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While we are not currently at total automation, we are inching closer. An Oxford Study from 2013 indicates by 2033 upwards of 45% of our job force could be automated. This automation, causing a reduced need for work (thus wages) might cause (over time) capitalism to die. While there may be other possible reasons/ways capitalism may collapse, my main objective is to seek how capitalism could save itself from the reduction work/wages resulting from automation, assuming it's possible.

Capitalism (goods are owned by private individuals/businesses). People/workers buy those goods. Business automate functions to compete resulting in a better bottom line with less labor. Less labor, less money to buy goods... and so on. Eventually reaching a tipping point of little/no people being able to buy said goods.

If possible, how would capitalism prevent us from reaching that tipping point?

Sources:

I would cite more, but limited to two links.

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    I upvoted your question because it's intriguing. I don't understand how automation could kill capitalism. Wouldn't automation just be the latest incarnation of capitalism? If capitalism dies, what do we call its replacement? Automation is a very scary thing, though. I think it's going to rank with population growth and climate change as one of the mega issues of the (near) future. – David Blomstrom Apr 20 '17 at 1:13
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    Isn't this the exact same thing that happened with the industrial revolution that arguably launched capitalism? (I'll give you a hint, that's rhetorical and the answer is yes.) The dominant method of producing physical goods at the time ("cottage industry") was mostly replaced by assembly lines and a great deal of automation. Why do you think this time is different? What makes you think this "tipping point" will happen this time, when it didn't last time? – HopelessN00b Apr 20 '17 at 6:01
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    How would people stop being able to buy those goods if the increased productivity keeps making them cheaper? Who forces the people to participate in an economy that doesn't benefit them? And how could those capitalists stay in business if people couldn't buy what they produce? Who owns the factories and robots? If there is any scarcity at all, people will have a means of employment. If there isn't, that's not a question for capitalism. Capitalism is an economic theory, and economics concerns itself with the distribution of scarce resources and nothing more. – Luaan Apr 20 '17 at 14:35
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    What's wrong with people simply working less? If goods are half as expensive to make I only need to work 20 hours a week to afford twice as many goods. (Then if my employer wants the same amount of person-hours as before, he can now employ twice as many people) – immibis Apr 20 '17 at 23:58

21 Answers 21

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+50

In 1800, more than 90% of everyone were farmers. Modernly in the United States, which is a net exporter of food, less than 5% of everyone are employed on farms. That's a reduction of 85%, much higher than 45%. Far from causing the end of capitalism, it launched the industrial age.

In short, the capitalist answer is that there is always something else that people could be doing. Police departments could hire more police. Hospitals could hire more nurses. Automation leads to higher wages which leads to more consumption of other things: maid services; landscaping; construction; other things that don't have names because we haven't created them yet.

When I was young, we had a refrigerator, oven, washer, dryer, phone, television, and several radios. We added a microwave, a computer, and a VCR. Now, that VCR is already obsolete and replaced by Blu Ray players and DVRs (or the internet). And people each have their own phone, computer, and television (which may also be the phone or computer).

Capitalism can't tell what the future holds. But looking at the past, it can guess that the future holds something. Because our previous responses to automation has always been to find new and different things to do.

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    Also, it should be pointed out that this whole idea is going to start changing very drastically. For the past 100 years, automation was mainly a replacement for hard labor. Going forward, we're finding that automation is increasingly a replacement for light labor and white collar work as well. – user1530 Apr 20 '17 at 1:45
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    @blip: Going forward? Probably the first case of white-collar work being replaced would be direct dialing, the replacement of telephone operators by automated switches. That started in the 1940's. . – MSalters Apr 20 '17 at 10:37
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    @Floern Why would you expect that to happen? It's a prediction that has been made over, and over, and over again, and the result has always been the same - people found other things to do. Why do you believe "in 100 years" would actually be a point where humans are unemployable? If you make automatons that can do everything humans can do, you've just created a massive slave empire; not to mention that regardless of quality or cost, people seem to be turning back to "hand made" products for many reasons. Would you expect that to diminish as well? – Luaan Apr 20 '17 at 13:11
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    We don't know what's going to happen. But my idea is that automation reaches a point where all those "new jobs" are immediately occupied by automation itself, because the robots are better suited to do those jobs from the very beginning. So humans will drop out of the production cycle, and I have no clue what would happen then. – Floern Apr 20 '17 at 14:26
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    I wish I could give this answer more upvotes. It should be noted that people have been raising this same concern for hundreds of years (see: Luddites.) Yet, the predicted drop in employment has never actually occurred. The prediction has been wrong every time in the past and there's no reason to believe it won't continue to be wrong going forward. – reirab Apr 20 '17 at 17:47
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The answer from a capitalist's point of view is fairly straight forward. As demand for certain types of labor fall, demand for other types of labor will increase and workers will need to gain skills in other areas in order to maintain employment or for their own businesses to succeed.

A comment to your question alludes to this. There used to be a huge buggy whip manufacturing industry when horse buggies were the standard for transport. Today that industry has (mostly) died out. Capitalists would argue this is a Good Thing™, because there is nowhere near the level of demand for as many buggy whips so producing them in large supply today would be a giant waste of time and energy. This scenario is what proponents argue is one of the major selling points of capitalism: because of the decentralized nature driving market decisions, the market itself can react much more efficiently to changes in reality than any centralized government planning office could. A government could come up with a few solutions that may or may not work, but the market itself can try millions of solutions to a demand in parallel and what works will survive.

In terms of automation, I don't think any capitalists have all the answers (simply though because they happen to be a subset of people and I don't think any group of people have all the answers), but if they do they probably won't be sharing them publicly until after their IPO. In less abstract terms, all this means is that a different form of labor will evolve. What that is is really anyone's guess, but it's better to leave it to the market to decide rather than have a bureaucrat decide for you.

  • Comments are not for extended discussion; this conversation has been moved to chat. – Sam I am Apr 20 '17 at 20:00
  • > if they do they probably won't be sharing them publicly until after their IPO -- I don't see how that follows... companies don't disclose all confidential information after they IPO; they simply report financial statements following SEC requirements – A.T. Apr 20 '17 at 20:56
  • @AndreTerra I am using it more as a figure of speech here than a factual statement. If a capitalist has an idea on how to solve a problem, they probably won't share it until they can figure out how to make money off of it. – Jeff Lambert Apr 21 '17 at 14:25
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    Perhaps buggywhips have (almost) become obsolete, but (per Google: horsecouncil.org/economics ) US horse-related activites were a $39 billion/year industry in 2005. Other estimates go as high as $300 billion. – jamesqf Apr 21 '17 at 18:11
  • @jamesqf That's partly the point, there are still plenty of people making money off of the collective horse industry, even though horses as a 'technology' have been rendered obsolete. It just isn't as prevalent in larger society as it used to, which I think is just fine with everyone. – Jeff Lambert Apr 21 '17 at 18:39
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In 1930 John Maynard Keynes published the essay Economic possibilities for our grandchildren where he discussed technological unemployment ("unemployment due to our discovery of means of economising the use of labour outrunning the pace at which we can find new uses for labour"). He proposed to solve the problem by working fewer hours:

[W]e shall endeavour to spread the bread thin on the butter-to make what work there is still to be done to be as widely shared as possible. Three-hour shifts or a fifteen-hour week may put off the problem for a great while. For three hours a day is quite enough to satisfy the old Adam in most of us!

So say you have a factory with ten workers and you automate four jobs. There are two things you can do: fire four people, or keep everyone and reduce their working hours by 40%.

Keynes' 1930 prediction hasn't come to pass – yet, and it may never (interesting view on why it hasn't), but it's one reasonably famous proposal to solve the problem which could still be called "capitalist" (unlike e.g. basic income and some other proposals).

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    Does 40% work mean 40% the wage? That doesn't sound hopeful or even survivable in some cases. And if not why does the capitalist increase compensation or bother to automate? – user9389 Apr 19 '17 at 16:16
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    @notstoreboughtdirt Automation also means it's cheaper to produce things, so products should become cheaper as well, compensating for the lower wages. Of course, the 40% example is rather extreme; in reality change would be more gradual. – Martin Tournoij Apr 19 '17 at 16:23
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    I imagine the trickle down from improvements in wig making reducing the cost of living for wig makers is negligible. – user9389 Apr 19 '17 at 16:39
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    @notstoreboughtdirt Compensation is mostly relative, so if everyone is both working and earning 40% less then companies producing consumer goods won't have anyone to sell to unless they lower the price of those goods. It wouldn't necessarily correlate to any drop in standard of living under that scenario, the question is whether the degree of imbalance between the top/middle/bottom becomes too great, because then any sort of social mobility would go out the window since someone in the middle wouldn't possibly be able to make it to the top. – Jeff Lambert Apr 19 '17 at 20:45
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    But it hasn't changed all that much since 1930 @dasdingonesin. Certainly not to levels like 10-20 hours/week. – Martin Tournoij Apr 20 '17 at 13:12
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It doesn't have one. Full automation in a capitalist society will naturally evolve towards a dystopia without intervention from outside the economy.

When a machine is smart enough, and can do the job of a human at lower resource consumption than the human, there is simply no reason to employ a human. So far, machines have not been smart enough, and people have been able to adapt to new jobs at a faster rate than machines can.

Note that machines do not have to reach truly self aware or even particularly scary levels of intelligence to be able to as a group specialize in some new work opportunity faster than typical humans can (remembering that 'typical humans' are the kind of people who keep reality TV afloat). THAT will be the downfall. Each human needs to learn individually, but all robot replacements learn and benefit from each others' experience in parallel, and work at 100% from the first minute. Each human has variance in their performance, but a machine works like... well, a machine.

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    Presumably we would still need humans to design the machines making at least some jobs. Unless you propose machines can design better machines than themselves and than humans can design, at which point we reach a singularity where we are defunct as a species, not just as individuals. – Vality Apr 20 '17 at 22:06
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    This is the best answer thus far. Capitalism has no answer. The rest of the answers are ideology. – axsvl77 Apr 21 '17 at 1:43
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    @axsvl77 That's the best argument I've ever seen in the whole universe. Let's just stop discussing anything, since everything you don't agree with is ideology anyway ;) – Luaan Apr 21 '17 at 7:56
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    You're wrong, and not in an interesting way either. Division of labour makes sense even if I can do every single thing better than anyone else in the world - trade will still make both sides better off. Increasing productivity means you need less resources to feed the humans, and in a different way than the robots. And either the robots will be owned by humans (investment like any other), or they'll be free (if they can do anything humans can, what right do you have to enslave them?). And thinking that robots will be able to benefit from each other's experience is hopelessly naive. – Luaan Apr 21 '17 at 8:02
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    @Vality I think that is an inevitability, in which case we become the horses in the parable of the buggy whip, The US horse population peaked in 1915 and is now a bit more than 10% of its peak. We're sort of a meat-based bootloader for a more sophisticated type of intelligence. – Spehro Pefhany Apr 24 '17 at 11:07
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I'm not sure if Tim Burton is a Capitalist or not, but he gave a really good illustration of what tends to happen over time in his version of Charlie and the Chocolate Factory

  • Charlie's father works capping toothpaste tubes
  • The factory buys a machine to cap the tubes. Charlie's father is fired
  • At the end of the movie, Charlie's father is the man who repairs the machine that replaced him

Capitalism's chief feature is that it self-levels. For instance, if you produce a good that is too expensive, nobody will buy it. Henry Ford realized that and began to produce cars at scale (which drove the cost down) and paid his workers enough so they could afford to buy the product they make. Today, perhaps half of every car is produced by automation and Ford still sells lots of cars.

Remember, the goal is consumption of goods and services, not creating jobs (which is purely a political goal). I found this comment to be insightful

Luddites have constantly engaged in the fallacy of looking at jobs as an end in itself, rather than facilitating consumption as the real end. Production is merely a means to the end of consumption and the real objective is to produce the most goods and services with the minimum effort. This fallacy becomes extremely apparent if you consider a simple case of a single person on an island. Obviously his objective is to build himself a nice house, grow himself enough food, build enough nice things for himself etc. with minimum effort. His goal is most certainly not to work 40 or 60 hours a week irrespective of what that labor produces. His goal is to produce the maximum set of things that he wants or needs with the minimum effort. He would be overjoyed if robots did 97.5% of his work needing him to work only 1 hour a week. Nothing fundamentally changes when multiple people are involved who do a relatively more complex form of barter using a money system to trade with one another and produce those set of items that they enjoy a comparative advantage in producing and trade with others to get access to other items that they have no comparative advantage in producing.

About 70% of the US was engaged in agriculture in the 18th century and luddites always feared automation in agriculture resulting in loss of jobs. Today about 2% of the US is engaged in agriculture since the average agriculture worker has his productivity greatly enhanced by technology, and the remaining human capital has been freed to engage in other productive endeavors.

Robots replacing human jobs will have the exact same effect as what technology has had so far when it destroyed human jobs, which is improve overall human productivity, leading to higher real incomes and greater prosperity.

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    Thank you very much for sharing that comment. It describes my opinion about this topic better than I ever could, and it was driving me insane not having a way to express it. – A.T. Apr 20 '17 at 21:08
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    The Henry Ford thing is a myth. He didn't pay his workers high wages so they could buy his products (that's just as ridiculous as feeding dead humans to humans as food to produce electricity). He paid his workers high wages because nobody wanted to work there. People simply didn't want to stand next to a belt the whole day doing one thing over and over again. The worker turnover was horrible, so he had to keep increasing wages to increase his profit margins. You only make a trade if the value you are getting is higher than what you're giving away, and his workers simply didn't feel that way. – Luaan Apr 21 '17 at 7:54
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    The island analogy falls down because it ignores distribution of wealth. Say you had an island with 10 people, and it took 40 hours / week to build and maintain housing, and 40 hours per week to farm the available land. You could have one full time builder, who provided a home for a full time farmer in exchange for food. What have the other 8 people got to trade for the food and housing they require? – thelem Apr 21 '17 at 10:32
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    @thelem No, it falls apart at 300M. With 10 people the goal is mere survival. With 300M, the goals are far more diverse than just farming and housing (I can't think of any economy with only food and housing as their sole goals). You'll never reach 80% unemployment because there will always be demand for labor to reach the diverse goals of others. Even in poorer countries like, say, Mexico, the unemployment rate is under 10% consistantly – Machavity Apr 21 '17 at 13:43
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    @thelem "What have the other 8 people got to trade for the food and housing they require? " If they can't trade anything of value to the carpenter or the farmer for housing or food... they start trading among themselves. There's nothing preventing any of the 8 from realizing there is demand and starting to fill it. – NPSF3000 Apr 21 '17 at 17:43
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Capitalism doesn't have an answer, and doesn't need an answer. What people always forget when they worry about automation is that prices for things get less. At the turn of the century, people would pay 43% of their income on food, just to stay alive! That has gone down to about 5% now due to automation! (I can't find a source chart for before 1920's.)

us spending on food expenditures

What will happen when people can furnish their entire home by visiting the dollar store? (They can already do that.) They will have more money left over for other things: entertainment, sports, services, creativity, travel, etc. Maybe people will only work 1 day a week to survive? Maybe they will work 5 and live like royalty did in the nineteenth century?

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    Correct. Under capitalism, there is no question of automation. Instead, automation is an answer to the question of not merely staying alive but one of thriving. – Aki Suihkonen Apr 24 '17 at 9:17
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    It seems to me your thesis is based around 1 industry, food. There are other necessities that are more expensive than in the past with little gains in income. Not sure i fully understand your answer. – jharris8567 Apr 24 '17 at 21:43
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    @jharris8567 huffingtonpost.com/2014/09/08/3d-printed-houses_n_5773408.html Everything gets cheaper, in all industries. – Chloe Apr 25 '17 at 0:40
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    buying enough healthy, organic food for 5%-10% of your income? Not sure. – J. Doe Dec 4 '17 at 15:37
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    Do note that if you're living in the first world you're probably already enjoying a higher standard of living than most 19th century royalty while working only 40 hours a week. The king had more human servants, sure. But the food was worse, the healthcare was worse, the climate control was worse, the indoor plumbing was worse, the travel was worse, and most of those servants went to doing the stuff that Alexa will do for you today for free. – Perkins Sep 27 '18 at 23:45
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While labor is marginally valuable there is no problem. Fewer apple pickers needed means we've freed up people to be beekeepers. Fewer beekeepers needed means we've freed up people to be carpenters. And so on.

The imagined danger is when labor is not marginally valuable. When there is nothing productive a person with a free day could do that would cover the cost of living a day. A capitalist might laugh at this possibility and offer you a job at a not quite competitive wage, proving pretty clearly that day is not today.

And thinking a ahead on a whole system level is not expected of a capitalist, but if they did they might say something like: If a person alone can't earn his daily bread how was food found to feed him to adulthood? We will have reached the carrying capacity of the system and population growth ahead of resource growth is expected to be bad. Let him look for charity.

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    "And thinking a ahead on a whole system level is not expected of a capitalist" = interesting point! – user1530 Apr 20 '17 at 1:41
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    " thinking ahead on a whole system level is not expected of a capitalist". That's in fact the core point of capitalism. Since the whole system includes all personal preferences of millions of people, you cannot think ahead. Capitalism is known to be sub-optimal with respect to the millions of preferences, but it is robust in regards to getting those preferences slightly wrong. – MSalters Apr 20 '17 at 10:51
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    @MSalters Depends on what you call "optimal". If you mean "satisfying all needs and preferences fully", sure. The only "optimal" solution would be to erase people's preferences (which, granted, has been attempted with indoctrination) :P But as for "we know of a better way of simultaneously fulfilling all those preferences as much as possible"... I'd like to hear of such an idea. Not to mention that capitalism keeps the responsibility on the individuals - they get to choose what they value more, to the best of their knowledge. – Luaan Apr 20 '17 at 13:34
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    @MSalters isn't capitalism Pareto efficient if you make the common (unrealistic) simplifying assumptions, like perfect information and no barriers to trade? – user9389 Apr 20 '17 at 18:22
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    @notstoreboughtdirt: A Pareto inefficiency in capitalism means that two parties can make a mutually beneficial trade, but don't. The reasons you mention can hinder such a trade, and therefore cause these inefficiencies. IIRC there are also numerical issues, such as non-existent derivatives of demand curves. (you can't have 3.1415 cars). – MSalters Apr 20 '17 at 22:26
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The answer is that even when machines can do anything, they are not necessarily the best ways to do it.

Many developing countries do manually many things that we automated away ages ago. And it makes perfect sense: in those countries, wages are so low that paying for a machine actually wouldn't get your investment back. Automation only kicks in when labor is scarce; if it isn't, and wages stay low, then humans will keep being the cheapest machine.

The problem arises when labor is locally scarce despite mounting unemployment; for instance because of unionization, minimum wages, or people not having the required skills, or monopolies being allowed to keep prices high on necessities. But that's a problem for politicians to solve.

Without political interference, price of food and building will go down so much (thanks precisely to automation), compared to what skilled technicians and machine owners make, that humans will always be cheaper at something.

Of course it depends if you like such a world.

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More hair dressers!

As the primary production industries employ fewer and fewer people, service industries grow to take up the slack.

There will always be a market for having a real flesh-and-blood person use their time on you. It feels good, and will always be in demand.

In the old days rich people had servants to wait upon their every need. Including needs other people simply didn't have, like help getting dressed.

These days it is more common to go to a restaurant, hair dresser or some other place and pay the people there for their time and attention. (And, I guess, their actual work)

Look for example at the role of the "store greeter". I think most people would agree that this person does not do anything productive. They still have a job, they still earn wages and they still buy other goods.

Look forward to a future of more store greeters.

  • I have never seen a store greeter. Where in the world do those exist? – gerrit Apr 20 '17 at 11:58
  • @gerrit I've seen them on The Simpsons! – Luaan Apr 20 '17 at 13:54
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    @gerritt - I have observed them in grocery stores in the United States. Wal-Mart and Hy-Vee may both have greeters, though they are often semi-retired older people. – indigochild Apr 20 '17 at 14:43
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    Where I live we don't have store greeters. Instead, we have automatic checkout systems. I heard in the US you get them too (Amazon Go). – el.pescado Apr 21 '17 at 11:54
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    Home Depot also has greeters. They're typically older people who are there to help the weekend warriors find what they're looking for – Machavity Apr 21 '17 at 18:25
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A simple examination of history should put this fallacy to rest.

Automation has been replacing manual labor for as long as manual labor to accomplish a specific task has been performed, at least several thousand years. And most of us still have jobs, despite the automation and a growing population. How did that happen, despite all the predictions of gloom and doom?

Probably the first bit of automation was the animal drawn plow. One person with an ox drawn plow could cultivate the same amount as many people with hand tools. Did that put the many people out of work? No, it did not - now that everyone wasn't engaged in food production, some could specialize in more advanced fields, like building better plows, breaking oxen to harness, building and operating wagons to transport all that extra food, or what have you.

Moving forward, consider the case of Ned Ludd, a weaver in late 1700's England, who smashed up some automated knitting machines. Granted, Ludd appears to have been a ne'er do well who was championed for the wrong reason, but the coming of the automated loom as opposed to hand spinning yarn did not put everyone out of work.

The automated loom dropped the price of clothing to the point where more people bought clothes more frequently, creating more jobs at the automated factory, plus more jobs to meet the increased demand for wool and cotton, plus more jobs to transport the raw goods and finished clothing into the new stores with new jobs to sell the clothing to meet the increased demand...

Eli Whitney automated two manual processes: extraction of cotton (the cotton gin) and a standardized firearm production line (previously, guns had been pretty much handmade). Both reduced the number of people necessary for the task, neither ended up putting people out of work. Drop the price of the item being produced, demand goes way up, production goes up, more jobs, and more jobs to supply those factories, and to transport the goods.

Arguably, the coming of the steam railroad put a lot of horse drawn wagon operators out of a job. But, the steam railroad so boosted commerce in general that there were plenty of jobs to go around.

And, one of the most ironic cases of automation and job loss: Henry Ford's auto production line. Ford automated much of the process of building an automobile, previously done by hand. Ford dropped the price of a car by an order of magnitude, by lowering labor costs. Did this eliminate jobs? In fact, it did the complete opposite. Ford's pay of $5/day for work on his automated assembly lines essentially created the middle class, and in the process, Ford created a lot of customers... for his cars. More cars sold meant more demand for metal (more mining/smelting jobs), more demand for gasoline (jobs drilling, refining, and selling gas), more need for repair (jobs repairing automobiles)... it just kept growing. The cheap automobile made a lot of new jobs possible that weren't efficient before, like traveling salesman, delivery person, etc...

Finally, let's look at a contemporary situation. E-commerce. It is putting some brick and mortar stores out of business. Oh, dear, that's automation killing jobs, right? In fact, the opposite has happened. E-commerce relies on delivery, with UPS and FedEx seeing explosive growth in delivery. More jobs. The websites must be maintained - being a good web developer today is a fairly lucrative occupation. E-commerce with its lower prices and greater selection has increased sales, which increases production, which increases jobs elsewhere.

For as long as civilization has existed, automation has been eliminating jobs. If you look at previous examples, not by today's standards, but within the context of their time, you should be able to see that for every job that automation eliminates, the results of the automation creates more than one job.

Automation is not only not detrimental to employment, it is mandatory for increased employment.

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    Well said. the panic mongers always bemoan the loss of a sector and never come to grips with the fact that another sector will take it's place, and we can't accurately predict what that would be. – Paul TIKI Jul 17 '17 at 20:35
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I don't profess to know the answer, but I have just begun reading Thomas Piketty's Capital (2014). I will report back when I get a bit further.

One thing I think we can safely assume, however, is that whatever society results, it will be far less egalitarian that that of the late-twentieth century. "Economic equality" was I believe an unusual circumstance in world history associated with an age of mass manual production.

Given the continuation of the trends of the last couple of decades Europe and America are almost certainly heading to become oligarchic societies presided over by the top 1% of "earners".

China may be the new egalitarian utopia until it too succumbs to the same trends.

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    @PaulTIKI Well, there are plenty of people in the developed world who now depend on charitable food banks to live. I am not sure which are the countries where they would be considered part of the top 1%. – WS2 Jul 18 '17 at 7:01
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    Your point being....? The question asked about a capitalist answer to automation. Discussion has moved a long way since then. Whilst I do not profess to know the answer, I have a strong suspicion that the advanced economies are moving toward a far less egalitarian society than that of the late twentieth century. Indeed to a great extent they are already there. If there are no jobs for people to do, I don't see how they will have purchasing power. The only remedy would seem to be some sort of highly managed economy. But I've no idea what it will look like, or how it will be brought about. – WS2 Jul 18 '17 at 19:16
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    @Paul TIKI Problem is there seems to be a symbiotic relationship between overall wealth in society and it's egalitarian quality. Countries did not become rich until they began to become more equal. Consumers drive growth. But automation impoverishes consumers. – WS2 Jul 19 '17 at 22:52
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    @PaulTIKI Equal societies are generally associated with mass production. It was mass production which carried wealth to the masses. And in modern western states business no longer lends itself to mass production. I am not making comparisons with Nigeria, heaven forbid. I am simply comparing modern society with that of 40 years ago. An important egalitarianism has been lost. – WS2 Jul 21 '17 at 16:57
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    @PaulTIKI You've been reading too many self-improvement books. Try Barbara Ehrenreich's Smile or Die: How Positive Thinking fooled America and the World. – WS2 Jul 22 '17 at 6:00
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Prostitution and absolutism. As automation grows and control over resources remains in few hands, workers need to refocus on endeavors that are interesting to those in control of the resources. Capitalism only rewards success, so the idea of people in general turning to pursuit of arts and learning will not work out, in particular since reproductive media obliterate the need for most live performers (in antique times before literacy, it was a job description to learn all of Homer's available works by heart and travel reciting them, preserving them until people were actually writing them down).

Workers will be interesting for those things which cannot be readily automated. Sex will be one thing, and of course humiliation (either in connection with sex or as a value of its own) will be another that gives power over resources a special value not easily had otherwise.

It's not like empires based on similar principles have not been around previously. They went under in decadency numerous times in history, not able to keep up with less terminal forms of human societies.

But this time, capitalism is globalized, so it may stay the sole survivor.

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    I'm not so sure prostitution can't be automated. Heck, I think it's one of the first things that will – A.T. Apr 20 '17 at 21:00
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    Yes, but this is too pessimistic. Prostitution can expand into great industry, with franchises, themes, costumes, role games, be fused with other kinds of entertainment, drive clothing, cosmetics, pharmacy, plastic surgery and genetics industries with itself and so on. – Anixx Apr 25 '17 at 10:24
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    "since reproductive media obliterate the need for most live performers": we've had cinema and TV for a while now, and yet there is still plenty of demand for live entertainment. – Steve Melnikoff Jul 17 '17 at 10:20
2

Machines are learning to think like humans and work like humans. That means that it doesn't matter what new jobs they come up with. If a human can do it, so can a machine. It can be even reversed, there may be jobs that can solely be done by a machine!

By the way. A.I.s are proven to be able to think creative, so they will be able to program themselfes. So how much more is a human worth in working power compared to a machine? Its Zero. Its even negative, since machines don't want vacation, don't want to be paid, just need to be sustained.

You simply do not need humans to work in industries anymore. So nobody is paid and either all food is free (good luck convincing those who own/command the machines to give out free stuff) or you have to become a farmer to survive.

You can say the gap between rich and poor will come to it's final form. Those with the machines will have ALL power and the rest will have NOTHING.

So I bet with time even the management will die out (either a war against the machines or somehting other, humanity always found a way to kill of a lot of folks) so what will count?

In a society that only consists of machines, there will be competition. The more efficient a machine is, the more worthy it is of being used as a blueprint for the next generation of its profession. So ultimately this society will evolve to a complete machine (or human-machine hybrid) society that strifes for efficiency (at least that would make sense since the base requirement for all that exists is sustaining that existence, either through reproduction or immortality)

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    Machines are far from being able to "think like humans". That's too bold a claim, to begin with. – A.T. Apr 20 '17 at 21:13
  • A lot of the "machines thinking like humans" you have seen is just machines copying humans' thinking (surreptitiously extracted from your Internet browsing habits for example). They still don't exactly think for themselves. – immibis Apr 21 '17 at 0:04
  • I'am working in an R&D department for Automation and have seen things. Apart from that. We are talking about the future. Your claim is very naive, neuronal networks will experience a exponential growth in know how once they reach the point of developing themselfs (just like computers did with processing power). An no this point is not "far far away". Algorythms are becoming smarter each day and just because it scares you (I'm being bold here) doesn't mean it's not reality. – anyone Apr 21 '17 at 5:21
  • @immibis I'm a tech-guy not an talk-guy, look for Steven Armstrongs reply, he put my point it in better words. – anyone Apr 21 '17 at 5:28
2

Most of the answers here are optimistic, and assume there's a correct (or at least reasonable or workable) answer. Those are perfectly good answers, but... given many choices people don't always choose wisely. In which spirit, several stupid answers that seem to have been used before:

  1. Busywork and time waster jobs. Work behaving like a gas that expands to fill however much time is allotted for it. Water coolers and expense accounts.

  2. Lower pay. When people are too efficient at working, (not behaving like an ideal gas), pay them less, and maybe they'll do a worse job, and thus need more hours to pay their bills. Of course the money saved on wages would have to go somewhere, which becomes the rich man's burden.

  3. Move workplaces further from the home. More commuting means more work to pay for the commute, babysitters and day-care.

  4. Credentialism. In order to do the same job, upgrade the degrees, certifications and credentials required. More working to pay for more schooling. Make credentials harder to get, and easier to lose -- creating a bonding culture of fear, and plenty of openings for the next round.

  5. Propaganda. More demand for liars to reassure the public as things go sour. Perhaps all of the people can be fooled all of the time if only enough of those people work hard enough at it. Entertainment forever.

  6. Raise norms, and create more crime by outlawing and pathologizing more things. More police, prisons, and doctors are needed to fight these novel crimes and syndromes.

  7. Warfare. Nations X & Y can blame each other for their problems, and break each others windows and bones, and eventually create full employment for the surviving glaziers, bonesetters and undertakers.

  8. Conquest. Work can be spread quite thin for nations whose reach exceeds their grasp.

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    Wow. Love your doom and gloom take on the question. I can't dispute anything you said, but... wow. – CigarDoug Aug 1 '17 at 18:19
1

From a micro perspective, a capitalist will continue his labor / automation trade off based on marginal profitability. Because that's the only way for him to max his profits.

To out it another way, the substitution will yield the highest income for the labor, at the expensive of the maximum displaced labor.

This leads to a macro scenario whereby the goods and services produced by the capitalist may face a shortage of demand as consumers being increasingly priced out of the employment mkt.

But that's a case the individual capitalists cannot be expected to deal with. This calls for a socialist solution , for example tax on automation, ....

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    so...there is no capitalist answer to the question? – user1530 Apr 20 '17 at 1:42
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    If the services produced by the capitalists face a shortage of demand, the capitalist gets a lower marginal profitability. Therefore, capitalists which can satisfy their customers with better production volume and/or prices will be more profitable than those who do not, and displace them over time. You're ignoring the background effects - the cheaper it is to make something (thanks to automation etc.), the cheaper you can sell it with the same marginal profitability. The cheaper the people can satisfy their needs and wants, the lower wages do they require for the same standard of living. – Luaan Apr 20 '17 at 13:44
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    Again, this has been repeated in history over and over again. It's a prediction that hinges on assuming a change in one part of the economy, while expecting everything else to stay static. That simply isn't the case. How could it ever be possible that making enough food to feed a human requires more work than a human can provide as a result of increasing marginal productivity? That's a rather serious contradiction. – Luaan Apr 20 '17 at 13:47
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    Keynesianism is wrong. The theory is self-contradictory, it doesn't make any sense, and it doesn't describe reality. If you want an economic theory that can actually make successful predictions, you need to look elsewhere. – Luaan Apr 20 '17 at 13:49
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    @Luaan you are putting things way better than I can, good on ya! A lot of people here are also assuming that people will lock into the system and not move. If a person cannot afford the goods and services provided by automation, the law abiding will either find ways to do without, or a black market will develop. That's the historical pattern – Paul TIKI Jul 17 '17 at 21:05
1

Interesting discussion. Here is an answer that hasn't been proposed: Exploration. When technology advances to the point we can automate all of Earth's industries, then that same technology will find a way to efficiently mine the Moon, Mars, and the asteroids for raw materials. It will also find a better source of energy than we currently use (solar, nuclear fusion, etc.) to accommodate the increased demand for energy to power all these robots.

With access to more raw materials and energy, we will finally have the means, and the reason, to explore Mars and the rest of the planets, and eventually terraforming them to suit us. Some will be happy to live a life of leisure back on Earth, some will want the opportunity to explore the solar system and beyond. That will require hard work and man's ingenuity, exploration can't just be pawned off on robots. We may explore the depths of the ocean as well, building cities underwater. We may even take a few thousand people and put them in sleeper ships and ship them off to other stars.

Finally.

  • We'll only really explore the solar system when it's cost effective to do so. Automated robots don't necessarily reduce the cost of space exploration. Just as there's plenty to be explored on Earth still -- you don't see unemployed people in their own submarines going to the depths of the ocean to explore the unknown. – A.T. Apr 20 '17 at 21:12
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    "Automated robots don't necessarily reduce the cost of space exploration. " Wide spread automation reduces costs of energy, matter and computation. Space exploration, like many other endeavors boils down to energy, matter and computation. – NPSF3000 Apr 21 '17 at 17:53
  • @A.T. The "holy grail" is robots that make other robots. That allows you to send relatively small expeditions to faraway places (much cheaper than sending a mining fleet), which can in turn quickly expand into large factories sending materials straight home with little cost. We're very far from that point - and it will only really work well if those robots don't require special materials (something like silicon/carbon-printed everything would be ideal). Self-replicating solar arrays with e.g. microwave transmission would also be helpful. – Luaan Jul 18 '17 at 7:55
1

The question is a strange one. There is no "capitalist" answer. Capitalism is really just people being free to trade with each other absent outside interference, not a system designed to have answers to various questions. A better question is, "What happens in a pure capitalist system when machines become more efficient than humans at nearly everything?" A disaster is what happens. The few people who own the machines and the resources use those machines for their own benefit and everyone else starves.

But we don't have any pure capitalist systems where machines might take over. In this world any government of an technologically advanced society that provides the basic law enforcement required for a capitalist system also provides a social safety net. As machines replace more people, people whose skills are limited enough that they aren't more efficient than a machine in any job they might do, the safety net expands. That's the answer.

1

First of, automation of jobs is a very real thing and its good to have talk that provisions our collective reaction to it. Since noone (suprisingly) mentioned this concept already. The faster we draw ourselves near automation the more essential the concept of Universal Basic Income becomes more apparent as a solution. UBI would be a promise of equal opportunity, not equal outcome, a new starting line set above the poverty line. With basic income, all income from paid work (after taxes) is earned as additional income so that everyone is always better off in terms of total income through any amount of employment — whether full time, part time or gig. Thus basic income does not introduce a disincentive to work. It removes the existing disincentive to work that conditional welfare creates. This of course also covers the people unable to work because their work has been automated, until and if they decide to re-educate themselves in another field of expertise, in case their minimum guaranteed income isn't good enough for them.

Perhaps best of all, the automation of low-demand jobs becomes further incentivized through the rising of wages. The work that people refuse to do for less than a machine would cost to do it becomes a job for machines. And thanks to those replaced workers having a basic income, they aren’t just left standing in the cold in the job market’s ongoing game of musical chairs. They are instead better enabled to find new work, paid or unpaid, full-time or part-time, that works best for them.

Check this article the above quote is from, for more on the subject as well as more citations

As well as this enlightening TED Talk

0

Relying on welfare

Capitalism doesn't need to prevent us from that tipping point. Many economic systems in the world are only partly capitalistic with strong safety nets, taxation and redistribution of wealth including a provision of basic needs. See high welfare states like Danmark, Sweden, France, ...

Automation as driver of capitalism

Using machines you can produce more and more with less and less people. You only needed to invest capital into buying the equipment. That was actually a driver of capitalism and surely will continue being a driver. Somebody needs to buy all these robots who will do the work in the future.

Really cheap prices

Just look at the production costs of an Iphone in China and then at the selling price in the US? Many products can be produced en masse and really cheap, using automation probably even cheaper. So even though there might be less money to buy goods with the people because of lower employment, you might still be able to buy more products than before if prices fall enough.

More free time

We may not need to work 40-60 hours every week. 20 hours every second week might be enough to concentrate on family, hobbies, individual skills,...

Taxation

Taxes are an integral part of probably every government. By taxation of automation and redistribution of wealth you could probably quite easily achieve many different distributions of wealth. It mostly depends on what you want???

The real question:

How will total consumption and inequality develop in the future?

I don't know. I think everything is possible and it largely depends on what we want. Automation will only be one factor, maybe not even the deciding one. Among other factors are communication, education, politics, religion, wars, ...

There are natural limits though to how much one can consume and also on how much earth can provide (even with automation).

  • All those countries you mentioned are ardently capitalist... The means of production are privately owned. – Aryaman Oct 2 '17 at 18:59
  • @AryamanArora I agree but they are still high welfare states meaning that you have to pay a lot of taxes from your privately owned means of production to finance the welfare which is what I meant. – Trilarion Oct 3 '17 at 14:35
0

Capitalism is not an ideological system, it is a series of relationships between people. Relational systems lack consciousness, and thus intent. We can't speak about the intentions of capitalism, rather we should look to past instances.

Does technology in capital generally automate existing practices? No. It causes breaks through the foundation of new methods of highly profitable exploitation. Frame weavers continued to work until they worked themselves into the grave—machine loom weavers were young women and children, with rape and brutality enforcing labour discipline which frame weaving male heads of household would murder over. Similarly Soviet MTS were used primarily on sovkhoz not kholkoz, and the workers in the declining industry were forced into new disruptive urban and resource industries. Coal miners do not retrain as computer operators: open cut mines mechanise with new "surface," labour. Google doesn't employ redundantly secretaries.

Now this could be either painful dislocation, or it could be permanent technical unemployment. Or it could be worker resistance to loss of geographic communities.

The wage rate could be lowered, making certain functions profitable: bicycle food delivery.

Existing technical relations could Ben reproduced in low wage regions: Bangladeshi garment work.

However, the general expansion of service labour without loss of pay can only come about IF the per capita wages increase in real terms. There are too few bosses to employ hairdressers: fellow hairdressers must buy haircuts.

The alternative Keynes posits of a 3 hour day, no loss in pay, would require a massive contraction in profits generally. Historically capitalists have had to be forced by unions or states forced by unions to lower the working week without loss of pay. Many western union movements are moribund or terminal.

Automation will result in massive disruptions, it could result in permanent emiseration, this emiseration could be exported, and productivity growth could change the goods bundle without changing real wages in positive %gdp/capita terms.

There is an out: if there is currently something not a commodity, but which could require labour in mass to produce, rate stars of profit and employment could be saved by the "enclosure" of this new field. This could be an existing thing not done for profit, childcare recently (reliant on female wage differentials white / pink collar); or, it could an entirely new desire.

-1

Let's first put things in the proper perspective here. The machines and computers that are available today may look impressive, they certainly have made a lots of jobs redundant, but they are no match for a human being using its full intellect. When it comes to fully automatized systems, we're not even at insect level capabilities. A recent test with a drone trying to fly and navigate around obstacles had a performance that's a bit worse than what bees are capable off. Here we need to consider that the drone was controlled remotely by a large supercomputer, while a bee carries its own brain while flying.

So, we must first properly interpret the facts about the redundant jobs. This is clearly not due to technology approaching human level capabilities, it's simply a matter of there being large numbers of people who are employed to perform extremely trivial tasks. If 6 people are doing a job that for 85% is trivial work, but it also involves 15% higher cognitive abilities, then it may be possible to automate the tasks and keep only one person who will then be primarily engaged with doing the tasks involving the higher cognitive abilities.

The people who've lost their jobs will then have to find a new job, but they may need to be re-educated for that. They are, after all, humans with brains which are enormously more powerful than bee brains, which in turn are enormously more powerful than the machines that replaced them. So, the capitalist system isn't really under threat here.

Suppose that as technology advances, we do get into the situation where machines can start to rival human beings in all of their capabilities. In such a scenario you have to consider why intelligent systems that would likely start to resemble humans more and more, would be bothered to do our work. They'll have their own interests and will therefore need to be part of a capitalist system themselves.

So, in the end it will boil down to humans being replaced by a new machine version of humans. And if they become superior to us, then you won't get into the situation where all humans are out of work because all our work will be automated. Far from it, from the perspective of the machines we'll be the dumb machines who will be forced to do all the work in exchange for our primary needs.

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    Yet, in the span of just a couple years, we've figuring out self-driving cars. I think the proper perspective is that up to now they haven't been a match for human intellect. Things are going to start changing very fast, though. – user1530 Apr 20 '17 at 1:46
  • @blip Yes, I agree, but it's good to keep the perspective here that what we have now is machinery with substandard insect level intellect. While we may indeed reach human level machine intelligence in a century or even sooner, that kind of technology we'll then have even if it is still within our lifetime will likely be completely alien compared to what we have for the same reason why we are completely different from insects. – Count Iblis Apr 20 '17 at 2:37
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    Particularly, just like we cannot ignore that unlike insects we have a mind of our own, we cannot make the assumption that the human level AI systems can be used just like we use our washing machines today. It's far more likely that the AI systems will decide their own fate. – Count Iblis Apr 20 '17 at 2:40
  • True, but I think you're taking a big jump between "factory robots" and "skynet". Both are valid points, but there's going to be that in-between time...which is happening right now. For example, they're predicting the entire industry of driving (truck drivers, taxis, etc.) will be gone within a decade (we already have completely autonomous tractors and combines, for example). – user1530 Apr 20 '17 at 2:43
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    @blip An automaton that can fully replace a human in any activity is a sapient being. You're talking about massive AI slavery here :) And if it can only replace humans in highly specialised scenarios, it means there's significant costs to development, deployment, maintenance etc. of these specialised robots. Unless you're assuming there's no more scarcity anymore, which would be a weird question to ask economy, which is a science entirely concerned with distribution of scarce resources. – Luaan Apr 20 '17 at 13:54

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