This is an expanded version of an op-ed
piece I had in the Deseret News
earlier this week.
On December 14, The New Yorker posted an article by
Elizabeth Kolbert titled “Our Automated Future: How Long Will It Be before You
Lose Your Job to a Robot?” She begins with the perhaps apocryphal story about
how IBM’s Watson came to be. As the story goes, “an IBM executive named Charles
Lickel was having dinner [at a restaurant] when he noticed that the tables
around him had suddenly emptied out. Instead of finishing their sirloins, his
fellow-diners had rushed to the bar to watch ‘Jeopardy!’ This was deep into Ken
Jennings’s seventy-four-game winning streak, and the crowd around the TV was
rapt. Not long afterward, Lickel attended a brainstorming session in which
participants were asked to come up with I.B.M.’s next ‘grand challenge.’ The
firm, he suggested, should take on Jennings.”
This, it turns
out, was a much greater challenge than creating the computer that beat Gary
Kasparov at chess. Of course Watson defeated both Jennings and his human
nemesis, Brad Rutter. And the rest is history.
Except it is not.
Watson was not the beginning, nor will “he” be the end of technology that can
replace humans. Kolbert surveys several books that address the subtitle of her
article, books such as The Industries of
the Future, The Future of the Professions, Inventing the Future, and,
especially, Martin Ford’s Rise of the
Robots: Technology and the Threat of a Jobless Future. Ford cites a 2013
Oxford University study, which concludes that nearly half of the jobs in the
United States are “potentially automatable,” perhaps within “a decade or two.”
Yes, half.
Jobs, according
to some MIT researchers, can be divided according to two different sets of
criteria. They are either manual or cognitive. And they are either routine or
nonroutine. The highest paying jobs are coginitive-nonroutine (think hedge fund
managers and lawyers). The lowest paying jobs are manual-nonroutine (think
emptying bedpans and cleaning hotel rooms). The jobs in the middle are the ones
that are easiest to replace with technology.
This, of course,
was a major issue in the recent presidential campaign, with Donald Trump
promising to bring back blue-collar jobs (mostly manual-routine). The problem
is that even if he were able to bring those jobs back (which is doubtful), they
would soon be replaced by technology. In fact, they are being replaced by
technology in China almost as fast as they are in the U.S.
In order to
understand the ramifications of this phenomenon, you must first understand
something about productivity. Businesses have long viewed productivity
improvement as a panacea for almost all ills. But increasing productivity, as
we define it, means that a company can produce either more product with the
same number of workers or the same amount of product with fewer workers. Either
way, though, the gains from increased productivity do not go to the workers.
They go to the stockholders and executives. Generally, increased productivity
leads to workers losing their jobs. It takes moral and humane managers (like
the oft-cited James Lincoln of Lincoln Electric fame) to devise programs under
which increased productivity benefits the workers.
This fact about
productivity represents a good part of why we are seeing so much wealth
inequality in our economy. The other part is that we have dropped the top
marginal tax rate from above 90 percent to below 40 percent. And Trump’s
economic proposals, if enacted, will drastically increase the inequality.
So, what do we
do? Trump can’t turn the calendar back to 1965 (which is what he is really promising).
Regardless of what he does, we are heading for a future in which more and more
American workers will be either be replaced by technology or stuck in
low-paying superfluous service jobs while most of the wealth continues to
accumulate at the top. This is not a sustainable economy.
I don’t think any
of us will be surprised to see truck drivers, waiters, cashiers, and even
computer programmers replaced in the near future by automated “employees.” What
is it that drives owners and executives to supplant human employees with
technology? The simple answer is the bottom line. Short-term gains for stockholders
(which generally include upper management) outweigh any other considerations,
such as the duty corporations owe to their human employees or concern over the
long-term health of the economy. (An economy in which there is insufficient
demand, because of shrinking wages in the middle and lower classes, is an
economy bound for collapse.) But as long as owners and executives view
employees as a resource, a commodity, or a cost to be minimized, rather than as
human beings who deserve to be treated as partners, nothing will change, and
our future will be compromised.
One possible
solution to this dilemma is to drastically increase worker ownership. This
would slow the takeover of jobs by technology, since worker-owners would be
less eager to replace themselves with machines. It would also spread the wealth
more evenly. Eventually, if productivity keeps increasing, an accommodation might
be reached in which the workday is shortened but the workers still receive full
pay.
There are other
options, but none of them work in an economy structured like the one Trump and
most business leaders imagine for our future. For some reason, they cannot see
the writing on the wall. They imagine that if they keep replacing human
employees with technology, those displaced workers will somehow find
high-paying jobs so that they can afford to buy all the stuff corporations are
producing.
But we have already
seen three shifts in the economy to accommodate the shrinking pay of the middle
and lower classes. First, women entered the workforce, giving most families two
wage earners to cover expenses. Second, workers started taking on second and
third jobs to pay the bills. Third, they maxed out their credit cards and took
out home equity loans. This all ended with the crash in 2008. There is no other
shift that can be made. Unless businesses start hiring more people in
decent-paying jobs, demand won’t be sufficient to keep the engine running. And
tax cuts for billionaires is not the answer. Supply won’t magically increase
just because the wealthy get even more money. They are sitting on massive
amounts of cash right now, rather than investing it in new production (new
jobs), because there is insufficient demand.
Of course, this
raises the question I posed long ago toward the beginning of this blog
adventure, namely, is it possible for an economy with limited resources
operating on a finite planet to keep growing endlessly. The answer, I submit,
is no. But no politician is willing to deal with this idea. And Trump wants not
only to grow the economy at an unrealistic 4 percent, but do it by destroying
the planet at the same time. Now there’s a recipe for long-term success.
What is obvious
is that we need to start thinking outside the box, and we need to do it now.
The recent presidential election was a major step in the wrong direction. But
if we aren’t smart enough to recognize where we are going, we will not be ready
for it when we get there, and that could be disastrous.