Minimum Wage: What's the Other Argument?

[rah]

Because we can build a better society. Because the profit motive is an extremely powerful one, and there is simply no reason not to use it as a force for a better society.

I understand why the status quo is the way it is. I'm arguing that it can (and has to) change, not just for the betterment of society, but for the long-term health and profitability of the corporations themselves. The kind of planning needed to ensure this is not something corporations are equipped to handle, nor is it the kind of planning they can legally do.

I've been an executive at many of these global corps, and I have given up any hope of that happening. At least in the old days "long term" actually held some sway, but it doesn't anymore. SHORT term profit to look good usually seems to be the driving force for decision making. Bonus plans set up based on it are dangerous because it just reinforces that type of thinking. Beware how you incent your workforce.

The only good change I've seen is the recognition of how positive public opinion does impact profits which has let to considerably more charity work and some better public policy. In the old days it used to take someone that actually cared about society, now the bean counters pretend to also.

 

[metalhead]

I've been an executive at many of these global corps, and I have given up any hope of that happening. At least in the old days "long term" actually held some sway, but it doesn't anymore. SHORT term profit to look good usually seems to be the driving force for decision making. Bonus plans set up based on it are dangerous because it just reinforces that type of thinking. Beware how you incent your workforce.

This is exactly my point. One of the downsides to automation replacing human employees, is that human employees that earn income create demand for goods and services. Fewer people employed means that in the aggregate, there is lower demand for the goods corporations produce, which in the long term is bad for the bottom line. However, the vast majority of corporations are incapable of planning for this, both because of human nature and because the profit motive is immediate.

This is why you need government to step in, and impose regulations and possibly taxes that ensure that consumers still have capital with which to create demand for goods. Our economy depends on it. Whether this is by shortening work weeks significantly, requiring more extensive employee leave, raising taxes to provide a UBI, or some other way is a point for debate, but the need to adapt to the new economy is fast approaching. It is in everyone's best interest that corporations adapt to the best of their ability.

 

[Lexicus]

Certainly in the US the corporations (briefly) got on board with demand planning because the benefits to business were seen to outweigh the cons.

 

[Commodore]

This is exactly my point. One of the downsides to automation replacing human employees, is that human employees that earn income create demand for goods and services. Fewer people employed means that in the aggregate, there is lower demand for the goods corporations produce, which in the long term is bad for the bottom line. However, the vast majority of corporations are incapable of planning for this, both because of human nature and because the profit motive is immediate.

This is why you need government to step in, and impose regulations and possibly taxes that ensure that consumers still have capital with which to create demand for goods. Our economy depends on it. Whether this is by shortening work weeks significantly, requiring more extensive employee leave, raising taxes to provide a UBI, or some other way is a point for debate, but the need to adapt to the new economy is fast approaching. It is in everyone's best interest that corporations adapt to the best of their ability.

Or we go through a brief period of hardship as with any transitional phase in history, and allow automation to become so prevalent that the average person won't need capital to purchase goods. Eventually, if we allow it, we will be able to create machines that can produce just about anything we could want with zero input from humans. Even maintenance, programming, and production of the machines can be handled by other machines. And since we won't have to pay the machines to do all this work for us, that means the cost of goods will effectively drop to zero. After all, machines don't have profit motive.

 

[sophie]

I don't think you're properly comprehending how absolutely brutal that transitional phase is going to be.

 

[Tahuti]

And since we won't have to pay the machines to do all this work for us, that means the cost of goods will effectively drop to zero. After all, machines don't have profit motive.

I'm a little bit worried a design flaw in the AI could make them use up every resource available and create an Easter island problem.

I don't think you're properly comprehending how absolutely brutal that transitional phase is going to be.

We are already in a transitional phase. If the economy shrinks, the transition will be easier to negotiate.

 

[metalhead]

I don't think you're properly comprehending how absolutely brutal that transitional phase is going to be.

Exactly. If not properly managed by the government, it could be devastating.

I mean, look at what happened when the government failed to properly manage the emerging capital markets in the beginning of the 20th century. It led to a decade-long depression. And it's fair to wonder whether, without what was in effect massive stimulus spending in the form of a fully mobilized war effort, we would have pulled out of it when we did.

 

[El_Machinae]

Or we go through a brief period of hardship as with any transitional phase in history, and allow automation to become so prevalent that the average person won't need capital to purchase goods. Eventually, if we allow it, we will be able to create machines that can produce just about anything we could want with zero input from humans. Even maintenance, programming, and production of the machines can be handled by other machines. And since we won't have to pay the machines to do all this work for us, that means the cost of goods will effectively drop to zero. After all, machines don't have profit motive.

It's very possible for the story to end well, but it's not a natural outcome of the current system. In the current system, layoffs precede price drops. Wealth in all three forms (debt paper, money, and property) moves upwards with each turn of the wheel.

Now, historically, the uber rich give ~2% of their income to charity. But it's not guaranteed that trend will hold when 7 billion people are utterly dependent on charity.

More on topic, minimum wage is not the appropriate tool for automation concerns. It doesn't help at all. Price floors have a history of not working

 

[Commodore]

I'm a little bit worried a design flaw in the AI could make them use up every resource available and create an Easter island problem.

Even that wouldn't be a problem. If all the resources on Earth get used up, the machines can start mining resources from the rest of the solar system since they would be able to operate in environments that humans can't.

I don't think you're properly comprehending how absolutely brutal that transitional phase is going to be.

I do, I'm just not so selfish as to put my own comfort and security ahead of the prospect of a better world for future generations. Which is really what all this boils down to: selfishness. People now aren't willing to sacrifice what they have now so the future generations of people won't have to make those sacrifices. I mean, to build that dream world of the future, someone's going to have to pay the price and bear the burden of the transition, might as well be us.

 

[sophie]

We aren't talking a little bit of sacrificed comfort here, we're talking massive, generation(s)-spanning ratcheting unemployment followed by the largest, bloodiest revolution the world has ever seen, and even then I could see a Luddite reaction happening just as easily as I could the advent of the technological singularity.

 

[Lexicus]

I do, I'm just not so selfish as to put my own comfort and security ahead of the prospect of a better world for future generations. Which is really what all this boils down to: selfishness. People now aren't willing to sacrifice what they have now so the future generations of people won't have to make those sacrifices. I mean, to build that dream world of the future, someone's going to have to pay the price and bear the burden of the transition, might as well be us.

Sure, because millions and millions unemployed for the sake of individual profit means it's actually the unemployed who are selfish.

 

[Commodore]

Sure, because millions and millions unemployed for the sake of individual profit means it's actually the unemployed who are selfish.

I'm talking about a world in which machines run and produce everything so there is no longer a need for any type of currency to exist. How is that individual profit?

Or are you just ignoring the content of my posts and just making the argument you want to make anyway?

We aren't talking a little bit of sacrificed comfort here, we're talking massive, generation(s)-spanning ratcheting unemployment followed by the largest, bloodiest revolution the world has ever seen, and even then I could see a Luddite reaction happening just as easily as I could the advent of the technological singularity.

Except the Luddites have no chance of winning. Robot soldiers and police would, by their very nature, be superior to human soldiers in every way. So if the Luddites attempted some anti-technology revolution, I see the legions of robot enforcers putting it down very quickly. I imagine it would look similar to that scene in the movie "I, Robot" when the civilians attempted to fight back against the robot takeover. The people had various forms of firearms and improvised weapons and the completely unarmed robots dispersed the mob rather quickly.

 

[El_Machinae]

I see no implicit reason the transition needs to be brutal. There's no inherent goodness in making the transition more painful

 

[Commodore]

I see no implicit reason the transition needs to be brutal. There's no inherent goodness in making the transition more painful

Nor do I. If it is brutal though, I suspect it would be the Luddites that would make it so by resisting the transition.

 

[Lexicus]

I'm talking about a world in which machines run and produce everything so there is no longer a need for any type of currency to exist. How is that individual profit?

What do you mean, no longer a need for any type of currency to exist?

How is it not individual profit? What you're advocating is essentially that corporations should automate production. Unless you want a massive expansion of social spending, you are advocating for mass unemployment and poverty. You even go on to say in your response to Owen that you're sure any resulting social unrest would be bloodily suppressed.

You aren't advocating for utopia, you're advocating for dystopia...

If it is brutal though, I suspect it would be the Luddites that would make it so by resisting the transition.

That is utterly ridiculous. You should really study the early history of English capitalism...

 

[Farm Boy]

We aren't talking a little bit of sacrificed comfort here, we're talking massive, generation(s)-spanning ratcheting unemployment followed by the largest, bloodiest revolution the world has ever seen, and even then I could see a Luddite reaction happening just as easily as I could the advent of the technological singularity.

"It is by will alone I set my mind in motion" would be an optimistic outcome.

The great majority of people becoming as empowered as preindustrial women is an optimistic outcome.

A humanity that has rendered itself useless through the merits of its mighty works is a great filter level problem if we're not being optimistic.

 

[Commodore]

What do you mean, no longer a need for any type of currency to exist?

I think it's pretty obvious and I've already said it several times. If machines run everything and produce everything, then production costs drop to zero. Machines also have no profit motive, so it's not like they are going to charge us a price for the goods and services they provide. So with everything freely available, there is no longer any need for currency.

Also, when I say machines will run everything, I mean everything. They will be the owners and operators of all the corporations, and they will be the governing body for every nation. Basically, all humans would have to do in this world that I envision is exist. Beyond that, people would be free to do whatever they damn well please as long as it doesn't infringe on the rights of others.

 

[Lexicus]

I think it's pretty obvious and I've already said it several times. If machines run everything and produce everything, then production costs drop to zero.

Yeah, and if private property is retained then the benefits of having near-zero production costs (it will never actually be zero) will all accumulate to the top, with the great majority of people, to use the technical term, screwed.

What you're talking about is techno-utopianism. Color me skeptical that it's possible, let alone that it will come to pass the way you're saying.

If your argument is we should not use social policy to ameliorate the effects of automation, you need a better argument.

 

[sophie]

Yeah, and if private property is retained then the benefits of having near-zero production costs (it will never actually be zero) will all accumulate to the top, with the great majority of people, to use the technical term, screwed.

What you're talking about is techno-utopianism. Color me skeptical that it's possible, let alone that it will come to pass the way you're saying.

If your argument is we should not use social policy to ameliorate the effects of automation, you need a better argument.

I don't doubt that it's possible, it's just that the transition to that point is going to be, unequivocally, the most traumatic period in human history. Also it could go the other way, depends on how the revolution interprets the causes.

 

[Mouthwash]

Why doesn't GDP grow exponentially? Economic development is supposed to improve the means of production as well as the ends. The fact that we aren't producing greater and greater amounts of everything seems to violate the basic premises of economics (the quality of the items produced may rise as technology advances, having objectively higher production costs, but that isn't even close to commensurate with our advances in production).

I know this isn't what the thread is about, but it's already off track and the subject matter seems close enough.