A Future Without Jobs: What is the Solution?

Automation and robotics are becoming hot topics. Some writers, like Martin Ford and Marshall Brain, recognize the impact these technologies have on jobs and employment, while others deny that these technologies lead to massive unemployment and insist that technology will in fact create jobs. Both camps in the argument have it wrong, but for different reasons.

Seeing the problem but not the solution

Ford and Brain are on to something, though they are missing something crucial—the true solution to the problem. They have begun to analyze what more and more people are experiencing. Both writers have a clear handle on some of the most important impacts of automation and robotics on the economy: they eliminate jobs. Martin Ford is a computer engineer and entrepreneur, who recently wrote, Lights in the Tunnel: Automation, Accelerating Technology, and the Economy of the Future. Marshall Brain is a computer scientist who founded howstuffworks.com and publishes an insightful blog called “Robotic Nation.” Though Ford and Brain recognize the problem, neither provides the necessary solution: public ownership of the machines for the benefit of the entire society.

In Lights in the Tunnel (Acculant Publishing, 2009), Martin Ford makes a compelling case for the ways in which large segments of the labor force will be permanently replaced. He argues, “…as technology accelerates, machine automation may ultimately penetrate the economy to the extent that wages no longer provide the bulk of consumers with adequate discretionary income and confidence in the future. If this issue is not addressed, the result will be a downward economic spiral.” Like Ford, Marshall Brain argues, “The problem is that these [automated and robotic] systems will also eliminate jobs in massive numbers. In fact, we are about to see a seismic shift in the American workforce. As a nation, we have no way to understand or handle the level of unemployment that we will see in our economy over the next several decades.”

Brain also extrapolates from current trends, arguing that the speed of the microchip will continue to improve and robotic technologies will continue to find new applications. Brain predicts the possibility of 50% unemployment in the next 40 years as robots take upwards of 50 million jobs. He recognizes that labor = money, so that those who don’t work can’t buy the commodities they need, no matter how cheap the new technology makes them.

Though Ford and Brain provide a detailed description of the problem, their solutions do not address the question of ownership (private property) of the technology and its uses (profit, competition, and the accumulation of wealth). In fact, they go out of their way to ideologically and rhetorically protect and sanctify these pillars of capitalism. Ford sets out to consider how to maintain a free market economy, “one of mankind’s greatest inventions,” and how to “outsmart Marx,” who also discussed such a potential capitalist economic collapse due to increases in production. Ford makes clear that widespread joblessness is caused by new technology, but he seeks to ignite the many entrepreneurial lights in the tunnel before it gets any darker. He proposes adapting and re-tuning free market capitalism to the new conditions with a brand of neo-Keynesianism in which the State collects “special taxes to recapture the income from lost jobs and then having the government redirect that income according to individual incentives—without the requirement for traditional work.”

Similarly, Brain argues that the solution for a strong capitalist economy in the age of automation is for a national income of $25,000 for every citizen funded by taxes, selling off resources, lotteries, ads on dollar bills, fines, email taxes, new fees, etc. Like Ford, Brain seeks to strengthen and adapt capitalism.

This June even President Obama admitted that technology is connected to lack of jobs. He called it “a structural issue” and emphasized that these are simply changes to the economy that the government must monitor to see where future jobs will be (even if there will be fewer). This way the solution is about training people for the dawning new reality so workers can better compete in a downsized world. The interviewer of the President on the “Today Show” was correct in pointing out that businesses are not hiring much despite record profits, but instead are investing in the latest technologies, rendering workers even more obsolete.

Denying the problem

Economist Russell Roberts, in a Wall Street Journal Op-Ed piece entitled, “Obama vs. ATMs: Why Technology Doesn’t Destroy Jobs,” took Obama and the interviewer to task, arguing that “doing more with less is what economic growth is all about.” For Roberts this is progress: we are now able to do things that before could never have been dreamed of. Yes, he admits this increases unemployment, but it should decrease prices and therefore raise the standard of living of all consumers. He reasons that this is caused by the fact that workers will have to work fewer hours to buy the goods they need. He goes on to say that jobs are created when people and resources are freed up by technology to create new products and industries and thus create new jobs. He doesn’t say what kind of jobs or what they pay. In the end he says technology has always displaced labor; the economy adjusts accordingly: “Somehow, new jobs get created to replace the old ones,” just because, he assumes, society continues to improve.

Similarly, the Information Technology and Innovation Foundation (ITIF) argues that technology in fact creates jobs. Their argument goes like this: automation increases profits and lowers prices which in turn gives consumers more money to spend, which people then use to “go out to dinner a few times, buy books, watch movies, or any number of other things. This economic activity stimulates demand that other companies (e.g., restaurants, book stores, movie theaters, airlines, and hotels) respond to by hiring more workers.” They then point readers to their April 2010 report, “Embracing the Self-Service Economy,” which details the benefits of food ordering kiosks, retail kiosks, airport and travel kiosks, etc. Their vision is that these would all be workerless service industries, which directly undermines their previous argument. But we might say that some workers would be needed to design, build and service these machines. (See also, their “Technology and Innovation Create, Not Destroy Jobs,” June 15, 2011.)

Their “estimate is that if the self-service technology was more widely deployed, the U.S. economy would be approximately $130 billion larger annually, the equivalent of an additional $1,100 in annual income for every household.” Unfortunately, the wealth that would be created would not be divided across the population as in this statistical sleight-of-hand, but would continue to go to the 1%. They admit short and medium term job loss, referring to it as “occupational shift” and “workforce shift.” Citing agriculture as an example, the ITIF points out that today far fewer farmers produce more food than ever before. For them it’s simply progress. But as Brain points out in “Robotic Nation,” new occupations and industries that emerge due to technology are not immune from automation. It is too pervasive and accelerates into countless industries.

Another argument used by both Roberts and ITIF is that technologies eliminating jobs is nothing new, implying that because it’s been happening and the economy is still functioning, there’s nothing to worry about Chicken Little—the “sky has not fallen yet.” For them things will become stabilized as in the past. Ford debunks this by arguing that the new technologies are revolutionizing our lives in all aspects, on a qualitatively different basis than in the past and thus of course will transform the economy in completely new ways on a totally different level and at a much faster speed.

The problem exists and what we can do to solve it

A new book, Race Against the Machine(Digital Frontiers Press, 2011), by Erik Brynjolfsson and Andrew McAfee, two MIT economists, removes any doubt that automation and robotics eliminate jobs and cause growing unemployment and permanent joblessness. They argue against the ideas of many economists that the crisis is cyclical, or that it’s simply American stagnation in innovation and productivity. They argue instead, “The root of our problem is not that we’re in a Great Recession, or a Great Stagnation, but rather that we are in the throes of a Great Restructuring,” and that these advances in technology leave behind great numbers of people.

They show this by giving example after example of the ways in which computer and robotic technologies are taking on and overcoming the obstacles others say will limit the spread of labor-replacing technologies and they show how this is accelerating due to the growth in the performance of these technologies. They link these changes to the enormous growth in productivity and the simultaneous stagnation in wages and growth of unemployment. Unemployment is caused by layoffs, but they show that the bigger issue since 2000 is the lack of hiring due to new technologies. They clearly see the problem and its implications, but they, like Ford and Brain, offer policy reforms that avoid the fundamental problem (and the potential promise) of these labor replacing technologies.

The problem is the private ownership of these massive means of production. Ford, Brain, Brynjolfsson, and McAfee do an excellent job describing the problem and refuting the argument of the deniers, but they fall into the trap of old thinking by trying to help capitalism survive this leap in production. Unfortunately, these are not real solutions given the way society is objectively developing based on these technologies.

At the same time, the problem is not the technology itself. It’s not about destroying the machines and turning to older ways of producing. New productive technologies offer the possibility of producing what every human being needs to not only survive, but thrive, allowing us to turn our attention away from fighting each other based on the old notion of scarcity. Instead, the abundance these machines make possible can enable us to solve the issues we as a planet are facing: hunger, homelessness, sustainable energy, environmental degradation, disease, etc. These are achievable ends, but it will require harnessing these technologies to benefit all humanity, and this will only be possible if they are owned by all of humanity.

March/April 2012. Vol22.Ed2

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