Wednesday, January 1, 2014


The main force behind steadily falling wages and working conditions is a population boom that has been deliberately created by the rich in order to increase competition for jobs, which drives wages down for the many, while increasing both profits and social power for the rich. 

But the rich don’t want the obvious effects of their policies discussed, because that might result in people organizing to oppose them, so you humans are treated to a steady stream of ridiculous ideas designed to distract and confuse.

For example, there are those pundits who claim that the problem in the labor market is not too many people, but rather automation reducing the need for labor.  A generation ago many high tech goods were made on semi-automated assembly lines in the high-wage United States.  Today they are assembled by hand in vast hangars where 40-cents-an-hour workers are jammed side by side like battery hens.   Just look at the world: the factories in Asia are not automated, they are operated by vast numbers of poorly paid people doing the work by hand.  Overall we are seeing more handwork and less automation in the production of most industrial goods.  Saying that automation is the problem is like standing in the middle of the Pacific Ocean and claiming with a straight face that boats can no longer float because they have run out of water.  How much does a neoliberal economist have to get paid to utter this nonsense, anyhow?

There have been times in the past, for example when automated looms were first developed, that automation had a big impact on the labor market, but that was a special case and a long time ago.  For some commodities, like nails, automation is so efficient that nobody will ever mass-produce nails by hand no matter how cheap labor gets.  There are also some processes, like precision welding, where human labor is just not accurate or repeatable enough.  But as a general rule, automation does not lower the value of labor, rather, automation is a reaction to expensive labor.  Because automation is so expensive, it typically does not depress the value of labor to any significant degree.

Suppose a human oligarch has a business making shirts.  If he wants to make the shirt in an automated factory, he will need to invest a vast amount of capital in automated machinery.  Even if everything works well, he will have to wait years before he has recouped his investment and he starts making a profit.  And there is a lot of risk: the factory might not work, or the need for the factory might change leaving him with an expensive white elephant.  If labor is dear, factory owners will put up with automation, but it’s not their first choice.  If labor is cheap enough, a business owner can rent a big shed, hire a bunch of people that he hardly needs to pay more than subsistence, and have them sewing away.  There is minimal investment, the owner can make a profit almost on day one, and if things go wrong he just closes up the shop! 

If a million dollar automated shirt-sewing machine breaks, the owner needs to get it fixed and that can be expensive both in direct costs and also in lost production.  If a sweatshop worker gets sick, he can just throw them out the door and replace them with someone else.  Easy!  Cheap!  More profitable even than slavery!  (You can’t just throw sick slaves away, because you would have to buy new ones, and slaves require the additional expenses of guards and chains).  Almost risk-free!  What’s not to like?

Ask yourself: if automation is causing wages to fall, how come we see the least automation in low-wage countries (India, Bangladesh) and the most automation in high-wage countries (Japan)?  That’s absurd, right?  This should be obvious: AUTOMATION DOES NOT LOWER WAGES.  AUTOMATION IS AN ADAPTATION TO EXPENSIVE LABOR, BUT BECAUSE AUTOMATION IS GENERALLY EXPENSIVE ITSELF IT DOES NOT SIGNIFICANTALY REDUCE WAGES.  That's why countries with the highest wages have the most automation, duh!

And ask yourself this: if automation is reducing the demand for workers, why are the American oligarchs screaming for an open-borders immigration policy that will import tens of millions of new workers in just the first decade?  Answer: because automation is NOT reducing the demand for labor.  The overall demand for labor remains high, and rapid increases in population are required in order to ensure that there remain more workers than jobs.

There are paid econo-whores out there who are simultaneously saying that automation is reducing the demand for workers, and that there is a need to import more foreign workers because there is a labor shortage and the jobs can’t be automated.  You know who you are.  Have you no shame, neoliberal scum?

Or try this: we keep hearing that an aging population is going to result in too many retirees and too few workers to support them.  Aside from the fact that this is a lie (compare the retirement plans in Switzerland to those in Bangladesh: how exactly is the 'shortage' of young workers in Switzerland a problem, exactly?), if automation is reducing the need for human labor, then surely an aging population is not a problem, right?  To claim that automation is reducing the need for workers, and then claim that there is a need for more young workers to deal with an aging population, is logically absurd.

As more and more of the world moves to low-wage low-capital investment high-labor content production, there will continue to be notable pundits blaming automation for poverty.  I envision that while blaming automation they are filmed in front of a Bangladeshi carpet factory where young children chained to the wall weave carpets by hand for 12 hours a day.  OK, maybe that’s too extreme a logical disconnect even for today: I envision them begin filmed in front of an archival video clip of an automated factory from the 1970’s that has since been closed and where the work is now done by hand in Malaysia.  Or maybe they will blame sunspots.  Or the music of Barry Manilow.  Or gay marriage.  For a professional flack paid to deflect attention from the real causes of poverty, reason doesn’t matter, just filling space with anything so long as it is not the truth.  It’s like jamming a radar: it doesn’t matter if the false images created by the jammer don’t make sense, there just have to be so many of them that you can’t separate out what’s real from what’s false in time. 

Practice skepticism, my poor little humans.  Think about what you are told, and whether it makes sense logically and whether it corresponds to what you see in front of you.  It’s your only hope.

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