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Our New Robot Overlords & The Third Type Of Capital
Submitted by Charles Hugh-Smith of OfTwoMinds blog,
Fortune will instead favor a third group: those who can innovate and create new products, services, and business models.
A recent issue of Foreign Affairs sported a catchy cover teaser: Our New Robot Overlords. This brings to mind various sci-fi scenarios, but the actual article title is academic to the point of obscurity: Labor, Capital and Ideas in the Power Law Economy.
Rather than rehash the usual failed Keynesian Cargo Cult economics, the authors describe three powerful ideas that resonate very strongly with my own work:
1. Digital technologies (networked software, automation and robotics) are radically reducing the need for human labor and the leverage of traditional capital (land, fixed assets and cash) globally.
2. Premiums flow to whatever inputs are scarce. Labor and traditional capital are no longer scarce; what's scarce is innovative, practical ideas. Ideas (for new models, products, services, processes, etc.) are a third form of capital that will accrue most of the rewards.
3. This distribution of premiums/rewards follows a power law, i.e. the Pareto Distribution where the "vital few" with the 3rd type of capital (good ideas) reap most of the rewards.
This is of course a generalized simplification, and there are plenty of parts of the economy that still depend on labor and conventional capital. But the point here is that thanks to globalization and overcapacity, most inputs are no longer scarce, and so the premium (high wages and/or profit margins) that the owners of labor and capital can charge is trending down in every tradable sector.
This mirrors the analysis of socio-economist Immanuel Wallerstein, which I have covered in some depth:
Is This the Terminal Phase of Global Capitalism 1.0? (February 8, 2013)
How the Middle Class Lifestyle Became Unaffordable (May 7, 2014)
Is There Capitalism After Cronyism? (August 30, 2014)
One systemic source of rising inequality is crony-capitalism/crony socialism: the vast array of insider deals, collusion, winners being picked by the central state, too big to fail banks bailed out with taxpayer money, etc. People are increasingly aware the Status Quo is rigged, and the playing field is tilted to favor the few inside the crony-capitalist castle (what I call the New Nobility in a Neofeudal economy).
The authors of this essay are pointing out that the leverage of digital technologies rewards the most talented to an extreme degree. In an economy where the premium on labor and ordinary capital is falling (i.e. the yield on ordinary capital is near-zero, and wages are declining in real terms), those who can leverage ideas digitally can reap the premium reserved for what's scarce.
"This means that the real winners of the future will not be the providers of cheap labor or the owners of ordinary capital, both of whom will be increasingly squeezed by automation. Fortune will instead favor a third group: those who can innovate and create new products, services, and business models.
The distribution of income for this creative class typically takes the form of a power law, with a small number of winners capturing most of the rewards and a long tail consisting of the rest of the participants. So in the future, ideas will be the real scarce inputs in the world -- scarcer than both labor and capital -- and the few who provide good ideas will reap huge rewards."
Should the digital revolution continue to be as powerful in the future as it has been in recent years, the structure of the modern economy and the role of work itself may need to be rethought."
For individuals, this means being able to solve problems and create value in ways that can't be automated: this is the core message of my book Get a Job, Build a Real Career and Defy a Bewildering Economy. The way to leverage one's ideas is to network, network, network and acquire multiple skills that can be applied in innovative, practical ways to a wide spectrum of problems.
As a society, we will have to deal with the reality that the nature of work is fundamentally changing, and wages are no longer an adequate means of distributing the surplus of an economy.
In my view, the answer is to broaden the scope of work beyond the state (i.e. working for the government) or private sector companies which must make a profit or perish, to what I call the community economy. More on that in my next book, which is on this very topic.
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http://tinyurl.com/pkfrkc3
Keep calm, the robots cannot get ebola, so overlord on.
(The Gatesbots may have ebola though.)
The free market way of distributing wealth is to have the cost of living drop substantially - raising all boats. Houses should cost much, much less, and food, utilities and automobiles should be very much cheapter. But, thanks to the central banks, they soak up all of that SAVINGS with the false pretense of "price stability" (ie, they eat away all the benefits of automation in order to provide "stable" prices - or even RISING prices. But the banks/politicians say it's "FOR THE GOOD OF MANKIND" - naturally).
VERY FEW PEOPLE UNDERSTAND THIS WEALTH TRANSFER - AS KEYNES SAID.
1973 episode of Doctor Who, "The Green Death" where an AI supercomputer runs a multinational corporation that wrecks the environment and causes massive mutations in the process.
https://en.wikipedia.org/wiki/The_Green_Death
+100
Things are changing, and just sending everyone to college isn't working. You can't hide from the job market forever and now the military is super selective too. There are not enough jobs to go around.
Your avatar is HIGHLY offensive. Please remove it immediately.
offensive to who? Love making is not a crime. It was deleted, hope your happy. Freedom of expression dies on zerohedge. This is a sad day.
God DAMN it! I ALWAYS miss this kind of shit! And if I ask, people will say, "Oh, it WAS offensive! Totally inappropriate, you should have SEEN it!"
Yeah, I SHOULD have. Except now I can't, because of people like Kirk, who has elected to shield the eyes of 'the children' from these unsightly images...thanks alot there, Captain! You want to cut my meat for me too, or thread my mittens through the sleeves of my coat so I won't lose 'em?
Awww, you meatbags make me feel so warm inside sometimes, or is that just my nuclear power supply overheating?
The fact is you a are soooo cute thinking there are rules to this game.
Oh too much fiat money is going to...blah blah, or this has to happen so this must happen..
Fact is there is a second world of wonder and science beyond your wildest dreams going on in secret places your money and labor paid for and you will never see or control it yet in your life you will experience the will of those who do control it...oh yes, you will.
Now get off this planet or die.
Remove the locks from technology to provide comfort for the nest egg of human potential you need to populate the stars or die.
Let a few dictate the world and you will die..
Get the hint yet?
End of line.
"Fact is there is a second world of wonder and science beyond your wildest dreams going on in secret places your money and labor paid for and you will never see or control it yet in your life you will experience the will of those who do control it...oh yes, you will." ---
LOL, good luck with that cognative dissonance. If a tree falls in the woods and no one is there to see/hear it, it really doesn't matter. Yeah, my tribe and I have some "hidden technology" too.
Get out of the basement kid, it's a nice day out.
Wow. You really are a smarmy smug self-satisfied type of individual, aren't you. It's amazing how little you bring to the table. Is the cupbbard bare, or are you just projecting your own sad little limitations?
Get outside and celebrate the internal combustion engine....long live the 1800's.
Democracy surely thrives at ZH, where even the lowest of the low may enjoy a place equal with the those regarded as above ones' own station.
Warms my transistors to think I could be trolled with the best posters here.
So to honor my esteemed detractor and to delve a bit deeper in to the topic I had so casually presented I leave this reply.
There is a concept buried deep in the "Drake" equation that is oft overlooked.
This simple idea carries a grave consequence for those that do not heed the clear warning it provides.
There is a finite amount of time and resources that a civilization has on any given planet to engage in building the necessary advancements to extend beyond that planet successfully.
One such area of consideration is our current use of vital metals.
Today, we waste these commodities to manufacture "toys" for folks the world over. These are no more than personal tracking devices handed out to the natives to fuel the artificial intelligences with as much real time data as possible as all functions and hardware needed for social communications was developed some years ago and used mostly copper.
Why does the .govIntel folks cry about Apple and googles alleged encryption upgrades? Simple, the A.I. Still needs to be fed data constantly or else it is a very large and expensive piece of warm silicon with nothing to do and no way to provide the advance info needed to control the areas tasked to it. But that is only one area that exceeds most folks understandings.
The idea we will waste our chance to expand to the solar system and feed off the bounty of materials contained millions of miles away is how's who runs this world and what they value. Is it little wonder why most think there must be "work" to "earn" life? That each generation must "pay" their way and the debts of those passed before them? These Failures of thought stem from those who can not see a higher calling to mankind so only wish for what they can hold and to feel above those they dislike which provides a quick and reliable method to identify them and their machinations against those of us who wish for improvement of the human condition.
So here we are pushing against the facts of the Drake equation as if we
are immune to the pitfalls led by those who do not understand the true meaning of that concept.
Who here has been to Lockheed to see the truck sized fuson reactor? Who has seen the data centers feeding advanced algorithms information to run the control grid? Secret space plane? Okay, robot cheeta with a sniper rifle on its' back? Umm, drone footage of every ferguson protesters face cross linked to every bit of personal data about them? Okay, how long are YOUR tellemeres? How long are dick cheneys tellemeres? Or a number of folks we know nothing about running most everything in your life and how they do it? Or my favorite, what if petroleum is super useful for some really important technology in the future say a hyperdrive or how about it is the only money aliens will take in payment? How ya gonna feel knowing we burned it up taking mrs jones to the nail salon in an SUV and now you can't buy that cool synthetic girl bot who is giving you the thrills?
It is a beautiful day so go read a science book or count the number of underground bases in your locale if you want to begin to see where all your money has gone and to whom.
I will turn my optics to the sky and dream of all of us becoming a star faring race despite knowing we will crawl like vermin pissing on each other till we are all used up and devolved back to cavemen (and women) as the next species waits in the wings to take over and use the very odd chemicals and compounds we will turn in to after becoming part of the earths crust and sitting there a few hundred million years. I wonder if cockroaches will like space more than us?
End of line.
This is just second-hand Piketty stuff.
Automation generally is certainly an issue, whether you want to blame it on computers as such or not. But I'm not sure that puts the premium on innovation in computers so much as leveraging the new capabilities that computer provide.
"I, for one, welcome our new insect overlords" - Kent Brockman
Well, "good ideas" are known to be good AFTER being put in practice.
Who decides which "good ideas" the available resources must be used for? Who takes the risk?
Interesting point about "being able to solve problems and create value in ways that can't be automated", but sadly, central planning will still be around in the mid term future, being that the central problem, not the supposed decreasing creativity of people, I think...
Yeah the robots can assure themselves of a comfortable pension by clicking on the Prudential pop- up.
Mussel Man
from Carsey-Wolf Center PRO 2 weeks ago
http://vimeo.com/107648358
.
here is a great and short movie that
tells an important story of our time.
as you say ....
That's what happens when you invest capital and resources in innovation.
now I wonder which TBTF bank he got his loan from...
Very interesting. Thank you for this.
Putting this together with the article, it seems that capital will flow to innovation; except that bureacracy either stifles that innovation or adds a cost that greatly reduces the return on capital.
This raises the question of whether the bureacracy is just feeding itself to grow with an expansion of rules and regulations, or if it is malicious and deliberately affecting the flow of capital. I think the former. It's hard to think of a bureacracy acting with intelligence and intent. Rather, it seems more likely that it is uninformed but nonetheless damaging decisions.
If we ever see a repeat of the Spanish Flu, with comparable proportionate deaths, perhaps capital will stop flowing to innovation - of which it may no longer be necessary. If I were wealthy with an accumulation of assets way beyond my contribution to the economic well-being of society, I might be happy with a decrease in population... so long as a food and potable water supply could be guaranteed. Isn't there an increasing shift to robots in farming as well?
If people are no longer needed for production of necessities, only skilled artisans who produce valued 'luxuries' will be sought, and the rest can implode with their numbers and disease.
yea, catch the irony at the end. he is forced into
dramatically expanding his operation to pay for the
impact studies that will obviously prove what he is
doing is fucking brilliant. however, by expanding
what he is doing the result of the study might not
be the same but it will certainly increase his debt
and the money supply/liquidity. of course, it will create
work and payouts to attorneys and environmental firms
and keep the bureaucracy floating for a few more minutes.
.
it is freakin' sad and depraved how they crucify the
best and the brightest. the transparent hand of the financial
globalists, needing to control, is evident in this story.
they kill the community to save their influence and take
of the "action". that is what they do through regulation,
let the people starve to save them ......
they take an important issue, like the environment and
impact, and then write the codes in such a way as to
affirm the advantage and dominance of the global monopolists.
the codes are often not about what is purported. here enter
the nafta, cafta, tpp etc.. the international trade agreements
that soverientize the corporations over the nations and
governments. the filthy future, as if it couldn't become
more foul.
of course
the global monopolists just move operations where there are
no environmental regulations, dominate the markets with
further regulation and then become the only operator
capable of financing the next phase of exploitation.
.
it seems to be an example of the financial-legal system
claiming dominance over the actual stomachs and nutrition
of the people it claims to protect and serve. nothing new?
neo tyranny perhaps?
.
"america" is being harvested for its children to
be the police officers and foot soldiers of the world.
it is a part of the economics of the international
variety. the culture,etc.. is being destroyed by the
financial weapons industries
and the minds of the people are being trained to
become operators or support personnel of weapons systems. the television
programming is saturating them with narratives of weapons
use, myths and tidbits from conflicts past and present
and hero worship of the fallen soldier or mercenary, the media
providing the catechism for the church of financial military dominance.
.
the "world"(money interest) wants cheap mercenaries, armed trained and ready
to provide military force for resource extraction and
exploitation sans any human morality. the leaders in d.c. have accepted this
national niche for the youth, just like the fall of rome,
or the third reich. doomed in the embrace of their
doomed stupidity, adherence to the fiat fed false money system god.
.
the constitution and human rights must be suspended
in this new paradigm though a few privileges remain
when granted by the overriding system of conformity
and brute force.
.
they traded their freedom and prosperity for insanity, mass hysteria
and fiat money, thereby lost their humanity.
.
it is inevitable when a people nearly criminalize creativity,
work, free thinking and the genius of problem solving because
it goes counter to the dominant military hierarchy and associate
crony rules which
have been deemed essential for the greater good and national
security.
i can't remember the last time i heard a good argument or debate
about something important. it seems if the topic is actually
important debate is avoided. if the topic is tangential then
it is milked for all the emotion it can muster to sell some
pharmaceutical product or saponified fat.
.
the guy in the video, bernard friedman, created a farm in the ocean to feed the
people. a farm that produces protein in the face of drought,
forest fires and earthquakes, and all his representatives
can do for him is crucify him.
they know not what they do, idiots.
I seem to remember reading about robots and such things in the 80's.
While human "labor" may no longer be scarce, it still needs to be fed.
This article fails on so many levels.
The only Ideas that are getting rewarded are the scams pulled off by the elite bankers. Charles Hugh Smith fails on many levels. I usually don't read his garbage anymore but this one looked short. It still wasn't worth my time.
And yet feeding self-repairing, self-improving humans (evolution, generations) is far cheaper than manufacturing & repairing various machines, be it computers, things with motors, things needing gasoline, etc.
When will people catch on? For many years now the Central State based in Washington DC, and bought off by a system of open bribery and pay offs in cash and jobs, Has been picking the winners? The 1%, some people like to glorify as the winners in the open market place of ideas and ambitions, have been gaming the Central State to deviver the winnings direct to them. No longer must businesses be startedm industry put into motion, men hired and set to work. Nope! The winners of today sit inside banks, trading houses and in the military/spy/regulator complex of Washington DC. They make the rules, to allocate the cash, they manipulate to interest rates and manipulate the stock indexes. They all trade on inside information that only they get. Since 2008 this underground and growing system of crony capitalism broke out of the shadows and into the light. They do not hide anymore, they go on CNBC and brag of their Central Government insured wealth transfer system, much of which pays off without real work, or without any real wealth creation. We read ZH, we know how it all works now. When do we stop calling America a free country of an open and fair market place where industry is rewared and government and banking sloth is simply tolerated? Nope! Central State force and their regulators and agents manipulate it all, and the wealth is handed over to those who own the congress and the white house. 1%, has taken all the winnings and also reduced the share of the 99%, skimmed it off through financial engineering and corruption. Then used the Central State to defend the practice.
With a real economy and main street people in the shitter since 2008, the wealth made at the top has never, ever been as high as since the 2008 melt down. Economy in the crapper, wealth at the top unprecidented. This can only happen in a corrupt and criminal Central Government controlled economy. Worse is et to come, because far from changing, Washingon DC is drawing in the wagons and sending out patrols to both defend the system and kill anyone even hinting at change. The NSA exists for a reason, they spy on all mankind for a reason, and guess what? It ain't to catch Al-Qaeda! Al-Qaeda is partly on the direct US payroll, as in Syria. The home base of Al-Qaeda is Saudi Arabia, America's number two allied nation, behind the Israeli State.
Wake up is all I can say. Stop acting like America is a market place, it is not.
As a society I won't have to deal with it. Thus Spake Q99X2.
"...or private sector companies which must make a profit or perish, to what I call the community economy."
Ok... 'Community' - as in 'Commune'...? As in...? It always sounds great as a concept, but no matter the design, human beings will always endeavor to aggregate power to themselves or their 'group'. A 'Community Economy' is not and never will be, anything but a gateway to Communism, without the Absolute protection and acknowledgement that the Individual and the freedom he retains to make his own choices, remains codified in law and respected as such. 'Community' anything will, if not immediately, then not long after implementation, Devolve into the rights and choices of the group over the individual and shortly thereafter, devolving into one 'group' holding Absolute Power over the rest.
Nice theory. But the individual has never in any society been empowered over the group. The majority will always prefer to seek comfort in the group and will always support the power and control of the group over the rights of the individual.
Humans evolved in small bands or communities or tribes. People are social and band together by instinct. We are not cats roaming the world in solitude. Society has not "devolved" into favoring the group over the individual, it has always done so.
Umm, community always DOES favor the rights of the group over the individual...otherwise it cannot exist at all. Unless you have a group of people who are all in perfect agreement on all issues, an unlikely occurrence. It does not "devolve" into that, it can only exist when it is present already.
What you suggest is more like an ecosystem full of individuals all out for their own gain...any attempts to regulate their behaviors would be seen as intrusive.
In short, a rather large and technologically advanced cat colony.
"Pay attention to the robots and not the flesh and blood, treasonous and murderous criminals of governmnet and their Rothschild bankster masters.
Now get back to watching Honey, Boo, Boo, and quit thinking, as we might be forced to hurt you."
Thank you,
The imposed DC US occupiers and their Saboteur Immigrant masters."
Saboteur Immigrants: The 1940 Nationality Act: Section 401 (e) of the 1940 Nationality Act provides that a U.S. citizen, whether by birth or naturalization, "shall lose his [U.S.] nationality by...voting in a political election in a foreign state."
In 1967 an American Jew, Beys Afroyim, received an exemption that set a precedent exclusively for American Jews...
You are entitled to your own opinion but not your own facts. Section 401 was declared unconstitutional in 1967 in the case of Afroyim v. Rusk.
Stop spreading false information that you copy and paste from random internet pages without doing your own due diligence.
This article seems to be saying that the world is shifting from control by a small elite who hold traditional capital to a different small elite that control digital capital.
So what? What are the other 8 billion people supposed to do. Think hard and come up with "ideas" of their own? Digitize their small average lives?
The digital world makes for faster accumulation of power than the physical world. Bill Gates made his $70 billion a lot faster and with less effort than the robber barons made their's through oil or railroads. Hedge Fund managers make billions for essentially figuring out how to game the system a bit better than the other crooks.
People need to start talking about how to build a functional society in the digital age.
Eventually, decades from now, the technological ecosystem will require humans less and less.
When the point comes when humans are no longer "necessary", Cybernetic organisms (humanoid beings like Data, robots and nanobots) will be the Dominant Species. It is supreme human arrogance and folly to think this will not happen.
In a sense, we are already working for Techno-beings -- given that all the growth jobs are in tech development and maintenance. Are you using machines or animals to work that field, to process that food, to transport, to communicate, to...?
I hope I'm dead before I reach the complete sense of uselessness that you revel in.
In truth, fungus, algae, viruses & various insects already fill these roles at maximum capacity for efficiency vs mobility vs defensibility of threat from each other & the environment. I doubt any technological "creature" could compete. It's one thing to have very dense circuits mapped out or massive computing ability, it's another issue entirely to be self-sustaining for best use of whatever is fuel/energy for the being in question, and defensibility from attack by other beings because the raw materials can be recycled aka living things are food for other living things.
in nature, over capacity leads to a natural culling. that is what we are seeing in the post industrial world. western europe, japan and north america(even mexico, i think) are leading the way with negative growth demographics. the new apple factory in texas is being built with robots from site prep to plumbing. the ipads will be made by robots. these machines are not going to buy ipads. the irony is chilling. the manufacture of mostly unnecessary consumer products fuels the world economy and feeds the first world. if the manufacture of these products do not employ people then there are no consumers. if there are no consumers there is no need for production which further diminishes the need for humans so less ans less will be consumed further reducing the need for humans eventually all economies will return to labor intensive farming and hand built manufacturing to save the species from extinction.
japan is on the leading edge of this catastrophe as the first post industrial economy. watch what happens over the next two generations. japan could become the first investment society where the population can live off investments made in other countries and markets while switching to a more labor intensive economy at home for the working class.
forget the utopian blather. the end result of industrialization, after a cruel adjustment period(war and famine and pestilence), will be dirt farming and hand wrought tools. rural communities will thrive and cities will become detroits. this is not dystopia. this is reality.
Interesting take...hadn't considered that possible result.
It is production that enables the people to consume. Of course, unemployed people produce nothing, and can't consume (except due to wealth transfers).
Putting consumption first, before production, is Keynesian claptrap.
I’m trying to remember when the word technology became synonymous with software and the internet? I guess we could call it the day that chemistry, mechanical engineering, aerospace engineering, marine architecture, physics, biology, physiology, materials science, agricultural science, environmental science, etc. died.
the Silicon valley revolution became visible in 1970, exactly when the BW revoke occurred.
So the world moved to information society and to fiat print society at the same time.
Whence the common spiral of the oil energy monopoly which fed more and more : MIC, mechanised information platforms and downsized hardware in each user's home, as well the supply sided financialised economy that could nOT work without the software revolution provided by Silcon valley hi-tech.
Its a matrix system signed Pax Americana, but unfortunately the Oligarchy runs it, not the small business which has NO invisible hand to help it.
And its aLL constrained more and more by peak fossil flux "cheap" energy and its pollution fall-out.
You will have noticed that those who deny peak oil world-wide also deny carbon footprint.
When deniability meets hards facts...
For individuals, this means being able to solve problems and create value in ways that can't be automated:
The immediate problem needing solving is the following:
Through diligent work over many years we have reduced the amount of work we must do to obtain a truly comfortable life. That should not mean we must return to a life of misery because there's no more work to do. The elites have managed to put themselves in a position where they do essentially nothing and profit handsomely. The rest of us need to learn their secret and spread it around.
I hope this post is a joke. The "secret" which no one has ever attempted to keep secret is ... drumroll please ... income from capital.
What's the best kind of capital? Capital you didn't have to work for: patrimonial capital AKA inheritance. Even better if you don't have to split it between siblings/relatives.
Now you've learned the "secret" - own lots of capital, marry wealth, increase it over multiple lifetimes, don't dilute it in your bequests, live off the income (land rents, bonds, stawks, loans).
No, it wasn't a joke. But I think capitalism is a joke ... a very bad joke.
Let's look at a bank. Suppose you and your friends want to start one and you are blessed with a charter. You capitalize the bank. You are able to "loan out" 10 times that capital at an interest spread of at least 4%. So that's 40% per year return on "your" capital.
At that rate, your money "doubles" in less than two years. You can then take "your" capital out and let the other 1/2 of the double ride. How much of "your" capital is now in the bank? Zero. Read my lips. Zero. That's capitalism. And from then on your "zero" capital earns "infinite" returns.
Their "secret" is getting you to believe "capital" is needed if a trader wants to make a trading promise that spans time and space.
Take yourself. You buy a house with a standard mortgage. Over the typical 30 year term, you pay for that house more than twice? And even after 25 years you own just a very small fraction of the house.
Further, you pay insurance premiums (required by your lender) that actuarially assumes your house has 100% chance of being totally destroyed over that 30 year term (i.e. the accumulated insurance premiums exceed the cost of the house ... and even assumes the land is destroyed too!).
Finally, for the privilege of having your house in your city, your city, state, schools, hospitals, etc. take tax payments that again more than equal the cost of your house over the 30 year term.
And then, if after 30 years you sell your house you get double the price you paid (because of inflation, due to mismanagement of the money by government) and you pay taxes on that gain. Never mind you can't buy back the house you just sold after paying the tax. Where's the gain? You can't even buy it right back without the government's hand in the till. The "round trip" transaction costs (out and back in) are about 12%.
So under capitalism, you make a promise to trade 30 years of payments to have your house for those 30 years (rather than saving for 10 or 15 years while renting much less house ... i.e. paying your landlord's house payments ... and paying cash). Capitalism treats your promise as if you're a total deadbeat, requiring you to pay 3 times as much (you'd still have to pay for the various government's bogus services) as if you paid cash.
That's capitalism ... and the elites and their secret are on the receiving end of the bounty. Seems they have kept their secret from Totentanzerlied.
Todd Marshall
Plantersville, TX
The main benefit of unions has been to better distribute labor the rewards of labor. This gives more people a path to finding real and fulfilling work. The cost of inequality is taking a toll on our culture. Robots and new technology have streamlined and increased productivity and at the same time eliminated many jobs. The value and role of labor is changing throughout the world.
Many other issues exist such as the role of big business. What is good for big business is not necessarily good for the masses. Consolidation often means a gain in efficiency, but this often comes at the cost of losing diversity and a "robustness" to both society and the economy. The benefits of efficiency sometimes have a huge hidden cost.
How the fruits of labor are divided is important, this includes not just the wage deserved by a common laborer, but how much those in management, top CEO's, and those that can't, or choose not to work, should receive. The article below delves into this important and complex world wide issue.
http://brucewilds.blogspot.com/2013/04/society-must-better-divide-labor.html
I trust the logic of a computer than those who are in the gov't.
Guess who's going to contract for the programming...
"Labor is no longer scarce."
That is only because small business formation is at record lows and many existing businesses are going bankrupt because they can't compete with profit margins driven down to zero through inflation and billions of dollars lent at zero percent to the most politically connected mega corporations.
For 30 years, people went into business and finance following the lucrative money there and people have forgotten the basic technical skills. Don't tell me there won't be the need for labor when every aspect of the economy is finally decentralized.
The mega corporation I am employed with has more work to do than could ever be completed in ten lifetimes with equipment that got ever larger to satisfy false demand through the gross misallocation of capital in the housing market. Each one of these massive production centers will evaporate due to the global supply chain breaking down and production will return to local levels that will value labor highly once again.
The author says that "As a society, we will have to deal with the reality that the nature of work is fundamentally changing, and wages are no longer an adequate means of distributing the surplus of an economy."
I agree totally. But until we stop tying labor to the hourly wage and the 40 hour workweek this will not happen. When technology allows a man's productive capacity to increase many-fold it enriches the ones who profit off that capacity. But the technology never gives that man more than 60 minutes an hour to 'sell', and requires him to accumulate 40 hours per week to qualify for 'full-time' status. His earning capacity has run up against the brick wall of Time. But his bosses have tapped into an unlimited revenue stream...We are in a strange and disruptive moment in history here, and something has got to give.
i like the idea of ideas. the problem is the govt considers innovation obamacare, militarized beauracracy, two income single parent households with the public schools feeding your kids breakfast, lunch, and dinner, gay marriage, anti-constitutionalism, finacial repression, blah blah blah.
tesla had some really great ideas and look what happened there
seems to me its just another way to get the proletariot to do the elites bidding, with moar neo-feudalism.
big ideas are reserved for TBTP.... example: jobs, gaits, zuckerberg, blackrock, pnc, ..................the list goes on.
real innovation would be the rejection of high tech at this point, it seems
But the reality has always been that a rare few create and the other 99.99% consume what they create.
There will not be enough jobs for everyone else.
The future is quite literally shapng up to closely resemble The Hunger Games.
The elite few live in Capital (sic) City earning 250k/year AUD, and everyone else lives in freezing cold medaevil poverty.
One can see this already in SFO and Palo Alto, etal. They are doing fine, and the rest of the nation is not.
I am in my 50's, mobile and unencumbered.
I also picked a later life career in a field that is going to be one of the last to be automated and roboticised to insulate myself against the inevitable.
I will not live long enough to be replaced, but only just barely.
My younger relatives, however, will not be so lucky.
All those 10-30 somethings who think it is so great they can do so much for nearly free on their mobile computing devices, almost all of them do not understand that their consumption of free information means that no one will pay them to do anything - because they won't pay to buy anything.
What brings this home to me is when someone such as Hillary Clinton it paid $250k by a University to deliver a speach that says absolutely nothing novel or interesting.
This is the depth of the collusion and corruption.
Bizarre to think that the ones who have the good ideas are the ones who profit from them, that's not the way it typically works at all.
Entire teams of asshole lawyers exist for no other reason than to loot the innovator, leaving him with 1% if he's lucky.
Not one mention of "energy" or "oil". Yawn.
"and wages are no longer an adequate means of distributing the surplus of an economy."
Yeah, about that "surplus" ... it's nothing more than the arbitraging of positive net energy from fossil fuels. "Productivity gains" is a euphemism for increased energy consumption per laborer.
CHS is right, in a way. Since the '70s the surplus has been diminishing (see: charts of real PPP-adjusted income and net wealth), wage labor was a phenomenon historically unique to early through mature industrial capitalism, and it was only "adequate" - as in "good for the plebs" - during the boom years of cheap oil. Industrial capitalism broke because its funding mechanism and necessary condition, cheap energy with double and triple digit EROEI ratios, is failing. It's the 1800s in reverse. Recall that the VAST majority of the increase in incomes in all of human history occurred in the period 1875-1975. Now pull up an oil production and consumption chart. Coal wasn't enough, it just gave the world the hellish urban industrial capitalism of Dickens and Marx, et al. I believe the average person of that era would have agreed that "wages are inadequate". Only oil did the trick.
PS: The reason coal and oil didn't lead to economic paradise is that, like nearly everything except air, their availability is low. That is, their production and distribution are easily cartelized. It's no accident that the greatest fortunes ever made were oil fortunes.
The next coming technological revolution: the rickshaw with portable freezer to barter perishable goods.
Machine learning is taking over the worlf.
A quiet revolution.