Sudanese Sensation wrote:I have been reading all your writing here. Can any leader really stand athwart progress and stop it ? Capital will flow where labor is most efficient. Sometimes it means cheapest, sometimes it means smartest, or a combination of the two.
Automation is a greater threat to jobs than trade. An anecdote. This is the second time it happened. There were no cashiers at Target so I had to use the self service check out. I had a lot of stuff. I was upset because it was more work for me and less work to be had.
A lot of this depends on what one's opinion of the role of government is. Article 1 Section 8, depending on the interpretation, might suggest that it is government's role to accommodate those who are financially vulnerable:
Clause 1 (General Welfare). The Congress shall have Power To lay and collect Taxes, Duties, Imposts and Excises, to pay the Debts and provide for the common Defense and general Welfare of the United States; but all Duties, Imposts and Excises shall be uniform throughout the United States;
There are underlying rules of capitalism, but if the government intervenes in the market, it changes the rules. Regulation can be a job killer in a lot of industries (even with the environment or other noble causes in mind), but in others it can be protective of the assets of lives of others (financial industry in particular, and depending on your world view, the pharmaceutical and insurance industries). That is to say, one can be a believer that capitalism is the law of the land (and that the labor theory of value is bunk), but also oppose the free market.
Automation is a threat of jobs certainly. Which is why when people like Paul Krugman suggest for people working in energy/manufacturing to move to service, it sounds a bit silly - the service industry is the sector of the economy most prone to automation. I don't know that I'd agree that it's a much greater threat than trade (so-called free trade isn't always free - when reciprocal trading partners apply BAT's, VAT's, and tariffs, and we don't do the same because we want to democratize the world, we are not doing ourselves a favor). Automation, trade/outsourcing, immigration, and regulations are all factors that have gotten us to where we are.
With regards to automation itself, I've heard a couple of proposals:
(1) Some sort of a robot tax.
Bill Gates has suggested this recently, and it has gotten some traction.
(2) Basic income. It sounds a bit drastic based on the arguments in Europe, but stalwart capitalist Milton Friedman was a big supporter of the
Negative Income Tax.
At the end of the day though, I don't think it should be our place, or the place of a handful of people, to determine policy direction. Even if there is a fair degree of skepticism, if the voting public supports candidates who do not have free market ideas in mind, and do not eschew big government, then they should be able to vote for policy that will allow them to work and retire with dignity. There are some issues with the electoral college, but it self-corrects: it protects the minority in the short term (presently those in the Midwest dependent on the old economy), and self-corrects with the census, via reapportionment of number of seats in the house and the number of electoral votes assigned to each state.
