Backstage - OOC Forums
General Discussion => The Speakeasy: OOG/Off-topic Discussion => Topic started by: Saede Riordan on 20 Jan 2014, 11:49
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For every job opening in the US, there are 3 people looking for work. That’s really all you need to know.
And it’s going to get worse.
You know that fancy billing program that generates quotes and invoices automatically? That used to be someone’s job.
That fancy spreadsheet? That was someone’s job once.
To quote someone on reddit:
"I remember when I was going to school for Drafting and all of the instructors were insistent on the fact that you absolutely, positively, 100% HAD to have an expert knowledge of trigonometry in order to draw.
But you don’t. The best grade I ever got in Trig was a D+. And I can draw. I've never needed to do anything beyond basic math when using AutoCAD.”
It’s more than just robots that are going to take our jobs away. Automation in software is going to do as much if not more damage to the outlook. Engineering degrees are becoming less and less about the concepts behind design. They are teaching you less and less why to design something a certain way and more and more how to do so. A modern engineering degree is more of a “How to use software programs X,Y and Z” course than a “how to engineer” course.
Back before these tasks were automated in software, they had to be done by hand, by very smart people, who were in extreme high demand, and made lots of money as a result.
Software has dumbed-down so many of those advanced tasks that someone with barely any knowledge of the concept behind it can do the task equally as well as the knowledgeable person. Companies see that and the “Cost savings! Cost savings!” alarm goes off in the board room. No need to hire the engineer who got straight As and has 30 years of experience when the intern knows the software better.
We’re moving very quickly to becoming a post-scarcity society where automation and advances in information technology make just about everything so cheap to make and obtain it basically becomes free.
Now, we may laud these advances and say “that’s the whole point! We don’t have to work as much!” But when you look at what’s actually happening, it’s the opposite. My generation (I'm either a millennial or a gen-xer depending on who you ask, but this applies to both) works longer hours than the generations before us. We take fewer vacation days. We are statistically more productive.
But at the same time, we are getting paid less. Why? Because we’re still living in that old mentality where hours worked has a direct correlation to added value to the company. Most of us know that’s not true, and few companies are under the illusion that everyone is exactly as productive at 4:30 pm on a Friday as they are at 10 am on a Wednesday. But how do you measure productivity? We haven’t figured that out yet, at least not in a way that’s fair, consistent, and manageable. Until we do, we’re still largely going to pretend that hours = value, and watch as hours get cut, benefits get slashed, and older, more skilled workers are put out to pasture and replaced with younger, cheaper workers. All of the value automation adds to a process go directly to the top, and the human workers get their wages slashed and their jobs cut.
The unemployed are sneered at with derision for not “wanting to work,” as if there is some pressing task that needs to be accomplished that isn't already being done. That’s the old farmhouse mentality again. 100 years ago if you didn't work, you died. That’s not true now. It can’t be true because there isn't enough work to keep everyone busy in the first place. We've corporatized, mechanized, and automated farming, banking, government, you-name it. We have unemployed because things don’t need to get done like they used to. But the concept of paying someone not to work is such an anathema to the down-home, work-based, agricultural values we were raised with that most of us simply shut our brains off when we even hear the notion.
Either we accept the fact that even if every job opening were filled today, there’d still be millions of people who will be perpetually unemployed and deal with that in a humane manner; or, we continue to let the system work as if we’re all agricultural workers and let those increased profits reaped by automation rise to the top, and wake up one day realizing the middle class has all but disappeared and the feudal system has returned.
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Some relevant and, I think, inspirational words from Reverend John Ball, spoken in England circa 1350 AD
"My good friends, things cannot go on well in England, nor ever will until everything shall be in common, when there shall be neither vassal nor lord, and all distinctions levelled; when the lords shall be no more masters than ourselves. How ill they have used us!… They have wines, spices and fine bread, when we have only rye and the refuse of fine straw; and if we drink, it must be water. They have handsome seats and manors, when we must brave the wind and rain in our labours in the field; but it is from our labour they have the wherewith to support their pomp.… Let us go to the king, who is young, and remonstrate with him on our servitude, telling him we must have it otherwise, or that we shall find a remedy for it ourselves"
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Well, if you've got an architecture degree and a working knowledge of REVIT, there's a lot of work out there.
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It's all the mindless jobs that are progressively being replaced. Actually, most of the non interesting jobs imo. The problem is, though, at the demographics level, yes.
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I've often pondered on this, and as you say it's getting worse, I say it's going to get much better...why, you ask?
Cause old people are dying.
Sounds harsh, eh? But I ask you too keep in mind, oh readers, that the future is -us-, not them. I may be one of the few with this hope, but I plan on being a CFO one day. I've often talked to my fiancee's father, a current CFO. I realized in these conversations the raw gap between what is "taught" to my generation and what has been "taught" to his. What we "know"....what we are allowed to -think-...and we will be the ones running companies, creating technologies, and generally running the world.
You say as long as we hold on to old values, it'll get worse....I ask you then, what generation has never left their personal mark on history...either as a generation (hippies), or as a sub-set of said generation(geeks of the 80's)?
Look at the very day it is in America. MLK Jr. Day. I don't think I need a better example than that. In his day, blacks were inferior. Look at us today...we find that idea to be backwards in most of society. And that's 60 years. 60 years is not even a lifetime in the modern age.
It will get better...if we make it better.
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The primary issue, it seems to me, is that any future solutions are of no use to those in dire straits at this very moment. Yes, I think it is likely that technological advances will eventually balance themselves out to the point of making human existence less costly instead of merely making corporate existence less costly, but this is of no comfort to someone currently struggling to exist.
One cannot preach individualism for the present but community for the future. Either you are willing to structure society for the community in this moment or you are selling platitudes for the future in order to placate the justified indignation your current individualism causes in those around you.
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I've always found it a strange thing that in our current economy, our most renewable and available resource is also one of the most costly, yet still distributed so poorly.
Side note: society also benefits from unemployment. In fact, economists consider it a necessity, so don't feel too ashamed if you're unemployed.
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Side note: society also benefits from unemployment. In fact, economists consider it a necessity, so don't feel too ashamed if you're unemployed.
This is true of a certain unemployment rate that is mobile - meaning it is intended to be people temporarily unemployed, not the perpetually unemployed at high rates.
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I've always found it a strange thing that in our current economy, our most renewable and available resource is also one of the most costly, yet still distributed so poorly.
Side note: society also benefits from unemployment. In fact, economists consider it a necessity, so don't feel too ashamed if you're unemployed.
Around 5% turnover, no more. Above, it's bad but also refrains inflation. Try to reduce unemployment though, and you will probably create inflation.
No wonder to me that they prefer to fight inflation instead of unemployment.
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The primary issue, it seems to me, is that any future solutions are of no use to those in dire straits at this very moment. Yes, I think it is likely that technological advances will eventually balance themselves out to the point of making human existence less costly instead of merely making corporate existence less costly, but this is of no comfort to someone currently struggling to exist.
One cannot preach individualism for the present but community for the future. Either you are willing to structure society for the community in this moment or you are selling platitudes for the future in order to placate the justified indignation your current individualism causes in those around you.
This definitely.
Side note: society also benefits from unemployment. In fact, economists consider it a necessity, so don't feel too ashamed if you're unemployed.
This is true of a certain unemployment rate that is mobile - meaning it is intended to be people temporarily unemployed, not the perpetually unemployed at high rates.
Also this. Unfortunately perpetual unemployment is going to become an increasing trend. Where its not temporary and transitive unemployment but structural unemployment.
Its going to get worse.
That self driving car of google's? Ten years from now, its going to be replacing our currently 2 million truck drivers. What are those people supposed to do then? Work at walmart or McDonalds for 8 dollars at hour part time, making barely enough to pay some of the bills, much less feed their children?
And with automated checkouts and the automated restaurants that are currently being prototyped, even those low hanging service jobs aren't going to be immune to to automation. Its here and its not going to go anywhere. At the same time as we're having less and less work for people to do, we have more and more people being born to do it. The gap between available people and available work is growing, which gives capital a tremendous amount of power over labour. The bargaining chip of unions and individuals when working for higher wages is that their job needs to be done and without them it won't be. But that's increasingly becoming less and less the case. Not only are the jobs requiring less and less skill due to automation, but there are more and more people unemployed and trying to find work, due to automation. So previously high demand workers are now easily replaced, and there's no incentive on the part of corporations to negotiate with them. I'm not saying automation is a bad thing here, its not. But it is creating structural inequalities that are slowly eroding the lower and middle classes and bolstering the rich. We're all slowly going to be thrown off the bus if we don't, all of us, as a generation, wake up and do something about it. And I don't mean smashing looms, or reducing automation, that will never work. But the fact is, unemployment is here to stay, and that completely anathema concept of paying people to live, instead of paying them for work, might be what we have to consider if we are to retain ourselves and our culture and prevent the richest among us from tossing the rest of us back into the dark ages.
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But the fact is, unemployment is here to stay, and that completely anathema concept of paying people to live, instead of paying them for work, might be what we have to consider if we are to retain ourselves and our culture and prevent the richest among us from tossing the rest of us back into the dark ages.
Even if everything you say is true, they won't be tossing just "the rest of us" into the dark ages. It'll be everyone, because there will be no one to buy their products. Some of the rich - especially the ones who make money making actual things - are aware of this. But many, if not most, of the rich these days are concentrated in financial and service sectors, and they are often of relatively little utility to the rest of this.
Let me inject my pessimism here: laws are made by the strong, for the strong, and what the rest of us want will not matter. And, since it sometimes seems necessary, I would note that we do not have other economic systems that could potentially work in place of capitalism.
Be wary of saying "post-scarcity". Scarcity is, in many ways, logically necessary in this universe. Even if everyone could have a galaxy to themselves, that would not mean that several someones wouldn't want a particular galaxy over others. What we are entering is a period where people are being systematically deprived of the ability to make enough money to support themselves, and where the protections on workers have largely been stripped away. If we had continued the pattern established earlier in the century, we would probably be down to a 30 hour work week. Of course, with globalization (which, if we want to be fair, is necessary), we probably couldn't do that, but we certainly wouldn't be working longer and longer hours for less and less.
That said, the wealthy would be well advised to invest in seeking a financially healthier population. Impoverishing the other classes tends to lead to them eventually deciding to try other means for improving their lot than the legal, never a good thing for the class with the most to lose. And despite the attempts by some to believe otherwise, capitalism is not a system that tolerates cronyism forever. Continue to deprive your workers of enough to live on, and you will find that none can afford what you sell.
But many people and corporations are not willing to consider that, and so they make the conscious choice to pay their employees as little as possible, so that they can make as high a short-term profit as possible.
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Why can't I find a job? (http://www.learnliberty.org/videos/3-reasons-you-cant-find-job)
Can the government create a job for me? (http://www.learnliberty.org/videos/does-government-create-jobs)
Economists are often asked what people will do when their jobs are replaced by technology. The typical economist's answer is "something else." As long as we're paying attention to the changes in the market and are willing to acquire or develop the skills that will meet those market needs, rather than simply make us feel good, then we can do "something else."
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In general, we fail to plan long-term. Individually or corporately. I think as our generation gains its collective voice, we are going to reject many of the debates our parents think exist. We are going to decide that the "big problems," they did not decide to tackle (because profits), we are going to end up going after.
In my industry, Aerospace*, there is an interesting challenge coming. (https://www.aiaa.org/uploadedFiles/Issues_and_Advocacy/Policy_Papers/Information_Papers/Retaining%20Aero%20Workforce.pdf) Essentially, 50% of the Aerospace workforce is getting set to retire. Many of these are knowledge-jobs, they cannot be easily automated. Some of it takes plenty of imagination. In addition, automation only goes so far on the factory floor. Today, satellites and even aircraft are each largely handcrafted and the assembly line skills are not straightforward. These are not automobile production lines, they produce dozens of units in the best of years. The graph in the linked pdf is telling.
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Economists are often asked what people will do when their jobs are replaced by technology. The typical economist's answer is "something else." As long as we're paying attention to the changes in the market and are willing to acquire or develop the skills that will meet those market needs, rather than simply make us feel good, then we can do "something else."
While it is true that automation does not necessarily mean that joblessness is inevitable, it is nonetheless also true that simply appealing to the "free market" doesn't solve for the problem.
First of all, a "free market" actually requires governmental regulation to function. Without governmental controls, there's nothing actually preventing Wal-Mart from showing up at your door and simply taking your money. So we at least need enforcement of criminal and contract law. Alright, so what if ChemCo Limited decides to dump half a million tons of cyanide gas into the air over your house, or decides that they'd like to dump their waste into the river that cuts across both your property, theirs, and your neighbor's? Right, so we need environmental regulations, too. And so on.
There is no such thing as a "free market" in the unregulated sense. A free market is one in which I can sell you my crap and you can sell me your crap. It works well, as long as the laws are evenly enforced. But that says nothing about education, human welfare, etc. We need capitalism, but we don't need only capitalism. It is a necessary but not sufficient condition for a progressive society.
Secondly, economists are quite willing to say that innovations do not, in the long run, necessarily mean job loss. But that's in the very long run, and under specific conditions. The specific conditions being that the workforce can be educated for new jobs, and that the labor market actually be a market. And in the short run - as in, specific, individual human lives - people suffer. A lot. Being a (mostly) utilitarian, I don't see any principle that I must obey before advocating that something ought to be done for those suffering.
As for the conditions, most corporations are not willing to pay for educating future employees, and schools are without the funding they need to actually educate. Say what you will about how much money is being set aside for "education", the simple fact is that the schools aren't getting enough. The labor market, as well, simply isn't. It's not just that there are too many people for too few positions, it's also that companies are running the people they have at 60, 70, 80 hours a week or more, for less and less, because those people are terrified of being fired. And there is no law of economics stating that the labor market will settle on a livable wage. It's perfectly possible for it to settle out at a level at which everyone who isn't a technician or skilled artisan will starve to death.
So, do we serve capitalism, or does it serve us?
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I've often pondered on this, and as you say it's getting worse, I say it's going to get much better...why, you ask?
Cause old people are dying.
Sounds harsh, eh? But I ask you too keep in mind, oh readers, that the future is -us-, not them. I may be one of the few with this hope, but I plan on being a CFO one day. I've often talked to my fiancee's father, a current CFO. I realized in these conversations the raw gap between what is "taught" to my generation and what has been "taught" to his. What we "know"....what we are allowed to -think-...and we will be the ones running companies, creating technologies, and generally running the world.
You say as long as we hold on to old values, it'll get worse....I ask you then, what generation has never left their personal mark on history...either as a generation (hippies), or as a sub-set of said generation(geeks of the 80's)?
Look at the very day it is in America. MLK Jr. Day. I don't think I need a better example than that. In his day, blacks were inferior. Look at us today...we find that idea to be backwards in most of society. And that's 60 years. 60 years is not even a lifetime in the modern age.
It will get better...if we make it better.
There are some factors working against this, though. The aging population which has well-paying, high-knowledge jobs also tends to have access to superior healthcare and can expect to hold on to the positions they're in for another decade or two at least. I remember when I was studying engineering in college I checked out undergrad internships and co-ops, and the latest trend seems to be for engineering and tech companies to take on new, young workers in unpaid internships performing high-knowledge tasks. These young interns who are about to leave their engineering schools with ABET certifications may still find themselves in unpaid internships, waiting for the older workers to retire or die (which may take some time, people are retiring or dying later and later these days). Will it work out in the end? Maybe, but it's going to be a rough ride initially for those young engineers and scientists.
I'd also like to point out the hippies and 80s tech lords have had HUGE impacts on our society. While I'll admit many of the goals the hippie movement set out to accomplish flopped, they revolutionized the way we consider social liberties and other cultures. And the geeks of the 80s ushered in wonderful things like this very internet. While I get you were responding to the bit about tossing out old ideas, your example was kinda wrong. At the end of the day, any idea can have merit regardless of how old it is, so long as its a reasonable idea that conforms with facts and gets good results.
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The wealthy would be well advised to invest in seeking a financially healthier population. Impoverishing the other classes tends to lead to them eventually deciding to try other means for improving their lot than the legal, never a good thing for the class with the most to lose. And despite the attempts by some to believe otherwise, capitalism is not a system that tolerates cronyism forever. Continue to deprive your workers of enough to live on, and you will find that none can afford what you sell.
The issue is, with automation, you don't necessarily need to sell anything, hell, where you don't necessarily even need workers. When your entire top to bottom production chain is automated from raw materials to finished product, you can just leave the people behind like you would a worn out factory. I think this could create a very dangerous Elysium-esque schism in the population, where the very rich basically tell the rest of us to fuck right off and die. If they have everything they need, and the process of them getting everything they need doesn't require us anymore, what value do we have, to them?
The problem with capitalism is that it relies on the assumption that those with the money need those without it to generate their wealth. But if they don't need us, then capitalism falls apart. This is maybe not so immediate a problem, but its going to become more and more of a problem over time. Its already starting to become a problem now. If Walmart could automate every one of its stores, do you think the Walton's would lose any sleep over firing every one of their employees? I doubt it. Even when the situation becomes such that no one can afford to buy anything, then those things will just stop being sold. We'll be sold goods of less and less value, given less and less to work with. Look at places like the dollar stores that are all over the place. Selling crap that by many accounts should never have been made in the first place. Things made poorly because that's all people can afford. As we can afford less and less, the value of the products being sold to us will decline further and further.
We will be scraped and scraped until there's nothing left to take from us. And then, while we die in the streets, our foreclosed homes sitting empty, those who were wealthy enough to raft themselves onto the ship that is complete automation? They'll just sit back and watch. They'll inherit the future that should have been meant for all of us, because they were too selfish and too focused on the short term to share and in the long run it just won't affect them. They won't have to live with it. We will.
Be wary of saying "post-scarcity". Scarcity is, in many ways, logically necessary in this universe. Even if everyone could have a galaxy to themselves, that would not mean that several someones wouldn't want a particular galaxy over others. What we are entering is a period where people are being systematically deprived of the ability to make enough money to support themselves, and where the protections on workers have largely been stripped away. If we had continued the pattern established earlier in the century, we would probably be down to a 30 hour work week. Of course, with globalization (which, if we want to be fair, is necessary), we probably couldn't do that, but we certainly wouldn't be working longer and longer hours for less and less.
You're right of course, that unless we all had entire universes to ourselves or some other such impractical nonsense, we can't make everything available to everyone, but what we can do and in my mind, should do is make enough available to everyone. Of course, we all might have different ideas of what is enough. What does someone need to survive? What does someone need to thrive and live happily as a human being? What do we consider living well and do we as a society want to make sure everyone lives well? If we could make sure everyone had food, housing, clothing, and medical care by putting them all in grey prefabricated concrete blockhouses, would that be what we want? Would we be okay with that? Do people need more then that? Do they need communications, access to the internet, the ability to express themselves and explore creative and scientific endeavours?
I believe that the best society we can hope to achieve is one where someone has the resources to dedicate their lives to working on something they enjoy. Taking on tasks they feel passionate about, not because those tasks need to get done but because the people doing them want to be doing them. We should be fostering a society where scientists and engineers and inventors and artists and innovators are cherished and supported. A society that encourages people to pursue the things they are passionate about, instead of the things that the system requires in order to function. The increasing levels of automation are going to eventually reach a point where nothing needs to get done. Where no one will need to collect the trash and deliver the mail and work in the factories. Because the trash will collect itself, the mail will deliver itself, the factories will run themselves. This may seem like some sort of insane pipe dream but I believe it could be something we achieve in as little as 30 to 40 years. We are approaching a threshold now, where the systems we had in place because things required people to do them start to leave the people behind. And yes, as you said, we have to ask ourselves, do we serve capitalism, or does it serve us? In the past, it was a mutually beneficial arrangement. The work got done, a tremendous amount of wealth was generated, and people who would have had nothing were able to live very well. But now that system has run its course, and is accelerating past us. We are approaching the point where capitalism no longer serves us, and we merely serve it. Acting as organic cogs just waiting to be replaced by synthetic parts.
I would note that we do not have other economic systems that could potentially work in place of capitalism.
Maybe its time to change that. Its been 150 years since anyone proposed a radically new economic model. The models we have, the systems we have, are all made under the assumption that people are a critical step in creating the things we need. But that's more and more rapidly ceasing to be the case. Capitalism, communism, even socialism. These are becoming increasingly outdated systems built upon premises that no longer apply in our automated and global world. I think its time for something new. Everything is on the table. For the sake of our futures, and our children's futures. We have to be willing to put aside our parents tools, and start to construct our own.
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The issue is, with automation, you don't necessarily need to sell anything, hell, where you don't necessarily even need workers. When your entire top to bottom production chain is automated from raw materials to finished product, you can just leave the people behind like you would a worn out factory.
I guess that's one way to create a post-scarce society, eh? Just boot-strap the process off the labor of others :(
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The primary issue, it seems to me, is that any future solutions are of no use to those in dire straits at this very moment. Yes, I think it is likely that technological advances will eventually balance themselves out to the point of making human existence less costly instead of merely making corporate existence less costly, but this is of no comfort to someone currently struggling to exist.
One cannot preach individualism for the present but community for the future. Either you are willing to structure society for the community in this moment or you are selling platitudes for the future in order to placate the justified indignation your current individualism causes in those around you.
This.
So much this.
Marry me? Seriously?
THIS.
Can I quote this?
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The issue is, with automation, you don't necessarily need to sell anything, hell, where you don't necessarily even need workers. When your entire top to bottom production chain is automated from raw materials to finished product, you can just leave the people behind like you would a worn out factory. I think this could create a very dangerous Elysium-esque schism in the population, where the very rich basically tell the rest of us to fuck right off and die. If they have everything they need, and the process of them getting everything they need doesn't require us anymore, what value do we have, to them?
A good question, to which I think there are a couple responses.
The first is that, essentially, the rich could almost be said to have reached this point already. Most wealth is in the hands of a very few. They don't need us for most things. Why do they continue to seek wealth? Well, because they don't just want to be richer, they want to be better. Better than the other guy, better than the competitor. Why? Because we're humans, we wouldn't have made it this far as a species if we weren't competitive. If we're lucky, that'll get us into space. Of course, then you have to deal with the ones who aren't competitive, just greedy...
So, to the second, let me point out that if none of us can buy things from Wal-Mart, something very bad is going to happen to Wal-Mart. Wal-Mart won't suddenly be able to get income from somewhere else - it will fold, and all the people who owned parts of Wal-Mart will be in financial trouble insofar as they were exposed to it. The rich, even those in the financial sector, base their economies on us, on our consumption. Who is going to buy the iPods, the cars, and so forth, that make the rich, well, rich?
And that's not to mention the fact that automation cannot actually handle many of the tasks necessary for the rich to survive, from custom craftsmanship to raw resource extraction.
But suppose you are right. Suppose that every job that humans can do is automated. What then? Well, the fun thing is that if you can do that, then there's no reason that you can't use that automation to make your own life better. So the rich have 3d printers? So what? I and my friends will get one together, and print ourselves what we need.
And yet, I agree that your worries are valid. Not because capitalism is failing us - not that we have much of capitalism in the United States anymore - but because I take issue with this statement, in an odd way:
They'll inherit the future that should have been meant for all of us, because they were too selfish and too focused on the short term to share and in the long run it just won't affect them. They won't have to live with it. We will.
There is no such thing as a future that is meant for all of us. There are no such things as innate human rights. There is no such thing as justice. There is no principle that the powerful violate, no over-arching ideal.
But there is power. The point of what we see, for most of those who would exploit us, is power. Financial power, political power, the exercise of power. That's why your proposed future is possible, because it won't be automation that crushes us, if it comes in the manner you speak. Give free people that sort of access to technology and they'll be colonizing the asteroid belt, if that's what it takes to find a job. If automation crushes us, it will be because those who utilize it saw it as an opportunity to remove the threat that the majority of humanity could always exercise: that of simple non-compliance.
So we only have those rights which we fight for. And that is a political problem, not an economic one. Capitalism works, or, at least, welfare capitalism does. Why isn't it working? Because it is sabotaged by those with personal interests in getting rid of it.
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To your second point: what do we owe people, simply for being people?
Nothing. It neither breaks my heart nor picks my pocket if someone in the Sudan dies from starvation. Or, to put it in the Adam Smith analogy, if you were to find that you were going to lose your leg tomorrow, your would likely be far more upset by that than by the fact that several thousand children died today, in rather excruciating circumstances. Some will deny this, but the test of caring is in action, and few if any sacrifice everything they love and enjoy just to save lives they do not know.
On the other hand, perhaps I should care quite a lot. That child might have been a possible Einstein, or his death might spark a revolution that could harm my interests, or there might be innumerable other advantages that might accrue to me if he lived. If it costs me nothing, why wouldn't I want him to live?
So, perhaps we are not obligated to save a life, or to make it better - just as you are not obligated to jump into an ice-cold lake to save a drowning man - but it does seem pretty decent of us to give it a shot, so long as it doesn't cost us too much. Fortunately, you have posited a society in which helping others costs us essentially nothing. And, given that little fantasy, which I admit would be nice if true, it would naturally follow that we could help everyone as much as possible. Nothing, being an infinite, allows for infinite help if the cost is nothing.
Well, what becomes the currency in that case? The currency becomes ideas and inventions, art and science. If the trash collects itself, then what people will want and pay for are better and more artistic trash collection methods, as well as aforementioned limited-by-nature items (coastline property, for instance). Capitalism will still exist, only the products will change. Even given infinite resources, time and ideas will still be limited.
Maybe its time to change that. Its been 150 years since anyone proposed a radically new economic model. The models we have, the systems we have, are all made under the assumption that people are a critical step in creating the things we need. But that's more and more rapidly ceasing to be the case. Capitalism, communism, even socialism. These are becoming increasingly outdated systems built upon premises that no longer apply in our automated and global world. I think its time for something new. Everything is on the table. For the sake of our futures, and our children's futures. We have to be willing to put aside our parents tools, and start to construct our own.
To this I am tempted to point out that almost every time someone in charge has taken the above seriously, quite a lot more people have died than was strictly necessary. But I think a more...reasonable approach is in order.
I'm not a Marxist, because I have studied Marx, and his theories do not correspond to reality. But he had good historical points, as well as sociological ones, and one point he made, whether he knew it or not, was that capitalism was an organic system.
That is to say, capitalism was not designed. It grew out of the feudal and mercantile eras without anyone particularly coming up with the idea that it should. In fact, many did not think it should. Yet, it triumphed anyway. It triumphed because it was the most efficient and natural method for people to relate to each other economically.
So to say that capitalism is outdated or founded on any premises is, I think, to miss the point. Capitalism isn't a system that anyone sat down and chose, it is a system that arose despite the efforts of many to squelch it. It did not beat out socialism, feudalism, Marxism, corporatism, and other systems because it was imposed - although it can be imposed - it beat out those systems because it was simply what people did when not acted upon by state control of property. We are very fortunate that it can be harnessed to collective aims. We were very stupid, as a species, to think ourselves capable of over-riding it.
Now this is the mistake people make: when I say that capitalism should serve us, and not we it, I do not mean that we are free to institute whatever economic system we wish. We are not, unless you are willing to embrace a forcible control of people that must expand beyond any terror of automation you might care to name. You could no more suspend the laws of natural selection than you can change economic behaviors by fiat.
Yet, the laws of evolution did not cause us to shrug, decide that whatever bad happened was necessary to the natural order, and thus remain ever in stasis. Rather, humanity found that it could tailor certain organisms, by those same laws, to its own ends. Similarly, we live by economic laws that entail capitalism, and will continue to entail it as long as limited goods (of any particular kinds) exist, but that does not mean that we must live tooth and claw economically. Capitalism, like natural selection, is an engine of titanic and incomprehensible power, subtle and brutally strong, but if we are aware of it, if we understand it, it can make us unimaginably better off.
But the ability to do that is a political decision. It has always been a political decision, a decision about power. And capitalism is not uniquely corruptible. Feudalism was, in essence, one long continuous barbaric orgy of exploitation. Slavery lasted for thousands of years, and not always for pure economic convenience. Socialism, fascism, and attempts at communism are already infamous for their callous treatment of humanity. No, whatever economic system we have, it will always be susceptible to the weak, pathetic mirror of our will to compete and dominate - that is to say, our fear, our terror of defeat, our sadism, and our desire to crush the other in the vain hope that by doing so we will be exalted.
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The issue is, with automation, you don't necessarily need to sell anything, hell, where you don't necessarily even need workers. When your entire top to bottom production chain is automated from raw materials to finished product, you can just leave the people behind like you would a worn out factory. I think this could create a very dangerous Elysium-esque schism in the population, where the very rich basically tell the rest of us to fuck right off and die. If they have everything they need, and the process of them getting everything they need doesn't require us anymore, what value do we have, to them?
A good question, to which I think there are a couple responses.
The first is that, essentially, the rich could almost be said to have reached this point already. Most wealth is in the hands of a very few. They don't need us for most things. Why do they continue to seek wealth? Well, because they don't just want to be richer, they want to be better. Better than the other guy, better than the competitor. Why? Because we're humans, we wouldn't have made it this far as a species if we weren't competitive. If we're lucky, that'll get us into space. Of course, then you have to deal with the ones who aren't competitive, just greedy...
So, to the second, let me point out that if none of us can buy things from Wal-Mart, something very bad is going to happen to Wal-Mart. Wal-Mart won't suddenly be able to get income from somewhere else - it will fold, and all the people who owned parts of Wal-Mart will be in financial trouble insofar as they were exposed to it. The rich, even those in the financial sector, base their economies on us, on our consumption. Who is going to buy the iPods, the cars, and so forth, that make the rich, well, rich?
That's because the economy right now is based on consumption. But I mean, lets look at what the rich are hailing as the ultimate way to make the economy work. 'Trickle down' economics. The corporate puppet that has become the Republican party supports it because it makes their funders happy. (http://www.ted.com/talks/lawrence_lessig_we_the_people_and_the_republic_we_must_reclaim.html) I don't think the rich are stupid. They have a lot of power and a lot of very smart economists to advise them. Trickle down clearly doesn't work for generating wealth, it deprives the lower classes of their purchasing power and thus deprives the wealthy of the markets they use to generate their wealth. This doesn't make sense, and I can't think that those very wealthy people with their very smart economists would just be blindsided by it. Clearly they have some ulterior motive for extracting all the wealth out of the lower and middle classes.
And that's not to mention the fact that automation cannot actually handle many of the tasks necessary for the rich to survive, from custom craftsmanship to raw resource extraction.
But suppose you are right. Suppose that every job that humans can do is automated. What then? Well, the fun thing is that if you can do that, then there's no reason that you can't use that automation to make your own life better. So the rich have 3d printers? So what? I and my friends will get one together, and print ourselves what we need.
Except that you don't own the 3d printer, or the raw materials. And if every job is automated, you'll have no income, no purchasing power, and never be able to buy the raw materials or the printer, or the electricity it needs to operate, or the internet required to get the open source plans for what you want to print. And that's the other insidious thing. The people who still have the jobs won't think they need to prepare for the jobless future, so they won't help economically prop up those who have lost their jobs, and won't see it as worth their time until they too are thrown off the bus.
And yet, I agree that your worries are valid. Not because capitalism is failing us - not that we have much of capitalism in the United States anymore - but because I take issue with this statement, in an odd way:
They'll inherit the future that should have been meant for all of us, because they were too selfish and too focused on the short term to share and in the long run it just won't affect them. They won't have to live with it. We will.
There is no such thing as a future that is meant for all of us. There are no such things as innate human rights. There is no such thing as justice. There is no principle that the powerful violate, no over-arching ideal.
But there is power. The point of what we see, for most of those who would exploit us, is power. Financial power, political power, the exercise of power. That's why your proposed future is possible, because it won't be automation that crushes us, if it comes in the manner you speak. Give free people that sort of access to technology and they'll be colonizing the asteroid belt, if that's what it takes to find a job. If automation crushes us, it will be because those who utilize it saw it as an opportunity to remove the threat that the majority of humanity could always exercise: that of simple non-compliance.
So we only have those rights which we fight for. And that is a political problem, not an economic one. Capitalism works, or, at least, welfare capitalism does. Why isn't it working? Because it is sabotaged by those with personal interests in getting rid of it.
You make a good very good point here, and I think it validates even further what I said above.
To your second point: what do we owe people, simply for being people?
Nothing. It neither breaks my heart nor picks my pocket if someone in the Sudan dies from starvation. Or, to put it in the Adam Smith analogy, if you were to find that you were going to lose your leg tomorrow, your would likely be far more upset by that than by the fact that several thousand children died today, in rather excruciating circumstances. Some will deny this, but the test of caring is in action, and few if any sacrifice everything they love and enjoy just to save lives they do not know.
On the other hand, perhaps I should care quite a lot. That child might have been a possible Einstein, or his death might spark a revolution that could harm my interests, or there might be innumerable other advantages that might accrue to me if he lived. If it costs me nothing, why wouldn't I want him to live?
So, perhaps we are not obligated to save a life, or to make it better - just as you are not obligated to jump into an ice-cold lake to save a drowning man - but it does seem pretty decent of us to give it a shot, so long as it doesn't cost us too much. Fortunately, you have posited a society in which helping others costs us essentially nothing. And, given that little fantasy, which I admit would be nice if true, it would naturally follow that we could help everyone as much as possible. Nothing, being an infinite, allows for infinite help if the cost is nothing.
Well, what becomes the currency in that case? The currency becomes ideas and inventions, art and science. If the trash collects itself, then what people will want and pay for are better and more artistic trash collection methods, as well as aforementioned limited-by-nature items (coastline property, for instance). Capitalism will still exist, only the products will change. Even given infinite resources, time and ideas will still be limited.
You're absolutely right that our ability to care for people decreases with distance. As much as it pains me to know that people are starving and dying and getting shot, I'm not willing to throw away everything I have to help them (though I have been sort of seriously considering joining the Peace Corps). Dunbar's Number is a bitch like that. However, we're also rational agents, capable of looking at the situation, with thousands of people dying of starvation and dehydration and poisoned water and sectarian violence and go 'I don't approve of this'. If we create a situation such where it takes very little more then this to start bringing about change, it'll happen. We're not there yet of course, but we can dream. The question becomes then, how do we get to there from here. How do we cross that gulf from artificially induced scarcity to manufactured abundance? Because that's the crux of it. We have the tools to start building that world today. We have the resources and the technology, its just that its all controlled by those with vested interests in keeping the rest of us in check to maintain their power.
Maybe its time to change that. Its been 150 years since anyone proposed a radically new economic model. The models we have, the systems we have, are all made under the assumption that people are a critical step in creating the things we need. But that's more and more rapidly ceasing to be the case. Capitalism, communism, even socialism. These are becoming increasingly outdated systems built upon premises that no longer apply in our automated and global world. I think its time for something new. Everything is on the table. For the sake of our futures, and our children's futures. We have to be willing to put aside our parents tools, and start to construct our own.
To this I am tempted to point out that almost every time someone in charge has taken the above seriously, quite a lot more people have died than was strictly necessary. But I think a more...reasonable approach is in order.
I'm not a Marxist, because I have studied Marx, and his theories do not correspond to reality. But he had good historical points, as well as sociological ones, and one point he made, whether he knew it or not, was that capitalism was an organic system.
That is to say, capitalism was not designed. It grew out of the feudal and mercantile eras without anyone particularly coming up with the idea that it should. In fact, many did not think it should. Yet, it triumphed anyway. It triumphed because it was the most efficient and natural method for people to relate to each other economically.
So to say that capitalism is outdated or founded on any premises is, I think, to miss the point. Capitalism isn't a system that anyone sat down and chose, it is a system that arose despite the efforts of many to squelch it. It did not beat out socialism, feudalism, Marxism, corporatism, and other systems because it was imposed - although it can be imposed - it beat out those systems because it was simply what people did when not acted upon by state control of property. We are very fortunate that it can be harnessed to collective aims. We were very stupid, as a species, to think ourselves capable of over-riding it.
Capitalism arose yes, after 200,000 years of it not arising from hunter gather society. Sure its been with us for the entirety of our journey out of the stone ages, but I think its a bit of a stretch to say it is innate to human nature. It is a very good system yes, but its a system that can, and is, easily manipulated by those in power. Maybe you're right though, maybe I have a more jaded view of capitalism because what I see people call capitalism is really nothing but a tarted up oligopoly with big 'capitalism' 'freedom' and 'patriotism' stickers branded all over it. However, I think something else to note is that while capitalism did evolve, the times continue to change. The world that capitalism evolved within, where individuals make good and sell them locally, is by and large no longer the case. Globalisation has disrupted the supply and demand so much that all the demand can be supplied by relatively few people, who rake in all of the wealth generated on the backs of those they can pay very little. I think its important that we continue to let our economic system evolve, and not get stuck on capitalism. There is not 'best' in evolution, evolution doesn't work like that. There is only best suited to its environment, and I posit that capitalism is no longer fit for the environment it operates out of, and needs to evolve to fit the changing world.
Now this is the mistake people make: when I say that capitalism should serve us, and not we it, I do not mean that we are free to institute whatever economic system we wish. We are not, unless you are willing to embrace a forcible control of people that must expand beyond any terror of automation you might care to name. You could no more suspend the laws of natural selection than you can change economic behaviors by fiat.
Yet, the laws of evolution did not cause us to shrug, decide that whatever bad happened was necessary to the natural order, and thus remain ever in stasis. Rather, humanity found that it could tailor certain organisms, by those same laws, to its own ends. Similarly, we live by economic laws that entail capitalism, and will continue to entail it as long as limited goods (of any particular kinds) exist, but that does not mean that we must live tooth and claw economically. Capitalism, like natural selection, is an engine of titanic and incomprehensible power, subtle and brutally strong, but if we are aware of it, if we understand it, it can make us unimaginably better off.
But the ability to do that is a political decision. It has always been a political decision, a decision about power. And capitalism is not uniquely corruptible. Feudalism was, in essence, one long continuous barbaric orgy of exploitation. Slavery lasted for thousands of years, and not always for pure economic convenience. Socialism, fascism, and attempts at communism are already infamous for their callous treatment of humanity. No, whatever economic system we have, it will always be susceptible to the weak, pathetic mirror of our will to compete and dominate - that is to say, our fear, our terror of defeat, our sadism, and our desire to crush the other in the vain hope that by doing so we will be exalted.
That's a very poetic sort of cynicism there. I'm not sure I can disagree with it, but by the same token, I believe that our will to compete and dominate are products of the worlds we were raised in, not some innate property of humans. The human mind is incredibly malleable, and we have gotten out of it what we have put into it. We've put into it competition for resources, war, greed, racism, sexism...none of these things are innate. No one is born a racist, its something taught, its a learned behaviour. And it can be unlearned. Maybe we're too far gone, but our children, and their children? They still have a chance, if we decide to get off the cycle of violence that we've been party to.
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The primary issue, it seems to me, is that any future solutions are of no use to those in dire straits at this very moment. Yes, I think it is likely that technological advances will eventually balance themselves out to the point of making human existence less costly instead of merely making corporate existence less costly, but this is of no comfort to someone currently struggling to exist.
One cannot preach individualism for the present but community for the future. Either you are willing to structure society for the community in this moment or you are selling platitudes for the future in order to placate the justified indignation your current individualism causes in those around you.
This.
So much this.
Marry me? Seriously?
THIS.
Can I quote this?
Sure.
Edit: To the quote bit, I mean. >.>
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Supposedly, the combined wealth of the richest 85 people in the world, is greater than the combined wealth of the poorest 3.5 Bn people.
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Supposedly, the combined wealth of the richest 85 people in the world, is greater than the combined wealth of the poorest 3.5 Bn people.
To be fair, the poorest 3.5 billion people in the world make our homeless in the U.S. look like they're living in the lap of luxury.
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Supposedly, the combined wealth of the richest 85 people in the world, is greater than the combined wealth of the poorest 3.5 Bn people.
To be fair, the poorest 3.5 billion people in the world make our homeless in the U.S. look like they're living in the lap of luxury.
Its still not right. If what Vikarion says above about there being no objective morals and us having to impose our ideals on the world if we want them to come about, then I definitely think we need to impose some sense of justice for the downtrodden. It isn't right for people to have to live like that.
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Heh lol. I am in a situation that made me think of this this morning again. Weirdly, I have a job and earn a bit above the minimum wage with a master degree (which means the minimum wage since I pay standard taxes where minimum wage people do not). So I am looking for somewhere to live, you know, because with my little salary i'm very happy to have, I am supposed to be able to afford by myself my own apartment.
But the lol thing is that even with a salary, you can't find somewhere that is cheap enough for your salary not to choke to death. What is the most ludicrous in that situation, is to earn your life with a job, and still be "homeless" (I do not live in the street lol, i'm grateful to have other alternatives...), because those fucking rents are stupidly expensive, and even if you can manage to pay them, the owners won't let you in because you don't earn 3 times the rent per month. :bash:
Fucked up world.
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Heh lol. I am in a situation that made me think of this this morning again. Weirdly, I have a job and earn a bit above the minimum wage with a master degree (which means the minimum wage since I pay standard taxes where minimum wage people do not). So I am looking for somewhere to live, you know, because with my little salary i'm very happy to have, I am supposed to be able to afford by myself my own apartment.
But the lol thing is that even with a salary, you can't find somewhere that is cheap enough for your salary not to choke to death. What is the most ludicrous in that situation, is to earn your life with a job, and still be "homeless" (I do not live in the street lol, i'm grateful to have other alternatives...), because those fucking rents are stupidly expensive, and even if you can manage to pay them, the owners won't let you in because you don't earn 3 times the rent per month. :bash:
Fucked up world.
It's weird like that. Now that women are in the workplace, rents and housing prices have inflated because people are earning enough money between them. It really leaves single people, or couples with one stay-at-home partner, out in the cold. I make about 2300 dollars a month, which isn't anything to sneeze at. If I lived on my own, I'd be shelling out half of that for a one-bedroom apartment and my Wrangler alone. Not counting internet, utilities, or food, just rent and car would be about a thousand dollars a month. God only knows how people with kids manage it.
Even when I was working at Target though and my wife and I were barely making it, I was happy to be in the U.S. It's not the best place in the world to live, but there are a lot of places that have it way worse. I spent almost an entire year's free time watching documentaries about failed states and underdeveloped nations. I'm thankful every day that I didn't end up being born homeless in Haiti. They've got it worse than anyone I know here.
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The question becomes then, how do we get to there from here. How do we cross that gulf from artificially induced scarcity to manufactured abundance? Because that's the crux of it. We have the tools to start building that world today. We have the resources and the technology,
Faith/trust. Our current economy relies on it, and for another one to prosper, enough people need to have faith in it.
A lot of people that are born into this economy almost see it like it's as much part of the world like gravity, and other economies are quite alien to them, if they've even considered there could be other ones.
The current concept of possession and abstraction of wealth are my biggest issues with our current economy.
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Supposedly, the combined wealth of the richest 85 people in the world, is greater than the combined wealth of the poorest 3.5 Bn people.
To be fair, the poorest 3.5 billion people in the world make our homeless in the U.S. look like they're living in the lap of luxury.
Its still not right. If what Vikarion says above about there being no objective morals and us having to impose our ideals on the world if we want them to come about, then I definitely think we need to impose some sense of justice for the downtrodden. It isn't right for people to have to live like that.
Did you ever think about the peace corps or something similar? They don't give you much spending money, but they pay for food and lodging and send you out to help people. A buddy of mine I went to school with graduated with me in 2008, right at the beginning of the credit crunch. He went into the peace corps and ended up helping to design and build modular sun shelters in South Africa.
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The question becomes then, how do we get to there from here. How do we cross that gulf from artificially induced scarcity to manufactured abundance? Because that's the crux of it. We have the tools to start building that world today. We have the resources and the technology,
Faith/trust. Our current economy relies on it, and for another one to prosper, enough people need to have faith in it.
A lot of people that are born into this economy almost see it like it's as much part of the world like gravity, and other economies are quite alien to them, if they've even considered there could be other ones.
The current concept of possession and abstraction of wealth are my biggest issues with our current economy.
Let us not forget that our society as it is now seems to fail to understand that money, by itself, has no value. It only has value for as long as you can use it to buy something. The value of money scales in proportion of the amount of goods available for purchase. Seriously, what the hell? Why are you hoarding all that money for its own sake?
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Supposedly, the combined wealth of the richest 85 people in the world, is greater than the combined wealth of the poorest 3.5 Bn people.
To be fair, the poorest 3.5 billion people in the world make our homeless in the U.S. look like they're living in the lap of luxury.
Its still not right. If what Vikarion says above about there being no objective morals and us having to impose our ideals on the world if we want them to come about, then I definitely think we need to impose some sense of justice for the downtrodden. It isn't right for people to have to live like that.
Hey now. I never said there was no objective morality. As long as we can admit that we want to get away from the worst possible world, as long as we are forced to admit that our well-being is a desired end, objective facts about how humans can and should behave can be determined.
What I said is that there are no human rights, no mandated principles, no karma or justice. That is to say, it is a bit of a near-dialectical question, with my intention to point out that the world, as the world, does not carry anything within it that would dictate what humans ought to or ought not receive. You have no right to health, to food, to shelter, or even to life. These things are seized, wrested from the environment. It is not different because we now live in skyscrapers, cities, and towns.
Therefore, rather then "the future that ought to have been ours", we are better to say "the future we should have taken for ourselves".
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In my opinion, we don't need more jobs.
We need to "work" less, and live more - as in concentrating on what you like and what is important.
I've always been of the belief that this sort of society we are living in, is not the highest form of society that humans can achieve.
Not that his solves the issue on topic, but it gives me a sense of calm when I rather work less hours a week, get paid less, to actually do things I want to do instead of just working 9-5 because that's the norm.
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In my opinion, we don't need more jobs.
We need to "work" less, and live more - as in concentrating on what you like and what is important.
I've always been of the belief that this sort of society we are living in, is not the highest form of society that humans can achieve.
Not that his solves the issue on topic, but it gives me a sense of calm when I rather work less hours a week, get paid less, to actually do things I want to do instead of just working 9-5 because that's the norm.
It also depends on the country you live in. Workers here with minimum wage can not work more thn 35h per week. And everyone has access to 5 paid weeks of vacations per year with social healthcare, where most companies also help employees pay their complementary health insurance (well, not all of them sadly :/).
They somehow did that in the past to supposedly decrease unemployment, but it puts so much strain on companies that it's not the miracle solution either, though i'm still glad to have such conditions. Anyway, they could afford it because individual productivity was high enough (just behind the US which are among the most productive in the world), and it actually helped to bolster that productivity even higher to compensate (compared to poor or mediocre productivities like very work intensive hours like in Japan).
Eventually everything to me hints towards a progressive decrease in work hours overall. But how will society adapts to it remains a big question.
The question becomes then, how do we get to there from here. How do we cross that gulf from artificially induced scarcity to manufactured abundance? Because that's the crux of it. We have the tools to start building that world today. We have the resources and the technology,
Faith/trust. Our current economy relies on it, and for another one to prosper, enough people need to have faith in it.
A lot of people that are born into this economy almost see it like it's as much part of the world like gravity, and other economies are quite alien to them, if they've even considered there could be other ones.
The current concept of possession and abstraction of wealth are my biggest issues with our current economy.
Let us not forget that our society as it is now seems to fail to understand that money, by itself, has no value. It only has value for as long as you can use it to buy something. The value of money scales in proportion of the amount of goods available for purchase. Seriously, what the hell? Why are you hoarding all that money for its own sake?
It is not even money or capital that creates value. From what I hear the real value, which means more than 99% of the real capital flowing around is constituted of debt.
Debt generates value. Every time a debt is created, value is created. Without debts every bank would go bankrupt, thus the economy with it.
Heh lol. I am in a situation that made me think of this this morning again. Weirdly, I have a job and earn a bit above the minimum wage with a master degree (which means the minimum wage since I pay standard taxes where minimum wage people do not). So I am looking for somewhere to live, you know, because with my little salary i'm very happy to have, I am supposed to be able to afford by myself my own apartment.
But the lol thing is that even with a salary, you can't find somewhere that is cheap enough for your salary not to choke to death. What is the most ludicrous in that situation, is to earn your life with a job, and still be "homeless" (I do not live in the street lol, i'm grateful to have other alternatives...), because those fucking rents are stupidly expensive, and even if you can manage to pay them, the owners won't let you in because you don't earn 3 times the rent per month. :bash:
Fucked up world.
It's weird like that. Now that women are in the workplace, rents and housing prices have inflated because people are earning enough money between them. It really leaves single people, or couples with one stay-at-home partner, out in the cold. I make about 2300 dollars a month, which isn't anything to sneeze at. If I lived on my own, I'd be shelling out half of that for a one-bedroom apartment and my Wrangler alone. Not counting internet, utilities, or food, just rent and car would be about a thousand dollars a month. God only knows how people with kids manage it.
Even when I was working at Target though and my wife and I were barely making it, I was happy to be in the U.S. It's not the best place in the world to live, but there are a lot of places that have it way worse. I spent almost an entire year's free time watching documentaries about failed states and underdeveloped nations. I'm thankful every day that I didn't end up being born homeless in Haiti. They've got it worse than anyone I know here.
From what I hear around here it's mostly a problem tied to speculation and not so much to single/couples. It's true it plays a huge role but prices are not rising so much because of the presence of working couples, but mostly due to speculation.
A law passed recently to heavily tax owners selling their estate property less than 20 years after they bought it, to precisely avoid speculation.
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It is not even money or capital that creates value. From what I hear the real value, which means more than 99% of the real capital flowing around is constituted of debt.
Debt generates value. Every time a debt is created, value is created. Without debts every bank would go bankrupt, thus the economy with it.
Oh, its even worse then that. The economic mess we are in is really just the tip of the iceberg and it could get a whole lot worse if we don't come to a screeching halt right now and start figuring out a new way of doing things.
To do a bit of explaining, to make it clear exactly why things are much worse then they look on the surface right now, to understand all of this mess, you need to understand one term, its called a derivative. A derivative is any financial instrument which is derived from the inherent value of something else that's tangible. In other words, an ear of corn has value, a barrel of oil has value. If you have a house and a mortgage, that's fine. When you start doing mortgage backed securities, packaging and bundling, that's a derivative.
There are right now, derivatives with a notional value worth over 700 trillion dollars (http://www.forbes.com/sites/stevedenning/2013/03/17/three-essential-measures-to-make-banks-safe-again/). In other words, if everyone cashed out at once, you would need to have 700 trillion in cash, and of course there isn't that much money.
So you had all of these hedges and derivatives and puts and calls, and in all this, all anyone cared about was making the minimum monthly payment on their credit card bill. In other words, to service the 700 trillion dollars in notional value derivatives, they had to pay a certain amount of cash every month, and God forbid they should all come due. What happened with all of these bailouts, which are now around 12.2 trillion in the US if you add them all up, (http://www.nytimes.com/interactive/2009/02/04/business/20090205-bailout-totals-graphic.html) is the government chasing a 700 trillion dollar derivatives bubble down the drain.
There are only three things only anybody needs to know about the way money works around the world today.
One. Fiat currency (http://en.wikipedia.org/wiki/Fiat_currency). What is money? Its not a resource, its a piece of paper. Its only a symbol, it doesn't equate to anything in the real world, it's fiat, it has no more real value then monopoly money. It's created out of thin air because somebody turned on a printing press. Before 1933 in the US, we had the gold standard. You could go into a bank and get your paper money exchanged for gold coins. In the UK, There was time when the pound sterling actually meant a pound of sterling silver. With rare metal backed currencies, there was only so much gold or silver out of the ground, it was tangible, you couldn't print gold,(http://i.imgur.com/SY5gIVG.jpg) (http://www.dezeen.com/2013/11/27/ross-lovegrove-designs-3d-printed-gold-jewellery/) it was something real. You cannot print more money than there is energy to back it up. It's that simple.
Two. Fractional Reserve Banking (http://en.wikipedia.org/wiki/Fractional_reserve_banking). If I were a banker, and you were to bring me in a 10 dollar deposit, I could make 90 dollars worth of loans off of just those 10 dollars in my drawer. It's all calculated on the premise that not everybody is going to come in and want all their cash all at once. That's called a run on the bank (http://en.wikipedia.org/wiki/Bank_run), and its what happened at the crash of the 1930s. So, the financial masterminds of this system have calculated the odds, and said "ok, well, under normal conditions, the odds of this happening are very low." So when I lend now a total of 100 dollars based on that 10 dollar deposit, that's money that I create out of thin air. That means that, in order to pay off the loans whoever gets that money has to make more money still to feed it at the bottom to pay the bank, so that the bank can create still more money.
Three. Compound interest (http://en.wikipedia.org/wiki/Compound_interest). In simplest terms, compound interest is money added into the principle of a loan for the servicing of the loan, giving the lender money for the opportunity cost of lending money out. So the borrower has to make more money to feed money back to the lender so they can lend out more money to make still more money. You know, in both the Bible and the Qu'ran, there are passages forbidding the taking of interest on loans. Of course, the religious right pays no attention to the passage in Leviticus saying not to collect interest (http://www.biblegateway.com/passage/?search=Leviticus+25:36-37) while they zero in with a laser guided focus on another passage (http://www.biblegateway.com/passage/?search=Leviticus+18%3A22) from the same section of the bible because it justifies their homophobia. Anyway, after all collapse of the credit card bubble and the housing bubble, I think I can pretty safely say that most of us know how compound interest works. The higher the interest rate on your credit card, for those people who had 20-25% cards, that means they're creating that much more money, if they don't pay cash every month.
What I have just described, is a pyramid scheme. We live in an infinite growth paradigm, which requires growth forever. It's not that Bernie Madoff was a pyramid scheme, or Stanford was a pyramid scheme, the entire economy is a pyramid scheme. The whole global economy cannot be sustained, it requires infinite growth.
The human species cannot grow forever. We do not have the resources on Earth for it and our space programs are underfunded and decades behind where they'd need to be to make the difference by going to space. We live on a finite planet with finite resources, and we're using an economic model that requires us to grow forever or the whole system collapses. The entire world is in debt to itself, there is no real money left, its all debt. If all the debts came due every country on earth would be bankrupt tomorrow. Its a very complex problem.
Iceland dealt with it the right way. They reformed their government, threw their bankers in jail, forgave their loans (http://www.bloomberg.com/news/2012-02-20/icelandic-anger-brings-record-debt-relief-in-best-crisis-recovery-story.html), and are now further into their economic recovery then anyone else. We in the US haven't forgiven the loans, haven't pursued criminal charges against any of the banks, and no one is even talking about the possibility of changing the fundamental issues with the system that led to the crisis, and is leading us towards a bigger crisis. We cannot pay off our loans, there is more debt then there is money and so the loans will never be paid. We cannot make the money we need to pay of the loans because that requires the creation of more debt in order to do. The system is broken in a very fundamental way. We're dealing with a long term structural crisis in the way we arrange our economic and financial systems. It wasn't as big of a deal when we had cheaply and easily accessed frontiers and new resources were constantly being found to tap. But we're beginning to run up against the hard limits of what our planet can provide. We don't even need to pollute the world to screw ourselves at this point. All we have to do is run out of oil or some other vital resource.
So you have finite energy and you have a financial paradigm which demands infinite growth and we're rapidly approaching the point of human history where the infinite growth paradigm collides with something that is more powerful than money is.
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When I was reading your essay about how the economy works, Saede, I had a hard time understanding how any of this is supposed to work. None of this made any logical sense as a properly functioning economic system. Then I read down further and I realised, that's exactly why it isn't working!
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When I was reading your essay about how the economy works, Saede, I had a hard time understanding how any of this is supposed to work. None of this made any logical sense as a properly functioning economic system. Then I read down further and I realised, that's exactly why it isn't working!
To be fair, it isn't the monetary system that isn't working, it's that we've evolved, as a society, to view employment, housing, food, and so on as basic human rights, which in a way they are. Back before we decided that poverty was a societal problem, it was thought that poverty was just what you deserved for not working.
This makes it a problem because money is meant to be a standard unit of value, which isn't a problem either. We use completely arbitrary measures for everything else, so a dollar is essentially a portion of the estimated worth of the United States. When our debt rises, we print more money to compensate. If you guess just right and you print exactly enough money to meet the calculated growth of your country's GDP, nothing happens. When you print more, the same dollar is worth less because it's worth a smaller percentage.
I'd say your biggest problem is the stock market and what it represents. The problem is that a company isn't allowed to just float in place, it has to not just make a profit, but make a continually increasing profit to pay new investors. Otherwise, their stocks don't rise in value, they just sit their accruing their tiny bit of the profit of the company. So if your company makes a bigger profit, but it's not big enough to meet investor expectations, you can still be in trouble.
Which is why you randomly see people laid off. They have to make that profit and growth quota.
Unfortunately, the system does work for a specific purpose, it's just not meant to benefit the little guy. The more money you have, the easier it is to make. People who have a ton of money and invest it may find it impossible to ever run out. If you don't have money, all these problems we're talking about are omnipresent. However, once you have a lot of money, it's exceptionally easy to make more.
Unlike a lot of people, I'm not sure the system is completely non-functional or fundamentally flawed. It's just that the switches and levers that should equalize wealth aren't being pulled, because they're operated by the more affluent in society. If they wanted to, they could equalize the wealth gap tomorrow at the expense of stock market profits simply by removing tax loopholes, highly grading the income tax, killing the sales tax, instituting a high minimum wage, and essentially shutting down the stock market.
There's a larger debate on not just whether that's possible or if we'll even want to do that, but whether it's fair. It does become a question of whether it's a crime to be rich and whether some people deserve to be impoverished.
I don't have the answers for that. However, the system is incredibly flexible and can, if we need it to, work to fix the problems we have. It's just that the people who have control of those systems don't think of it as a problem to have downward pressure on wages and employment at the bottom.
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If they wanted to, they could equalize the wealth gap tomorrow at the expense of stock market profits simply by removing tax loopholes, highly grading the income tax, killing the sales tax, instituting a high minimum wage, and essentially shutting down the stock market.
Removing tax loopholes :D
Highly grading the income tax :D not having the tax brackets stop at under $500k and including capital gains (maybe I misunderstood)
Killing the sales tax :| While I understand it reduces the cost of items to consumers, I think there is a need for a sales tax on none essential items. I still want someone buying a McLaren sports car to pay heavily for it.
Instituting a high minimum wage :ugh:
In a global economy, this creates all kinds of complexities. If I am running a company based in the US and I want to manufacture an item, I have a few choices. I can build a factory in the US that has 100 people providing the labor (at said higher minimum wage). I can build a factory in Mexico, China, or India that has 100 people providing labor (at a fraction of the labor cost of the US). I can build an automated factory in the US and pay a maintenance team to keep it up and running (cost may vary versus the other two options).
So, unless we are imposing a not insignificant tariff on goods made in places like China or India, in order to enable an American based company to compete, then this is a hard one for me to simply back. I think there are plenty of reasons to impose such a tariff on Chinese made products beyond providing a competitive market for US based industry, for example a lack of environmental regulation in China.
essentially shutting down the stock market :| I think the stock market has an useful purpose. However, that purpose is now a secondary to the derivatives market and constant need for growth demanded by uninterested shareholders. Initial Public Offerings are important and useful in my opinion, as it provides a mechanism to borrow against the company to increase the company's productivity. The problem is the need for quarter to quarter growth demanded by those who are not making investments, but rather buying and selling in the margins. Perhaps the introduction of a law reducing the rate of sales would be beneficial for everyone outside of those who make their paychecks as day-traders. Something like having to retain shares for 6 months to a year, making it more of an investment.
The Red-Green-Blue Mars trilogy (http://en.wikipedia.org/wiki/Mars_trilogy) is actually about the transition from hypercapitalism to a new society. They have events which drive the need for change beyond recognition that things are bad. However, I think it may provide a potential model to at least look at for the future - extensive Coops that are member owned, size restricted, management is hired in vs owning the Coop. Larger projects/products, require a Coop of Coops to get it done.
Understanding what the end-goal is, for example, an environmentally-compatible, egalitarian society, then understanding what steps can enable a transition to that society is critical. A revolution, while likely to achieve the goals short-term, seems to fail to achieve the goal, simply replacing one oligarchy with another. Somehow we have to transition from the 3-months (economic), 2-year (political), thought processes to achieve change.
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If they wanted to, they could equalize the wealth gap tomorrow at the expense of stock market profits simply by removing tax loopholes, highly grading the income tax, killing the sales tax, instituting a high minimum wage, and essentially shutting down the stock market.
Removing tax loopholes :D
Highly grading the income tax :D not having the tax brackets stop at under $500k and including capital gains (maybe I misunderstood)
Killing the sales tax :| While I understand it reduces the cost of items to consumers, I think there is a need for a sales tax on none essential items. I still want someone buying a McLaren sports car to pay heavily for it.
Instituting a high minimum wage :ugh:
In a global economy, this creates all kinds of complexities. If I am running a company based in the US and I want to manufacture an item, I have a few choices. I can build a factory in the US that has 100 people providing the labor (at said higher minimum wage). I can build a factory in Mexico, China, or India that has 100 people providing labor (at a fraction of the labor cost of the US). I can build an automated factory in the US and pay a maintenance team to keep it up and running (cost may vary versus the other two options).
So, unless we are imposing a not insignificant tariff on goods made in places like China or India, in order to enable an American based company to compete, then this is a hard one for me to simply back. I think there are plenty of reasons to impose such a tariff on Chinese made products beyond providing a competitive market for US based industry, for example a lack of environmental regulation in China.
essentially shutting down the stock market :| I think the stock market has an useful purpose. However, that purpose is now a secondary to the derivatives market and constant need for growth demanded by uninterested shareholders. Initial Public Offerings are important and useful in my opinion, as it provides a mechanism to borrow against the company to increase the company's productivity. The problem is the need for quarter to quarter growth demanded by those who are not making investments, but rather buying and selling in the margins. Perhaps the introduction of a law reducing the rate of sales would be beneficial for everyone outside of those who make their paychecks as day-traders. Something like having to retain shares for 6 months to a year, making it more of an investment.
The Red-Green-Blue Mars trilogy (http://en.wikipedia.org/wiki/Mars_trilogy) is actually about the transition from hypercapitalism to a new society. They have events which drive the need for change beyond recognition that things are bad. However, I think it may provide a potential model to at least look at for the future - extensive Coops that are member owned, size restricted, management is hired in vs owning the Coop. Larger projects/products, require a Coop of Coops to get it done.
Understanding what the end-goal is, for example, an environmentally-compatible, egalitarian society, then understanding what steps can enable a transition to that society is critical. A revolution, while likely to achieve the goals short-term, seems to fail to achieve the goal, simply replacing one oligarchy with another. Somehow we have to transition from the 3-months (economic), 2-year (political), thought processes to achieve change.
I'm just saying, the tools exist to fix the issues right now. Just that those are switches no one wants to flip for those exact reasons.
That's actually why I kind of like the concept of the Eurozone and hope we can move in that direction. Having a unified set of labor laws and having those laws form the basis of joined economies would be nice. It's not going to happen anytime soon, but it would be nice if everyone had the same minimum wages, taxes, and whatnot. I'm very post-nationalist.
I suppose you have to start at the bottom, though. Before we fix our situation, we'd need to make sure people in Africa aren't subsisting on less than a dollar a day and with no access to any kind of education.
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Well, sometimes the most wealthiest among us put their wealth into doing amazing things.
Bill Gates Talks to TIME About the Three Myths of Global Aid (http://science.time.com/2014/01/21/bill-gates-talks-to-time-about-the-three-myths-of-global-aid/#ixzz2rA0Ehtxl)
Look at the numbers. If you go back to 1800, everybody was poor. I mean everybody. The Industrial Revolution kicked in and a lot of countries benefited, but by no means everyone. Even in the 1950s and 1960s, most countries were very poor. India, China, Africa, everyone but the West was living on less than $2 a day per capita. But the curve is shifting and incomes are rising and now most of those countries have $5- to $10-a-day-type incomes. That doesn’t sound like much, but it’s per person not per family and the key thing is purchasing power, which can be quite high on $10 per day in a country in which things cost much less. Living on $6 a day means you have a refrigerator, a TV, a cell phone, your children can go to school. That’s not possible on $1 a day.
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Quick, everyone become artists! The machines won't have souls for at least another 50 years! That's just enough time to get rich and retire!
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(http://www.smbc-comics.com/comics/20111213.gif)