Surplus to Society

Originally published at: Surplus to Society – Quillette

Workers are scarce and wages are rising. “The relationship between American businesses and their employees,” reports the New York Times, “is undergoing a profound shift: for the first time in a generation, workers are gaining the upper hand.” In the Guardian, John Harris writes that, “As consumer demand surges, hospitality businesses don’t have the staff…

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Automation is the constant focus of any enterprise, not just the manual labor or service economy. Anyone working in an office setting should be aware that if his or her job can be automated, it surely will sooner or later. This would involve any work that is repetitious in nature. I spent my career automating processes in software and IT. This is the focus of most consulting firms doing IT consulting as well. In terms of long term job security, the key for an employee is to be in a position that does not involve rote tasks. At the very least such workers will be under constant pressure of being replaced by lower paid employees or even losing their positions to outsourcing. Not all jobs can be automated, but to expect a high salary or wage doing repetitive work is unrealistic. On the up side, there are always plenty of jobs in automing processes, as processes are always evolving and improving. IT is the way to go for young people if they want secure and steady work. You don’t need an expensive degree, you just need to be ready to think and constantly adapt. No company can survive and compete without the efficiencies achieved by automation. It just won’t happen. In just 30 years time I saw amazing changes in what a single office worker can do with automation. Things that could not even be done in the 1980s with a team of experienced workers can now be done by an entry level worker at the click of the mouse with no thought. And yet, there are no fewer office workers now than before. Workers in offices will end up with much more time free from tasks and this could indeed cause much insecurity — when you are not busy you start to worry how long your job will be there. Jobs of this nature will gradually become temporary jobs. A worker should always be thinking of ways to find positions that require thinking and initiative. The jobs are there.

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More Utopian Nonsense, curtesy of the New York Times, The Guardian, and . . . John Lloyd.

May I please have my last seven minutes back?

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Interesting article, but shot through with some misconceptions.

I don’t know about the UK, but here in the US, we had the fastest hourly wage growth in 50 years in the Trump boom of 2017-early 2020. It will take a while for economists to pick this part, and it built on some strong wage growth in the 2012-15 period, to be sure.

The most striking thing about the most recent surge of wages is the amazing strength at the lowest end of the labor market. There’s little doubt that this has been due to the suppression of illegal immigrants in the labor market. Trump didn’t deport them in large numbers (although Obama did in the 2009-11 period, deliberately ignored or downplayed by the media). The Trump DoJ and other branches of the executive did put a lot of pressure on employers to not hire illegals, and the effect was stunning. That one action did more to ease income inequality in the US than any nonsense with “progressive” tax or other policy.

I suspect that there was the beginning of a trend about five years ago, accelerated by the COVID restrictions, toward “re-shoring” production, which has also played a role. The big tech monopolies set the pace with hourly wages in many areas, and the growing legal and political pressure on them seems to have affected their behavior toward their workers.

Overall, we may be seeing decline in the labor arbitrage strategy – driven by artificially low interest rates, artificial strength of the US dollar, extreme forms of leverage and financial engineering, off-shoring, high immigration both legal and illegal, declining small business formation, and neglect of investment and training – that has characterized the post-1990 globalization era. If it continues, this new trend will do real good for middle- and working-class America, particularly for younger workers. Beware of manufactured sideshows (like corporate “wokeness” and “DIE”) designed to distract our attention and keep voters and workers divided.

(I find it incredible that anyone keeps resurrecting discredited theories of “exploitation of the proletariat” that keep coming back after being repeatedly laid to rest by historians and economists. The source of industrial workers in the 19th century was the rural areas, and rural workers kept coming to the cities in the 19 century precisely because their wages were higher in the cities than in the countryside. Even Marx correctly noted this fact. There’s no appeal to the labor theory of value either, as that was already discredited back then – it’s a false, pre-modern, pre-scientific concept imported from Aristotle. It is true that urbanization generated its own set of problems – overcrowding from the concentration of workers and their families, easier spread of disease, cities unprepared for such large numbers. But in terms of wages, the “exploitation” claims are false.)

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A thoughtful and intelligent piece, reflective of many of the concerns raised by Andrew Yang’s 2020 Presidential Primary Run, which I found myself supporting for the simple reason that he did have some rather useful ideas like a Tobin-style tax on financial transactions, but was more important because of the general generosity with which he was willing to treat the political opposition in our toxic partisan landscape.

Instead of racism, sexism and homophobia, Russiagate, Hilary’s emails and a whole host of other conspiracy theories, he correctly intuited that the reason for the massive switch of blue collar voters in battleground states from Obama to Trump had more to do with the labour devastation caused by offshoring, trade deals and automation than all of the above. Little wonder then that the likes of MSNBC took every opportunity to sabotage his campaign, omitting him from graphics when lower polling mainstream politicians were included- because his narrative was a direct threat to their Hate Inc. anger economics business model.

Key to understanding the current political and cultural upheaval simmering beneath the Culture Wars, as a contributory root cause, is the realisation we have been rapidly switching out reasonable well-paid jobs manufacturing tradables for service jobs which have, until very recently, been extremely poorly paid. And in case you imagined automation wasn’t coming for you, AI can now design contracts better than any lawyer, it looks set to gut radiography as a profession and the entire finance sector will, in the next couple of decades, become little more than a job involving client hand-holding, with the exception of a few quants and qualified actuaries, operating in the stratosphere of the top 0.2% of mathematical ability.

But it’s not the only adverse economic factor pushing young people towards greater sympathy for Socialism. University fees have pushed the cost of education to the point it requires what amounts to a mortgage, through the massive expansion of administrators, corporate officers and extremely well-remunerated diversity officers. At the same time, housing in the and UK and US, already beset by antiquated, burdensome and archaic planning laws, has become the purvey of an emergent oligopoly with a small number of suppliers buying up the land in a practice known as land banking, and who have- at least in the UK- engaged in price gouging through deliberate undersupply.

This YouTube video by British Free Speech comedian, libertarian and cultural commentator Dominic Frisby is quite succinct and to the point on the subject:

He asks the question why one group of young people might be afforded the opportunity to settle down and have a family, whilst another is barred from doing so, when the only thing separating them is time- a matter of which generation they were born into? Who knew that housing would become the new appreciating asset class for the global rich, a form of up-front rentier economics facilitated by artificially low interest rates?

Don’t get me wrong, I think automation is a serious problem. History teaches us that although capitalism is a great reallocator of resources financially and in the long-run, it is less able to reallocate labour other than intergenerationally, with obsolete workers more often left to the generosity of the State and whatever charitable provision exists, than able to transition to new market opportunities, unless they happen to be bright, young, lucky or all of the aforementioned. It’s also led to any number of unstable periods of history, beset by system-wide political violence and destruction of property, only compounding the misery.

But however painful, it is the only thing powerful enough to push our civilisation forward, to lift us up from the wrenching poverty and brutal people necessity dictated we become. In two hundred years, it has led to roughly 85% of the world’s population being raised up from the most abject conditions subsistence farming or worse, malnourished, losing their teeth by 25, and their lives by 35.

Controversially, other than the Printing Press, it is also the engine of all social progress- recent evidence from China suggests that the people only begin to care about air quality and the environment when average earnings exceed $5K a year, and I’m sure we could find all manner of similar thresholds throughout history relating to slavery, the vote for women and racial/gender equality.

The problem, the new element in the equation, is the way the Twitter bubble has distorted the perceptions of our media class, coupled with the internet and social media. It makes serious problems like Climate Change seem far more apocalyptic than they actually are- and there is a symbiosis which occurs between the angst the young feel at the quite justifiable desperation they feel about their inability to acquire property and start a family, and their illusionary perceptions of the ills of the world, which are in recent times generally overly catastrophised and, in many instances, downright wrong.

It’s what makes people yearn for the totalitarian nightmare which Socialism always becomes, with its poverty inducing economic Armageddon and inclination towards mass murder. It’s why the regulatory burden needs to be shifted away from small businesses and onto the shoulders of large corporations, why we need to massively shift public expenditure away from universities and towards technical and vocational training, and why there needs to be radical reform to housing markets. Because without these changes the temptation of totalitarian Socialism will simply prove too much over time, leaving the next generation to inherit Hell on Earth at their own hands.

This comment will soon be included in my Substack in a more polished form, which is free to view and comment:

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Sadly, the number of workers who are capable of successfully handling positions that require both effective thinking and initiative is much less than half of any population.

What are you going to do with the 2/3 to 3/4 of the population that are not up snuff?

It does seem to be obvious that humans do not handle idleness, isolation and the lack of structure in their lives very well. It also seems obvious that as a rule people are not endlessly altruistic and will not usually assent to any serious degradation of their own circumstances so that the state may better subsidize the miserable existence of idle, ignorant and disorderly people whose chief contribution to the commonwealth is that they merely consume things for the benefit of the rentiers (who here in the US usually manage to pay no net tax at all) and to the detriment of whoever winds up being taxed to perpetuate this nonsense.

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The obvious answer is simply to limit the population. But that would be the death blow to both capitalism and socialism; so that won’t happen.

What will happen is a return a feudal sort of government where the top 5% rule, another 15-20% prosper or survive as useful servants to the ruling class and the rest are simply ignored.

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I am optimistic America will eventually return to a democratic form of government once the Biden regime falls. A government should be looking out for the general welfare of its people and the US has a “government” that is literally at war with its own people. We need to stop bringing in waves upon waves of migrants. We need to stop the type of woke crony capitalism that incentivizes corporations to outsource our manufacturing to China.

However, the cries against automation are misguided. The last thing we want is for government trying to stand in the way of innovation and efficiency.

My comment was more from a realistic perspective. I don’t actually desire constant change and insecurity. But it is the world we live in. We tend to have a paternalistic attitude toward workers in manual labor and services, as if it were somehow any different in the so-called white-collar world. It is not different and everyone is under the same pressure to adapt. There are plenty of skills to learn of all types for everyone. No one is exempt. People need to learn or fall behind. The world will pass them by. Life is hard, it always has been, and it is not going to suddenly get easier.

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But in your comment you said, and I really don’t disagree, almost all of those “skills" will soon be automated.

I understand your response to be what the Red Queen would have said - evolve or die because "it takes all the running you can do just to stay in the same place.”

Again, I don’t disagree but it is going to be very messy and the more you insist on automation, which only benefits the rentiers and vulture capitalists, the messier it’s going to be.

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At some point whatever resources are available will be convertible to stuff by only a few workers. It used to be that surplus workers would end up redeployed eventually in other stuff producing enterprise which is fine if resources are infinite, but they aren’t. There’s the ‘service’ economy too of course but that also is being automated. Nope, at some point the full employment paradigm will simply fail.

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