It is AI that they believe can cut government spending budgets and AI that they believe can deliver private sector growth, even though they seem wholly unaware that AI would also be the source of considerable unemployment if all their hopes for its power to replace humans and so increase what they call productivity were to be fulfilled.
If AI does the work so that poutput even just stays static while employment falls then by definition that is a rise in labour productivity. It’s just made us all richer. Even if those now not in work never gain work ever again we’re richer by that increase in leisure across the society.
For jobs are a cost, see? Not a benefit.
People being unemployed and unemployable might be considered to be a problem. An externality, if we must play at economics.
Is AI the new CO2?
I would have agreed with you before, Tim, but the last few years have made me reassess all sorts of things, and one of them is the purist approach to economics.
It is true that jobs are a cost. But so are millions of unemployed men. Unemployed men are (on average) more likely to behave antisocially, commit crime, raise terrible and unemployable children (if they even have them), not to mention that we end up having to (OK it’s a choice) feed, clothe and house them forever.
We probably won’t remove benefits wholesale, so I have started to think that the next best thing is to force Scousers to do something for eight hours a day, five days a week – almost anything, stand in fields digging ditches and backfilling them – would be a good thing in and of itself.
Pay them 3x the dole. Make it hard to say no, or quit. Physically tired men who come to think they are earning a living, even if they’re not really, are better men than lazy fuckers who know they’re stealing every penny they have.
A society that bifurcates in the way our societies are doing is not long for this world (even assuming there isn’t some fiendish plan to fuck us all anyway).
Who’s this Al? Paul Simon’s friend? He seems to get everywhere, just like Sid.
I had a great-uncle called Albert, but he was always Bert not Al, and my grandad Alfred was always Alf never Al.
@Interested: they should beautify the country by picking plastic out of hedges and lots of other litter off verges.
@Interested, dearieme,
You have just described the WPA of FDR’s 1930s administration.
Is the productivity generated by AI going to generate enough tax revenue to pay for another 5 million (or whatever) on the dole? Because if not, it is more of a cost than the jobs it destroyed. And that’s before you get to the other costs of mass unemployment.
I can see the logic of Interested’s plan, but triple benefits doesn’t sound like the way forward.
@Dearieme
they should beautify the country by picking plastic out of hedges and lots of other litter off verges
I would certainly not be averse to that.
@
Mohave Greenie
@Interested, dearieme,
You have just described the WPA of FDR’s 1930s administration.
Yes, and I would not have supported it then (or now, if those circumstances obtained).
Truth be told, I would prefer other solutions now: I simply think that the old wives had a lot of wisdom, and think they were correct that the devil makes work for idle hands.
In the old FDR days there was plenty of genuine work for men to do, and the route out of that situation was clear and obvious, and shortish, even if (unsurprisingly) the state didn’t take it.
The US then was essentially (at least largely, and in the majority population) one country with one morality and one understanding of what needed to be done, it didn’t have whole cities full of men habituated to getting fat while doing no work for multiple generations with the division between the people widening, and AI coming to make even some of those who appeared gainfully employed redundant.
Not that this is a sudden AI problem – it’s as I say a long term and growing cultural and societal problem.
@Marius
I can see the logic of Interested’s plan, but triple benefits doesn’t sound like the way forward.
Triple is just a random figure. What I mean is that if blokes are going to do work then there should probably be something else to separate them from those who remain on the dole. 2x? 3x? I dunno.
My ideal solution would probably involve devolving decisions about dole to local levels, and allowing cities and towns and villages to set their own levels.
That way, if the ‘I’m not even English I’m a lefty grafter me’ J96 Scousers want to dish out generous dole to their confreres they can also fund it.
But I’m a bit radical!
Interested
Some good points made there – actions have consequences and the one thing we know about the likes of Murphy is that they don’t consider any longer term consequences in anything they do!!
Tim – it is economics but not as you or I would know it. It’s MMT and therefore likely to be garbage.
OTOH the Eloi keep telling us they need to import a million workers each year to do the work. Seems to me we can work out a win-win here. The AI can do the work, it won’t need pensions or social care later. In the meantime we can send home about ten million people who don’t really like it here so they won’t need pensions and social care, or at least not in the UK. Let AI solve the demographics and we can work down to a reasonable population number.
Interested – My ideal solution would probably involve devolving decisions about dole to local levels, and allowing cities and towns and villages to set their own levels.
Agree with that. And I’d go further: reintroduce the element of moral pressure, abolished by Brown in one of new Labour’s many revolutionary acts when he lied by saying to welfare recipients “this is your money, no thanks is required”.
Those moral judgements are best made by locals who pay the bills and can assess whether a recipient is deserving. It’s the only way I can think of totackle the moral hazard of welfare. It will not be perfect, but nothing is and it will be better than what we have got, which is governments every few years trying to tackle layabouts gaming amoral universal welfare based on form-filling, their initiatives working for about 12 months, and then the layabout are back having found a hack.
How much of an employees wage ends up with the Treasury? For standard rate employees 20% income tax, 10% NI and employers NI of 13.8%. So a £40k gross salary employee pays £8.25k tax, his employers adds on another £4.25k. So £12.5k in direct tax revenue, or c.31% of the gross salary. You should also think of all the consumption taxes a person earning £40k/yr would pay, but lets ignore those for now.
So our MegaCorp uses AI to replace our employee, and their profits rise by (say) 90% of the £40k (allowing for some AI expenses). So it makes another £36k in profit which it pays 25% tax on (assuming it doesn’t manage to shift those profits to another lower tax jurisdiction), which is £9k. Now the remaining £27k of retained earnings could be paid out as dividends to a UK taxpayer, who might pay tax on them (or might not if they are a poor pensioner), but equally they might be paid to a non-UK person/entity that pays no UK tax at all.
I can’t see how using AI to replace workers can ever create enough tax revenue to to pay these now unemployed workers benefits. A company that employs thousands but makes no profit still generates huge tax revenues on all those salaries and consumption taxes on the employees expenditures. Get rid of those humans and the company becomes nice and profitable, but the State gets a smaller proportion of those profits and many of the retained profits will go overseas, as we’ve sold everything to foreigners (which is a great idea according to our host), so are lost to the UK entirely. And the State now has millions more to pay benefits to. Plus of course the excess of labour will depress wages in the wider economy too. All jobs that remain will tend towards minimum wage because they’ll be so many people looking for work.
So how exactly can replacing swathes of people with AI bots do anything other than impoverish the nation?
Tractors, never works see, they’ll never pay enough tax to support the hands with scythes. I tell ‘ee.
As regards Unemployment benefits, I’ve heard that Singapore requires anyone in receipt of benefits of that type to keep their local area clean, litter picking, street sweeping or whatever.
– Tractors, never works see, they’ll never pay enough tax to support the hands with scythes. I tell ‘ee.
That’s fun (and a bit inaccurate – the hands had largely fucked off by the time tractors arrived) but the basic notion that there will always be some new area of human productivity to engage idled workers is what is at question here. What if, and it’s a big if, there is nothing substantial left for people to do after AI robots?
Two options here
1) There are no unmet human needs or desires because absolutely everything is provided via the machines and robots. So, who needs a job?
2) There are some unmet human needs or desires because not absolutely everything is provided via the machines and robots. Therefore we all have jobs producing what hte robots and machines do not.
There are no other end states.
I agree, wholly and entirely, that transitions can be hard. But as I say, no other end states.
@Tim
Two options here
1) There are no unmet human needs or desires because absolutely everything is provided via the machines and robots. So, who needs a job?
We’ve tried this experiment pretty much to destruction in our inner cities, where no one ‘needs’ a job and all that leisure time has produced a flourishing new class of artists, philosophers, writers, thinkers and aesthetes. I vote we extend it to the entire country!
@PJF
Tractors, never works see, they’ll never pay enough tax to support the hands with scythes. I tell ‘ee.
That’s fun (and a bit inaccurate – the hands had largely fucked off by the time tractors arrived) but the basic notion that there will always be some new area of human productivity to engage idled workers is what is at question here. What if, and it’s a big if, there is nothing substantial left for people to do after AI robots?
I think Tim is falling into the logical trap of thinking this time isn’t different, because every previous time when someone has said ‘this time it’s different’ it hasn’t been.
It’s very obvious in many ways and for many reasons that this time it very definitely is different.
Surely if there is an increase in leisure owing to technical advances, then jobs simply emerge to make that leisure more enjoyable. Professional sportsmen, chefs, nail bar technicians, blog posters, etc.
I’ve never understood the angst about the loss of miserable jobs and their replacement by fun ones. Unless those feeling that angst are simply worried that their social inferiors might no longer feel that inferiority as their lives become less oppressed.
It does not inevitably lead to mass unemployment, it could lead to a further reduction in the average working week to match school hours so “working mothers” didn’t need to employ childminders (one parent could take the kids to school and the other could collect them)
“We’ve tried this experiment pretty much to destruction in our inner cities, where no one ‘needs’ a job and all that leisure time has produced a flourishing new class of artists, philosophers, writers, thinkers and aesthetes. I vote we extend it to the entire country!”
Yes, you only have to walk down the average British shopping precinct (or what remains of it) to see what happens when you pay vast swathes of the populace to do nothing all day. You don’t get a flowering of arts, music, sports and intellectual pursuits by people healthy in mind and body, you get vape shops, tattoo parlours, pubs that sell beer as cheap as possible, and a general undercurrent of drug based criminality, all pursued with vigour by people who look like 100 kilos of lard stuffed into a sack.
An economist is a person who tells you that because a pinch of salt makes your spuds taste better, if you pour half a kilo on they’ll taste like heaven on earth………
“Tractors, never works see, they’ll never pay enough tax to support the hands with scythes. I tell ‘ee.”
You’re ignoring the fact that between 1914 and 1945 (the period when we moved from a largely horse based economy to a ICE one) the UK lost c.1.3 million adult men killed in 2 world wars . And during the 2 wars had many millions more were away from the country fighting somewhere. So the introduction of technology such as tractors and combine harvesters etc was largely to replace the men who were no longer there to do those jobs. They weren’t just told ‘Sorry boys, no more work for you now the tractor has arrived, bugger off and find something else to do’. The whole process also took 30-40 years – horses and traction engines (and scythes) were still being used on farms as late as the immediate post war period, despite ICE equipment being available since the first world war. There were also massive new industries growing up around new technologies that had just been invented/discovered – ICEs, aircraft, electrification, electronics etc etc. All of which were being developed and manufactured here in the UK. Not on the other side of the world. So yes, a farm worker who lost his job as a scythe operator might have found work in a factory making TVs, or fridges for example. What do we have similar today? Whats the average HR desk jockey made redundant by AI going to have to slide over into? Making solar panels? Oh, no they’re made in China. How about electric cars? Sorry, China again. Perhaps he/she could retrain as a tattoo artist, that seems to be a growth area for the welfare claiming classes. But presumably that market will be saturated and the living to be made pretty poor. What exactly are these millions of people no longer employed going to do?
“, then jobs simply emerge to make that leisure more enjoyable. Professional sportsmen, chefs, nail bar technicians, blog posters, etc.”
Last time I looked the last 3 don’t exactly make a great deal of money. And the demand for the first one is strictly limited. And anyway those are all existing jobs, that presumably there is a supply/demand equilibrium for. Add in millions of people all looking to get into them is only going to do one thing – depress wages/profits in those industries, unless there is suddenly going to be a massive rise in the demand for all those services. Which is going to come from where – the millions of suddenly unemployed? If they don’t demand those services when they are in paid employment, why would then when their income drops significantly on dole payments?
Any Western society that is predominantly service based that introduces AI and makes a vast swathe of people redundant in a short order is going to discover that the only jobs that get created are existing shitty minimum wage type ones. The ones that we can’t fill today because no-one wants to do them, so we import ever more foreigners who will (for a while). There are no ‘good’ jobs going to be created, because they’ve all been sent abroad already. Where are the brand new industries springing up in the West to soak up the excess labour? Where are the 21st century equivalents of car factories, the aircraft factories, the electronics factories? Remember the tractors replacing cart horses were actually made here. Fordsons, Massey Fergusons, David Brown, all made in the UK. Plus the iron horses needed mechanics, people to make and supply tyres, people to refine and distribute the fuel, people to sell them, all brand new jobs and careers. What the AI going to need? Some big f*ck off data centres staffed by a few Indians and some more AI. The chips aren’t made here. They might be designed here, but the people who already do that aren’t going to need millions more to help are they?
Jim, our host has already made the point that the replacement of depressing jobs by AI data centres makes us wealthier. More money available for other things and more leisure time. That wealth gets realised both in terms of jobs which are more entertaining and in the time newly available to to enjoy that entertainment. Self-employed Deliveroo monkeys and vloggers may not be paid any better than scythers were or call centre drones are, but, my word, you can’t put a price on the better quality of life those independent cyclists and keyboard warriors enjoy. That’s real wealth.
I still think the basic objection to what I’m trying to express is snobbery though. Old-fashioned Fabian Society, Starmerite snobbery, where work only has value if the lower orders don’t enjoy iy.
@Paul
I still think the basic objection to what I’m trying to express is snobbery though. Old-fashioned Fabian Society, Starmerite snobbery, where work only has value if the lower orders don’t enjoy iy.
Who knows, but I doubt ‘Deliveroo monkeys’ [which sounds quite a bit like ‘snobbery’!] earning a pittance for weaving through traffic, inhaling fumes and dodging knifemen as they deliver pizzas to ungrateful twats in city high rises are enjoying it all that much.
My point (not that you’re particularly addressing my point) is that we need to find something to occupy the minds and hands of young men or reap a whirlwind. Ideally it would be something they enjoy doing, feel free to make suggestions.
Jim, our host has already made the point that the replacement of depressing jobs by AI data centres makes us wealthier.
He has, but it’s bollocks. It makes some of us more wealthy. But spend any time at all on any British housing estate and point out the ‘wealth’. Maybe it’s a definitional thing. Yes, lots of our poor are fat. Yes, they have colour tellies and iPhones. I don’t think they’re wealthy.
The poor on housing estates are almost unimaginably wealthy in comparison to their equivalents a couple of generations ago. They’re clothed and housed in better conditions and (via their tellies and iPhones), they have access to worlds of information and entertainment that were denied to their grandparents. I’m not sure the fact that they make limited use of those things is an easy problem to fix.