put people out of work. What John Maynard Keynes called technological unemployment

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1 1 Rage Against the Machines Since the time of the Luddites people have raged against the machine revolutions which put people out of work. What John Maynard Keynes called technological unemployment referred to technological revolutions, economizing the use of labor such as the mechanization of railways which put half a million people out of work. Similarly, rotary phones made switchboard operators obsolete. Mechanical harvesters, plows and combines replaced traditional farmworkers. Similarly, the first steam-engine tractors replaced horses and oxen a century earlier. Many calamity prophets argued that automation would make the economy tank. The fear was that jobs were not coming back. Usually, however, while old jobs were lost, new ones were created to make up the lag. Of course, middle aged people or those lacking in the ability to make geographic shifts did suffer and had little chance of getting the new kinds of jobs. They needed attention through governmental support programs or even re-training programs. Two new books address the new machine age. Nicholas Carr in his 2014 book, The Glass Cage: Automation and Us ( Norton, 276 pp.) raises anew the rage against the machine as he considers how robots and algorithms are taking over and replacing jobs. This time he is not so sure there will be an increase in alternative jobs to take their place. Martin Ford, a Silicon Valley

2 2 entrepreneur has just seen his new book issued: Rise of the Robots: Technology and the Threat of a Jobless Future ( Basic books, 2015, 352 pp.). He doubts, in this second machine age, that the usual earlier way of addressing job loss and replacement by automation ( more training and education) will solve the problem now. He opts for a guaranteed annual wage for all able bodied workers in the United States ( Not much chance of that being enacted by our congress!). But both books underscore some key elements of Catholic Social Teaching, many of them strongly endorsed by Pope Francis. Work matters not just for the remuneration it brings, but also for the ways it gives a sense of meaningful societal inclusion and participation. Inequalities of a certain scale lead to a diminishment of true democracy as money rules politics. People do need a certain decent minimum of adequate housing, food, health care for their human dignity. It is no longer just manual labor which is being replaced by automation. Banking, logistics, some surgery, medical recordkeeping are just a few of the occupations that have already been given over to machines. As the cost of industrial robots has plummeted, manufacturing long open to automation and mechanization is now pursuing it apace. The Boston Consulting Group estimates that machines which now account for 10 percent of manufacturing tasks will likely form about 25 percent of them by Take an example from the automotive industry. A human spot welder costs about $25 an hour and a robotic one costs only $8 an hour. The robot also is faster and more accurate. As we know, the average airline pilot is actually at the helm of the plane for about three minutes per flight the rest is done by machine and algorithm controls. Xerox uses computers not people to select which applicants to hire for its call center. Amazon uses 15,000 robots to pull items off the shelf and pack boxes. A number of hotels are already being staffed by robotic desk clerks and rooms are cleaned by robotic chambermaids. Some airports use robots as valets for parking. Even when new jobs are created they do not

3 3 address the unemployment of people who are the wrong age cohort to take up the new jobs or to go where the new jobs are in terms of the geography of where jobs are being lost. Former Treasury Secretary, Lawrence Summers wrote in July 2014 for the Wall Street Journal: The economic challenge of the future will not be producing enough. It will be providing enough good jobs. Today there are more sectors losing jobs than creating jobs. And the general purpose aspect of software technology means that even the industries and jobs that it created are not forever. In a similar way, Carr describes the new computer technology. Computers can now parse thousands of pages of digitized documents in seconds. Using e-discovery software with language-analysis algorithms, the machines not only spot relevant words and phrases but also discern chains of events, relationships among people, and even personal emotions and motivations. A single computer can take over the work of dozens of well-paid professionals. The MIT economists, Eric Brynjolfsson and Andrew McAfee, both champions of automation, nevertheless, in their book about the new machine age ( The Second Machine Age: Work, Progress and Prosperity in a Time of Brilliant Technologies ( Norton, 2014 pp ) note the shadow side of the new machine age: Even the most beneficial developments have unpleasant consequences that must be managed. Technological progress is going to leave behind some people, as it races ahead. In a sense, automation leaves behind some people as it benefits greatly just a few as it races ahead. Note that of the fifteen wealthiest Americans, six own digital technology companies such as Microsoft. Nobel economist, Paul Krugman noted this same trend in an article in The New York Times: Smart machines may make higher GDP possible, but they will also reduce the demand for people including smart people. So we could be looking at a society that grows ever richer but in which all the gains in wealth accrue to whoever owns the robots.

4 4 As we know, in the United States, real wages have stagnated for four decades while corporate profits soar. 16 percent of men between the ages of eighteen and fifty-four and 30 percent of women of the same age were unemployed and a third of those unemployed attributed their joblessness to technology. The Economist saw the causes of this growing unemployment ( or people being employed in low paying jobs) : Recent research suggests that substituting capital for labor through automation is increasingly attractive; as a result owners of capital have captured ever more of the world s income since the 1980 s, while the share going to labor has fallen. Carr picks up a key notion found in Catholic Social Teaching. Work confers identity. How much does work matter for a sense of self-worth, identification and inclusion in society? Dean Baker, the director of the Center for Economic Policy Research, noted in an essay in The New York Times, that there were a 50 to 100 percent increase in death rates for older male workers in the years immediately following a job loss, if they previously had been consistently employed. Long ago, Mihaly Csikszentmihalyi in his book, Flow: The Psychology of Optimal Experience found that people were happier and more fulfilled by what they were doing while they were at work than during their leisure hours. Carr also notes that even when automation does not eliminate jobs, it often changes the nature of work. He points out that the wealth of information readily available on internet disinclines users from remembering what they have found out. Amit Singhal, Google s lead search engineer, has stated that the more accurate the machine gets at predicting search terms, the lazier the questions become. A study of flight pilots indicated that there is a direct correlation between a pilot s aptitude at the controls, and the amount of time the pilot spent flying without the aid of automation. It indicated that manual flying skills decay quite rapidly towards the fringes of tolerable performance without relatively frequent practice. In a similar

5 5 way, doctors who cede authority to machines to read x-rays and make diagnoses, architects who rely increasingly on computer assisted design programs, marketers who place ads based on algorithms, traders who no longer trade all suffer a diminution of the expertise which comes from experience. Thus, Carr states: As more skills are built into the machine, it assumes more control over the work, and the worker s opportunity to engage in and develop deeper talents, such as those involved in interpretation and judgment dwindles. When automation reaches its highest level, when it takes command of the job, the worker, skillwise, has nowhere to go but down. Basically Carr and Ford s books force us to ask three important economic and social questions. (1) How much inequality in a society is tolerable and what are the limits to expanding economic and social inequalities? Of course, people are unequal in skills, intelligence and efforts expended. There will always be inequalities in any society. But too great inequality, as Thomas Piketty argued in his important book, Capital in the Twenty-First Century, can erode societal solidarity ( social capital or the common good ). It can also undermine democratic values as the one man one vote principle shifts to a one dollar one vote principle. By most accounts the United States has now reached a level of intolerable inequality. We pay a deep price for that in diminished human capital and skills, as Robert Putnam notes in his new and important book, Our Kids: The American Dream in Crisis ( Simon and Schuster, 2015, 400 pp.) (2) For those permanently unemployed or severely underemployed, some serious efforts more than presently available in the United States are called for to provide a decent floor in housing, health care, food etc. for the people displaced by automation. This is the brunt of the argument in the Ford book. (3) Finally, remuneration or a decent minimal welfare system is not enough. Work matters because it provides meaning, community, purpose and dignity. As Catholic social

6 6 teaching insists, work is essential for a sense of true inclusion in the society. Sue Halpern, in a review of Carr s book in The New York Review of Books, concludes her review with these words: It is naïve to believe that government is competent, let alone in a position, to control the development and deployment of robots, self-generating algorithms and artificial intelligence. Government has too many constituent parts that have their own, sometimes competing visions of the technological future. Business, of course, is self-interested and resists regulation. We, the people, are on our own here though if the AI developers have their way, not for long.. If not rage against the machines, a careful analysis and control of their proliferation and its consequence is very long overdue in America.