On a micro level, I see this as a worker figuring out how to do his 8 hour task in 4. Boss man says great, now you can do this other task for 4 hours also instead of going home at noon.
If knowledge and skill comes from time immersed in work and study, then the knowledge worker who puts in 60 hours a week will be far more valuable than the one who only devotes 15 hours a week.
A surgeon who practices medicine only 2 hours a day will be much less capable than one who does more surgeries, spends more time learning new procedures and technologies, and keeps current with all the latest research.
If you need to design a suspension bridge, do you go with the engineer who spends 80% of her time not designing bridges, or do you choose the engineer who lives and breathes bridge design and has many more successful projects in her portfolio?
An attorney making $600 per hour might survive financially on 4 hours per week if her hourly rate stayed constant. But if she tried to do that, her knowledge would quickly atrophy, and nobody would pay that rate any more.
It's a bit of a paradox. To make enough money per hour to live well on a small number of hours, knowledge workers must acquire a very high level of knowledge and skill to make their time a scarce resource.
But to acquire and maintain that level of knowledge and skill demands a large and continuing investment of time.
Competition with other knowledge workers ensures that the highest rate per hour goes to those who spend the most time actively engaged in their field.
Making yourself more valuable is not the only thing required in order to get paid more.
This is why Musk, Thiel, et al. moved to the US.
I think this is generally true if you are looking for a place that can best leverage your skill sets for maximum financial rewards, and you are willing sacrifice some quality of life in doing so.
"If you aren't (and enjoy government financial support) the US is not the best place."
I suppose this is the part that got you downvoted because it came across snarky. But it's also not entirely true. You can still be very average or somewhat talented in the U.S. and still hold much better paying jobs in the U.S. than you would anywhere else in the world, if you pick the right sector.
This makes small businesses lives in Spain hard, and make big corporates think twice before getting real big centers in Spain.
This lack of competition is the reason you need to consider moving to US to have a good chance of a better life.
I wouldn't call myself a marxist, but I do think we're entering an era where something like a universal basic income might make sense. Nothing against people getting wealthy off their labor, but it seems apparent to me that the job market will continue to shrink as things become more and more automated, and shaming people that don't have some distinct skill-set that can't be automated doesn't sound like a recipe for a great society...
What has changed now that was not the case 200 years ago. New maschines replace people and those people have to do something else.
The problem is not that there is not enougth work to be done, there are tons of industries and tons of places where people are needed. The problem is far more institutional, why are people not effectivly switching?
There might still by some cyclical unemployment but some of it is structural and blaming robots is the cheap way out.
So, the robots/automation replacing jobs explanation doesn't really float for me right now. First, it's not clear that there's a phenomenon that needs to be explained at all. People have a feeling that there are fewer jobs, but that doesn't actually seem to be true. And, as you said, this has always been a go-to complaint. I'm sure it will be accurate someday, but it doesn't seem to be today.
Same thing with factory work. Yeah, you still need people.. but you need less people. Do we really think that all the people that got displaced from their factory jobs are suddenly going to become robot mechanics or something? Sure some of them, but I just don't buy this argument that technology always creates new jobs when it destroys the old ones.
There are also a lot of jobs that currently exist that I suspect are not particularly necessary, they're just convenient. You see this all the time: a manager will hire someone to do something that they just don't like to do themselves. A convenience hire, basically. As long as the budget is there, everyone feels good.
For instance: "project managers" (Different places call them different things). I'd define this role as people that don't actually have any hiring or firing authority, or significant design role, but rather, they're mostly in charge of client relationships. Useful? Sure. But mostly that role exists so that the people doing the actual work have a buffer between them and the client/customer. If the economy fell of a cliff again, we'd probably not have that many project managers.
I just think different economic systems make sense in different contexts. Capitalism was a pretty good idea when growth was the most important factor, but now the US Government literally sets extra wheat on fire to keep prices at a certain level. I mean if you're literally burning food and employing people in jobs that aren't that useful, maybe the whole "growth" thing has stopped making sense.
I think you have not understood my argument. My argument is that this happens ALL THE TIME. Do yourself a favor and go back and read the discussion going on 150 years ago. Its the same thing you are saying now.
Blablabl the basket makers are unemployed because of plastic bags. The barrelmaker because of plastic barrels and so on and so on.
The point is that this happens constantly and the market is the exact tool to deal with this. People get insentivised to move into the next best thing humans can still do. This has lead to more and more investment in human capital and it has been a good thing.
Capitalism is the best if you want to give people as much freedom and choices as possible, it is also the best if you want to get BILLIONS of people out of poverty and since there are still BILLIONS of people in poverty turing away from it to some sort of 'lets just leave everything as it is' policy is simply madness.
> I mean if you're literally burning food and employing people in jobs that aren't that useful, maybe the whole "growth" thing has stopped making sense.
Thats that terrible thing. It is done to please special intrest groupes and has nothing todo with acutal markets. I would suggest reading about the politcal economy of farm subsidisment and protectionsim.
Its a terrible thing and helps make us all poorer, and it worse because it makes it harder for BILLIONS of people to move out of poverty.
> 150 years ago was a vastly different time. I don't care if they were wrong THEN. Back then they didn't even have computers and motors were inefficient. Time and technology have changed.
I agree. But simular argument can be made for every decade since then.
Im not arguing that it WILL go on, Im arguing that we have no reason to belive that it will stop soon. Im not hearing any new arguments and the data does not really fit the 'automation' story.
So my question is, why is it diffrent now, and 'now we have tech X' is not good enougth.
Indeed historically, rapid technological development did often lead to many years of immense economic suffering for large groups of people - it just eventually got better. I don't think it's wrong to ask if now it's possible it will never get better because we're on the verge of technology replacing so many jobs.
My argument is not that it will go on for ever, my argument is that we can not predict when its going to stop and without some groundbreaking new line of argumentation I see no reason why I should expect it to change very soon.
However the only argument I hear is 'Tech X replaced Y amount of people'.
There are many things that come back again and again. Overpopulation pops up every 20 years. Resource prices will just go up (peek oil).
All these arguments have one thing in common, the stay consistanly the same and they are consistently wrong. Now once in awhile some prediction turns out to be true, and then people cry 'see I was right'. However its very unlikly that these people were actually right in the sence that they had discovered some new analysis or something, they are just luck.
So if there is a great new argument, please tell me and if its good I belive you.
> Indeed historically, rapid technological development did often lead to many years of immense economic suffering for large groups of people
True. But I dont think the last couple of years were specially revolutionary in terms of technology.
> I don't think it's wrong to ask if now it's possible it will never get better because we're on the verge of technology replacing so many jobs.
Its not wrong to ask. Belive me I spent quite some time reading about this, reading both sides but in the end, one side was consistently correct and the other never changed there argument or there position.
Productivity gains enable all sorts of industries to exist that couldn't have previously, such as people who clean dinosaur bones, get paid to play baseball, do interior decorating, restore classic cars, organize your closets, etc.
Look around you. Is your street clean, is everything working, are old people being cared for, are children being well educated? The problem is misallocation of resources and apparently that is down to free market economics.
Unemployment is actually not that high in the US. This is why I think a lot of policies people such as basic income, make work schemes, etc are really not that needed right now. The economy is generating jobs.
I'd be interested in any stats which measure that - say, coming out of this recession versus previous recessions.
A surprising number of working professionals are at that level, but some factors prevent it:
1) It's simply more efficient to have one person working on a problem than 2 or 3...e.g. the mythical man month. The problems I work on don't get smaller just because I work less. I can either work on it 3 times as long, which puts my company at a competitive disadvantage over companies that have employees willing to work full-time. Or we can have 3 people working on it, which, for a variety of reasons turns out to also be less efficient than 1 person working on a task and is also a competitive disadvantage.
2) The standard of living at 3 hours a day is significantly less than the one I get to live working 8. Is it sufficient? sure, is it nice? No. Even if I took the cut and downsized, many of the hobbies I enjoy now, I wouldn't have the money or space for any longer. I'm also able to live well below my means and save up significant amount of money for eventual retirement. I can't stay in the labor force 3 times as long to save up the same amount.
You might argue that the owners of capital capture all the gains from technological advance, but it would be wrong. This model only works if there is only one entity operating in the economy that's advancing. In a competitive economy technological advances allow you to undercut your competitors either by offering the same item/service at a cheaper price, or by offering more at the same price. Doing this, you end up shaving into your profit regularly. In general, the profits at the most technologically advanced companies tend to be among the slimmest.
Profits are also eaten up as reinvestment in continuous technological advance. R&D is hideously expensive, and it fails most of the time. Economies that send all the profits home with the workers tend to also have stagnant technological advances and rely on espionage against economies that do innovate to maintain parity.
The problem is that this just isn't an equilibrium point. If everybody worked three hour days, you could double your income by just working six hour days. The extra money would probably be too tempting, and before long everybody would be back up to eight, at which point the marginal benefit of adding on more hours seems to hit a threshold of sorts.
It's similar to the issue of dual income households. How was it that in the 50s and earlier very few families needed two incomes to afford a nice middle class lifestyle? The answer, partially, is that society had found this pseudo-equilibrium point where no families had two incomes, and so the market prices reflected that at the time.
This was sustained only by social pressure against certain demographics working, mainly women, and when those pressures were finally broken down dual income households started becoming more common. This was a huge increase in prosperity for the initial wave of dual earners, but as it became widespread housing prices came to reflect the doubled earning capacity, and now most middle class folks find they struggle to afford a home with two incomes.
No, not really. Pricing doesn't work that way. You have to account for the vast price differences that occur globally and the fixed cost of production.
A more concrete example, Samsung makes (I don't know, making up a number here) 5% profit on a new Blueray player. That means the rest of the pricing is fixed. But now instead of 1 person working an 8 hour shift producing x number of Blueray players, they have 3 times the number of people working 1/3 the time. Production doesn't scale linearly with the number of people, and management overhead increases as the need to coordinate more people simply requires more effort. So costs don't scale linearly either. So now Samsung is making fewer Blueray players at greater expense.
Remember, their downward price mobility is only within that 5%.
Do they a) lose profit to maintain prices?
b) increases sale prices to maintain profit?
The demand signal is still similar. You working 1/3 the amount of time doesn't change the number of people who might buy a blue-ray player, it only decreases the amount of money you have to spend on one. Samsung can't simply drop prices by 2/3s because you have less money. The solution is to cut production to meet the demand signal.
Cutting production means they've let go much of their production staff (which lowers the managerial overhead) and helps keep prices low. But the blue-ray player still costs what it costs to produce. Your ability to pay for it doesn't change the laws of physics.
Now let's make things worse for Samsung. China doesn't have a 3 hour work-day policy, they have an 8 hour work day policy. So, even at exactly the same per-hour wage, Foxconn can outproduce and price undercut (by realizing the greater efficiency of fewer workers) Samsung on the same product.
Fewer workers producing the same amount of stuff as more workers increases productivity and realizes efficiencies that can be used as competitive advantage.
Simply cutting everybody's time to 1/3 isn't the same thing.
> It's similar to the issue of dual income households. How was it that in the 50s and earlier very few families needed two incomes to afford a nice middle class lifestyle?
I think there's a very good argument that the definition of "middle-class" has continued to veer upwards over time. The kinds of homes and lifestyle my parents grew up in are nowhere near the quality level of what I've grown up with. The world my grandparents grew up in would be considered poverty levels today.
Lots of families could go single-income today and realize a lifestyle not too different from that single-income lifestyle of previous generations. But having two incomes means more TVs, more internet, more cars, nicer cars, nicer computers, multiple computers, bigger house, granite countertops, large en suite bathrooms, expensive overseas vacations, more expensive schools, more resource to put into your kids, etc.
That, I tend to think, depends to a significant degree on where you are. In many areas of the US, housing (for example) is very cheap, and much of the cost is down to the construction of the building and its amenities. On the other hand, in parts of the UK with a decent jobs market, there's a shortage of available land, and housing is very expensive indeed. I spend three times what a friend in Wales spends for his (otherwise similar) house, and three times less than some other friends spend for their one bed flat in central London. That difference in cost has little to do with the difference in intrinsic value of our properties, and lots to do with the fact that the land they sit on has differing value, thanks to the UK's shortage of residential land in places with jobs.
In the south of the UK, I would tend to argue that if everyone cut an hour or two off their daily work, we might be affected a little less than you might normally think - because everyone below a certain class has a lot of their income tied up in an area that approaches a zero sum game.
I will say that I mainly had housing in mind when I made that statement. That was somewhat short-sighted of me, but in my defense housing is quite different from something like a Blueray player or a TV. House prices are much, much more fluid than those of gadgets and are also highly localized. One house can be 3x more expensive than another carbon copy simply because it's closer to an office district that employs a large number of comparatively wealthy people. In other words, housing prices in competitive markets are determined mostly by factors other than the cost of production, which can be nearly negligible in some cases. Housing prices certainly would go down if everybody's income was simultaneously cut by two-thirds; this is exactly what happens when a local job market crashes (e.g., see the Houston oil crash in the 80s).
Regarding your final point, about standard of living simply veering upward over time, I think there's a lot of truth to it. But I also think there's a lot of complexity. I know plenty of folks who still live very modest lives that are barely different from the 50s -- small homes, often homes that were built in the 50s and are still standing and are in bad condition, certainly worse condition than when they were first built; small TVs; old kitchens; no vacations; public schools; many family members living in the same house; etc. These people are often working classic middle-class jobs: nurses, school teachers, etc. Despite not having many of the materialistic advances you list, they also often have pretty bad debt, either student loans or credit card debt.
Any economic model that doesn't assume for the cost of production simply isn't realistic.
Japan has a particularly weird model that might work: homes drop in price like cars over time, so prestige signalling means building a new house and not living in an old one. It also means homes are built cheaply and without intention to last more than a couple decades. It also means that the new home construction industry maintains a fairly flat work schedule and increases certainty.
There's a bunch of other construction economics that occur in Japan. Something like 5% of the people working in Japan work in construction.
Studies of Japanese economics are interesting in terms of how many economic problems the Japanese have tried to solve with construction projects.
http://www.nytimes.com/2009/02/06/world/asia/06japan.html?pa...
http://bigthink.com/Global-Pedestrian/needless-dams-and-road...
http://www.nytimes.com/2009/10/16/world/asia/16dam.html
https://www.youtube.com/watch?v=sx63GTCFKzY
http://regex.info/blog/2007-03-25/403
http://nfggames.com/neography/photos/paved.htm
http://www.nytimes.com/2007/11/07/world/asia/07iht-07japan.8...
Historiclly this is just wrong. There is a very short window in very view country when couples could not both work. I would argue it was more a social then a economic effect.
Basiclly it was a sign that you had made it, if your wife would not have to work. Kind of goes back to Victorian ideal woman that only sits around and does not really do much.
> and now most middle class folks find they struggle to afford a home with two incomes.
Maybe this is a issue because people all want there own homes. Economicly I have not seen one good argument that buying is better then renting. Countrys that have much more renting are just as well of.
There would be only 3/8 as much "stuff" (including services etc), modulo productivity effects, to divide among the same number of people. So on average, you'd be able to afford 3/8 of what you could in a 8-hour-a-day world. Regardless of whether prices changed and in which direction.
What is consumed, must have been produced. If less is produced, less is available to consume.
I think there would be productivity effects, though, as noted by another poster. And not everything scales linearly in the necessary manner for this to work (but many things do). One upside, though, is that the number of jobs would drastically increase.
I thought we have less than 66% unemployment?
My hope is that when people get to live and work in space on a semipermanent basis, it will start the single biggest goldrush the human species is or ever will witness beyond leaving the solar system. (Hint: invest with Musk.)
http://www.oecd-ilibrary.org/economics/economic-globalisatio...
Have you been to America lately and decades ago?
Most people, especially the middle and lower classes, in the US are far poorer than just a couple decades ago. Many jobs are part time to avoid paying benefits and pension is a long forgetten relic. Ageism is a rampant dirty little open secret also.
Gen Y cannot find a job and many have given up seeking work. This is a fact because there's so much competition for fewer jobs. Existing office workers in the US are getting more "hurried" to perform and produce more, similar to the prevailing mood of office workers in Europe (esp UK).
Janitors that clean our building can't afford rent and so sleep in their car in our parking lot. Don't even get me started on how the meat-packing industry encourages and abuses undocumented workers (by advertising pay in Mexican newspapers).
Also, if you need skilled knowledge labor cheap and you're say a startup, either you can hire "expensive" Americans or people that will work for less. It's routine for founders to hire remote staff because the costs are dramatically diffeent (people are the largest cost.). Belarus, India, Brazil, Mexico... I'm guilty of hiring staff from there too.
The interesting consequence of apps such as Asana, Slack and the like have made workers location-independent, which makes them even more replacable from anywhere.
There are not just one but multiple shanty towns now in Silicon Valley, even after The Jungle was "cleared" out like what happens to immigrants in France. I don't recall ever hearing about such a thing in the 1980's. Expect the homeless population to continue rising.
It's not globalization, it's not the "President's fault," it is the situation of being qualitatively and quantitatively harder for most of the 99% to make a living than it was (in the US).
The non-office jobs that are good are "blue collar" skilled labor work (electricians, plumbers, welder a, mechanics, etc.) that have a stigma because the mainstream bought into the myth that academia is the only true path to success.
Watch "Inequality for All" to see specifics facts laid out.
Finally, if we are to continue on this over aggregation of wealth treadmill, the lower classes have no more religion and so there will be a redistribution in one way or another.
This part of your comment hints at where these openings are.
"The non-office jobs that are good are "blue collar" skilled labor work (electricians, plumbers, welder a, mechanics, etc.) that have a stigma because the mainstream bought into the myth that academia is the only true path to success."
That would be a Marxist-Leninist system (or rather a Marxist-Stalinist one).
Marxism doesn't say anything other than the society en masse and through democratic means has a say on what the level of production is for each sector. They could have just said "that's enough" if they prioritized leisure.
Of course USSR had two problems: it was underdeveloped, and it faced huge dangers from outside ("capitalistic") powers, so it had to ramp-up its production pronto (else, it would have been squashed by Germany in WWII, for example, something which the industrialization prevented). A single country (or even a small alliance) cannot adapt that well to doing what it wants (e.g. emphasize leisure) without falling prey to other powers around it. That was the whole hoopla with the notion of "socialism in one country" btw ( http://en.wikipedia.org/wiki/Socialism_in_One_Country ).
Vanilla Marxism is the abstract base class of political ideologies. You can't actually instantiate it, because Marx left too much unsaid when it came to the nuts and bolts of how he thought a society should function on a day-to-day basis.
https://en.wikipedia.org/wiki/Marxism
> For the political ideology commonly associated with states governed by Communist parties, see Marxism–Leninism.
ideology (n) a system of ideas and ideals, especially
one that forms the basis of economic or
political theory and policy
1. Ideology is not a dirty word. It's just a noun that describes any large-scale philosophy that focuses on political or economic issues.
2. Referring back to that definition, Marxism is very much an ideology. Claiming that it isn't is just playing word games.
3. All that aside, focusing in on quibbling over a word like that, to the exclusion of addressing any of the actual content of the statement that was being responded to, doesn't do much to add value to the conversation. Given the current context I don't think it would be unfair to suggest that it amounts to trying to meet a response to a courtier's reply with yet another courtier's reply.
i think the fact that you refer to marxism as a base class and marxist leninism as an instantiation mean that we fundamentally agree on the nature of the distinction between the two.
i think the nub of our disagreement is whether ideology is a loaded term, and whether marxism meets our personal definition of that word.
That was the state-of-the-art in classical economics when Marx branched from it. And his argument flows from it.
But the LTV breeds paradoxes. That's why, when the concept of subjective value was introduced, economics left LTV behind.
A thing is only valued according to what it is exchanged for.
So a single good actually has different values, at different points in time and space. The value of the labourer's efforts are a distinct exchange from the value of the good to the manufacturer, which is distinct again from the value when sold to the wholesaler, distinct from the value at the retailer, distinct from the retailer to the consumer, distinct again the value between the buyer and the buyer's son who inherited it, distinct again to the value at a lawn sale, distinct again to the value at a swap meet, distinct again to the value at a recycling centre ...
There was no "real" or "true" value to be expropriated here, so the Marxist critique basically falls to pieces. It continues to be attractive because it makes sense to people who are unaware of more modern economics, because it predicts cyclical behaviour in capitalist economies and because it finishes with some hand-wavy eschatological futurism that sounds really pleasant.
Most of these arguments where developed by people who were disappointed in the soviet union (because it took exactly the course critices had said it would) and made up arguments.
The USSR could have traded with others, there is nothing that says a country can not be internally socialistic and externally trade with capitalists. Thats exactly how some market anarchist schemes work.
In some ideal world yes. In the real world, other countries (well, they ruling classes) wanted to see its demise, not trade with it, for it gave their people the wrong ideas...
Also the USSR influnced almost half of the world, the extend of the market is easly big enougth. Its not like the USSR was Hong Kong or Cuba.
The reason you can't work just 3 hours a day is that you need to make money for other people as well. Too many governmental jobs that has really no real value, but exist due to socialistic idea, governments want to give work to people for votes and for statistics.
And you must pay for those jobs yourself, be it through direct taxes or by the fact that products you buy cost more, because companies are obliged by regulations to hire someone to do something that they have to pay for.
Then there is just plain inefficeny, and I have seen that. I know people who work in govenremnt and have worked there myself. There are people that work there that basiclly kind of float. They do jobs that could be done in hours in days, I even did that. This is true in any large organisation but governement is usally much bigger then most cooperations and they have less insentive for efficeny.
Data on that?
I know mulitble people who have exactly that job, and non of them work for governemnt.
IBM, that has existed for 100 years but they are the exeption not the rule. Most companys dont make it that long or grow that big.
I would suggest you read economic theory on this "The Theory of the Firm" by Ronald Coase is the usual place to start.
There are vast examples of workers not doing anything on any organization, blaming only the public sector is denial. The truth is that a company doing well has enough resources to do well even if they pay non productive workers.
On a macro level, I see this as a economy optimizing for technological expansion over leisure. Worker man says shitty, then pulls out his magical pocket sized supercomputer on the bus ride home at 6pm.
Total fallacy. Most of the incredible advances we've had in science are due to passion for science, as opposed to financial gain. Financial gain usually promotes iterative advancement.