Saturday, December 8, 2012

Major Online Pundits Discover Automation

I've heard this argument before, but here it is plainly stated from Matt Yglesias at Slate: The Jobs of Tomorrow Will Be Health Care Jobs
What will everyone do for work when everything is automated? They'll take care of old people and sick people, because people would rather interact with human beings if possible. How will we afford all this caretaking for the elderly? Because there will be so much automation that we'll enjoy lives of material plenty even with very little human work.
So there you have it the growth industry of the twenty-first century will be wiping old folk's asses for minimum wage. Problem solved. I wonder what will happen to those of us who may not actually want to stick catheters in grandma for a living? I guess we're screwed, aren't we? Unfortunately for us, the professional jobs of the future will be hoarded by the children of the wealthy and well-connected thanks to the costs and duration of higher education. Cleanup in aisle six!

But seriously, this calls for a major change in the economic paradigm. The thing about health care is that it is most needed by those who are least able to afford it (the elderly at the end of life and the poor). The traditional concept of capitalism - selling products and services to those who can afford them is completely upended. The only way the above could work is under a redistributionist paradigm (each according to his ability to each according to his need). Does that mean it's inevitable? Instead of worker uprisings, will the socialist revolution be brought about by the  aging of the population and the advance of medical technology?

And this blog entry by Bank of Sweden Prize winner Paul Krugman is a major step forward in recognizing the challenge placed by automation: Rise of the Robots:
Robots mean that labor costs don’t matter much, so you might as well locate in advanced countries with large markets and good infrastructure (which may soon not include us, but that’s another issue). On the other hand, it’s not good news for workers!

This is an old concern in economics; it’s “capital-biased technological change”, which tends to shift the distribution of income away from workers to the owners of capital.

If this is the wave of the future, it makes nonsense of just about all the conventional wisdom on reducing inequality. Better education won’t do much to reduce inequality if the big rewards simply go to those with the most assets. Creating an “opportunity society”, or whatever it is the likes of Paul Ryan etc. are selling this week, won’t do much if the most important asset you can have in life is, well, lots of assets inherited from your parents. And so on.

I think our eyes have been averted from the capital/labor dimension of inequality, for several reasons. It didn’t seem crucial back in the 1990s, and not enough people (me included!) have looked up to notice that things have changed. It has echoes of old-fashioned Marxism — which shouldn’t be a reason to ignore facts, but too often is. And it has really uncomfortable implications.

But I think we’d better start paying attention to those implications.
When people of Krugman's influence start paying attention to those implications, that's a good sign.


  1. Health care is the bubble du juor. All you need to do is spend time at community college (as I have since May) to meet the absurd number of people returning to college to redirect into health care (whether it is nurses or doctors, or physical therapists or the menagerie of "technician" jobs).

    Medicare is a social transfer mechanism riddled with fraud and deliberate misrepresentation. The health care industry is wed to Medicare and attendant blind largesse. Medical care is so wildly overpriced that it defies rational sensibility.

    The actual future of health care, once the economics of generational coercion break down under the weight of arithmetic, is death panels for obese proles (but don't worry, our guilt will be assuaged knowing those folks bear responsibility for their lifestyle choices, tisk tisk), generally shorter life expectancies and concierge (read: cash only) health care for the rich.

  2. Whenever you see ads on websites or on commercial radio enticing people into certain professions, you can be sure it's a scam. I have yet to hear an ad for becoming an engineer or lawyer on the radio or see it one a Web site, unlike nursing assistants or computer techs which are constantly flogged by for-profit diploma mills.

    The problem is you have people offering a service that everybody needs, because everyone has a body and will probably need medical help at some point, even if it's minor, but it's practitioners make too much for anyone to pay for it. How can people in a country where the median income is 50,000 or so (meaning half below that) pay for professional services from someone who earns anywhere from 250,000-500,000 dollars a year? Where does that money come from?

    Death panels are already here, doctor visits and life expectancy are already declining for the poorest members of society.

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