizenry discuss the issues of the day.
Why does anyone need employment in the first place?
Because we basically let the jobless starve. Eventually technological progress will force the separation of income from labor (at least to an extent).
This is why I think we will eventually (be forced to) detach income from labor.
The conclusion is probably going to be the detachment of income from labor.
Progress is bad for us right now precisely because we allow workers who have been displaced by technology to starve (or nearly so). We should try and alter our economy so that increased efficiency actually benefits society.
Screw happiness, shortening the work week would drastically reduce unemployment (and make as all better off as a result).
Most likely the reduction in unemployment after the shortening of the work week would discourage workers from finding a 2nd job because 1) the tight labor market would cause their existing wages to rise and 2) the new jobs opened by the shorter work week would be taken up by unemployed.
That said, the reduction should be gradual, so as to further discourage taking additional employment as the work week gets shorter. The point isn't to make people happier, it's to distribute income more equitably. You want the new hiring to go to the unemployed...I'd advocate 2 hour reductions every 2 years for 20 years or something like that.
Capital has pulled the wool over your eyes. The long work week serves to increase the size of the reserve labor force (the army of unemployed), and helps perpetuate labor market conditions detrimental to workers (cheap, easily replaceable labor).
With regard to your last point, it is true that corporations have boosted their falling profit rates (not profits, profit rates) by suppressing labor, but it has only led to weaker and weaker aggregate demand.
It was the first time that researchers had discovered that the ancient civilization used bowls for specific purposes.
Honestly, I'm at a loss for words.