Tom,
You wrote, on another list, what I quote below. I've replied here because you
and Julio have been having a related convseration.
I want to explore your "displacement" a little more. You have two ways
that machines displace workers. But you don't say, or at least I can't see
where you say, where the individual displaced worker ends up. There are two
possibilities: (a.) the individual gets a different job, or (b.) the
individual gets no job at all.
The person in possibility (b.) would think, and I would agree, that a
machine (owned by someone else) has destroyed the job. Is the idea that
automation/mechanization/robotization creates more jobs than are destroyed?
What am I missing in your analysis?
Gene
On Jan 13, 2013, at 10:57 PM, Tom Walker wrote:
> I know this is hopeless but robots (or machines) DO NOT destroy jobs; they
> displace workers. The consequences of that displacement are far more serious
> than if robots merely destroyed jobs. The economists' binary "do/don't
> destroy jobs" keeps us asking the wrong questions. "If they can get you
> asking the wrong questions," Thomas Pynchon wrote in Gravity's Rainbow, "they
> don't have to worry about answers."
>
> Machines don't destroy jobs.
> Machines don't destroy jobs.
> Machines don't destroy jobs...
>
> Machines DISPLACE workers.
>
> There are two ways that machines displace workers. One of them is from one
> group or kind of workers to another. This is a secondary displacement. The
> primary displacement is from human labor to fuel consumption. Substituting
> fuel consumption for human labor is only cost effective, though, when the
> fuel is artificially cheap. Fuel is made cheap by shifting to third parties
> the social and environmental costs of its extraction and combustion. Fuel is
> cheap because most of its cost is discounted as so-called "externalities."
>
> Think of all the work to be done cleaning up after superstorm Sandy. Machines
> "created" that work. (Not really.) But machines displaced workers with higher
> fuel consumption and the consumption of more fuel resulted in more carbon
> dioxide emissions that contributed to rising sea levels and extreme weather
> events that caused extensive damage, which will result in a whole bunch of
> workers being hired to work repairing that damage.
>
> Note that the corporations who "invested" in those machines and who reaped
> profits from the displacement of labor will not be called upon to pay for the
> extreme weather event clean up costs. But more importantly, notice that
> collectively we would be better off if the machines had merely destroyed jobs
> rather than displacing them from productive employment to disaster relief,
> repair and restoration. This is why asking whether machines destroy jobs is
> asking the wrong question.
>
>
> On 13/01/2013 8:57 PM, Eugene Coyle wrote:
>> Thanks for this Joe. I learned something. I phoned a friend and learned I
>> can watch this on my computer! And so I did. The URL is
>> http://www.cbsnews.com/video/watch/?id=50138922n
>> . The segment is 13 minutes.
>>
>> The guests, Brynjolfsson and McAfee were good. The first half of their book
>> is even better. The second half of their book, where they talk about what
>> is to be done, is terribly weak, bad actually. The Lazonick piece in
>> Alternet was. I think, not very good.
>>
>> Gene
>>
>>
>>
>> On Jan 13, 2013, at 7:24 PM, Joe Polito wrote:
>>
>>
>>> Erik Brynjolfsson and Andrew McAfee were the guests
>>>
>>> On Wed, Jan 2, 2013 at 6:38 AM, Ken Ellis
>>> <[email protected]>
>>> wrote:
>>> In this article, author Lazonick does not address the fact that automation
>>> can only proceed so far before human labor disappears altogether, but he
>>> does have a thought provoking perspective. KE
>>>
>>>
>>> http://www.alternet.org/economy/robots-dont-destroy-jobs-rapacious-corporate-executives-do?paging=off
>>>
>>>
>>> AlterNet / By William Lazonick
>>> Robots Don't Destroy Jobs; Rapacious Corporate Executives Do
>>>
>>> Worrying about automation distracts us from the real problem: misuse of
>>> corporate profits.
>>>
>>> December 31, 2012
>>>
>>> Americans are understandably upset about profits without prosperity.
>>> Corporate executives seem to be the big winners, while the middle class is
>>> declining and young people face a bleak economic future. How did this
>>> happen? It's easy to blame technology, especially the automation that
>>> supposedly displaces workers. But that's not the real story. The fact is
>>> that automation creates jobs. It's the misuse of corporate profits that are
>>> destroying them.
>>>
>>> There was a time when high corporate profits meant bright employment
>>> prospects for most members of the US labor force. That relation between
>>> profits and prosperity was strongest in the immediate post-World War II
>>> decades when US corporations led the world in manufacturing, provided
>>> workers with career-long employment security, and reinvested profits in
>>> productive capabilities in the United States. For the past three decades,
>>> however, the pursuit of corporate profits has been at the expense of
>>> prosperity for an ever-growing proportion of the American population.
>>>
>>> This disconnect between profits and prosperity began in the 1980s with
>>> permanent plant closings that cost production workers their middle-class
>>> jobs. It increased in the 1990s as major US corporations scrapped the
>>> career-with-one-company norm that had prevailed for salaried employees, and
>>> it became common even for college-educated people with a couple of decades
>>> of work experience to find themselves on the wrong end of the pink slip.
>>> Then in the 2000s, as US corporations accelerated the globalization of
>>> production activities, the jobs of all members of the US labor force, no
>>> matter what their level of educational attainment, became vulnerable to
>>> competition from qualified people in lower wage areas of the world.
>>>
>>> Profits without prosperity is now starting to get attention in the
>>> mainstream press. In his New York Times op-ed, “Robots and Robber Barons”
>>> (Dec. 9, 2012), Paul Krugman seeks to explain why, with corporate profits
>>> up, labor compensation is down. As part of the ongoing digital revolution,
>>> he argues, robots are throwing American workers out of their jobs. In
>>> addition, he claims that corporations are making high profits through price
>>> gouging, and are not sharing these gains with their employees.
>>>
>>> Krugman is on to something important that needs to become part of the
>>> national policy debate. But he is off target in blaming a combination of
>>> automation and monopolistic practices for the disconnect between profits
>>> and prosperity.
>>>
>>> Automation is not the problem. As part of a process that could reconnect
>>> profits and prosperity, the US economy needs more, not less, corporate
>>> investment in automation. A company that successfully invests in automation
>>> creates far more, and typically better, jobs than those it destroys.
>>> Indeed, the study of industrial history reveals that when a nation’s
>>> leading companies fail to make sufficient investments in automation its
>>> economy runs into trouble.
>>>
>>> As Krugman himself notes, the argument that automation is bad for workers’
>>> employment and incomes dates back almost two centuries to the British
>>> economist, David Ricardo, who was writing during the world’s first
>>> industrial revolution. By definition, automation displaces the need for
>>> workers to perform the tasks that have been automated. If, however,
>>> automation only destroyed jobs, advanced economies such as those of
>>> Britain, France, Germany, Italy, Japan, and the United States would not
>>> have risen to positions of world industrial leadership with strong middle
>>> classes.
>>>
>>> Some of these new jobs are created in the industries that produce automated
>>> equipment. By far Japan is the world leader in both the production and use
>>> of robotics. An original source of Japan’s competitive advantage in this
>>> capital-goods sector was the willingness and ability of production workers
>>> to cooperate with engineers in automating tasks they performed on the shop
>>> floor Under Japan’s system of “lifetime employment,” these production
>>> workers did not fear that the introduction of robots would result in loss
>>> of employment, while their involvement in the automation process gave them
>>> experience that, post-automation, could be put to productive use in other
>>> parts of the business organization.
>>>
>>> Increasingly, moreover, in the age of nanotechnology, automation performs
>>> productive functions that no human being could ever have possibly done.
>>> Rather than destroy jobs, these automated processes make it possible for
>>> companies to produce all kinds of sophisticated goods and services. These
>>> products are the hallmark of an advanced economy, and open up all kinds of
>>> new employment opportunities in companies and countries in which these
>>> goods and services are produced.
>>>
>>> Automation entails huge upfront investments. Companies that invest in
>>> automation have to build organizations to ensure steady supplies of
>>> high-quality materials, improve and maintain machinery, and capture
>>> sufficiently large market shares to achieve economies of scale. These
>>> investments in the development and utilization of automated facilities
>>> create lots of high-value-added jobs, especially for companies that,
>>> because of their investments, can grow large by producing higher quality,
>>> lower costs products than the competition.
>>>
>>> To repeat, automation is not the problem. The three-decades long erosion of
>>> middle-class jobs in the United States is the result of, as stated earlier,
>>> permanent plant closings, layoffs of older employees, and the globalization
>>> of employment – none of which have been the result of automation. In the
>>> process, many US industrial corporations have become very profitable (for
>>> now, but by no means forever). The question that needs to be asked is why
>>> US corporations are failing to reinvest these profits in new products and
>>> processes that can create large numbers of new high value-added employment
>>> opportunities in the United States.
>>>
>>> The problem lies in the ideology that corporations should be governed
>>> to“maximize shareholder value,” which became prevalent in boardrooms and
>>> business schools in the 1980s, and has become totally dominant since. In
>>> the name of shareholder value over the decade 2001-2010, the 500
>>> corporations in the S&P 500 Index (representing about 75 percent of US
>>> stock-market capitalization) expended not only 40 percent of their profits
>>> on cash dividends – the normal mode of rewarding shareholders – but also
>>> another 54 percent on stock buybacks, the purpose of which is to give a
>>> manipulative boost to a company’s own stock price. Large established
>>> companies did hardly any buybacks in the early 1980s. Over the past decade,
>>> buybacks by S&P 500 companies totaled about $3 trillion, which has left
>>> scant corporate resources for investment in innovation and high-value-added
>>> job creation.
>>>
>>> When companies do massive buybacks to boost their own stock prices, the big
>>> winners are the very same top executives who make these resource-allocation
>>> decisions. Why? Because the largest single component of top executive pay
>>> is the income from exercising stock options – which become more lucrative
>>> when the stock price goes up, even if for just a short period of time
>>> during which the options can be exercised and the acquired stock sold.
>>>
>>> Many corporate executives justify buybacks by arguing that they represent
>>> the best corporate investments available. How about investments in
>>> innovation and job creation? Or how about corporate support for government
>>> investments in the national knowledge base, which typically provides the
>>> foundation for enterprise innovation and profits? If top executives have
>>> been the big winners of this financialized buybacks-options game, then the
>>> big losers have been erstwhile members of the US middle class as well as
>>> tens of millions of younger Americans who will never have the opportunity
>>> of entering the middle class.
>>>
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>>>
>>>
>>> --
>>> Obama's vision of America:
>>> "everybody's got a shot, everybody's treated with respect and dignity in
>>> which the -- the divides of -- of race and faith, gender, sexual
>>> orientation, ... are not the determining factors, in terms of whether
>>> people succeed ... it's how hard you work and are you trustworthy and are
>>> you responsible and you -- do you look after your family and ... do you
>>> love people and love this country? "
>>>
>>> Romney's"
>>> 47 percent of Americans ... believe that they are victims, ... who believe
>>> that they are entitled to health care, to food, to housing, to you-name-it
>>> ... My job is not to worry about those people. I’ll never convince them
>>> that they should take personal responsibility and care for their lives.
>>>
>>>
>>>
>>>
>>>
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