While
technologists point to the advances in automation that will displace
many jobs that humans perform, economists are scratching their heads
and are not looking beyond the near future. Sociologists haven't a
clue other than forecasting an ominous future. Educators are noting
that we are moving towards an unstructured world and our current
education system is tailored to a factory oriented assembly line.
Technologists, economists, sociologists and educators focus on their
own silos of expertise and don't look at the complete picture.
Opinions are expressed in the context of the silos of each opinion
maker. Politicians are concerned about getting elected, responding to
the immediate needs of their constituents and responding to crisis.
There needs to be some thought given to what children born today will
encounter when they reach middle age and their senior years. There
are competing predictions. However there is no analysis that ties it
all together in a socioeconomic and political context.
This
article takes a comprehensive view of the developments and forces at
play in looking at what the future could well turn out. It focuses on
the US, since that is where the initial impact would occur.
In the beginning of the 22nd Century:
By
the year 2100 Automation will have penetrated every aspect of
American life. Cars will be self driven. So will trains, buses and
planes. Robots will do the cooking and cleaning. Everything conceivable
that requires human effort will be automated. Robots will even look
after children, the elderly and the invalid. Only the most
sophisticated, delicate and intricate tasks will be performed by
humans. That too will be a rarity. It will be an era of plenty.
Energy will be plentiful; mostly safe renewable solar, wind and
nuclear energy. Even defense will be highly automated, consisting of
missiles, jet fighters that fly by themselves, drones and
micro-drones. These micro-drones will be able to seek and
incapacitate an individual by stinging them with a powerful sedative
or kill them with a lethal injection. Hunger and poverty will be
banished. There will be no shortage of essential goods and creature
comforts. Technological breakthroughs in energy, automation in
manufacturing, construction, farming etc. will have brought the cost
of goods and services down significantly and it will become
economical and viable to just give everyone their basic necessities
along with robots to serve them.
With
increasing unemployment a Guaranteed Minimum Income Program (GMI) will have
to be instituted. It will be further expanded. Credits will replace the
Monetary System. Everyone will be given Monthly Basic Credits (MBCs)
– Housing Credits, Food Credits and Discretionary Credits.
Education and Healthcare will be free. People will be able to earn
more Credits in a variety of ways, reminiscent of jobs as defined in
the 21st Century, to afford more. Inflation will be virtually
non-existent since everything is indexed to the Credits. A commodity
will cost the same number of Credits regardless. Money will have
ceased to be important and the notion of banking and investing might
even be disbanded which may precipitate the demise of Wall Street.
Wall Street may exist only in name.
Private
Capitalism will be replaced by State Capitalism. The importance of
“Capital” itself will diminish. Technology will devour the
current notion of Capitalism. National self-sufficiency which is an
embodiment of what Gandhi postulated will be the prevailing mantra.
There
will be peace and happiness. It will take significant changes and
cataclysmic shifts to get to this situation. Even with a few
detractors, the majority agree that the solution achieved will be as
close to Utopia as one can get.
The
path to the Age of Leisure:
The
US consists of:
- Makers, who add “real” value to the economy
- Takers, who live of entitlements and subsidies
With
the advent of automation, more and more people will be forced out of
work. The Taker population will comprise of not only habitual Takers,
but others forced into this predicament due to the unavailability of
jobs or their inability to function as Makers in the highly
specialized environment. As more and more automation sets in, even
the service economy will be affected and service jobs like gardening,
burger flipping, waiting & busing tables etc. will get automated.
This will create a major rift between the Haves and the Have Nots.
The country will have a dwindling population of Makers, Servers
(Service Providers) and an expanding population of Takers.
Food
Stamps to the Rescue:
To
counter the trend of increasing poverty, the Food Stamp Program and
Unemployment Benefits will have to be expanded. Providing and
extending these entitlements will be heavily fought over by fiscal
conservatives. Their point well taken. Money spent on entitlements is
not effective in solving the problem. Government and the poor have
one thing in common. Both live beyond their means and spend more than
they have. Furthermore, money poured at the bottom and near bottom of
the pyramid bubbles up to the top and the income gap widens. But the
government will be faced with rising unemployment resulting in
increasing poverty and less money being spent. The consumer economy
will collapse and this will set a downward spiral in the price of
produce and manufactured goods. Massive deflation will set in. The
country will get thrown into deep depression. Guaranteed Minimum
Income (GMI) is the only answer and will have to be introduced. The
alternative is “refugee colonies” where people are taken care of
and live a structured communal life. Meanwhile due to investments in
automation, the entire Farm to Fork chain will be automated. As a
result the agriculture economy will go into a downward tail spin.
With falling prices, farmers will default on their loans banks will
be left holding the bag and the government will be forced to take
over bankrupted farms. With the ever expanding Food Stamp program, it
will make eminent sense for the government to own agriculture. This
will introduce State Capitalism and impact Free Market Capitalism. A
Food Stamp Economy will emerge, it will be a success. Hunger and
malnutrition will be eliminated.
The
situation in cities will deteriorate. Homelessness will be on the
rise to unprecedented levels. The country will be driven to the brink
of disaster by uncontrollable law and order. Prisons will over flow
and the government will have to start building more prisons to
accommodate the increasing population of criminals.
Enter
Housing Credits:
While
the situation gets worse; and on the verge of reaching a tipping
point of anarchy, the politicians citing the success of the Food
Stamp program will recommend that the government apply this
principle to Housing as well and just give minimum housing to Takers.
The rationale will be instead of building more prisons, why not build
housing. Food is already taken care of and housing will take care of
giving people a roof over their heads. And so along with Food Stamps,
the government will issue Housing Credits. This will bring about
significant relief to the situation and more Monetary relief.
The
Collapse of Commodity Prices:
Extensive
recycling and reuse will result in judicious use of non-renewable
resources. This will extend the availability of non-renewable
resources for the 22nd Century and beyond. The drop in demand will
crater the prices of raw materials. Mining, refining, transportation,
manufacturing, delivering will be automated with minimal human
intervention. Technological breakthroughs in energy, automation in
manufacturing, construction, etc. will bring the cost of goods and
services down even further. With the collapse of prices and
subsequent defaults, the politicians will recommend that the
government take over of mines and oil fields as well. That will
sound the death knell of Free Market Capitalism and will be replaced
fully by State Capitalism. Fossil fuels will become yesterday’s
energy source and demand for it will evaporate. With that the debate
on climate change will be put to bed. The cost of goods will drop to
such an insignificant level that it becomes economical and viable to
just give the Takers the essentials that they need along with robots
to serve them as well, to enjoy a comfortable Quality of Life of
Leisure, since energy is cheap and everything is automated.
The
New US:
The
US will become completely self sufficient. Trading with other
countries will decrease to a negligible level. The world will be
forced to survive without relying on the US economy. Europe and the
BRICS countries will pick up the slack. The US will no longer be
accused of pursuing an expansionist foreign policy. The
rhetoric will shift to the rest of the world accusing the US of
being an isolationist. National self sufficiency which is an
embodiment of what Gandhi postulated will be the prevailing mantra.
China that copies US innovations indiscriminately will cry fowl since
Chinese innovations will be replicated in the US. The Dollar may
continue to be an International Currency, but most of the Dollars
will circulate overseas since the US finds little use for it
domestically. A Dollar to US Credit exchange will emerge. This will
be utilized by tourists visiting the US, and by US citizens wishing
to travel abroad and for existing trade to acquire Rare Earths and
the like. The entire Product Cycle from Supply Chain, Manufacturing
and Distribution being automated requires very little human
intervention. Robots will build and produce, humans will consume.
Technological advances will reduce or eliminate the reliance on
Capital. The new order is not “Capitalism” (State or Private),
Socialism or Communism. Scholars will wrestle with what to call it.
Fundamental
Rights:
Entitlements
will be re-branded and will become Fundamental Rights which will
include Basic food and Housing; institutionalized as the Right to
Food and Right to Housing. To this Right to Education will be added;
which will become essentially free and dispensed through Massive Open
On-line Courses (MOOCs), and the Right to Health Care; which which
will also be highly automated and free. The much fought over and
maligned Affordable Care Act will be re-branded as Right to Health
and made Universal.
Cradle
to Grave Security:
With
cradle to grave support provided for by the government, there will be
no need for 20th
Century entitlement programs - Social Security, Medicare, Medicaid,
Disability, Welfare, Unemployment Benefits, subsidies etc. will all
be eliminated. With the basic set of Rights established, all forms of
Subsidies and Entitlements will be eliminated. Everyone will be
entitled to these Rights and in order to avail of these Rights a set
of Responsibilities will have to established to maintain social
balance and harmony. All of these transitions will provide more
Monetary relief to the government. A new category of people will
emerge; Servers, who serve Makers; Servers who serve affluent Makers
who prefer to be served by humans rather than robots. And so we have
Makers, Takers and Servers.
Credits
will Replace Currency:
In
implementing these fundamental rights the government will establish a
new currency of exchange called Credits. Since Food Stamps and
Housing Credits will already be in place, all rolled into a Basic
Credit System of Food Credits, Housing Credits. Education and
Healthcare will not require any Credits. A new Credit will be
introduced called Discretionary Credits. These could be commonly
called FC, HC and DC. Discretionary Credits could be applied to
anything. Takers will able to live within the Basic Credits they are
given. The income inequality that widened in first part of the 21st
Century will vanish. Makers could earn more Credits by virtue of
their occupation and contribution to society, much like today, which
will allow them to live a more “affluent” life style. Makers will
be able to upgrade their housing by applying Discretionary Credits or
chose to live a simple lifestyle on their entitled Housing Credits.
They could use their Discretionary Credits (entitled and earned) for
whatever they chose. Inheritance rights will be preserved. People,
who inherited property, will have no use for their unused Housing
Credits. The Commercial and Rental Real Estate market will collapse
with dwindling demand. It will become the property of the government
by default. The oldest profession may continue to exist.
Inflation
and Deflation Eliminated:
Goods
and Services will be pegged to Credits and their cost in Credits will
remain the same. For instance a Pound or Kilo of Salt; the very basic
essential could be pegged at One Food Credit. The price of all food
items could be derived in relation to a Pound or Kilo of Salt. Each
individual could be given one Housing Credit per month. A family of
four would be entitled to a four bedroom apartment. With this system
of Credits, inflation or deflation will be completely eliminated.
The
Demise of Wall Street:
With
the establishment of Credits which is a virtual currency; with
inflation/deflation beaten, the notion of banking and investing will
be disbanded which will lead to the demise of Wall Street. The demand
for Bankers, Brokers, Investment Counselors, and Economists will be
eliminated, except for a few in the government to deal with
International Trade, which will be minimal.
The
Leisure Reality of the 22nd Century:
The
age old saying, “An idle mind is a devil’s workshop,” is an
axiom that transcends generations and holds true for the human race.
Kids will be kids, they challenge authority and some get into
trouble. The educationalists who critiqued the “assembly line”
education system that was devised for the industrial age and prepared
graduates for “structured” work in a “structured”
environment, will finally have their say. Factories requiring
organized human labour will cease to exist. Working on innovation
involves a significant amount of flexibility and self direction. The
criticism of these educationalists will come home to roost in this
new era. A child who grows up and chooses not to seek a “job”,
will be given the “tools” to keep preoccupied and out of trouble.
The emphasis of education will have to be reoriented to prepare
children for this unstructured society by instilling civic
responsibility and discipline. Schools will have to teach children to
think independently, work in groups to solve problems with adequate
assistance and minimal supervision. Habitual offenders might have to
be assigned to boot camps to remedy their behaviour. As a result, the
criminal population will decline and include only the “hopeless”
cases. A walled predominantly self governed township could be set up
to isolate criminals and these exceptions.
Preparing
for the Age of Leisure:
A
number of initiatives will have to be introduced to handle the
majority Taker population. The following are some suggestions.
Promote
the idea of Entertainment & Activity Centers where people can
utilize their Discretionary Credits to access the recreational
facilities provided. Many activities can be provided free; others
purchased with Discretionary Credits. Tournaments, games could be
conducted to enable people to earn Discretionary Credits that they
can use for special privileges like golfing, horse back riding, etc.
There
can be many avenues like volunteering, taking courses etc. to earn
DCs and that could be used to acquire things to satisfy human vanity,
such as human made items or works of art.
While
these Entertainment and Activity Centers could be accessible to
everyone, exclusive Country Clubs can be set up as well that require
significant DCs to access. These would be the places frequented by
affluent Makers. This would be a true meritocracy wherein competence
and creating value earns more DCs. The more one earns the more they
can afford, while no one is denied their Basic Rights.
There
can be other things established to ensure Quality of Life. For
instance by using Discretionary Credits, people can take vacations. A
Time Share like system would allow individuals and families to select
the type of vacation they wish to have. Airfare, ground
transportation and lodging would require Discretionary Credits. Food
Credits will cover Food. The more Discretionary Credits a person
possesses the more they will be able to afford, like upgrades to a
more luxurious vacation.
An
exchange facility can be established whereby a person, couple or
family living in one location could exchange places with an
equivalent in another location. Individuals and families can move
around as and when they wish provided they are able to find an
exchange opportunity.
Another
phenomena that may emerge is that every once in awhile some Takers
who excel in creativity and an art form or innovation would emerge
and achieve some recognition. This will earn them more Discretionary
Credits. It will not uncommon for a Maker to transition into a Taker
and then re-emerge as a Maker.
People
would have lots of choices. Farmers could migrate to cities to
experience a new life. Many city dwellers could move to rural America
and chose the simple rural life of being close to nature and mother
earth.
Towards
a new World order:
The
tumultuous period the US will go through while automation displaces
humans, will be decried by the rest of the world as the curse of
Capitalism. On the one hand, the GDP will increase rapidly, the US
may become a net exporter of goods and food grains, that will wipe
out the trade deficit. Initially as the US economic indicators look
good people’s lives will be decimated, with the rest of the world
not faring better. It is only when the US realizes that the economic
principles in vogue are irrelevant and that a rapid transition to a
new world order is the solution.
The US will emerge from its predicament and reinstate its position of world leader and become the beacon for other countries to follow. With plenty to give and nothing to want, US can take an active role in aiding the rest of the world and replicate its success.
The US will emerge from its predicament and reinstate its position of world leader and become the beacon for other countries to follow. With plenty to give and nothing to want, US can take an active role in aiding the rest of the world and replicate its success.
A
path to a new world order might emerge where borders become
meaningless and the term; “citizenship” would become a term of
association as opposed to a term of privilege or rights. The world
might look more and more like it does from space; a Blue Marble with
people living in harmony and peace.
References
and supporting information:
John
Maynard Keynes, wrote an article in 1930 titled - Economic
Possibilities for our Grandchildren where he takes “wings into the
future.” What can we reasonably expect the level of our economic
life to be a hundred years hence? His basic premise is that
productivity will continue to increase rendering more and more humans
jobless.
2030
is more than a decade away and John Maynard's forecast is amazingly
on target. Advances in automation, is affecting workers in developed
countries and the impact is undeniable.
Jeremy
Rifkin has coined the phrase, “The Zero Marginal Cost Society,”
and written a book pointing
out
that the rapid advances in technology is “speeding us to an era of
nearly free goods and services.”
He explains the impact on society in a talk he gave at the Churchill Club:
He explains the impact on society in a talk he gave at the Churchill Club:
“Nonemployed - As robots grow smarter, American workers struggle to keep up”:
This
trend will continue to pick up pace and in the future we will see
more and more jobs being performed by robots. So what does the future
hold? Watch this video on humans need not apply:
And
the alarm it raised for the author of the following article:
Computers
are becoming smarter and the implications are described in this talk:
The
children of the 21st Century
will have bigger challenges in bringing up their children, than the
20th Century
generation. The world has changed so much since our parenting
experience. While the pace of change is accelerating society's
ability to keep pace with its impact is not.
Society
will have problems coping with the rate of change being brought about
by technological advances and innovation. The rate of change is
accelerating and every indication is that the effect on mankind will
be cataclysmic unless it is planned for.
The
following is a Sixty Minutes feature: Are robots hurting job growth?
Here
is an opinion piece on the same subject:
Kurzeweil,
who is considered by some to be the world's leading artificial
intelligence (AI) visionary, coined
the phrase, “Singularity” to describe the
moment in the future when humans and machines will supposedly
converge. He sees this happening by 2029 just fifteen years away.
Pundits
are conflicted about this trend as portrayed in these TED talks:
Listen
to the last 60 secs, of the opposing talk below, if you don't have
the time. The title is half misleading. Innovation is not dead.
Whether it will contribute to growth is the issue. Innovation will
make things better for some and hurt others.
Notice
the difference in age between the two speakers. Both agree on the
rising income gap and the impact of automation. Education will be
revolutionized by technology. This is not acknowledged by the second
speaker. It will become more accessible. But, will people take
advantage of it. What the US faces today and in the near future, the
developing world will experience, not too far in the future.
Innovation will continue, however currently, there is a diminishing
rate of uplifting return due to innovation. More people are being
rendered jobless due to automation. The first speaker acknowledges
the challenges, and has a Utopian response; the second predicts
society will be unable to cope and he challenges the current
generation to deliver innovation that have the same uplifting impact
as the past generations did.
None
of these opinions delve into the massive socioeconomic-political
changes that need to take place to address this trend.
Podcasts:
The
Rise of the Machines:
Will
Your Job Be Done by a Machine:
As Our Jobs Are Automated, Some Say We'll Need A Guaranteed Basic Income
Parting
Thoughts - Income Inequality:
Growing
income inequality is a world wide phenomenon. For instance say one
person makes 5,000 a month and another makes 10,000. Both get a 5%
increase which takes their wages to 5,250 and 10,500 respectively.
The income gap of 5,000 becomes 5,250. The wages for an unskilled or
same skilled job is not going to keep pace with jobs that require
special skills. It doesn't take a new set of skills to perform
existing manual jobs like "load carrying", picking fruits
and vegetables, etc. Any wage increase is not because of
upgraded skills. It will be paying more for people doing the same
job, to keep pace with inflation. The solution to the rising
income gap is to reduce the cost to these people by way of subsidized
housing, food, healthcare and education. Just about all countries
provide these subsidies in some form or the other. The outlay for
these “hand outs” is going to increase and needs to be planned
for.
Developing
countries face the problem of lack of opportunity for their citizens
while developed countries are losing jobs to automation. Both are
faced with people willing to work but lack opportunities.
Furthermore, every country is faced with ‘Takers’ who are
unproductive people, be it due to unavailability of opportunity,
inability, age, or unwillingness to work.
With
increasing automation, more and more jobs will be eliminated, which
will increase the supply of workers and put a downward pressure on
wages. There will be more and more people who are unable, or
incapable and hence shut out from the "automated economy".
The
short term solution to this problem is for the "productive"
people the “Makers” to support the "unproductive"
people the “Takers”. This is being practiced in some form or the
other by every country.
Given
the current socioeconomic-political situation this solution is not
sustainable. We will be faced with a decreasing number of Makers that
will have to support an increasing number of Takers.
The
undeniable facts are:
Automation
and design for manufacturing will become localized, but it will
require fewer workers. The developing world will benefit and affected
by this trend.
In
the US the Middle Class that comprised mainly of Joe Plumber, Jack
Electricians and Bob the construction man is being decimated. Wages
are either stagnant or declining.
In
the Developing World the opposite holds true, the Middle Class is
growing and wages are improving for skilled, semi skilled and
workers. But this “dividend” may be short lived. The rate at
which technology is adopted by the Developing World is increasing as
well. The downside of not increasing productivity is increased costs
and reduced efficiency.
