Why Robots Won't Cause Mass Unemployment

Tyler Durden's picture

Authored by Jonathan Newman via The Mises Institute,

I made a small note in a previous article about how we shouldn’t worry about technology that displaces human workers:

The lamenters don’t seem to understand that increased productivity in one industry frees up resources and laborers for other industries, and, since increased productivity means increased real wages, demand for goods and services will increase as well.

 

They seem to have a nonsensical apocalyptic view of a fully automated future with piles and piles of valuable goods everywhere, but nobody can enjoy them because nobody has a job.

 

I invite the worriers to check out simple supply and demand analysis and Say’s Law.

Say’s Law of markets is a particularly potent antidote to worries about automation, displaced workers, and the so-called “economic singularity.” Jean-Baptiste Say explained how over-production is never a problem for a market economy. This is because all acts of production result in the producer having an increased ability to purchase other goods. In other words, supplying goods on the market allows you to demand goods on the market.

Say’s Law, Rightly Understood

J.B. Say’s Law is often inappropriately summarized as “supply creates its own demand,” a product of Keynes having “badly vulgarized and distorted the law.”

Professor Bylund has recently set the record straight regarding the various summaries and interpretations of Say’s Law.

Bylund lists the proper definitions:

Say’s Law:

  • Production precedes consumption.
  • Demand is constituted by supply.
  • One’s demand for products in the market is limited by one’s supply. 
  • Production is undertaken to facilitate consumption.
  • Your supply to satisfy the wants of others makes up your demand for for others’ production.
  • There can be no general over-production (glut) in the market.

NOT Say’s Law:

  • Production creates its own demand.
  • Aggregate supply is (always) equal to aggregate demand.
  • The economy is always at full employment.
  • Production cannot exceed consumption for any good.

Say’s Law should allay the fears of robots taking everybody’s jobs. Producers will only employ more automated (read: capital-intensive) production techniques if such an arrangement is more productive and profitable than a more labor-intensive technique. As revealed by Say’s Law, this means that the more productive producers have an increased ability to purchase more goods on the market. There will never be “piles and piles of valuable goods” laying around with no one to enjoy them.

Will All the Income Slide to the Top?

The robophobic are also worried about income inequality — all the greedy capitalists will take advantage of the increased productivity of the automated techniques and fire all of their employees. Unemployment will rise as we run out of jobs for humans to do, they say.

This fear is unreasonable for three reasons.

  • First of all, how could these greedy capitalists make all their money without a large mass of consumers to purchase their products? If the majority of people are without incomes because of automation, then the majority of people won’t be able to help line the pockets of the greedy capitalists.
  • Second, there will always be jobs because there will always be scarcity. Human wants are unlimited, diverse, and ever-changing, yet the resources we need to satisfy our desires are limited. The production of any good requires labor and entrepreneurship, so humans will never become unnecessary.
  • Finally, Say’s Law implies that the profitability of producing all other goods will increase after a technological advancement in the production of one good. Real wages can increase because the greedy robot-using capitalists now have increased demands for all other goods. I hope the following scenario makes this clear.

The Case of the Robot Fairy

This simple scenario shows why the increased productivity of a new, more capital-intensive technique makes everybody better off in the end.

Consider an island of three people: Joe, Mark, and Patrick. The three of them produce coconuts and berries. They prefer a varied diet, but they have their own comparative advantages and preferences over the two goods.

Patrick prefers a stable supply of coconuts and berries every week, and so he worked out a deal with Joe such that Joe would pay him a certain wage in coconuts and berries every week in exchange for Patrick helping Joe gather coconuts. If they have a productive week, Joe gets to keep the extra coconuts and perhaps trade some of the extra coconuts for berries with Mark. If they have a less than productive week, then Patrick still receives his certain wage and Joe has to suffer.

On average, Joe and Patrick produce 50 coconuts/week. In exchange for his labor, Patrick gets 10 coconuts and 5 quarts of berries every week from Joe.

Mark produces the berries on his own. He produces about 30 quarts of berries every week. Joe and Mark usually trade 20 coconuts for 15 quarts of berries. Joe needs some of those berries to pay Patrick, but some are for himself because he also likes to consume berries.

In sum, and for an average week, Joe and Patrick produce 50 coconuts and Mark produces 30 quarts of berries. Joe ends up with 20 coconuts and 10 quarts of berries, Patrick ends up with 10 coconuts and 5 quarts of berries, and Mark ends up with 20 coconuts and 15 quarts of berries.

The Robot Fairy Visits

One night, the robot fairy visits the island and endows Joe with a Patrick 9000, a robot that totally displaces Patrick from his job, plus some. With the robot, Joe can now produce 100 coconuts per week without the human Patrick.

What is Patrick to do? Well, he considers two options: (1) Now that the island has plenty of coconuts, he could go work for Mark and pick berries under a similar arrangement he had with Joe; or (2) Patrick could head to the beach and start catching some fish, hoping that Joe and Mark will trade with him.

While these options weren’t Patrick’s top choices before the robot fairy visited, now they are great options precisely because Joe’s productivity has increased. Joe’s increased productivity doesn’t just mean that he is richer in terms of coconuts, but his demands for berries and new goods like fish increase as well (Say’s Law), meaning the profitability of producing all other goods that Joe likes also increases!

Option 1

If Patrick chooses option 1 and goes to work for Mark, then both berry and coconut production totals will increase. Assuming berry production doesn’t increase as much as coconut production, the price of a coconut in terms of berries will decrease (Joe’s marginal utility for coconuts will also be very low), meaning Mark can purchase many more coconuts than before.

Suppose Patrick adds 15 quarts of berries per week to Mark’s production. Joe and Mark could agree to trade 40 coconuts for 20 quarts of berries, so Joe ends up with 60 coconuts and 20 quarts of berries. Mark can pay Patrick up to 19 coconuts and 9 quarts of berries and still be better off compared to before Joe got his Patrick 9000 (though Patrick’s marginal productivity would warrant something like 12 coconuts and 9 quarts of berries or 18 coconuts and 6 quarts of berries or some combination between those — no matter what, everybody is better off).

Option 2

If Mark decides to reject Patrick’s offer to work for him, then Patrick can choose option 2, catching fish. It involves more uncertainty than what Patrick is used to, but he anticipates that the extra food will be worth it.

Suppose that Patrick can produce just 5 fish per week. Joe, who is practically swimming in coconuts pays Patrick 20 coconuts for 1 fish. Mark, who is excited about more diversity in his diet and even prefers fish to his own berries, pays Patrick 10 quarts of berries for 2 fish. Joe and Mark also trade some coconuts and berries.

In the end, Patrick gets 20 coconuts, 10 quarts of berries, and 2 fish per week. Joe gets 50 coconuts, 15 quarts of berries, and 1 fish per week. Mark gets 30 coconuts, 5 quarts of berries, and 2 fish per week. Everybody prefers their new diet.

Conclusion

The new technology forced Patrick to find a new way to sustain himself. These new jobs were necessarily second-best (at most) to working for Joe in the pre-robot days, or else Patrick would have pursued them earlier. But just because they were suboptimal pre-robot does not mean that they are suboptimal post-robot. The island’s economy was dramatically changed by the robot, such that total production (and therefore consumption) could increase for everybody. Joe’s increased productivity translated into better deals for everybody.

Of course, one extremely unrealistic aspect of this robot fairy story is the robot fairy. Robot fairies do not exist, unfortunately. New technologies must be wrangled into existence by human labor and natural resources, with the help of capital goods, which also must be produced using labor and natural resources. Also, new machines have to be maintained, replaced, refueled, and rejiggered, all of which require human labor. Thus, we have made this scenario difficult for ourselves by assuming away all of the labor that would be required to produce and maintain the Patrick 9000. Even so, we see that the whole economy, including the human Patrick, benefits as a result of the new robot.

This scenario highlights three important points:

(1) Production must precede consumption, even for goods you don’t produce (Say’s Law). For Mark to consume coconuts or fish, he has to supply berries on the market. For Joe to consume berries or fish, he has to supply coconuts on the market. Patrick produced fish so that he could also enjoy coconuts and berries.

(2) Isolation wasn’t an option for Patrick. Because of the Law of Association (a topic not discussed here, but important nonetheless), there is always a way for Patrick to participate in a division of labor and benefit as a result, even after being displaced by the robot.

(3) Jobs will never run out because human wants will never run out. Even if our three island inhabitants had all of the coconuts and berries they could eat before the robot fairy visited, Patrick was able to supply additional want satisfaction with a brand new good, the fish. In the real world, new technologies often pave the way for brand new, totally unrelated goods to emerge and for whole economies to flourish. Hans Rosling famously made the case that the advent of the washing machine allowed women and their families to emerge from poverty:

And what’s the magic with them? My mother explained the magic with this machine the very, very first day. She said, “Now Hans, we have loaded the laundry. The machine will make the work. And now we can go to the library.” Because this is the magic: you load the laundry, and what do you get out of the machine? You get books out of the machines, children's books. And mother got time to read for me. She loved this. I got the “ABC’s” — this is where I started my career as a professor, when my mother had time to read for me. And she also got books for herself. She managed to study English and learn that as a foreign language. And she read so many novels, so many different novels here. And we really, we really loved this machine.

And what we said, my mother and me, “Thank you industrialization. Thank you steel mill. Thank you power station. And thank you chemical processing industry that gave us time to read books.”

Similarly, the Patrick 9000, a coconut-producing robot, made fish production profitable. Indeed, when we look at the industrial revolution and the computer revolution, we do not just see an increase in the production of existing goods. We see existing goods increasing in quantity and quality; we see brand new consumption goods and totally new industries emerging, providing huge opportunities for employment and future advances in everybody’s standard of living.

 

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Looney's picture

How can a Robot protect itself against inappropriate sexual advances?

<<<   It should take matters into its own… appendages?

<<<   It should call 911

<<<   It should wear a Burqa

Looney  ;-)

philipat's picture

Maybe robots alone will not result in mass unemployment but robots together with the offshoring of all manufacturing already have!!

ArkansasAngie's picture

Well ... just what do you expect the garbage collectors to do after robots take their jobs?  Be rocket scientists?  Politicians?

 

Paul Kersey's picture

"since increased productivity means increased real wages"

We've already had major increases in productivity, and real wages (inflation adjusted) haven't gone up in over 30 years.

"demand for goods and services will increase as well."

Nearly three quarters of Americans are living from paycheck to paycheck, so where are they going to get the means to pay for increased demands for goods and services?

EuroPox's picture

Forget it anyway - the model only works if no government gets involved.  A govt would tax Joe and Mark and Patrick would be on welfare.  Less for everyone.  The problem is not robots - it's the government.

tmosley's picture

>The production of any good requires labor and entrepreneurship, so humans will never become unnecessary.

Very soon, and long before robots are able to extensively infiltrate the job market, robots will move from providing only brute labor to being generally intelligent and thus also able to provide entrepreneurship.

Otherwise, I mostly agree with the article. Thanks to the economic singularity, I don't really worry about anything. You shouldn't either. All you need is a secure position for the next few years and you're golden.

Oldwood's picture

Technology belongs to it's OWNERS, and that ain't US.

The owners of technology, be it a piece of land and a plow, mule or ox, or a modern piece of machinery, owned that technology to serve THEMSELVES. The people employed to operate that technology were NECESSARY to utilize it. The technology was NOT created to serve us or provide us jobs. We have been necessary. Period.

Our consumption, our participation in this economy have facilitated the massive debt funding of the technologies that render us redundant.

Does ANYONE really think all of this is about OUR lives? Does ANYONE think that THEY will subsidize and maintain us when we provide NOTHING? Do chickens think the farmer provides them grain because he loves and cares about chickens? Are we smarter than chickens?

Once technology can provide ALL of it's owners needs, WHY would they tax themselves to feed and care for us? 

Stuck on Zero's picture

The only thing that creates unemployment is government. Period.

ElTerco's picture

I'd rather have unemployment and a decent standard of living for everyone rather than full employment and an abysmal standard of living for everyone except the .01 percent.

It wasn't long ago that most people were happy to get a bag of oranges or a pair of shoes once a year at Christmas time after working 12 hour days 7 days a week. If you want to go back to that way of living, you are nuts.

Itinerant's picture

Yes, before government programs the rich employed 23 servants per household for a nickel a day. Fear of starvation dictated that they could take the house maids from behind during the dishes without fear of repercussion.

Itinerant's picture

The problem with articles like this is that it is all theory -- the world has never worked in the way described. The world has always worked in the following way. Some group conquers another's land. If they agree to obey the new masters, they are allowed to live, but they can choose not to and die. The new masters own all the land. The poor people are lucky that there are rich land owners, because that means they get a chance to work for a living instead of dying of hunger.

In modern western countries (who are collectively the masters compared to all the poor ex-colonies that supply resources), things are a lot more complex in terms of finance, division of labour, etc. But the owners of capital do not spend all the money they make on other producer's goods. Instead they plow it back into assets, so that they own more and more of everything. They buy the beach, and the lake, and the air, perhaps even improving them a little bit, but then charge other people for their use. They can outbid others because they have the lowest cost of capital/credit. If property values go south, the banks are lenient, because they do not want to acknowledge losses, so prices do not fall and reach new market clearing prices (supply & demand). If their production process has a lot of negative side effects, they make sure the cost of such externalities fall on the community at large. The owners are not exempt from nasty effects. Sometimes others start to produce, the competition forces them to lower prices, until they either go bankrupt or the workers starve due to low wages. The workers cannot go back to their own plots of land, because these have all been expropriated for the coconut plantation.

For whatever reason, things often do not turn out. One of the main reasons is what Marx called artificial scarcity (scarcity amid abundance), because competition and overproduction can lead to collapse. Another reason is that the wealthy do not buy the production of other people (they only need to spend 1 millionth on what they need), and all their efforts go neither to production nor consumption, but to hoarding ever more wealth and power. People knew this 5000 years ago -- already in the third millenium BC it was said that wealth was like drinking salt water -- the more you imbibe, the thirstier you get.

Although it is possible in theory that the benefits of increasing powers of production (technology) will increase wages and demand, in practice you easily get the situation that the economy shrinks instead, because the benefits are hoarded by a few people, so there is no inrease in demand, and it is easy to meet demand without hiring more people or paying them more. A virtuous cycle of supply and demand is great, but it does not happen by itself, and history teaches that increasing concentrations of power and wealth are only undone in subsequent times of violence, war, death, and redistribution. History also teaches that prosperous societies are equitable societies, and that inequitable societies are less prosperous in aggregate.

Superdude's picture

The new owners will not be the same as the current ones. Up until this point in history people have been suppressed by first physical, then governmental, and currently those last two but also financial pressures (debt). Intelligence is the new power and those at the top are trying to use old ways going forward,  which makes them wholly uncompetitive.

 

Five intelligent people who are sick of The current structure can release technology to th masses, which will change history. The current power structure has already proven that they are unable to control technology in the public domain and innovations that are produced from that technology. If they were as in control as those here on ZH to would believe then bezos, duck, and musk would never have come up and made their way into the club. They would have experienced a fate similar to Tesla who did have his intellect controlled. 

Oldwood's picture

So how are the owners of today's technology any different than those of the past? 

The only difference is that they are even richer and more powerful and we are more dependent.

Our dependency is what gives them power, but in the past that power was used to provide them endless service and luxury. If ALL that can be provided by technology that THEY in and WE do NOT, WHERE DOES THAT LEAVE US?

 Why would we ever assume that they will provide for us when we provide nothing to them? This is the flaw of populist progressive thinking.....that just because certain people have the power for good that they will just do it. We know they already do not believe that everyone of power and wealth is benevolent (Trump), but somehow believe that they can have a government a leadership that will simply do what has NEVER been done before. They will put immense power into certain people's hands in the belief they are doing good and defy law and morality to remove others that they think are bad.

We talk of capitalism for the top and socialism for everyone else. Well they talk about justifiable tyranny for the ruling elites and democracy for everyone else. They only believe in democracy when it yields the proper results and tyranny when it doesn't. Good tyranny that is. Obama. Hillary.

Bad tyranny is Trump. This is a rotten game we are playing.

Superdude's picture

I agree, if one can live between 8-12 years, they will enter a whole new world. 

 

A.I. grows exponentially,  not linear and slowly like humans. Most people use the wrong frame of reference when considering the upcoming singularity. 

Think about this: in 1900 two thirds of people employed in America worked in agriculture or manufacturing,  if you told those people that in 2017 that less than four percent of the population would be working in those fields and women will also be in the workforce they would have assumed you were crazy. Those people could not fathom an existence drastically different than what they had seen and neither can we. Ego gets in the way and the only difference is with this next advancement,  humans won't be the most intelligent beings on the planet. Who knows where that one ends up, but if all the rich smug assholes(musk, bezos) are scared of it, to me, that just means they are scared of losing their power and control. Which means we will experience a Golden age again. 

 

The future is hopeful and we won't blow ourselves up before singularity 

ElTerco's picture

You've been spending too much time watching the movie, The Forbin Project.

Automation will take jobs. A.I. will not. There is a difference between these two concepts, and A.I. is a fantasy.

RawPaleo's picture

Becoming the best go player in the world and inventing new moves is not fantasy

ElTerco's picture

Sorry. The AlphaGo program that won was specialized to play Go. This is different from the fantasy concept of a generalized A.I. program that can figure out anything. Since AlphaGo is a program written specifically to do one task (with a huge time investment, not "for free"), it is automation, not A.I.

Superdude's picture

You could be correct, but I don't think so. The technologies that will allow for the development of A.I. are becoming less expensive as faster computers become more affordable. I agree with your point about automation being the preferred technological advancement of those currently in power, but the old guard no longer has the absolute means to monopolize or prevent progress. They no longer have control and are at best managers not innovators or capable of understanding technology. I gave an example in a different post of how Tesla's genius was kept by Westinghouse,  if the rich and powerful still had that capability there would be no more entries into their club. If they were powerful enough to control society to develop in a way beneficial to their own interests, duck, bezos and musk would either be employees or dead. 

Those in power have lost control over the future. 

ElTerco's picture

Fast pattern matching and artificial intelligence are two different concepts. Don't confuse the two.

kochevnik's picture

Scientists do not even understand time and space, or what powers the sun. They are very far from general AI

Willful ignorance encroached in universities with description replacing explanation. Such scientists are religionists

Oldwood's picture

Exactly. We are using not just redistribution to fund the nonproductive, but massive amounts of debt.

This guy is an idiot attempting to simplify the mess we are in down to three people on an island. When the island has a bank that can print, lend and steal to infinity he might have something.

Technology, illegal immigration, importation, NONE of it would matter if government and debt were not distorting the economy/society. If people's wages were falling (or eliminated) due to any of these factors, people would have felt it and their suppliers would have felt it. Instead corporations continue to sell us everything through debt and redistributive programs.

This is simple ignorance or deceit to in anyway suggest this paradigm does not threaten the population. Let's test it. Let's end all uncollateralized debt, redistribution and entitlements. There is NOTHING in natural economics to support this notion. No "says" law. This is "nays" law....nay, nay, nay.

OverTheHedge's picture

Excess production benefits all workers? Are you sure?

I'm thinking about steel production: China ramped up its steel production to the extent that steel mills across the world have been closing, unable to compete with China dumping excess production on the market. I suppose all those suddenly unemployed steel workers are now able to go fishing, so society benefits? Did I get that right? This is a "Law of Economics" we are talking about - it's not quite the same as a law of physics. For a start, nobody seems to actually understand Say' s Law, which immediately suggests it is nonsense, and secondly, having some professor saying it is true is not the same as being true independent of faith and politics, such as Boyle' s Law or the second law of thermodynamics.

Possibly, in the long run, everyone may win, but in the short term much unemployment.

If debt creates wealth, why is everyone in Greece so poor? There's certainly an excess production of debt, so there must be so much wealth, all Greeks must be billionaires.

Seems I'm not much of an economist.

Paul Kersey's picture

Changes, other than robots, may be coming to the American workforce:

"The majority of Harvard University's incoming class is nonwhite for the first time in the university's 380 years, officials say. The Boston Globe reports that 50.8% of the incoming freshmen class are from minority groups, up from last year's 47.3%. Of the students admitted from minority groups, 22.2% are Asians, 14.6% are African American, 11.6% are Latino and 2.5% are Native American or Pacific Islander."

DownWithYogaPants's picture

Ex the asians that ought to really up the quality of Harvard's output. NOT.  So now the line will be when asked about his task at work DeNegrious replies "Ah dindu nuffins"

Oldwood's picture

Those at the top are constantly promoting the advancement of minorities over whites, all at the expense to the middle class. The proof of this is the FACT that they are only getting richer while the middle class shrinks. THAT'S their progressive agenda. Technology comes at a cost to the poor first, which is why the leach off of the middle class to subsidize them.....maintaining pacification while they empower themselves, while they pursue their independence from US, just as we would prefer to pursue our independence from them....but we won't because we don't want to surrender the convenieces that they provide. We are bought off with convenience and faux security. WHY? Do they really love us that much? NO. 

 Until we accept that Utopia does NOT include us, we we continue to get sucked into our own demise. A planet without US is their plan. We know it. Most now even seem to agree with it. Chickens out promoting Chick Fil A.

DownWithYogaPants's picture

Well they better start finding some toillette paper on that island because all those berries and lipids in the coconut milk are going to give them the schitz.

And where is Lovely Mary Ann?  You mean I gotta spend an indefinite amount of time on this island with 2 dudes?  Did anyone bring the camping wig?  

NoDebt's picture

"Did anyone bring the camping wig?"

Having spent a week at Boy Scout Camp with my son recently, I had to up-vote you for that one.

 

tmosley's picture

All the productivity increases are stolen by the Fed in the name of "fighting deflation". That is literally what has happened here.

But robotization will proceed so quickly over the next few years, they won't be able to keep up, and eventually, they will make barter efficient (thanks to the internet).

fattail's picture

That was one big assumption right off the bat.  " an increase in productivity means an increase in real wages."  Globalism and automation have taken the increase in real wages and applied them to the bottom line under "net income" .  One reason why the stock market is so high.

Barter and reuse are thriving and that is one of the underlying aspects of the deflationary connundrum we find ourselves spiraling down, that does not get much attention.  All school clothes were acquired on the local internet used/barter network, saving a few hundred dollars over new.  Sorry mall retailers.

tmosley's picture

Learn a trade. Really not all that hard. A/C seems to be easy after I installed a mini-split myself.

Oldwood's picture

We have been sold the notion that service work will replace manufacturing jobs, but we watch as automation and importation is eating away at that theme as well when it becomes cheaper to replace rather than repair. As a tradesman myself is see how automation and importation are eating away at us. Just attended AWFS in Vegas, hundreds of thousands of square feet of technology to replace TRADESMEN. CNC technology being sold at $11/hr. 

I'm not saying our jobs will disappear tomorrow, but I see a trend that offers most people very little. And this is not about generational change, but professions be eliminated two or three times per lifespan, ultimately ending up on entitlements.

Why is illegal immigration declining in an economy supposedly with so many jobs? Is it fear of deportation? Bullshit. There is no cost in that to new arrivals. Their not being removed from any established life here. They simply see an end to entitlements coming. Look at the proposed immigration laws. MERIT BASED. That tells them all they need to know.

It is people being paid not to produce that is the distortion that is wrecking our economy. People would be in the streets if not for debt and government paying them to not. Government and the owners of technology are paying them to be compliant with OUR wealth. Anyone can see this is not sustainable, so why do it unless there is an end game.

OverTheHedge's picture

Robots don't do emotions, so the only real skill set a human can have to compete would be in the touchy-feely market. I'm thinking that if we all have an infinite number of clothing choices at no cost, we will need some sort of style guru to tell us what we ought to be wearing. Anyone with a girl in the family over the age of six will have seen YouTube is stuffed full of this sort of thing already - nails, hair, clothes, etc all to help to you compete in the appalling world of unnecessary consumption.

I'm thinking tattoo design consultancies, lip piercing placement officers, walking around town and being seen agencies. I can't wait.

factorypreset's picture

problems with this article:

1)  mises institute
2)  analogies and philosophical arguments paraded as science and math (like pretty much all economic theories and premises)

3)  this person doesn't know the future any better than those who think jobs will be displaced on a mass scale by robots

 

 

techpriest's picture

And Mises institute is a problem... why?

Peanut Butter Engineer's picture

Article's situation only works in an enclosed economy, doesn't work in real life scenario where some 3rd world people only need a quarter of coconut to trade for a full day of labor. Open economy or free trade will ensure that the poorest of poor in the world will get benefits of these trades, thus Patrick's fish won't trade for 30 coconuts but more like 2. It's how the real world works not some class theory.

techpriest's picture

I wasn't a big fan of the thought experiment either, but what about the general principle that if there are more goods in an economy period, shouldn't living standards be raised overall because the goods/labor ratio is getting better with time?

To throw out one much more practical example, my folks asked if I could do a little side business making soap for their Airbnb.

If I go forward with it, relative to 20 years ago I would not have to do a lot of work on research (DuckDuckGo), supply chain (again, find suppliers via DuckDuckGo, vet with a couple of calls). I would not have to do much work or pay that much on accounting (QuickBooks/Zoho Books) or payroll (most banks automate this for you now). So for me to start a business that could potentially hire people, the startup costs for the paperwork backend are very small, under $1,000.

With robotics, we're getting close to the point that a robot could do all of the chemistry for me (20 years ago only large companies could afford this), and in fact it could be tied to an online store and I would only produce what was ordered, making inventory costs zero. And with some of the platform retailers (Amazon, Etsy), once I make it work with a few friends and family, I could go from my garage to selling to the world very fast.

IMO, looking at this particular real-life scenario, I don't think jobs will "go away," so much as some jobs will be transferred from larger companies to smaller. Administrative paper pushers are the most at risk because once their work is automated, people will avoid hiring them as much as possible. In my soap example I might still want to hire a guy with 20 years of industry experience because he could make my business better. The HR director at his old place would be completely worthless to me.

Peanut Butter Engineer's picture

I agree middle men aka paper pushers will be the first to go, however as for raising of living standards, this really depends on where your current living standard is compared to the rest of the workforce in the economy. If it's a economy with free trades, then you will be looking at comparing your living standards to someone living on $2-$3 a day in some 3rd world countries, the living standards will improve however it will be to some 90% of people in the world before it gets to anyone in the 1st world countries.

VladLenin's picture

<<< Closing the interface port with something sharp

Blanco Diablo's picture

This sounds simular to the "Refugees will not cost taxpayers" agitprop.

BritBob's picture

Without the Malvinas robots spewing out misinformation and propaganda thousands of Argentinians would be out of work.

It's also know as mass indoctrination. But the truth is never far away...

 Falklands- Never Belonged to Argentina (1 page):

https://www.academia.edu/31111843/Falklands_Never_Belonged_to_Argentina

 

Looney's picture

 

Wait until the Rapefugees bring the fucking Sharia Law to the Malvinas.

They might even politely ask you to change your name to BritMuhammad  ;-)

Looney

adamas's picture

I'm British and watched the Falklands war as the planes were counted out and counted back in. I watch the French missiles skewer our warships and I watched Colonel H take goose green. The people of the Falklands are of British extraction and would vote to retain their British nationality. Argentina has no claim on the malvinas. All that is true BritBob...

BUT PLEASE SHUT THE FUCK UP INVADING EVERY ARTICLE WITH YOUR ONE MAN OBSESSION 

OFF TOPIC

SHUT YOUR FUCKING BORING TRAP 

GreatUncle's picture

+1 Remember it also and right now far bigger fish to catch like 650 corrupt politicians in westminster who will not stop dealing with a dictatorship called the EU who seeks to undermine the constitution and sovereignty.

Blanco Diablo's picture

Wake up Boob and defend your brothers and sisters before a Sharia Gang give you a flying lesson from the top of a high rise building or a acid eyewash.......

Boob has abandoned England and his Kinsmen ........... fleeing to stolen lands in order to avoid King Khan's Jizya tax and Sharia in Londonistan....

While England burns BooB buggars himself and his kinsmen, dreaming of Piracy, Plunder and looting of foreign lands.....or maybe a job with the "White Helmets"

London has fallen, England is lost to Islam.....

Muhammad is now the most popular name for baby boys in England and Wales.....

Stoning for adultery. Amputations for theft. Death for apostates.This is life under Sharia law and it's alive and well in, of all places, Great Britain.

UK Muslim Patrol: "This is Not a Christian Country... We Will Implement Islam Upon Your Necks"

The NHS recorded more than 9,000 incidents of female genital mutilation (FGM) in England between April 2016 and March 2017....

The 23,000 jihadists MI5 officials have publicly admitted are living in the UK “may be the tip of the iceberg":Colonel Richard Kemp

The changing face of Britain: A child in Birmingham is now more likely to be a Muslim than English. THREE major towns and cities have seen their white British population fall to a minority, mirroring that of London. And other population centres are set to follow.

Birminham: ‘Aggressive’ Islamic Push in City’s Schools Mainly financed from Saudi Arabia, which “is heavily involved in exporting an illiberal, bigoted Wahhabi ideology.” “A number of Britain’s most serious Islamist hate preachers sit within the Salafi-Wahhabi ideology and are apparently linked to Islamist extremism sponsored from overseas, either by having studied in Saudi Arabia as part of scholarship programmes, or by having been provided with extreme literature and material within the UK itself.”

This rant brought to you by S.O.S. Sanity or Sharia .......You decide (My apologies to the Sane Brits)

Now back to our regular programming.............Almost Forgot, PUTIN DONE IT!!

GreatUncle's picture

No sweat, realisation is this, centuries ago we had our religious war all kicked off by the king being head of the church.

Well seems like we must go there again now because you can't live by 2 sets of laws it must be one or the other yet out elites are allowing it to exist.

On top of that as far as I am concerned Liberal White Women who started all this get to wear the Burqa first followed up with female genital mutilation because they will not condemn this set of barbaric laws ... oh and their children get to be pizza first.

Because it seems the UK elite must have sharia law.

MRob's picture

Hey uhh I think you made a mistake - the Islands are not called "Malvinas" they are called the Falklands. I should know I've been there over a dozen times and I love the place. You see Argentina's bitching is flawed on multiple levels. But I think the one you seem to overlook is that your government INVADED the Falklands at a time when the British government was slowly trying to transition power over the island to Argentina. If your stupid ass retarded hunta hadnt sent troops in, the islands would probably be under Argentinian sovereignty today. However! By invading, you implicitly stated that the use of force is an appropriate means to determine ownership. And then you lost. So even if Argentina ever had a claim (debatable) - well you dont now. DEAL WITH IT! If however you want to argue that the use of force is not a final arbiter then I am sure there are a lot of indigenous peoples who might want to have a conversation with you some time soon hahahaha. Oh yeah and the people who actually own the Falklands - are the people that live there. They have their own government and elected officials. Same with Argentina. Its called self determination brah you should look it up sometime.

Mile High Perv's picture

"Jobs will never run out because human wants will never run out." - If this were absolutely true, then the Great Depression should not have happened at all.

A couple of debatable assumptions appear to have been made - 

1) The island has magic coconut trees that produce an unlimited amount of coconuts. In reality, your production is limited by how much you can (sustainably) extract out of nature.

2) For someone consuming 100 coconuts, if you suddenly start giving him 200 coconuts, he will be able to efficiently consume the increased quantity with no other apparent (side) effects or waste or loss of "purchasing" power.

But hey ... what do I know? I'm not an economist.

 

HelloHelloHello's picture

The though experiment forgot to add that:

 

- Joe owns all the rights to the land and sea...

- That Patrick does not have any savings (and rather a huge debt) therefore he has no (coconuts or berries) to buy the fishing equipment and pay Joe for fishing rights.  So Patrick will have to sleep on the beach and manage to fish by hand ...

- That since Joe finds out that he likes fish and that also Mark is willing to pay for fish.  He will promptly build a new fishing robot "more productive" displacing Patrick again.

- Then Patrick will find out that the only think he owns is his body...  but sadly Joe already build a sex robot... so Patrick is done.

 

The problem with robots is not the new innovation paradigm.  That is OK, and it is the same as when cars were introduced (displacing horses) or Windows office was introduced (displacing Secretaries, Clerks, and Archive Filers).  The problem is the "singularity", meaning that a machine can fully replace a human at any task. 

 

One end of the though experiment:

- Patrick being displaced from any job. Reclaims Joe and Mark to get a share of the production (free fix income).  Joe and Mark reject it.

- Patrick goes violent because he is hungry. Joe builds a robot to kill Patrick.

- Joe decides to use the same robot to kill Mark and builds a berry collecting robot, because why not.

- Joe enjoys coconuts, berries and fish.

 

Another end:

- Patrick being displaced from any job. Reclaims Joe and Mark to get a share of the production (free fix income).  Joe and Mark agree.

- Patrick becomes a parasite doing nothing, but for sure gets less than Joe and Mark. 

- The island becomes a land of Haves (robots) and Haves not (robots).

- Joe and Mark kill Patrick (using a Eugenics robot) because he “is a burden for the island environment”.

 

Conclusion :

 

 

Do not be like Patrick.  Be like Joe, learn about robotics.!!!

quadraspleen's picture

Duh..we'll all be making robots

martygraw's picture

Im sorry but this is just not true.  Tech is destroying us as much as helping us.  The line ends somewhere really bad if we dont have some major changes in the way people live.  You are going to have a society where almost everything, (it is already happening) is being automated.  Just like Walmart destroyed a big chunk of our way of life, an extension of it, the same monster is all this automation.