Author Topic: Automation Culture  (Read 1327 times)

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Offline SirJohn

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Re: Automation Culture
« Reply #120 on: July 17, 2017, 12:16:11 pm »
1) Savings in labour cost.

How exactly do you think that translates into money for people to sit around loafing?
Let's say I own a business, and I borrow money to buy some machines which then let me use fewer employees. This increases my profits somewhat, but probably not hugely. Certainly the cost savings would not translate into enough money to pay those now unworking employees a GBI.
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Offline MH

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Re: Automation Culture
« Reply #121 on: July 17, 2017, 12:51:29 pm »
How exactly do you think that translates into money for people to sit around loafing?

Exactly the way it did in the 20th century.  I don't mind debating you but you're asking some elementary questions here.  Do you not know how EI and Welfare came about ?  I'm not saying this to call you out or insult you but you honestly seem to be asking questions about well-known points of economic history.
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Let's say I own a business, and I borrow money to buy some machines which then let me use fewer employees. This increases my profits somewhat, but probably not hugely. Certainly the cost savings would not translate into enough money to pay those now unworking employees a GBI.

Your example is incorrect.  Look on a macro level.  If unemployment soars 10% due to automation then there is definitely a savings of more than those salaries.  The idea is that on a macro level, efficiency savings are spread around the economy.

Offline MH

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Re: Automation Culture
« Reply #122 on: July 17, 2017, 12:52:17 pm »
I probably didn't explain it very well... but you don't need to go into numbers beyond saying that x% savings will be spread around.  This is what has happened throughout the history of economics.

Offline SirJohn

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Re: Automation Culture
« Reply #123 on: July 17, 2017, 06:58:33 pm »
Exactly the way it did in the 20th century.  I don't mind debating you but you're asking some elementary questions here.  Do you not know how EI and Welfare came about ?  I'm not saying this to call you out or insult you but you honestly seem to be asking questions about well-known points of economic history.

Not remotely comparable. You have to qualify for EI, which is self-funding, and welfare. A guaranteed basic income could simply be applied for. You can't be rejected because you don't feel like working and want to party. And when we combine this with the numbers of jobs likely to be eliminated by automation you're talking far greater numbers than welfare or EI, quite possibly a third of the population or eventually even half.

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Your example is incorrect.  Look on a macro level.  If unemployment soars 10% due to automation then there is definitely a savings of more than those salaries.  The idea is that on a macro level, efficiency savings are spread around the economy.

You're assuming that the automation would save 100% of the cost of the jobs eliminated, which is just not going to happen. The machines are going to cost money to buy, or more likely finance, and money to operate and maintain. You'll be lucky if the cost savings amount to 30% over salaries.
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Offline MH

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Re: Automation Culture
« Reply #124 on: July 17, 2017, 07:09:50 pm »
Not remotely comparable. You have to qualify for EI, which is self-funding, and welfare. A guaranteed basic income could simply be applied for. You can't be rejected because you don't feel like working and want to party. And when we combine this with the numbers of jobs likely to be eliminated by automation you're talking far greater numbers than welfare or EI, quite possibly a third of the population or eventually even half.

They aren't comparable in terms of qualification, you're right.  But I think you were asking how such a thing could be affordable.  These things were subsidized at the beginning, and are still a kind of tax.

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You're assuming that the automation would save 100% of the cost of the jobs eliminated, which is just not going to happen. The machines are going to cost money to buy, or more likely finance, and money to operate and maintain. You'll be lucky if the cost savings amount to 30% over salaries.

Regardless - I am not arguing numbers.  I'm saying that generally if there is less work to do, the savings will be used to fund whatever comes next.  If the savings are 30%, which seems low to me, then we may not see a big impact from automation anyway, right ? 

Here's one article:

http://www.makeuseof.com/tag/self-driving-cars-endanger-millions-american-jobs-thats-okay/

4 million jobs eliminated plus $180 billion in other costs trends towards $400B to 500B per year savings in the US.   That equates to about $100K per job lost.  This is a back-of-the-envelope calculation, I'll admit.  But this isn't an argument, it's an exploration.  Come back at me with your thoughts.


Offline kimmy

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Re: Automation Culture
« Reply #126 on: July 19, 2017, 12:32:37 am »
Not remotely comparable. You have to qualify for EI, which is self-funding, and welfare. A guaranteed basic income could simply be applied for. You can't be rejected because you don't feel like working and want to party. And when we combine this with the numbers of jobs likely to be eliminated by automation you're talking far greater numbers than welfare or EI, quite possibly a third of the population or eventually even half.

Welfare and EI are two kinds of government assistance that could be scrapped if a GBI was introduced. OAS is another.  Long term disability is another.  There are perhaps more.

As well, there are other potential savings in scrapping numerous tax deductions that would be irrelevant if a GBI existed.  As well, each of these income supplements has administrative costs and fraud prevention costs associated with it, which would become irrelevant.  There are savings associated with scrapping existing government assistance programs that would help pay for GBI.

As well, I think we have differing ideas on how "basic" a guaranteed basic income would be. You seem to be anticipating that people with a GBI would be living comfortably enough to spend all their time partying or loafing around.   I think most of us are picturing something a lot more "basic".   The lifestyle of living on GBI alone with no additional income would be motivation enough to get people to find ways of supplementing their income.

"Precarious employment" is increasingly the new norm in our economy.  People have no job security and no assurance that their job will even exist in a few months.  People like Mitt Romney talk of "creative destruction" as old unnecessary jobs are eliminated and people transition to new things. "Precarious employment" is the reality of that "creative destruction"... people drifting from one temporary job to the next as they try to re-establish a career after their old career became obsolete... people working as self-employed contractors who may or may not have a client from one month to the next... people trying their hands at entrepreneurship by selling their hand-made goods on Etsy, all kinds of things like that.  If "creative destruction" is a great thing for the economy, then we need to find a way of sharing the benefits of that "greatness" with the people who are displaced by all of this "destruction" while they find new ways of "creating".

You're assuming that the automation would save 100% of the cost of the jobs eliminated, which is just not going to happen. The machines are going to cost money to buy, or more likely finance, and money to operate and maintain. You'll be lucky if the cost savings amount to 30% over salaries.

The amount of work employers have put into offshoring jobs or automating them makes it clear that there is a big financial motivation in eliminating jobs.

Ultimately every employer wants to reduce costs and increase profit margins. The wider social costs aren't part of their business model. Their business model is build around having customers, of course, but it's an article of faith that displaced employees will find new better jobs somewhere else and keep buying products.  But every other employer is trying to cut costs too.  As the potential means of eliminating more and more jobs are created, the assumption that there'll always be customers is increasingly questionable. If nobody is hiring humans anymore, who is going to buy your products?

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Offline MH

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Re: Automation Culture
« Reply #127 on: February 04, 2020, 06:32:42 am »
What the WHAT??

I posted in the Basic Income thread that we needed a discussion on this topic.

Maybe we can start with people posting their intuition o. This.  Then I will correct you. 😀😀😀

Jk

Offline Gorgeous Graham

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Re: Automation Culture
« Reply #128 on: February 04, 2020, 10:20:00 am »
What the WHAT??

I posted in the Basic Income thread that we needed a discussion on this topic.

Maybe we can start with people posting their intuition o. This.  Then I will correct you. 😀😀😀

Jk

People will probably always have jobs, they'll just change.  It doesn't matter if robots make things if people don't have income to buy them.

People will work more in sectors where human-to-human contact is preferred, like services, sales, law, healthcare, teaching etc.

I assume any transition will be very messy though, worse than the hollowing of the manufacturing sector.  It will take generations to change education and career patterns while people stuck with outdates education and skills will be left behind, just like in manufacturing.
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Offline MH

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Re: Automation Culture
« Reply #129 on: February 04, 2020, 10:35:02 am »
1. People will probably always have jobs, they'll just change. 

2. It doesn't matter if robots make things if people don't have income to buy them.

3. People will work more in sectors where human-to-human contact is preferred, like services, sales, law, healthcare, teaching etc.

4. I assume any transition will be very messy though, worse than the hollowing of the manufacturing sector.  It will take generations to change education and career patterns while people stuck with outdates education and skills will be left behind, just like in manufacturing.
1. The industrial revolution resulted in a radical re-imagining of work.  To say "people will have jobs" is as correct as it is elementary. 

2. The economy is, by definition, a system to allocate scarce goods.  Is food a scarce good anymore ?  Can we just make it free ?  You see, economics itself is changing in drips and drops as the collective economy progresses.  These conversations are about big changes, so there's only so much use to comparing the future to the past IMO.

3. But there are limits to that too.  Unless you envision people making $100,000 a year to provide image consulting to your cat and so on.   Is having more lawyers a desirable future, to you ?  Labour is a cost, unless the services enhance our lives.  Again, it's time to reimagine.

4. Does it have to be ?  The other thing that would blow everything apart would be governments just printing their own money.  And if the capitalist class demands too much for what they provide to the economy, governments can do a different kind of revolution.  They can refuse to honour copyrights, they can nationalize intellectual property, make robots open source etc. etc. etc. if feeding the capitalist class begins to defeat the purpose of us having a capitalist class.