Staff Reviews

Your New Robot Overlords

Are we heading for a great economic bifurcation?


Average Is Over: Powering America Beyond the Age of the Great Stagnation, by Tyler Cowen, Dutton, 290 pages, $26.95

The rise and spread of intelligent machines has led to increasing income inequality and anemic job growth. And this dynamic is likely to be permanent. Such is the arresting and depressing thesis proposed by the George Mason University economist Tyler Cowen in his provocative new book, Average Is Over.

The American economy is becoming a "hyper-meritocracy" in which workers will either be big earners or big losers, Cowen believes. He blames this bifurcation on the rise of "genius machines," which are increasingly doing the routine intellectual work that once supported millions of middle-income workers. If your skills enhance the work of ever-more-intelligent machines, you'll likely be a big earner. If your skills do not complement the computer, you're liable to be a big loser. "Ever more people are starting to fall on one side of the divide or the other," writes Cowen. "That's why average is over."

Those middle-class jobs just aren't coming back, Cowen claims. "The financial crash was a very bad one-time event that revealed, rather suddenly, this more fundamental long-term structural problem, namely that a lot of workers had been overemployed relative to their skills," he writes.

Trend data on American household earnings since the 1970s do show that incomes in the top 20 percent rose steeply while those in the bottom 80 percent experienced more modest increases. Writing in the online financial newsletter Advisor Perspectives, economic analyst Doug Short reported in September 2013 that between 1967 and 2012, the incomes of the top 5 percent increased 88 percent in real dollars. Incomes in the top quintile rose 70 percent, the second quintile went up 38 percent, the middle increased 20 percent, the fourth gained 12 percent, and the bottom quintile grew by 20 percent.

While the average real incomes of Americans in all categories have fallen since the Great Recession, those of middle and lower quintiles remain still lower than they were in 2000. As Short reports, the average income of the middle quintile fell 9.1 percent (in constant dollars) between 2000 and 2012; the fourth quintile fell 12.2 percent; and the bottom quintile dropped 15.9 percent. The economics consultancy Sentier Research reported in July 2013 that real median household income is 7.2 percent lower than it was in 2000. Even more tellingly, the real median household income at its height, just before the 2008 recession, was only 0.7 percent higher than it was in 2000.

Cowen interprets all this stagnation and decline as a signal that a "lot of jobs aren't worth as much as before, and they are not being replaced by a comparable number of high-earning slots." And he is particularly alarmed about the trends in men's unemployment and incomes.

Citing data from the Brookings Institution's Hamilton Project, Cowen writes that between 1969 and 2009, "wages for the typical or median male worker have fallen by about 28 percent." This stark claim has been challenged, and Cowen notes that other analysts have argued that men's average wages have fallen by only 9 percent since 1969. That nine percent figure was derived by the Brookings Institution economist Scott Winship. However, Winship has recently re-crunched the wage numbers using a different and more accurate income deflator, and he now finds that there was no decline in men's average wages between 1969 and the peak year of 2007, though since the recession average male wages have dropped 12 percent. While not as terrible as the Hamilton Project numbers, it's still pretty bad if the average wage hasn't increased over four decades.

Cowen further notes that 60 percent of the jobs that disappeared during the recent recession were mid-wage; 73 percent of the new post-recession jobs pay less than $13.52 per hour. In addition, more Americans, especially American men, are exiting the labor force. In the 1960s, only 9 percent of men between the ages of 25 and 64 were not working; today that figure is more than 18 percent. Cowen reports that the civilian labor force participation rate has fallen from over 67 percent in 1999 to below 64 percent now. In addition, in 1990, 63 percent of American national income was paid to labor, but by 2011 that figure had fallen to 58 percent. The implication is that capital, especially including new intelligent machines, is now earning a higher share of the national income.

The recession revealed an interesting paradox: Average productivity per worker soared while unemployment deepened. In the past employment increased in tandem with rising productivity. Cowen explains this contrast by arguing that during the recession companies "laid off a lot of workers who were not producing enough for their level of pay." They have not been hired back.

The middle class still endures in some low-productivity sectors of the economy: government, education, and health care. Of course, all of these areas are shielded from competition, either as monopolies or as highly regulated services. "I wonder how much of the middle class consists of people in government or protected service sector jobs who don't actually produce nearly as much as their pay," writes Cowen. Income data suggest that Cowen's intuition may be correct.

The Bureau of Labor Statistics (BLS) reported in September 2013 that total employer compensation costs for private-sector workers averaged $29.11 per hour (roughly $58,200), whereas total employer compensation costs for state and local government workers averaged $42.09 per hour (roughly $84,200). In other words, the average local and state government employee earns 40 percent more than the average worker.

An August 2013 report by the Cato Institute economist Chris Edwards found that federal civilian worker had an average wage of $81,704. Edwards also reported that the average federal worker "earns 74 percent more in wages and benefits than the average worker in the U.S. private sector. A job-to-job comparison found that federal workers earned higher wages than did private-sector workers in four-fifths of the occupations examined." Between 1975 and 2013, the total number of federal, state, and local government employees grew from 14.8 million to nearly 22 million, remaining steady at about one for every 15 citizens.

According to the BLS, private health care workers accounted for just over 3 percent of the private workforce in 1958; they were nearly 12 percent of the workforce by 2008. Health care constitutes an ever greater proportion of our economy, growing from about 5 percent of GDP in 1960 to 18 percent today, including both public and private expenditures. The health care industry is also bifurcated in terms of pay. The annual average salary of the more than 6 million health care practitioners and technical staff, ranging from physicians to laboratory technicians, is just over $55,000, solidly in the middle quintile of income. Support workers, such as home health aides and dental assistants, earn considerably less, around $23,000.

Cowen also argues that government has boosted the threshold costs of hiring new employees in various ways. For example, the new health care mandate increases the cost of hiring, which ultimately means fewer jobs, especially for entry level and low-skilled workers. Payroll taxes, higher minimum wages, and regulations that increase corporate uncertainty about investments, such as the Sarbanes-Oxley accounting requirements for publicly traded firms, also erect barriers to hiring.

So what is the future of work? Cowen cites Freestyle chess as a model of man-machine integration at work. Freestyle chess is a rapid-fire variation on the game played by teams who consult various computer programs for their assessments of the best moves. The computer outputs are evaluated by the human team members, who are not themselves necessarily highly ranked players. The combined man-machine chess teams regularly outscore the best grandmasters.

Similarly, in the future, the most successful doctors, lawyers, teachers, marketers, and retailers will be members of teams skilled in the use of intelligent machines to inform and guide their decisions. For example, a patient's symptoms and test results could be uploaded into a comprehensive program for an initial diagnosis. This kind of diagnostic procedure need not be done by physicians, but by technicians whose skills enable them to identify when the diagnostic outputs of smart machines need to be supplemented by the insights of a team of doctors.

Cowen predicts that smart machines will constantly monitor and rate every professional and worker on the quality of their outputs, which he believes will dramatically improve services at the high end of the market and yield a hypercompetitive meritocracy. On the other hand, service providers will also have more information about their customers, including past purchases, evaluations by previous service providers, and so forth. "Customers will have to live with the reputations they create for themselves," he observes.

Cowen suggests that we will be living in a "stupider" world in which we reduce the complexity of our work and service environments to take into account the limitations of even smart machines. "Your daily life will become a curious mix of both 'much, much easier' and 'more frustrating,'" he predicts. "It will be like living in a help menu." Our experience of more and more services will increasingly resemble our standardized interactions with bank ATMs, self-service gas stations, and supermarket checkout scanners.

The big earners in our increasingly bifurcated workforce will be self-motivated, conscientious, and highly skilled. Upgraded forms of learning will be key to their success. Cowen notes that the country now spends twice as much per K-12 pupil in real terms than it did four decades ago, yet educational outcomes have barely moved. This indicates a huge drop in schooling productivity. On the other hand, the advent of online courses has democratized learning as never before. Cowen cites the example of the online course taught by the Stanford artificial intelligence researcher Sebastian Thrun in which the best students were not from Stanford but from poor countries such as India. This means that Americans will be competing with the smartest and most motivated students from around the world.

Given the differences in curiosity and self-motivation, Cowen tartly observes that putting the world's very best education online cheaply will likely not matter much at all to most people. Hard-working and disciplined students aiming for high wages will take advantage of the proliferating opportunities to learn. Others lacking motivation will attend schools that enforce discipline and hard work. Individual teachers will function less as experts and instead act more as coaches to motivate students.

At the low end, many who lack motivation or talent will not upgrade their skills and instead opt for what Cowen calls the world of "threshold earners," making just enough income to get by. For high earners, learning will be a constant feature of their lives as they seek newer skills to complement ever-smarter machines.

Cowen also peers into the future of science, predicting that intelligent machines become vital research partners to people. Ultimately, he suggests, smart machines will one day come up with new theories that are so complex no human scientist will understand them. We will take advantage of the resulting predictions to improve our lives, but a lot of science will look like magic to most of us.

As the gap widens between the big earners and the big losers, what kind of country will America become? Cowen imagines a scenario in which 10 to 15 percent of the citizenry is extremely wealthy and has fantastically comfortable and stimulating lives with excellent health care. "Much of the rest of the country will have stagnant or maybe even falling wages in dollar terms, but a lot more opportunities for cheap fun and also cheap education."

The coastal cities, with their existing concentrations of brain-based industry, will become home to the cognitive elites, while the rest of Americans will retreat to the interior with low-cost housing and scant public services. Essentially, Cowen expects members of the lumpenproletariat to peacefully while away their time with bread and circuses cheaply provided by a fabulously productive economy run by an elite class and their smart machines.

"One day soon we will look back and see that we produced two nations, a fantastically successful nation, working in the technologically dynamic sectors, and everyone else," concludes Cowen. "Average is over."

Not everyone agrees. In a September report for the Information Technology and Innovation Foundation, tech analysts Ben Miller and Robert Atkinson reject the idea that robots are killing our jobs, calling the claim "completely wrong and not supported by the data, scholarly evidence or logic." In the past, Miller and Atkinson note, productivity gains generated by technological progress and incomes have generally increased in tandem.

At the center of their counter-argument is the idea that rising productivity-more output per unit of input-produces savings and increases overall wealth in the form of lower prices, higher wages, or higher profits. The increased wealth creates more demand for products and services, which in turn requires more workers. The increased savings also lower interest rates, which encourage more investment in other productive activities, creating more jobs.

Has this virtuous process of producing prosperity for most workers finally broken down? Perhaps not. It could be that the American economy is still suffering from a severe hangover from the financial crisis, exacerbated by the adoption of particularly stupid economic policies.

In their 2012 book Race Against the Machine, the Massachusetts Institute of Technology economists Erik Brynjolfsson and Andrew McAfee also worried that workers are losing in their competition with machine intelligence. They are, however, considerably less fatalistic than Cowen. They recognize that government policies are increasing barriers to both hiring and upgrading the capabilities of low-skilled workers. Consequently, they advocate improving education, aggressively removing regulatory obstacles to business creation, resisting efforts to restrict hiring and firing, decreasing payroll taxes, decoupling benefits from jobs, not rushing to regulate new network businesses, streamlining the patent system, and shortening copyright terms.

Cowen might be right that it's different this time around. Nevertheless, the sensible reforms suggested by Brynjolfsson and McAfee would give workers a better shot at competing with smart machines, and should in any case be adopted whether or not technological unemployment turns out to be a real problem.

In the meantime, Cowen has given you fair warning: If you don't want to welcome robot overlords someday, it can't hurt to take advantage of any opportunity to upgrade your skills.

NEXT: Chinese Police: Eight Attackers Killed During Assault on Police Station

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  1. Of course, the logical end result of “machines are taking over all the middle class jobs” is a world where “machines produce everything anyone would ever want, at zero cost”. In such a world, even the poorest of the poor would end up with lifestyles that today’s average working stiff could only dream of.

    Admittedly, there may be a few bumps in the road from A to B.

    1. Yes, but it hulls the Marxist premise that labor and capital are distinct. It turns out that for many applications, they are interchangeable, and the more expensive one makes labor, the more development money will be spent on making capital improvements do the job of labor. I think even people who reject Marxism have a hard time letting go of there being a distinct difference between capital and labor for production.

      1. This is certainly the nicest-job I have ever done..I earn up to 500$ per week. Im using an online business opportunity I heard about and I’ve made such great money. It feels so good making so much money when other people have to work for so much less. I work through this link,

    2. Zero cost? Maybe. Energy and materials are limited.

      Increasing efficiency and new generation technologies may allow for energy that is nearly free. Use of new materials(silicon… carbon…) may make materials costs near free.

      Will energy and materials ever be completely free? Probably not. They will certainly not be limitless and as their price drops the consumption will rise. Humans will find new uses for them, even if it is on building trifles like 1000′ tall homes or other objects of fancy.

    3. He is an idiot, a short-sighted narrow-minded idiot with blinkers on and no memory.

      The history of technology shows that the inevitable result of progress is cheaper prices and more goods. A common cry of the anti-tech crowd is that we are awash in a flood of cheap material goods and have lost touch with our core humanity.

      It boggles my mind that this clown can simultaneously hold two such conflicting thoughts: that too many people are making too much money, and that this means there will be more poor people.

      His theme seems to be that people without computer (or tech in general) skills will be cast aside. He ignores that almost every worker today deals with far more tech than almost everyone 100 years ago, and that one reason we have so much tech is because people *want* it, as in smart phones and tablets.

      An incredible idiot.

      1. What good is a public intellectual if he can’t do horrendous long lasting damage to society?

        Hail, Tyler Cowen, our New Marx!

        1. Counting the days until economists are replaced by computers…

        2. Cowen leans Libertarian. Check out his blog at

      2. you are completely ignoring the basic structure of contract.

        it requires both sides having something of value to offer and both consensually sacrificing something.

        radically minimizing scarcity wont help the poor if they have no means to contractually obtain resources. or are you suggesting they will initiate force to obtain them? that is basically where we are at with wealth redistribution.

        poor need to be empowered with liberty, not enslaved with freebies. progressing society technologically simply doesnt play on that equation.

      3. “It boggles my mind that this clown can simultaneously hold two such conflicting thoughts: that too many people are making too much money, and that this means there will be more poor people”

        If you got that from the article, you misread it. I’ve read a lot of Tyler Cowen and he doesn’t believe any such thing.

    4. …but but but JOBS!!!!!!!!!!!!!!

  2. “400 years ago, on Earth, workers who felt their livelihood threatened by automation flung their wooden shoes, called sabots, into the machines to stop them. Hence the word sabotage.”

    1. A STOS reference, as is the picture. Forbidden Planet is kindly referred to as Roddenberry’s inspiration for Star Trek. It’s more like he plainly stole the movie and broke it into episodes.

  3. What about the fact that the average hourly work week has fallen? And the fact that people begin their working lives later and retire earlier?

    That seems like the logical outcome of machines replacing human labor, not that it would create unemployment.

    Why would you continue to work as much once machines have reduced the price of goods to the point you don’t have to? The total number of jobs and would stay the same while utility gains come in the form of increased leisure.

  4. This is the book John was slagging in the AM links?

    Sounds like it deserves a good burning.

  5. “The implication is that capital, especially including new intelligent machines, is now earning a higher share of the national income.”

    For me, the implication is that American capital is profiting off foreign labor. Indeed, when you look at corporate profits, you find that domestic profits are pretty much in-line with their historical averages, it’s foreign profits that are through the roof.

    Globalization seems the “culprit”, not intelligent machines.

    1. The implication is that capital, especially including new intelligent machines, is now earning a higher share of the national income.

      Hasn’t this been the case since the Industrial Revolution? Isn’t all capital investment a replacement for labor? Does increasing your capital stock over time mean that the return on the capital stock increases concomitantly?

    2. So we’re not exporting jerbz, if domestic profits aren’t out of line and unemployment is fairly average (while absorbing population growth).

      We’re making jerbz for foreigners.

  6. “The financial crash was a very bad one-time event that revealed, rather suddenly, this more fundamental long-term structural problem, namely that a lot of workers had been overemployed relative to their skills,” he writes.”

    How many of those middle class jobs were in the construction industry?

    Construction is cyclical employment. The government’s reaction to the crash lengthened the time it takes for that industry to recover, and it hasn’t recovered yet.

    But those construction jobs weren’t lost because of long-term structural problems associated with the skills of the workers, and smart computers aren’t about to take over construction jobs.

    1. I spent decades working in the construction industry. Once upon a time, a man could make a good living doing it. Now, cheap labor from illegal aliens has driven wages down. This is where I break with standard libertarian theory. Open borders only work if the other side of the border has a somewhat free market. Econ101: if you have a surplus of something (like labor), the price is going to fall.
      20 years ago I was making $10 per hour as unskilled labor, today, unskilled labor still makes $10 an hour, and that $10 is not worth near as much as it used to be.
      As recently as 3 years ago, I was still making money in the trades, but it was as a contractor who paid low wages in order to compete, often to illegal aliens. This was one of the reasons I left the field.

  7. Cowen should have a chat with Mike Rowe.

    There are plenty of jobs that pay well, but are clearly middle class jobs, that are going unfilled because the skill set isnt being learned. And welding isnt exactly rocket surgery.

    1. Actually, it may literally be rocket surgery.

      1. There was an article a while back about a team that had taken all sorts of high-energy scans of the Saturn V engine. They were saying that some of the welds used to make things that we really are only just now getting to 3D print reliably because of the complexity. And the welds were real masterful things. Essentially making one piece of metal (even under xray photography) from 3 or more distinct shapes.

      2. You ever tried to weld ? I have, and I sucked. In his reason interview, Mike Rowe said we should resurrect the term Industrial Arts. I agree, because creating a good weld IS an art.

        1. I have, I also sucked at it.

          Its a skill, but not one requiring an advanced degree or anything, which is the point.

          1. If one digs into articles written by those in the welding industry, you’ll find a number of them with titles like “The Myth of the Welder Shortage” etc. Apparently, there is no shortage and the fact that the press talks about one results in eye rolls from those in the know.

            I’ll hunt around for some articles to link to.

      3. Actually, welding is a difficult skill to master. I consider myself competent in most aspects of construction, but my welding skills are pitiful, despite much practice and instruction. It is hard to master, and few people have the right set of skills to do it well. Which is why it is one the higher paying jobs in the field.

    2. I totally agree. That is what I found most pathetic and most humorous about this book. Cowen is the very person whose profession, being a college professor is going to be crushed by the information revolution. Yet, he writes an entire book arguing everyone but him is doomed.

      If I ever have a child, I am telling him or her to learn how to make things and fix things. Those jobs are not going away. Jobs like mine are going away.

      1. I picked EMT as a hobby/volunteer for a few reasons. having a skill set outside of DC desk work was one of them. If I get laid off tomorrow, I can pick up a shift pretty quickly with private ambulance company.

        1. That isn’t bad except that I have no stomach for pulling maimed people out of wrecked cars. I need to find a second hobby. I wouldn’t mind bar tending. But my wife is a bit too jealous to let me do that job.

          I am thinking of doing a sommelier course. It is actually a pretty tough subject to do right and a good one is always in demand. And even if you never use it to make a buck, it is very useful knowledge to have.

          1. There’s a doc about it on Netflix. I haven’t seen it, so I can’t vouch for it.

          2. Hell yea, in Michigan, wine and beer jobs are some of the most interesting opportunities around. Microbreweries are popping up like mushrooms, and our wines are starting to get some nationwide recognition too. You could also look into cicerone certification (a sommelier for beer)

      2. His profession has already been crushed by the data surge, but it’s buoyed up by student loan debt and government research investment. And even when those bubbles pop (the former, if not the latter), it’s the marginal producers who will get the axe first. Cowen I’m certain will retain the prestige of being a widely regarded annually published author. He’s going nowhere.

        1. Sure. But but he will be the last of a dying breed.

  8. Somewhere in here belongs the observation that society is driving toward every new job seeker having a college degree. This sounds very fine and progressive, but the fact remains that society only needs to many BAs, which primarily mark one as qualified to study for an MA. How much of this wage stagnation can be attributed to our educating generations of children in Liberal Arts bushwa that isn’t, strictly speaking, a set of job skills?

  9. At the low end, many who lack motivation or talent will not upgrade their skills and instead opt for what Cowen calls the world of “threshold earners,” making just enough income to get by.

    And such people haven’t existed in the past? One of the many things Cowen misses in this book is the possibility that we are reaching the end of scarcity. When you get passed all of his lousy prose and meandering anecdotes, you realize what he is getting at, but isn’t smart enough to realize, is the end of scarcity.

    There has always been people who were not motivated and were happy to live on the edge of society. The only reason the existence of such people might be significant in the future is if there are a lot more of them than in the past. Cowen seems to think there will be but never bothers to ask why. Well, the only reason more and more people would choose not to be motivated is because life becomes so easy that there is no real reward for doing so. That is called the end of scarcity.

    1. “The first lesson of economics is scarcity: There is never enough of anything to satisfy all those who want it. The first lesson of politics is to disregard the first lesson of economics.”

      ? Thomas Sowell

      There will always be scarcity. That’s why prices exist. When the price of something is very low, then the good is not very scarce, but scarcity will always exist.

      1. We’ll never truly be post-scarcity, no, but we could have a radically higher standard of living with robot labor combined with cheap, mostly unlimited energy. The latter is likely to happen someday, just a matter of how soon.

        1. Someone from a hundred years ago looking at our standard of living today might say we’re already there. And people a hundred years from now, living what we might consider a radically higher standard of living, will be a dissatisfied as people are today.

          The only thing that is truly limitless is human wants and desires.

          1. Exactly. Productivity gains have reduced the cost – in terms of hours worked – of almost every good/service imaginable. An hour of light is infinitesimally cheap now as opposed to taking a reasonable fraction of one’s labor a couple of hundred years ago. I believe that the poor in the US has equivalent living standards to the middle class of the 1960’s.

            I think when Cowen says that goods are effectively free, he is saying that the delta cost to produce the next item is nearly zero since most of the robot costs are up front.

      2. There will always be scarcity of things for which you can’t make more. Other things can become so abundant that they are effectively free. Salt is an example of this. Once upon a time salt was very expensive. Now salt is so cheap that it has a flat demand curve. You could double or even triple the price of salt and demand would stay the same.

        Now what Cowen misses is that people will always dream up ways to create value. Take for example diamonds. Diamonds have effectively stopped being scarce. You can make a fake diamond so cheap anyone can afford it. Yet, Diamonds are still priced very high. Why? Because when the look was no longer scarce, the status of owning one dug out of the ground became the product and thus diamonds retained their price.

        That will happen with everything. I can buy a hatchback that is better engineered and has a better ride than a 1960 Rolls Royce. But I can’t get the status for that price. Even when the day comes that we are so advanced that every car rides like the best car you can possibly made, people will just invent new things to value like the badge or the pride of knowing my car was hand made unlike your car that was made by machine.

        Cowen has a very poor understanding of people and how they actually think. Sowell is right, there will always be scarcity. If our manufacturing ever gets so advanced that we can have anything for virtually free like we can salt, we will invent something that can’t be made that way and want that.

        1. Or, if you have the means, you will have that 1960 Rolls Royce restored, or better, rebuilt to modern standards.

        2. There will never be an end to scarcity period.

          Chris Anderson wrote a whole book about this called Free. “Every abundance creates a new scarcity.”

          Too much time? Not enough money.

          Plenty of money? Not enough beach front property or rare works of art or trips to orbit or settlements on the moon or underwater hotels or time with your kids, etc, etc forever.

      3. There will always be scarcity. That’s why prices exist. When the price of something is very low, then the good is not very scarce, but scarcity will always exist.

        Well, sure, but if prices fall far enough, then you might find that while you can easily afford to live in a 5000 sq ft luxury apartment and eat gourmet food and fuck a gorgeous fembot while working 5 hours per week, you might not be able to afford a grand 100 room mansion without working really long hours.

        The economic law of scarcity means that you can’t have every desire you imagine — it doesn’t mean that a life of wealth well beyond current dreams of avarice isn’t possible for just about everyone in the future.

      4. Maybe not. Scarcity is people wanting stuff that there is not enough of to go around. If nano-tech play out the way the optimists foresee, then all matter in the solar system will be able to be remade an infinite number of times into whatever is desired at the time. How that would work out on a planet with an ever increasing population is hard to see, but with either a planet with a stable population, or for a species that is expanding into orbiting habitats or even other planets, it would effectively mean the end of scarcity.

    2. I know young people (as most people probably do also) who like to play video games, go drinking, watch sports and TV, but not much else. They work only enough to get enough money for these activities and live a life of mere subsistence with little though of anything beyond. They have chosen the lives they want, that’s all.

  10. Maybe our new robot overlords will produce so many goods and services that everyone can have about anything they want with only a few people working. I doubt that will be the case. But it is possible. But if it doesn’t happen, the problems are going to be nothing like Cowen describes. The problem won’t be “stratification”. As goods and services become cheaper and cheaper, the marginal value of money will decline. Sure, some internet billionaire will have way more money than I have, but if we are at or close to the end of scarcity it won’t translate into that much more stuff. Sure there are some things like land or tickets to a sporting event that are naturally limited and thus will reserved for the rich. But not much else. The real problem will be what the hell do we do with a society where people don’t have to work. Living on the dole is terrible for people’s mental well being. People get a sense of satisfaction and self worth from making their own way. In a world were scarcity no longer exists, how does one do that?

    Sadly, Cowen never thinks of these problems because he is too dim witted to understand the implications of his own observations.

    1. On our post “economic problem” future:

      “Thus for the first time since his creation man will be faced with his real, his permanent problem ? how to use his freedom from pressing economic cares, how to occupy the leisure, which science and compound interest will have won for him, to live wisely and agreeably and well.

      The strenuous purposeful money-makers may carry all of us along with them into the lap of economic abundance. But it will be those peoples, who can keep alive, and cultivate into a fuller perfection, the art of life itself and do not sell themselves for the means of life, who will be able to enjoy the abundance when it comes.

      Yet there is no country and no people, I think, who can look forward to the age of leisure and of abundance without a dread. For we have been trained too long to strive and not to enjoy. It is a fearful problem for the ordinary person, with no special talents, to occupy himself, especially if he no longer has roots in the soil or in custom or in the beloved conventions of a traditional society.

      —John Maynard Keynes*…..ildren.htm

      Some people find that frightening. …like they find the singularity frightening.

      *Yes, as quoted by Marxists! Do they understand what Keynes means when he writes, “The strenuous purposeful money-makers may carry all of us along with them into the lap of economic abundance.”? Why are the Marxists trying to stop us!

      1. Just because it didn’t happen in the past doesn’t necessarily mean it will not happen in the future.

        The fact is that even the poorest person in today’s developed world lives better than the richest of even a couple of hundred years ago. You can be a total crack smoking bum in this society and still have a roof over your head and no fear of starvation, something 99% of humans who have ever lived didn’t have.

        Right now rising expectations keeps people motivated. Sure you could live better than a farmer in 14th Century Europe, but who wants that when everyone else is living so much better than that? What happens when things get so abundant that money starts to lose its marginal utility at lower and lower wages?

        I tend to think that people will just endless invent ways to distinguish themselves and thus money will always retain its marginal value. But there is nothing to say that has to be true. There may come a day were working just doesn’t get you anywhere. And that will create some very interesting problems.

        1. I saw a refugee interviewed once about which country he wanted to go to, and he wanted to come to the U.S. When the reporter asked him why, he said that if he was going to go anywhere as a refugee, he wanted to go somewhere where the poor people are fat.

          Michelle Obama thinks obesity among the nation’s poor is a problem! It’s happening in the developing world, too. Type 2 diabetes often becomes a big problem right on the heels of economic growth. It’s the same sort of problem.

          People’s brains are still conditioned to be in starvation mode–even when they’re in no danger of starving. I worked in a factory as a kid–brutally, soul crushing, work; if I thought I’d had to live in that environment for the rest of my life, I don’t know what I would have done. But there were so many people there who were scared to death that they were going to lose their god awful jobs…

          People working on assembly lines should be see as like people working as plow horses. I’ve got all the respect in the world for a good work ethic, but we can all learn to think of something better to do with our hard work.

          1. I worked in a factory as a kid–brutally, soul crushing, work; if I thought I’d had to live in that environment for the rest of my life, I don’t know what I would have done.

            Which is why I can’t imagine that the people pining for the days of strong factory labor forces mean what they say they mean. And I’m not just referring to the lefties bemoaning an end to militant labor unions, although I’m sure they’d sell out the American middle class to a life of drudgery if it meant a return to the Democrat-friendly medievalist trade guilds of the mid-twentieth century, but the thought process common to low-info voters of all stripes that villifies capital intensification and exporting laborious, unprofitable work to developing countries that desperately need it. We don’t want factory work any more than we want another era of agriculture employing most of the country’s population.

            1. I always wonder if the people who pine for an abundance of factory jobs, also pine for an abundance of agrarian jobs.

              Actually, now that I think of some of the ideas communists embrace, they actually did.

              So, Marxists around the turn of the 19th century pined for agrarian jobs. Modern progressives pine for factory jobs. Why that’s called progress, I have no idea.

              If people are really worried about automation screwing up employment, do this:
              1. Ban agricultural machinery and chemical use.
              2. Ban factories.
              3. Ban imports.

              Progressives should be thrilled at the levels of unemployment. Of course, at that point, I’m not sure who you tax for social safety nets, since everyone barely makes enough to keep themselves alive. There’d be two kinds of people: employed, and dead.

      2. But it will be those peoples, who can keep alive, and cultivate into a fuller perfection, the art of life itself and do not sell themselves for the means of life, who will be able to enjoy the abundance when it comes

        People like Tyler Cowen will no doubt be willing to cultivate in us all, the art of life itself.

  11. Talk of income is meaningless without talking about what it can buy, because money is not wealth. For example I spent $600 on my 32in flatscreen tv five or six years ago, and at the time it was a good deal. Now you can find them on sale for a hundred bucks. And they’re better than the one I have since they’ve got built in wireless internet.

    As automation drives down the prices of goods, incomes buy more wealth.

    And this idea of a dystopia where the corporations rule a wasteland of people in poverty misses a crucial point. If everyone is poor except the corporate overlords, who do the corporations sell their goods to?

    1. Without actually reading the fucking article, I’m going to guess that the point isn’t that ‘the evil corporations’ will run things and have all the wealth. It’s that whoever has the smarts and the initiative will.

  12. In the past, Miller and Atkinson note, productivity gains generated by technological progress and incomes have generally increased in tandem.

    Note that this relationship goes all the way back to 1860, when there was first any kind of data relating to it. It has survived massive political and technological changes, much greater than the one’s we see today. That’s a hell of a persistent correlation. You need some strong evidence to support the claim that this time is different.

    1. It may end up the same as it always has, always the safest bet, but there are valid arguments that this time it may be different:
      1) The apparently accelerating growth in the availability, storage capacity, and speed of information systems,
      2) The apparently new-normal state of high regulation and Government interference with the market, and
      3). The anticipation of two or three important technologies all maturing at the same time. Think of nano-technology and genetics, to take the obvious two. Either one of these has the potential to transform us as a species, but the convergence of their maturing has the potential to make “this time different”.
      And this is a not different technological revolution than say, the one that was started by Gutenberg. All progress has led to the next level of progress in one continual, and accelerating, act of homo-sapiens crawling up from non-sentience to a place where we can at least glimpse the next evolution of our species.

  13. No mention of how the Federal Reserve makes capital artificially cheap and regulations make labor artificially expensive?

    1. This. Whenever someone states how the middle class is losing ground, why is it that they never notice the time frame is the same as the massive growth of government?

    2. Of course not. Intellectuals of Cowen’s sort have a reputation to maintain. Consorting with the Ron Paul relovelution conspiracy mongering class of critics would compromise his image as modestly disdainful cynic de rigueur.

  14. “Cowen predicts that smart machines will constantly monitor and rate every professional and worker on the quality of their outputs, which he believes will dramatically improve services at the high end of the market and yield a hypercompetitive meritocracy.”

    Machines making accurate qualitative judgements about people and their work? Outside of a narrowly focused manufacturing industry, where smart machines are doing quality control, you can color me skeptical.

    Individual consumers making their own qualitative judgements is the very stuff that makes the invisible hand do its work. If smart machines could make those sorts of qualitative judgements for us, then it should be relatively easy for the government–made up of people–to do a good job of making qualitative judgements for us, too.

    The government’s inability to make qualitative judgements on other people’s behalf is one of the important reasons why central planning consistently underperforms. And the nature of that failure is such that neither smart machines nor their programmers can solve the problem. It’s partially a problem of perspective–something that making machines smarter doesn’t even address.

    1. Yeah I assume Cowen subscribes to the strong AI hypothesis, something I disagree with. Penrose went after the strong AI hypothesis in 1990 went AI was a hot topic and intelligent machines were supposed to be right around the corner. That was a dinosaur age ago as far as computer technology goes, yet so far his predictions and criticisms have proved much more accurate than the Kurzweil types.

      1. I think strong AI is certainly possible, but it’s obviously not here yet. Nor does it appear to be on the immediate horizon, despite the claims of Kurzweil and others of his ilk. It’s like nanotechnology or fusion–we’re making progress, but the ultimate promise still seems a long way off.

        1. It’s like nanotechnology or fusion–we’re making progress, but the ultimate promise still seems a long way off.

          Some things will always be a long way off.

        2. The strong AI hypothesis is not about a time frame it is the hypothesis that our brains are algorithmic machines and can be mimicked with any other algorithmic machine like a computer that uses binary transistor logic. It was presented famously in Godel, Escher, Bach, where anthills or books (Einstein’s brain was put into a giant book as a thought experiment) were intelligent. Penrose and his ilk (Martin Gardner was another), disagree with this. They don’t think AI is impossible of course, or that there is something mystical about the human brain, simply that it is not an algorithmic machine and can’t be mimicked until the proper technology comes along, and probably a deeper understanding of how our brain works which Penrose thinks requires a deeper understanding of the Universe, ie, some sort of Theory of Everything.

          1. No, I agree that it’s not just about building faster and faster processors. However, I think there are ways to achieve it without necessarily knowing everything we need to get there. For instance, why not use the accelerated time and processing power to evolve intelligence? Not an original idea, of course, but it seems to me the most likely methodology for getting there.

            1. Neural nets were supposed to mimic intelligence by learning on their own. I believe those robot bugs use that, and they do learn to walk like their real world counterparts in the most efficient manner. But, again, this was developed in the 90s and hasn’t advanced since.

              If we could develop computers that could learn on their own, then it seems like some great advances could be made since computers certainly do process info much faster than the human brain. But it has gone nowhere, probably because of the limitations of the hardware models. Our brains physically change as we learn for example.

              This could all change with the development of quantum computers or it is likely a limitation of algorithmic machines in general.

          2. IMO, AI is more likely achieved spontaneously through massively connected networks. We would not even notice the first sentient AI life forms. h/t to Vernor Vinge.

          3. admitting the human brain is more complex than an algorithm is admitting you believe in magic.

            either it obeys natural causality or it does not.

            this is one of the most infuriating branches of the debate. that any selfrespecting atheist can believe in free-will boggles the mind. Are those proponents subhuman troglodytes or thinking sentient persons? it begs the question.

            1. I have a right to pretend to practice free will. I also like “admitting the human brain is more complex than an algorithm is admitting you believe in magic.

              either it obeys natural causality or it does not.”

              I like that very much. I am amazed at how people cannot look around today and see that something profound is about to happen. Either the creation of AI destroys all life on the planet, or man engineers himself into something new, or something completely else happens; but no matter what, I don’t think our species has ever experienced anything remotely like it.

        3. AI is possible, but how do you give it billions of individual perspectives, perspectives that have been cultivated with qualitative biases over time?

          This isn’t just about the inability for programmers to represent all of those cultivated perspectives either; it’s about the nature of qualitative judgement.

          They’re going to have to make some big qualitative assumptions in their programming, and some of those assumptions are likely to be wrong–especially if the computer is going to account for both my qualitative preferences and someone else’s.

          1. If the AI can actually learn, it shouldn’t be a problem. If you could get a computer to learn you could theoretically clone its entire experience to a bunch of other computers. The AIs could theoretically exchange experience at incredibly high speeds.

            Qualitative assumptions could be selected in through real world experience and feedback just as is done for non-liberal human brains.

            1. But each of our experiences is unique and our preferences are unique. AI would need to go through the exact same iterations I went through in order to cultivate my preferences–and account for whatever genetic predispositions and cultural assumptions fed them. You’re going to recreate what it felt like to be a punk kid in the ’80s?

              And there’s the question of the unpredictable nature of our preferences in new situations…

              Right now, I’d rather suffer ten more 9/11s than get rid of the Fourth Amendment. Maybe more than ten! Maybe just three. I don’t know. How could I know? How could a machine know?

              I prefer to pay a lot more for medication than it would cost me to just go through life with a colostomy bag. How long will that hold up? I don’t know, but I haven’t crossed that cost threshold yet. You think a computer can learn to understand where my qualitative inflection point is on that cost curve?

              My mother prefers her oncologist because of his bedside manner; I think her oncologist has the bedside manner of a tarantula. How do you gauge that kind of qualitative performance?

              And even if you could make a computer that could mimic each of our unique personal preferences, you would only succeeded in creating a redundancy. Each of us is already a fully actualized, qualitative preference maximizing algorithm, and we already have markets that provide us with the relevant data to inform our choices from billions of different qualitative perspectives in real time.

              1. What you call mysterious I call self-unaware.

                If there are 10 factors that determine your reaction to a request from your kid, but you can only think of 3, then your reaction is gonna look like chaos.

                AI could track billions of variables, humans can track 3 well, or 7 terribly, or zero if above that.

                1. Can AI track the relative importance–to me–of billions of variables and come up with the ten factors that are most important to me?

                  And isn’t whether seven of those factors are subconscious beside the point?

                  Qualitative factors are often almost always the difference between a good outcome and a bad outcome, and those qualitative factors are often highly subjective.

                  If the computer gets the wrong answer because it ignores seven out of ten of my qualitative factors, just because they’re subconscious, then what difference does that make? It will still be the wrong answer.

                  Nothing and no one can have my unique perspective. It is the product of culture, experiences, environments, genetic material, points in time, and personal relationships that are unique to my personal history. You might be able to create a program that learns and grows the way I do, but it will never have my subjective experiences. It can never see the world from my perspective and make the same qualitative judgements I would make.

                  1. Think of it this way:

                    “I prefer this to that” is essential to every decision we make. And the idea that everyone should be free to make those choices for themselves is the very essence of libertarianism.

                    Conversely, the conceit that anyone else (or anything else) could make qualitative judgements for us better than we can for ourselves is the essential enemy of libertarianism.

                    I have no fear that AI will ever be able to make qualitative choices for me better than I can, but the false assumption that someone like Barack Obama OR an AI is possible of doing that is probably the greatest threat to our liberty.

                    That false assumption that such a thing is possible is scary, but AI will never be able to make qualitative choices for bible-thumping rednecks with room temperature IQs better than the stupid hillbillies themselves. I suspect a lot of us are just trying to impose our own qualitative preferences on other people and hoping that AI will be the answer.

                2. And, it is not any random 3 choices out of the 10…it is the 3 that present themselves first. Although eventually number 4 will be arrived at by continuing to expand the iteration of the expression; explaining why it is usually a good idea to stop and take time to think, and why older people are “wiser” than the young.

      2. The Emperor’s New Mind is a great book. I still have never seen it refuted.

        And regardless, I don’t care how wonderful your machines are, you are always going to need someone to fix the machines and figure out how to get these machines to do what you want them to do.

        1. Yeah, I agree, and that fact that it has held up so well is the strongest affirmation of all.

          1. What is funny is that they just pretend the book doesn’t exist. The strong AI people had no answer to it but couldn’t admit they were wrong. So they just pretend it was never written.

            Since it is a very dense and difficult book to get through, the AI people have been pretty successful at ignoring it.

            1. Well there are people who have refuted it, if you read the Wiki page on Penrose, he was supposedly refuted handily or something.

              In general the media always parrots the proclamations of strong AI blowhards because it makes for good sensationalism and because “science” journalists are mostly ignorant idiots.

              1. I read that book when it came out in the 1990s. I found it to be one of the most difficult books I have ever read. Penrose really is one of those Vulcan smart people and you better have your A game if you want to understand what he is saying.

                I would be surprised if 10% of the science journalists writing today are even capable of reading and fully comprehending that book. So it is not surprising that they take the strong AI blowhards at their word and move on.

                1. Ha, well I’ll admit I skipped a lot of it. But I don’t think its necessary to have a complete understanding of Godel’s theorem to appreciate Penrose’s arguments.

                  1. And nowadays more than ever, science journalists are just j-school grad who had basic biology. As long as one has the journalism degree, who cares if you know anything about science. There are also plenty of science journalists who have, say, a masters in social science, psychology, etc. Since science is handed down by TOP MEN, the journalists job is to simply slavishly echo them and get as many page clicks as possible.

                  2. You mean the completeness theorem? It’s fairly easy to understand. Every axiomatic system generates theorems that contain unproveable truths. How does this relate to Penrose?

                    1. oops meant incompleteness

  15. Am I the only one who looked at the title and thought Ron was talking about Obama?

    1. That’s ‘Autonomous Cybernetic Organism’ to you.

  16. While automation and future-tech will certainly change everything, I think the key in these discussions is the timing and the path we take to get there. I think there are a lot of folks looking at past progress and extrapolating a technological curve that is not based in reality. There will be new, hard problems we encounter on the way. We may run up against fundamental limits that constrain us.

    Surely we’ll have robots flipping burgers and making tacos in 50 years. Will we have truely intelligent machines by then? Probably not. In 200? Probably, but who knows? We don’t even have a firm grasp of human intelligence and consciousness yet.

    In the long run though, yes, the labors of man will be worthless. How will you have an economy when no man has anything worth trading?

    1. We won’t be able to create legitimately artificial intelligence until we actually know how the human brain works. We’re not even close to that.

      This is also assuming that it’s even possible to recreate the functions of a biological mind using hardware and software. It might not even be possible to recreate billions of years of evolution using computer technology.

    2. “Will we have truely intelligent machines by then? Probably not.”(sic)

      Will you be able to tell the difference? My computer already spells better than you do. Being able to spell English words, while not requiring intelligence, is actually a skill that my intelligent brain lacks. Autocorrection anticipates my misspellings and proactively offers a suggestion that is more often than not the correct one.

      Take a bunch of little applications like spell correct and eventually you might have something that seems intelligent.

      1. You both miss the point… you look at these as apart from you (“My computer already spells better than you do. Being able to spell English words, while not requiring intelligence, is actually a skill that my intelligent brain lacks.”), while in reality that computer tool is part of you. It doesn’t spell better, it has nothing to say. YOU spell better, because you have a tool to use. This is the promise of our new age, to meld our tools and ourselves into a seamless whole.

  17. Cowen also peers into the future of science, predicting that intelligent machines become vital research partners to people. Ultimately, he suggests, smart machines will one day come up with new theories that are so complex no human scientist will understand them. We will take advantage of the resulting predictions to improve our lives, but a lot of science will look like magic to most of us.


  18. Show me something that is automated, and I’ll show you something that was once done by hand.

    Until people are satisfied and do not desire any new goods or services, there will always be a need for human capital.

  19. In the beginning of the movie The Apartment, Jack Lemon reports to work in room which appears to be the size of a football field completely filled with row upon row of desks. Those desks were occupied by clerks performing what we now refer to as data entry, keeping track of individual customers’ accounts. A lot of those jobs went away when computers replaced them, but new jobs were created.

    I think Cowen only sees a cavernous room with rows of empty desks.

    Also, if we want to “fix” education: “First thing we do, we kill all the Degreed Educators.”

    1. Speaking of education and fixing it, I have a friend who was a not shit Red Diaper baby. She grew up in the 1940s and 50s in New York. Her mother was the daughter of a Mexican communist and her father a Ukrainian socialist Jew. She went to the famous Little Red Schoolhouse in Greenwich village. The school never taught her to read and write. All they did was various political indoctrination and whatever artistic endeavors interested them. She had to teach herself to read and write as an adolescent. The only value the school gave her was dance training that enabled her later to become a professional dancer.

      When you realize that our public schools are now run by the intellectual children and grandchildren of the people who ran the Little Red Schoolhouse, you all of the sudden understand why our schools are so broke.

    2. And yes, Cowen never bothers to explain why this economic revolution is different than all of the others. His argument boils down to “I can’t think of what these people will do, so there must not be anything”.

      1. All that displacement could have interesting implications, too, even if it does happen. For instance, one-way trips to settlements in space or even relocation to unpleasant environments on Earth become more likely.

        Not that the transition is necessarily pleasant, but humans have the capacity to do much more than flip burgers and dig ditches.

    3. So your argument is that because previous technological advances have not resulted in an overall loss of jobs, no technological advance will ever result in an overall loss of jobs?

      I think we can all envision a future, maybe 1000 years away, where humans have been rendered useless. The question is what will it look like on our journey to that future?

      You can look to past advances and see that in many cases the jobs that were created required a higher level of intelligence than the jobs that were eliminated. Will the minimum threshold for intelligence required to perform any job rise faster than overall intelligence in the population? I think so, leading many folks towards perpetual unemployment and irrelevance. We’ll start to see that over the next 25 years, but I think it will take 50+ before things really get moving.

      1. Two decades ago, before digitization had taken root and computers were for hobbyists, traders, and high-IQ professions, today’s world of ubiquitous computer work would have seemed unthinkably complicated at first brush. But people aren’t any smarter today, nor better trained; it’s just that user interfaces and accessibility improved in tandem to render the work they do more productive and less laborious. Even the work of the 80s was leaps and bounds more complex than the work of the 1880s, but you didn’t need an engineering degree to work in fairly sophisticated fields any more than you need a computer science degree to work with computers today.

        If anything, the domains of high-IQ workers will be more banal and more accessible as computing improves, affording jobs to more marginal producers than would otherwise be possible. We won’t need thinking, A.I.-driven computing because the toolsets available to average humans will be so vast and so cheap.

        1. Not that it affects your argument much, but people, on average, are getting somewhat smarter.

          Your argument seems to be that because computers have functioned as assistive devices that are dependent on humans to actually accomplish anything, the computers of the future will also be helpless but function as even more effective assistive devices. Is that right?

          If so, I think that by restating your argument as I have it becomes apparent where the fallacy lies. At some point in the future, computers will be effectively enabled to participate in the real-world as adeptly, if not more so, than humans.

          Sure, the first generation of robots needs a human to build, train and repair it. The first generation of driverless delivery vehicles will still need a human to carry the package to the door. Will that trend continue indefinitely? No.

  20. “But can they ever mimic the warmth of a lover?”
    – Engineering student about to invent the world’s greatest Sex-Robot

    1. Universe…. universe’s greatest.

  21. I think that the future will transform us into something like pet dogs. A lot of people will be like lapdogs, happy to eat, sleep and fuck without a care in the world. The robot overlords will provide a pretty nice living for them.

    Others will be like the breeds that need to have a job. Think collies. They need to help herd something for their owners. Or a good hunting dog that lives for nothing but flushing birds. There will be a lot of people like that too. The robot overlords will use them to help run things, but the only real payoff is personal satisfaction at having something to do.

    I think the wildcard factor is how humans adapt socially. Will it become acceptable to just lay around being fed and housed by the robots? Or will we always disparage them for not working?

    1. For some that will be enough. But for most others, it will not. If nothing else, people will go out and do work for their own fulfillment if nothing else. We don’t need to ride horses for transport anymore, yet millions of people still ride them for pleasure and sport. You can buy a blanket for next to nothing at Wall Mart, yet people still spend hundreds of hours making handmade quilts.

      To believe Cowen’s dire prophecies, you have to believe that people are too stupid and laze to ever think of something to do when relieved of the need to work to live. And that is just bunk. I guess that is the main reason why I found this book so infuriating. Cowen is the worst sort of elitist trash. He has no idea how people actually think and act. He just assumes that anyone not of his class is too stupid, incurious and unmotivated to ever make anything of themselves.

      1. I agree that there will always be a bunch of people who need to work in order to get the satisfaction of a job well done. I put myself into that category. I can go about a week of vacation before I am bored and want to go back to work. I don’t know what I will do when I retire.

        I think though that society will also become more accepting of people who do nothing. I think that as it became possible for you and all the friends you grew up with to be comfortable without ever having a job, you would see a lot of people who would be more than happy to trade off the possibility of getting very wealthy via hard work for a lifetime in a hammock.

        I didn’t read the article, so I am not commenting on this author’s take at all. I’m just going with a gut feeling that there are a whole lotta people willing to make big tradeoffs for a life of ease and security.

    2. If we have the capacity and resources to support a society of nonworkers, a lot of people will go fully into retirement mode, fewer will go into semi-retirement, and fewer still will do whatever we need humans to stay involved in.

      Not sure what a government would look like with a large majority of nonworking voters, especially if that’s in a society that is also wealthy enough to have that without economic shenanigans or unfair taxation.

      1. I think one of the x factors in all of this is politics. I don’t see how robots will ever replace humans in politics.

        A lot of people will still want to be able to boss people around and tell them how to live.

        In a world where everything is almost zero cost, how do you justify the Drug War? Who cares if they stay home all day and do heroin? It isn’t like you need them to show up for work, and because of the Hospital 2000 robots, they don’t even cost that much in health care.

        I’m guessing though, that LEO 2001 robots will still be there to throw you in jail and shoot your dog if you don’t tow the lion.

    3. Sounds a bit like Brave New World.

  22. We’ve taken care of everything
    The words you read, the songs you sing
    The pictures that give pleasure to your eyes
    It’s one for all and all for one
    We work together, common sons
    Never need to wonder how or why

    We are the Priests of the Temples of Syrinx
    Our great computers fill the hallowed halls
    We are the Priests, of the Temples of Syrinx
    All the gifts of life are held within our walls

    Look around at this world we’ve made
    Equality our stock in trade
    Come and join the Brotherhood of Man
    Oh, what a nice, contented world
    Let the banners be unfurled
    Hold the Red Star proudly high in hand

    We are the Priests of the Temples of Syrinx
    Our great computers fill the hallowed halls
    We are the Priests, of the Temples of Syrinx
    All the gifts of life are held within our walls

  23. There are so many examples that disprove Cowen’s entire thesis. Take watches for example. Watches should be an example of the kind of dying industry that Cowen is talking about. You can make a quartz watch in China for a dime that keeps better time than a Rolex. And you can make one for just a few dollars that via the miracle of fake diamonds looks as good and keeps better time. If Cowen’s view of the world were true, the entire Swiss watch industry should have died leaving its workers to a bleak future.

    Yet, if anything, the high end watch industry is better today than it ever has been. And even worse for Cowen’s thesis, they make a product that when measured strictly by dollars and cents, makes no economic sense. There is simply no economic reason to ever make a mechanical watch in this day and age. But they are still made because people value more than dollars and cents. They value status. They value tradition and all sorts of things that can be measured in dollars are not governed by dollars.

    The point is that once something becomes easy to manufacture and affordable for everyone to have, people naturally will want to spend their money on things made the old way as a way to distinguish themselves from the masses. And for that reason there will always be jobs making things no matter how advanced our robot overlords get.

    1. Also, if everything was produced by robot to the point that robots were even producing and repairing themselves, we’d basically be living in a post-scarcity world.

      Who cares how much ‘unemployment’ there is when everything is basically free? Worrying about stagnation coming from technology is ludicrous, because at the point were computers were so advanced that they actually could permanently displace human beings from jobs, everything would have become so cheap as to be almost free.

      I personally don’t think this will ever happen.

      1. Also, if everything was produced by robot to the point that robots were even producing and repairing themselves, we’d basically be living in a post-scarcity world.

        Exactly. Cowen is talking about a post scarcity world but is either to stupid or too dishonest to realize it.

        In the end, I don’t believe there is such a thing as “post scarcity”. Post scarcity assumes that everyone makes their decisions based on dollar and cents efficiency and that is not how people behave.

        If post scarcity were possible, as things become more and more advanced and cheaper the range of available options should get smaller. We all drive cars today that are better engineered than any car made 20 years ago. So why is there still luxury cars? What is the point of paying big dollars for a high end car when you can buy a low end one that is better than anything your parents could have bought? It makes no economic sense, but people still do it. Why? Because there is more to life than efficiency. Sure your fake wood grain made in Korea may look the same as the grain on a Bently, but it wasn’t made with real wood and put together by hand by a little old man in England. Cowen is such a profound moron, it never enters his mind that people might pay extra for the status of having something different than the masses.

        1. More to the point — sure, my Toyota Avalon is a 4 door sedan that outperforms muscle cars from the 60s, yet that doesn’t stop people from buying Lexus or Hyundais (like the Equus) that are even faster and better handling than mine.

          It’s almost like Tyler Cowen fails to grasp that human wants are almost infinitely expandable with increasing wealth.

          1. I would bet money that Cowen drives a Camry or Accord and thinks anyone who spends a lot of money on a car is just stupid.

            1. Cowen’s leans Libertarian and he’s an economics professor. He most certainly doesn’t think that someone driving a nice car is stupid.

      2. Not necessarily. Just because the labor is free doesn’t mean the raw materials or energy are free.

        In fact, as you decrease the cost of labor, it allows you to put more money into raw materials and energy, allowing you to build bigger things. Think of a future where the fashion is to build 1000′ tall homes for the hell of it.

        Maybe you have a solar-powered scintering machine that fuses sand. Ok, you still have a limited amount of land for sand and sun.

        There will always be limits. The universe is not infinite in time or space.

        1. No, but a world where there is either a static population or a healthy extraterrestrial colonization program, mixed with a strong nano-tech capability, renders “scarcity” a more or less theoretical concern.

  24. Whenever I see people like Cowen trying to argue that we’re in store for ‘eternal’ unemployment, I always want to ask them why there wasn’t an appreciable increase in unemployment from 1970-2008. Surely computer technology was already displacing jobs in 2003, so why was unemployment in 2005 so much lower than in 1979?

    It’s almost like current high unemployment is the result of an economic crash and government policy since that crash. There has been absolutely no correlation between increased computing technology and increased unemployment.

  25. “The financial crash was a very bad one-time event that revealed, rather suddenly, this more fundamental long-term structural problem, namely that a lot of workers had been overemployed relative to their skills,” he writes.

    “overemployed” or “overpaid”?

    Either way, improving economic efficiency is good.

    Now, if the morons in Washington would just stop their idiotic attempts to inflate the currency…

  26. Next up: an article on how the advent of automobiles and harvesting combines have resulted in the loss of jobs among buggy whip makers and farm workers, thus causing permanent higher unemployment.

  27. Gee, and I thought it was the fact that socialism has all but wiped out the very brief, but prosperous, experiment with freedom based capitalism. Apparently the fact that huge swaths of the population have completely abandoned anything resembling even a modest work ethic in favor of dependency on “entitlements” and hand outs hasn’t done anything to promote income equality after all.

    Socialism in any flavor has never amounted to anything but a mass-murdering absolute failure. Blame the robots.

  28. I see the same problem as always: why are we paying indolent people to breed (the welfare state) in a civilization where the productivity bar is increasingly raised? Let’s remember that recent article where the author tried to say “the moral is the practical” while referencing everybody except the person who actually said it (and proved it), Ayn Rand.

    It is immoral to rob Peter in order to support the sloth of Paul, and increasingly impractical when the competitive bar is consistently being raised. Technological advancement can very well foster an underclass of unemployable proles–but such people can only exist in a welfare state, because you paid their moms to be professional broodmares in the first place. The Steve Jobses of the world create revolutionary technology which, in many cases, displaces human employment; the broodmares of the welfare state are paid to create more human beings to be displaced by the technology.

    On one had you’re raising the competitive bar qua economics, and on the other you’re paying people to have children who will (in all probability, let’s be honest) be uncompetitive and unproductive. So I would say that technological progress makes the imperative of ending the welfare state even greater. Buggy whips belong to the past, and so should the moral infamy of condemning productive Peter to serfdom in order to support the inhuman existence of Paul the moocher. The moral is the practical.

    1. Ouch! Even the cautious way you said it invokes Godwin’s God.
      But the truth can be painful. How would a republic-cum-democracy insulate itself from such an outcome, without violence?

  29. Not gonna happen. Supply and demand. We are creating a nation of people with graduate degrees who can’t change a tire. The problem is, someone needs to change all those tires. Already, plumbers earn 3X as much as college grads. No one has ever invented a robot that can change a starter, re-wire a house, grow food or un-clog a toilet. As these skills become rarer and rarer, thanks to the “everyone needs college” mentality, they will get paid more and more, throwing a monkey-wrench into “the machine.”

    1. Society is self correcting. The next generation will learn the lessons of their indebted and poor predecessors and fill those jobs.

      People as a group are not stupid and irrational and they do learn from the hard mistress of experience.

    2. Because those devices were designed to be serviced by humans. It’s entirely possible to engineer a device that can be serviced by a machine, just as it is common practice for machines to assemble devices today.

  30. Just to add a point, the author’s short sidedness seems to focus on mass production, because that’s been the whole point of the industrial revolution, ever since Ford’s model T came in “any color you want, as long as it’s black.” The trend in the coming years will be in customization, much like the after-market in car parts and custom kitchens. But instead of choosing between 3 different cabinet door styles, your designer will create a cabinet door that is just for you, milled on a CNC machine, in their shop. At first the designs will be very conservative, but over time they’ll get more bold and gaudy until the public catches up and accepts the new ways.

    In time we’ll expect everything to be custom built, since they’ll be no difference in price for actually building it, just in the value of the designer. You want to use a Morse code key to control your television? No problem, someone will be able to design it. There might only be 10 other people in the world who would ever want such a thing, but because the manufacturing cost is the same if you buy a million-button remote or a Morse code remote, it’s no big deal. And it will be assembled in the back room of the shop where you’ll order it.

    The industrial revolution will end with the second coming of the craftsman, this time with access to a global supply of raw material and designs, and automated tools that can build anything he can dream up.

    1. That is an excellent point. You should write a book. God knows it would be better than the piece of crap Cowen has produced.

    2. Just to add a point, the author’s short sidedness seems to focus on mass production,

      Don’t you actually mean short sightedness? Or does your computer not compose as well as it spells? 🙂

  31. I think I may be the only Linux user commenting here. The author certainly doesn’t seem familiar with it. In a nutshell, Linux is a computer operating system that was produced by programmers who weren’t paid for their efforts, and is available for free. (I recommend Mint Linux or Puppy Linux for those who want to breathe life into older computers.)

    Linux exists outside the traditional economy in a realm that I see expanding in the future. A realm without the jobs and wages that the author and commenters here are obsessing over.

    1. which interface language is used in the upcoming bio-tech revolution is besides the point; it literally doesn’t matter. Yes, one approach my shave a sliver of time from the ultimate endpoint, but in the timeline of species evolution, it is meaningless.

  32. Johnny Boy is not going to like that.

  33. my roomate’s half-sister makes 74 dollars an hour on the laptop. She has been without a job for 7 months but last month her check was 19922 dollars just working on the laptop for a few hours. published here

  34. increasingly doing the routine intellectual work that once

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