Cloud centers bring high-tech flash but not many jobs

That's a problem when you have a society built on capitalism where the reward is supposed to be attained by hard work and ingenuity. Welfare, social security checks, tax credits, bailouts, and minimum wage laws all share one thing in common: the creation of a moral hazard by taking money from one group and giving it to another. The moral hazard, of course, is reduced motivation to perform work, be creative, etc., and to instead become dependent on the money from the government.

We see this parasitic behavior in established corporations and in multiple generation welfare recipients. We see it when the government allows itself to take advances from pension accounts or other "lock boxes".

Ok, but that's not your question, you asked, "How is the government producing these necessities and distributing them?"

Well, let's split your question up into three parts:

  1. What is the government doing today?
  2. How can the government, which produces nothing except laws enforced by violence, acquire these necessities?
  3. How can these items be distributed equitably?

Now, I suppose that if the Economist sat down and figured out how much money we've seized and reallocated it would be more than enough to buy each citizen a ration of N calories per day per year, for their lifetime. Now, that statement is true for some N (0 is a solution). Similar statements exist for clothing: N issues of outfits of some standard quality per person per year, as well as for shelter: N months of rent at some standardized housing quality.

If we can define national minimum standard values for Nfood (e.g. 2000 calories per day), Nclothing (e.g. 3 outfits per year), and Nshelter (e.g. 12 months of 400sqft per person) and allow these values to scale by Real GDP/person so that improvements in the economy lift everyone's living standard and contraction reduce standards, then the government can simply pass laws enabling citizens to claim these perks from authorized vendors.

These vendors must be compensated for providing these goods, so let's let them participate in a dutch auction for each geographic statistical area. Competition among vendors drives down prices for the government who then pays winners with money reallocated from existing social and corporate welfare programs. A standardized dutch auction process and participation requirements would need to be implemented and audited to protect against quality shortcuts, graft, and corruption.

To recap: (1) the government is already spending all of the money necessary to do this, poorly; (2) the government can pass laws allowing citizens to claim their rations of food, shelter, and clothing from authorized vendors who themselves participate in an audited dutch auction (instead of no-bid contracts and similar corruption).

The last part, equitable distribution, that is the hard part. Encouraging the states to pass uniform laws isn't hard -- just attach money as a carrot and use the 14th amendment as a stick. Obtaining the resources isn't hard -- we're already spending them.

Equitable distribution is hard because you need to decide "who gets" and "have they been given enough".

In my opinion, the only defensible answer to the first decision is everyone gets access to the current rations of food, shelter, and clothing. There are two groups of people in the first decision: those paying into the system and those not paying into the system due to calamity. Clearly, the system should payout to the needy. But deciding who is needy is hard and fraught with potential corruption and complexity. So just simplify and allow everyone a claim. The truly non-needy will simply forgo their claim.

Up to this point, the changes necessary are straightforward and workable within our current legislative environment. However, our answer to the second decision will require a significant change in the national mood. Specially, we will need to track how much each person has received to reduce the impact of the inevitable criminal element that shows up whenever price controls are implemented -- and let's be clear, goods sold to the government for free distribution to the people are a form of price control (hence the strict limits on what is given out: only food, clothing, and shelter, only at known grades, only at fixed quantities, and only to authorized people).

There are 3 possibilities:

   a) We trust everyone not to double-spend their claims. Let's all laugh for a moment.
   b) We implement a national centralized bio-metric database to track claims.  It will likely be derided as Mark of the Beast stuff.
   c) We implement a national distributed crypto-currency for claim spends using wallets distributed by the social security administration on a per-SSN basis. Foodcoin. HN revolts.

This is getting pretty long but one last point -- cultures with food safety and more education have lower birth rates. Lower birth rates are desirable as unbounded growth would quickly undermine my proposal, so clearly we would also want to provide minimum claims to education. Given that the future is a computational knowledge economy where continuous learning is as critical as regular access to food, it makes sense to offer continuing education in grants of Neducation, but I'm not sure how to standardize quality.

I'm happy to hear your thoughts on these ideas, or suggestions to improve them.

I didn't say that a single data center employed thousands of engineers, or that the software industry is dying. But don't let that stop you from having an imaginary argument.

One is from the perspective of a participant in the job market, from that point of view it isn't such a huge problem. Predicting where efficiency improvements will shift factor intensity from labour to capital is something that most people here are able to do for their own field. I'm sure, for instance, that every system administrator reading this has already taken into account the effect of cloud services on their career. Smart people will build their expertise in managing cloud systems, move into a tighter integration with developers (DevOps), or specialise in an area that is more resistant to being moved into the cloud for performance and security reasons.

That's great, but it's a little like developing an optimal musical chairs strategy, if there are 10 such jobs today and 9 tomorrow then one person isn't going to have a job. Even if he has also tried to adopt an optimal strategy.

That brings me to the second view, which is viewing the entire system from the outside. That can be in the role of an economist, a citizen, whatever. From that macro point of view, what is important is only the following: Will the net job losses in this particular job eventually be outweighed by countervailing job gains in other parts of the economy?

Historically, that has always been the case. Ever since this became a topic of discussion in the early industrial revolution it has happened time and time again that new jobs pop up that no-one could have imagined a generation ago. The question is though, is that inevitable? Will there come a point where job losses from efficiency will outpace the gain in new jobs? I have no idea what the answer to this is.

If it were to come to pass that huge swathes of the population simply don't have any valuable labour to exchange, then the basis of an economy and society based on the exchange of labour for resources would unravel.