16 February 2012

Automation and Guaranteed Minimum Income

Here’s a comment Glowing Face Man left on a blog post titled “It’s No Coincidence”:

You (and the supermajority of pundits) labor under the false assumption that everybody needs jobs, that a healthy economy involves 90%+ employment. This simply is not consistent with the reality of automation, it will become less and less consistent in coming decades. Immigration and outsourcing are small factors next to automation. Within a couple generations, almost everything is going to be automated, and a realistically healthy economy would have single-digit EMployment, rather than UNemployment. The proper fix is a completely unconditional universal guaranteed basic income.

I’ll be upfront about my biases as they relate to this subject.  First, as a Christian, I believe that man was created by God to work, and therefore it is wholly unnatural for man to not work, and therefore man will always need to have a way of working.  I also believe that the unemployment statistics are a useful—though imperfect—barometer of whether people are actually working, as would natural for them.  There are obviously some differences between the ideal of work and its reality, but they can be ignored for the time being.

Now, as to the topic at hand, it is entirely true that I assume that a healthy economy is one where everyone works.  But it is also true that those who argue for complete automation are making some assumptions of their own.  In many ways, the proponents of a guaranteed minimum on the basis of the automation of production (which renders human labor unnecessary) are making several assumptions of their own, some of which may or may not turn out to occur.

The first and most obvious assumption is that the current trend towards automation will actually continue.  If the business cycle is any indication, it is not only possible that the trend of automation ceases at some point in the future, it is likely.  Just as innovations in papyrus production were superseded by paper production, which was then superseded by the various digital formats, so too is it possible that the current trend towards automation may be superseded by something else altogether.

A second assumption is that advances in technology won’t hit a serious point of diminishing returns.  Imagine, for example, the sheer amount of technology that would be necessary to automate, say, apple picking or painting houses.  It certainly possible that these activities could be automated (i.e. it is within the realm of technical feasibility).  But it is not necessarily possible that it would be worth the R&D costs to automate these things.  And there are thousands of more activities similar to these that would have generally high costs of development.

A third assumption is that technology will able to interface with humans in such a way as to handle the vagaries and nuances of human interaction.  Which is to say, it is assumed that technology will be able to, say, address customer complaints (or, more broadly, customer emotions).

A fourth assumption, as it relates to the guaranteed minimum income, is that human ingenuity will not spread beyond its current state.  By this I mean that it is assumed that humans will not use the eventual automation of production as the foundation for expanding production into new, uncharted territory.  Stated another way, the automation of production could enable people to simply open up new frontiers of innovation and production that are not directly based on automation (i.e. open up another level of goods).

A fifth assumption is that the economy will not collapse and undo any of the current technological advances we currently enjoy.  Massive economic and cultural collapses usually correlate to technological collapses as well.  See the collapse of the Roman Empire for an example.  See also Neurodiversity for an in-depth look at the subject.

A sixth assumption is that status-seeking will no longer exist.  Quite simply, automation should lead to decreasing prices in what were once luxury goods (see:  the costs of silk stockings after the beginning of the Industrial Revolution).  Things that were once the province of the wealthy will become available to everyone.  As such, wealthy status-seekers will need to find a new way to demonstrate value, which simply turn into direct displays of controlling labor (the current model is an indirect display of controlling labor).  Alternatively, the market could invert back to increased demand for direct craftsmanship, like that which was once seen prior to the Industrial Revolution (Etsy seems to be an indication of this trend).  This could be easily accomplished with increasingly user-friendly CADs and 3D printers.

A seventh assumption is that human interaction won’t become an economic good.  If prostitution is any indication, there is no substitute for another human being.  Human nature, generally being a constant, suggests that there might always be demand for other people’s time, and might lead to people getting paid for it, which is simply a higher-order form of employment.

An eighth assumption is that technology will develop to the point where only a few people are needed to manage it.  Also, in keeping with this, it is assumed that GUIs won’t be dumbed-down enough to the point where non-engineers can manage them.  Given the massive amount of IT support needed to maintain this level of technology, it seems reasonable to conclude that increases in the ubiquity of technology will drive demand for IT, particularly as technology handles increasingly complex tasks.  Now, in response, the UIs of technology should dumb down to the point where non-engineers can solve basic problems  The cumulative effect of this will be an increase in demand for IT support while simultaneously enabling growth in the pool of potential labor candidates in this field.

As can be seen, there are a myriad of conditions necessary to see the complete automation of production.  It is certainly possible that all of them can be met; I will leave it to the reader to determine whether it is likely and whether, by extension, a guaranteed minimum income will be necessary.


  1. The logistics on deciding how much the universal income should be would be insurmountable. Can you imagine the political finagling that would go into setting the amount and revising it each year?

    The other problem is that human desires and wants are insatiable. Most would not be satisfied with the universal wage and would always clamor to have it increased.

    Also based in this proposal is that our current unemployment fiasco is a natural development based upon automation advancement. Nothing could be farther from the truth. If the USA still made all its consumables in house, we would have nearly full employment. Globalization has pushed only some of the jobs overseas. Our ruling elite and their lackeys are more than happy to keep their jobs here. For example, India has very sharp business managers who would make competent CEOs for only $100K a year instead of millions a year. Those jobs, however, are not outsourced.

    This proposal also assumes that even maintenance becomes automated. That we could approach the Krell in Forbidden Planet with a machine which could maintain itself for thousands of years. Anyone who has maintained a house or car or equipment in a factory would know how far we are from that.

  2. Sorry, am I rambling or making sense? Hard day at work today and am a bit stewed after hittin' the hooch.

  3. @Carnivore- Not to quibble too much, but there are limits to human desire; it's just that those limits far exceed our ability to satiate them. But yes, figuring the baseline for universal minimum income would be a disaster.

    I've written before on how government interference has distorted the time-preference for technological advancement, particularly in regards to automation. This development has been, in my estimation, quite unnatural, and has undoubtedly contributed to the current high unemployment rate.

    And you are making sense. My response to GFM was simply to point out that the assumption of the inevitability of automation (and the corresponding argument for a GMI) is based on several highly optimistic and unrealistic assumptions. It sounds rather technocratic to me, and also ignores human nature. It seems to me that you're simply extending my argument, and what you say makes sense to me.

  4. Thanks for the vibrant discussion and sorry I'm late to the party.

    You're absolutely right about work being virtuous. I think people will continue to work, it's just they won't do work for a paycheck. An example would be your writing this blog post.

    The issue of status-seeking is also very interesting. The way I see it, Guaranteed Minimum Income doesn't eliminate jobs, it just eliminates the requirement to have a job or be a societal outcast. If you want stuff which your minimum income can't buy, you're gonna need to get some other money somehow! However, if worst comes to worst, you shouldn't have to starve to death (anyway the price of cleaning up a starvation victim is higher than it would be to just feed them in the first place). Also you shouldn't have to choose between starving or doing something you find morally repugnant.

    But yeah, the one thing we can say for sure about the future is that a lot of futurists (including this commenter) are liable to be humiliated!! I'd argue my opinion about the assumptions on a case-by-case basis, but it'd be more productive to state a ninth assumption which, I think, is a much bigger obstacle: the assumption that the government won't generate tons and tons of makework in order to preserve the status quo. If I know you at, I hope at the very least I can count you as an ally in being opposed to THAT!

  5. @Carnivore: yes, the logistics problem is quite tough. It might require some new technology we can't even fathom right now but which would be easy to fathom once it's invented (like the way money itself went uninvented for millions of years despite being so obvious to us)?

    Yep human desire is insatiable, you have a good grasp on human nature. But at least losing the game of capitalism (possibly due to nothing but bad luck) should be punished like losing a game show, and not punished by starvation.

    I disagree w/your 3rd paragraph. Even in China where the manufacturing is supposedly shipped off to, I was reading recently, say in the clothing industry, China is producing more clothes than ever but actually employing much fewer people than before, and expect to cut even that away.

    And yeah, with maintenance there'd always be some workers needed. Just nowhere near the situation we have now where pretty much every single person is expected to have a paying job.

  6. Capitalism and free markets would also mitigate away from total automation. As unemployment increases, the price of labor must go down, making it more competative WRT automated labor. This happens until the price equals the lowest cost barrier, then the method with a cost advantage wins. Even if someone's basic needs are met by some form of universal wage from the government, that opens up labor for more marginally less useful things to be produced like art, craft, entertainment and liesure.

  7. @GFM- Well, you know you can count on me to oppose government make-work. I do think that's an important consideration, though, because people like to feel that they're necessary, so it seems likely that they would support initiatives that make them necessary. And never underestimate the power of Luddites.

    @Prof. Hale- Two things that make it hard to tell how labor prices will impact employment levels are inflation and minimum wage. I'd argue that minimum wage has contributed to the level of automation we see today. I don't see any reason for this trend to discontinue in the future, except for inflation.