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Comment by ZhuanXia | Hacker News Reader

I remember reading Average is Over and A Fairwell to Alms just when I first started working. They convinced me that labour power was going to decline precipitously. I stared saving 60+% of everything I made and putting it into index funds. Anyone making a good salary should attempt the same. Much of white collar work is extremely amenable to automation, much more than even truck driving:https://en.m.wikipedia.org/wiki/Moravec%27s_paradox

Maybe comparative advantage will save the day, but I think it is a really good idea to start accumulating capital, even at today’s valuations.

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Being a consultant with clients in a wide range of industries I concur. Most of the employees I come into contact with have jobs that could be automated with a few days or weeks of programmer effort. They are one successful software project from losing their jobs. Lucky for them their companies are terrible at shipping software.

Conversely, automating the work of a plumber would require a massive investment in AI and robotics.

Also, nobody makes a robot that can be trusted to repaint the trim in my house unattended.

"Most of the employees I come into contact with have jobs that could be automated with a few days or weeks of programmer effort."

After looking at some of the business processes at my company I am not so sure about this anymore. There are a lot of jobs that are pretty mundane but when you look a little closer most of the processes have a lot of exceptions where the employee makes decisions that don't follow the process exactly. From what I have seen it's really hard to come up with a recipe that can be 100% automated because of all these exceptions. It seems to me that humans are a buffer that sometimes corrects unforeseen things and without that buffer the organization would do stupid things.

The key bit that companies that shift hard to software seem to figure out: How many of those corner cases are actually worth bothering with? Is the net loss associated with a corner case greater than the significant gain of dropping an FTE or FTEs? Sometimes it is (safety related things, etc.), but many times, it's not...just because you CAN handle something doesn't mean it's worth it do so.

It’s something the organization needs to decide. If you automate a process it means you are setting it in stone and lose flexibility . Maybe that’s a good thing or not but something people need to be aware of and accept.

> "If you automate a process it means you are setting it in stone and lose flexibility"

If you automate a process, you can in future build in variations, and gain flexibility.

And because you automated the process, your code shows how it works, and so you can quickly see what needs to be changed.

This is often a process issue more than anything else. For instance, our finance team spends insane amounts of time dealing with a variety of invoices with varying information and structure.There are a number of exceptions, rules and etc. However what's often ignored,is the fact that we are much bigger than any of our supplier and it would be pretty easy to convince them to invoice us the way we want instead the way they want. With some clever automations, I could easily replace a couple of my colleagues with software, however I would not be in a better situation at all,so no point of doing it.

While that would eliminate jobs within your organisation, it would clearly create development work in your suppliers.

On balance I would guess you would create work overall rather than reduce it.

Tangentially related: The German industry is working on a standard for digital invoices. Invoices would be a human-readable PDF file with an additional XML payload containing a machine-readable version of the same data. I can't say anything about adoption though. The Google keyword is "ZUGFeRD" for those who are interested.

colombia is also implementing the same thing, their customs/tax authority has a custom XML schema (!!) where large business are rolling out .pdf and .xml receipts.

https://globaleinvoicing.com/en/electronic-invoice/colombia - for an english link

Plenty of companies still use EDI for this.

This is a great example. I automated away the jobs of a few people at a transportation company that had a few large clients that expected to be invoiced in particular ways with additional documentation.

We put together a document imaging solution to gather all the relevant docs from all loads and made the pickiest customer the default for all invoices and automated the entire system. Instead of laying those people off though, we focused them on calling on unpaid invoices which greatly helped accounts receivable.

Similarly, at an oil and gas company we took the better of several business processes, molded them into one optimized process, automated it, and after a dip in the price of oil and layoffs many jobs were never rehired for.

At both of these places the leadership saw the value of getting the software right, hired for it, and we got the job done. I estimate the oil & gas company saved themselves $1 Billion over the next 10 years.

The only thing I don't like about these situations is how little money the developers get for doing things like this. Any other profession would be rolling in money after bringing such savings,yet the developers end up getting pennies ( relatively).

While the software I've written hasn't caused anyone to lose their job, my software has certainly kept new people from being hired. The people doing "mundane" processes are now handling considerably more transactions than they were 10 years ago and even more than 20 years ago. We keep automating more and more of the process and less people are ultimately needed. It will almost certainly always require someone but they'll be doing the job (but not necessarily the same work) that used to take 5 people.

So there'll be one or two people taking care of those human decisions when necessary... when there used to be ten people taking care of the whole process.

So it doesn't automate all the jobs out of existence; it just automates most of them out of existence

Personally I have seen many cases where isn't the automatability of the job that is the obstacle but the capabilities of the user as the limitation. Essentially a sufficiently technically sophisticated user would be perfectly capable of doing so but not the end user in that case and economics are against it.

As in "Yes this office job could be replaced by three shell scripts but the boss wouldn't be capable of using them and they make six figures so it is cheaper to just add a minimally skilled and paid underling than to try to teach them."

It may be maddening to see the needless extra expenses and pointless job but doing so makes some economic sense. A "roll-over" to those capable of doing it themselves would likely be a slow process as inertia must be overcome. Since even if you have "also technically competent enough to automate it" there wouldn't be a selective pressure and jumping the gun on this issue may prove pound foolish if the replacements aren't up to snuff or worth the added expense from supply vs demand let alone politics.

> They are one successful software project from losing their jobs.

Maybe. However, consider how successful Google has been at automating customer service.

If google is the example, then the world is in for an automated hands off hellscape for consumers and their true customers--advertisers.

The two have nothing in common. Many people have trivial useless office jobs.

> jobs that could be automated with a few days or weeks of programmer effort

Governments don't want the workers in their countries to not have a job, even when there's plenty of wealth to go around. Such people will actively demonstrate against all sorts of abuse by government employees and property owners, and even cause socialist revolutions at home and create terror abroad.

Even better for governments are when the workers in the country have heavily mortgaged houses and children with medical expenses. That's the main reason for BS jobs, high house prices, and fast food.

I think saving is an essential part of it, but not the whole story.

I recently took a job at a university. I had a bit of leverage (extensive clojure experience ftw), and I spent it on negotiating for 20 hrs/week. This gives me much more time to do "the other stuff" that's part of a career---networking, learning, interviewing, starting soon-to-be-aborted businesses. I've also been trying (with a group of friends) to figure out if there's any way we can make some sort of co-op work.

I do think "jobs are over," at least as we know them for the middle class, but I don't think that needs to mean that the middle class is over. What form it will take, though, I'm still not sure. I suspect things will keep getting weirder.

The problem is that jobs are over, but we are still taxed the old fashioned way - mostly to pay for the healthcare and pensions of baby boomers who had steady careers and cheap housing.

Healthcare and pensions make up 66% of the US Federal Budget. Its a similiar case in most other Western countries. If we could somehow find a way to relieve ourselves of that burden, taxes on labour could be much lower and life significantly better.

I think this is partly why we've seen such a huge boom in freelancing. Its much easier to optimise your taxes that way, instead of working for a company.

Saving and investing are good in general. Having a fuckyou fund helps your career as well. You can take on more risk and be more assertive at job.

If a large amount of white collar workers are jobless, your SPY calls would also become worthless.

It's a good idea to invest in index funds, but investing in index funds expecting a economic apocalypse is not good reasoning.

Do you have any suggestion as to what would be a good investment? Thanks!

I am not an investment expert, you should consult with your financial advisor, my personal rule of thumb is :

1 - Invest in yourself. - Health - Education - Social circle

2 - Invest in your living space. - Buy an apartment anywhere on earth where you can afford, you can take cheap flights to anywhere on earth these days. Even the remotest part of Africa can be reached within 1 day and less than 500 dollars. ( you are normally paying more than 700 dollars in rent anywhere in the developed world ).

3 - Buy high yielding government bonds, preferably multiple countries.

4 - Buy index funds.

I do not prefer gold / silver, there is severe restrictions in moving them around, and high taxation in audit and transaction. government bonds are generally tax exempt. You are better off investing in guns than gold if the economy collapses.

I'm sure the idea is to convert to cash before the apocalypse actually occurs. Even if one misses it by a little (ie, there is some downturn), the bulk of GP's earnings have gone to savings.

You’re assuming cash will hold value after a so-called economy apocalypse?

If the economic credibility of the nation goes, so too does the value of its cash currency.

What’s a “more white collar workers than jobs” economy look like?

Personally, I’m leaning into useful life skills, like growing food, reconnecting to hunting, low level electronics, rebuilding my car, and home myself with my money now.

I’d rather have deep experience in head and hands than a wheelbarrow full of dolla dolla bills y’all with the buying power of East German currency.

Not that I have any way to be sure the implosion is coming any time in my remaining years. But still, if we’re talking about how to prepare for such a thing, let’s get real: investments in today’s ephemeral value stores are the worst idea for securing yourself against economic collapse

Depends what you are preparing for. If you think automation is going to happen but that capitalism will survive, then index funds seems line a good idea. If you think capitalism will be supplanted, it depends on what you think will replace it. If we're looking at a Mad Max style dystopia, then sure, it won't help to have lots of shares. But presumably you'd see signs of that before we get there and be able to start converting your money into harder currency.

If we're looking at a benign-ish revolution with redistribution it won't matter much.

Personally I think the most realistic medium term risk scenario to protect against is that capitalism will hang in there, but that jobs become more scarce. An outright economic collapse or major social upheaval is likely to take more time. If you start seeing job scarcity hitting, then sure, start converting some of those index funds just in case things accelerate in the wrong direction.

I guess I’m assuming “economic apocalypse” means “fall of the nation state concept as we know it.” since that is the lynch pin for economic trade.

Business operations as a whole are so reliant on the legal rails, like it or not, they’d have to fail spectacularly to create “economic apocalypse” to my mind.

I forget some people see run of the mill loss of wealth status as akin to loss of life. So perhaps apocalypse to them means going from $100 million in wealth to merely $10 million, but the social foundations that support that wealth largely remain intact

The thing about apocalyptic preparations are it is all scope dependent. If it is local than portable valueables and GTFO as an emmigrant able to pay their way is better than five lifetimes of canned goods. And even then the collapsed area will either reestablish a regeime of some sort or be colonized by intact neighbors.

If it is world wide collapse than productive skills may be the best - since even if you have guns you may be outgunned but if you can supply food any remotely smart bandit or warlord would prefer the reliable food stream of a living serf under their protection than just a storehouse's worth.

Of course these are all very long odds and preventing a collapse is likely a far better use of resources.

My model is that as median labour power decreases capital and superstars should capture a larger percentage of future productivity increases. And automation should provide huge productivity increases. This seems compatible with index funds being a good bet.

Perhaps I am wrong, but could you provide details as to why?

Can you talk about how superstars would capture future productivity increases, in practice?

It’s no different then the proverbially 10x programmer landing a consulting gig for literally 10x the compensation of a nobody.

The model is incomplete in the details (as most models are).

The actual effect is that capital in the companies that are taking advantage of the new globoticized future does great. FANG does great. Upwork does great. AirBnB and Stripe do great, once they go public.

Labor and capital of old-line companies do terribly. This type of economic transformation doesn't just result in layoffs, it results in whole companies going out of business. Their value-networks are adopted to the cost structure of the old world; as that cost structure changes, they have no reason to exist as a firm.

When you buy an index fund, you're buying both of these types of companies. You should probably do okay, because the public market is actually pricing a lot of this phenomena in already: multiples on old-line companies are severely depressed while FANG shares are soaring, and the capitalization-weighting of the index is taking this into account. But you're leaving money on the table: many of the biggest winners will be new fast-growing startups that aren't public yet.

That's individually a smart move, collectively a dumb one. That strategy won't work for most people. Even the successful white collar workers, especially the ones who are married with children, are financially stressed already and can't save much.

You know, if 5% of the workforce follows that strategy, but things go to hell for 50% because of these trends, then we will have rioting in the streets, maybe a revolution with a nasty government installed, that is what history shows usually happens. And then the new government will go after the successful people like you.

Some problems can be dealt with only through responsible collective action.

Most of the entry level white collar jobs that can be automated have been.

Those that remain would require some major and I mean order of magnitudes improvements in AI.

Can you give me some examples of white collar jobs that you think can be automated?

I worked at a large tech company that had an enormous finance department. They did everything in Excel. Our job was to automate their work. The tools we built were routinely more accurate and faster than the finance people were.

When our work was less accurate, it was because the input was bad. The input came from the finance team. The only reason they didn't disappear entirely was because they'd convinced management that there were things that the software couldn't do that only humans could futz with. The one or two percentage points their adjustments improved their results by were easily outpaced by the overall improved accuracy of the machines.

People are already fighting back against this. I'm a SWE and my EX worked at the finance department in a huge robotics company.

Their department did everything by copying and pasting stuff in excel in a painfully slow and cumbersome way.

She told me their challenges, so I wrote some python scripts to automate their work.

When she showed it to her boss, hoping to get a positive response, his reaction was "Put that away if you like your job here!"

This is the nightmare of every middle manager. They won't be able to justify their existence if their teams get automated away so they will actively fight against it.

The solution is to keep your scripts private, automate your job, and work on whatever you want while making sure you always look busy when your boss walks by.

If you roll over like you suggest and let your boss tickle your belly, what do you say to yourself when you look in de mirror?

"Mmm. I look good. I mean, really good. Hey, everyone! Come and see how good I look!"

More importantly, what will you tell your grandkids, presuming you have any? "I was doing an unnecessary job instead of not wasting resources and doing anything productive"?

Maybe maximizing efficiency to increase shareholder value is not the sole metric for a life well lived.

Every story like that is a company with a bullseye on its back, just waiting for a lean and mean competitor to put it out of business.

> I worked at a large tech company that had

How big is their finance department now?

I don't know, I don't work there anymore. But my understanding is that it's essentially the same size.

Just make sure you diversify. Quality land, managed rental units, and other assets will still hold some value even if stocks and bonds take a massive hit. Regardless of the state of the economy, people still have to live somewhere.

Not if they read Henry George and realize there's no reason to assign you the land value.

I am a Georgist too! Can’t bring myself to buy land.

True but hasn't it always been a pretty obvious goal to accumulate capital?

> I think it is a really good idea to start accumulating capital, even at today’s valuations.

This is an interesting take. The alternative to individually trying to each become capitalists, is grouping together and making sure we all have access to the proceeds of automation.

Becoming a capitalist has a long history of being successful. The other way not as much.

A couple thousand years is a blink of an eye for a species.

Becoming a capitalist is the long history of learning to group together and work on common goals.

The other way just doesn't scale.

Gonna run out that clock when there’s no more natural world to exploit ruthlessly

That will never occur, fortunately. There is no end to the natural world. The natural resources that are most critical on Earth are infinite for all practical purposes in relation to human demands. This is especially true given the population growth curve for the next century.

If we somehow exhaust the mineral deposits on Earth in the next few hundred years, we can and will mine the solar system.

In the absolute worst case scenario, the rest of the natural world off of Earth is available for ruthless exploitation by our Capitalist ways for thousands and thousands of years to come. The clear bet is that it will be exploited eventually, probably by whatever we replace ourselves with.

The natural world will end for us when it can no longer sustain us. All these exploitations may be technically feasible according to a certain worldview, but we will not be there to carry them out if our belief in that worldview leads us to extinction.

As Noah Smith says, this type of argument is simply lazy analysis. Much of the "exploitation" occurs not due to singular businesses, but because of governments pursuing their own independent agendas. Take oil drilling, where state sponsored firms in China do not heed environmental regulations. Is that pure capitalism killing the natural world?

https://twitter.com/Noahpinion/status/1139994638599589888

I didn’t say the word capitalism, you did. This is a problem for everyone, not only the people we can make claims of guilt against.

There's more and more of if it every day thanks to ice melt.

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