I’ve just read an interesting and provocative book (A World Without Work: Technology, Automation, and How We Should Respond; Daniel Suskind; Metropolitan Books, New York, 2020).
As the title suggests, this book discusses the possibility that the demand for human labour will permanently decline as the ability of machines to do tasks hitherto done by people continues to increase. Should this occur major shifts in social and economic organization and practices will be needed; education will need to focus less on preparation for labour force participation, and income will need to be distributed in different ways – more via the state and less by private organizations.
Suskind expands on the work of Brynjolfsson and McAfee (B/M).[1]
B/M argued that the prospects for the further expansion of digital technology are enormous, citing ‘Moore’s Law’ – that computing power will double annually at a constant price for the foreseeable future – and the fact that digitization has increased at a faster rate in the past couple of decades. Further, they argue that the prospects for associated productivity growth are equally large.
B/M take issue with those (Robert Gordon, Tyler Cowan) who argue that innovation, technical progress and therefore productivity growth, are slowing down as the growth stimulated by the major 19th century innovations and inventions such as electricity is exhausted. They argue that, just as the invention of steam power and electricity were what they call General Purpose Technologies (GPT), i.e. “deep new techniques that have potential for important impacts on many sectors of the economy”, so is information and communications technology (ICT). Like GPT’s such as the invention of steam power and electricity, they argue that ICT is pervasive, will improve over time and is able to spawn new innovations. Steam revolutionized transportation and electricity changed everything including allowing the possibility of the digital revolution!
Susskind takes issue with the conventional argument that, as humans are displaced by machines, wages will decline thereby creating an “incentive for companies to invent new tasks for humans to do…. It is an ingenious thought. But if it is right, it raises a new puzzle: Why did this mechanism not help out horses as well? The answer is that new tasks were not created for horses because their capabilities had been exhausted.” (p.121)
So, he argues, as Keynes did almost 100 years ago[2], that we humans will need to adapt in the way we live our lives, to find new ways of distributing income and of occupying our time.
Susskind argues that, in a world with less work, the value of human capital will decline so that income will increasingly accrue to the holders of non-human, or physical, capital. “A world with less work, then, will be a deeply divided one: some people will own vast amounts of valuable traditional capital, but others will find themselves with virtually no capital of either kind.” (p.135)
He then notes that such a world will look like a more extreme version of the “one we live in today”, in which there is substantial and growing income and wealth inequality, and notes that society has the power to shape such ‘economic divisions’. This is an issue that Keynes did not deal with, implicitly assuming away the income distribution problem. The remainder of Suskind’s book consists of a discussion of the income distribution problem and possible solutions.
The traditional solution to unemployment is occupational and geographical mobility, the former being dealt with by education and training. But, argues Susskind, “it is hard to escape the conclusion that we are heading toward a world with less work for people to do. The threat of technological unemployment is real”. So, says Susskind, “to solve the distribution problem in the future, we need a new institution to take the labor market’s place. I call it the Big State.” (p.168)
There follow discussions of:
- methods by which tax and transfers can be used to redistribute income;
- ways of regulating ‘big tech’ companies and internet content;
- the relationship between work and meaning, how do we deal with a ‘world without work’.
Discussing the latter issue Susskind argues that we need to revisit “the role of education beyond basic workplace competence.” But all of that said, he argues that “any society that allows those without a job to fill all their time with idleness, play, or unpaid work as they alone see fit” is “likely to fall apart”. That’s why Susskind advocates what he calls a “conditional basic income”. It is a universal basic income, “but one that requires its recipients to do something in return”. This would mean that activities such as caregiving, for example, could receive recognition in a way they do not at present.
More fundamentally the disappearance of economic motives and necessities that drive employment require that “we will need to revisit the fundamental ends once again. The problem is not simply how to live, but how to live well. We will be forced to consider what it really means to live a meaningful life.” (p.236)
A provocative and well written – and argued – assessment of where we are and where we may well be going. It’s definitely plausible that he has the direction right. Whether the ride will be smooth is an open question; given the present direction of politics in many industrial countries it is difficult to be optimistic!
[1] Erik Brynjolfsson, Andrew McAfee; The Second Machine Age: Work, Progress, and Prosperity in a Time of Brilliant Technologies, W.W. Norton, New York, 2014.
[2] In an essay published initially in 1927 titled ‘Economic Possibilities for our Grandchildren’ Keynes stated “We are being afflicted with a new disease of which some readers may not yet have heard the name, but of which they will hear a great deal in the years to come – namely technological unemployment. … “. He recognized, however, that “if the economic problem is solved, mankind will be deprived of its traditional purpose. … Will this be a benefit? If one believes at all in the real values of life, the prospect at least opens up the possibility of benefit. Yet I think with dread of the readjustment of the habits and instincts of the ordinary man, bred into him for countless generations, which he may be asked to discard within a few decades.”