Tag Archives: automation

McKinsey on Income Stagnation

The McKinsey Global Institute has noticed inequality in the world, and is concerned about automation making it worse. Part of their solution is – this is a bit shocking – “government taxes and transfers”. It appears they are talking about lower taxes and higher transfers, which they acknowledge might not be “sustainable”.

If the low economic growth of the past decade continues, the proportion of households in income segments with flat or falling incomes could rise as high as 70 to 80 percent over the next decade. Even if economic growth accelerates, the issue will not go away: the proportion of households affected would decrease, to between about 10 and 20 percent—but that share could double if the growth is accompanied by a rapid uptake of workplace automation.

The encouraging news is that it is possible to reduce the number of people not advancing. Labor-market practices can make a difference, as can government taxes and transfers—although the latter may not be sustainable at a time when many governments have high debt levels. For example, in Sweden, where the government intervened to preserve jobs during the global downturn, market incomes fell or were flat for only 20 percent of households, while disposable income advanced for almost everyone. In the United States, lower tax rates and higher transfers turned a decline in market incomes for four-fifths of income segments into an increase in disposable income for nearly all households. Efforts such as these—along with additional measures such as encouraging business leaders to adopt long-term thinking—can make a real difference. The trend of flat and falling real incomes merits bold measures on the part of government and business alike.

June 2016 in Review

3 most frightening stories

  • Coral reefs are in pretty sad shape, perhaps the first natural ecosystem type to be devastated beyond repair by climate change.
  • Echoes of the Cold War are rearing their ugly heads in Western Europe.
  • Trump may very well have organized crime links. And Moody’s says that if he gets elected and manages to do the things he says, it could crash the economy.

3 most hopeful stories

  • China has a new(ish) sustainability plan called “ecological civilization” that weaves together urban and regional planning, environmental quality, sustainable agriculture, habitat and biodiversity concepts. This is good because a rapidly developing country the size of China has the ability to sink the rest of civilization if they let their ecological footprint explode, regardless of what the rest of us do. Maybe they can set a good example for the rest of the developing world to follow.
  • Genetic technology is appearing to provide some hope of real breakthroughs in cancer treatment.
  • There is still some hope for a technology-driven pick-up in productivity growth.

3 most interesting stories

too much democracy?

Andrew Sullivan has written a somewhat ridiculous article in New York Magazine called Democracies end when they are too democratic.

Socrates seemed pretty clear on one sobering point: that “tyranny is probably established out of no other regime than democracy.” What did Plato mean by that? Democracy, for him, I discovered, was a political system of maximal freedom and equality, where every lifestyle is allowed and public offices are filled by a lottery. And the longer a democracy lasted, Plato argued, the more democratic it would become. Its freedoms would multiply; its equality spread. Deference to any sort of authority would wither; tolerance of any kind of inequality would come under intense threat; and multiculturalism and sexual freedom would create a city or a country like “a many-colored cloak decorated in all hues.”

This rainbow-flag polity, Plato argues, is, for many people, the fairest of regimes. The freedom in that democracy has to be experienced to be believed — with shame and privilege in particular emerging over time as anathema. But it is inherently unstable. As the authority of elites fades, as Establishment values cede to popular ones, views and identities can become so magnificently diverse as to be mutually uncomprehending. And when all the barriers to equality, formal and informal, have been removed; when everyone is equal; when elites are despised and full license is established to do “whatever one wants,” you arrive at what might be called late-stage democracy. There is no kowtowing to authority here, let alone to political experience or expertise…

And it is when a democracy has ripened as fully as this, Plato argues, that a would-be tyrant will often seize his moment.

That’s an entertaining tale, but it’s somewhat silly to suggest the United States has “too much democracy”, if you define democracy as equality. For a long time we have had rule by a stable triumvirate of elites – a civilian government elite, a big business elite, and a military/security/intelligence elite. The big business elite pays off the politicians and bureaucrats in the civilian government so they can produce the propaganda to stay elected, the civilian government makes sure the rules are written unfairly in favor of big business so they can make enormous profits at the expense of the rest of society, and the military/security/intelligence elite gets a huge share of our national resources and free reign to do just about anything it wants abroad, in exchange for not overthrowing the civilian government which it could easily do any time. It’s been a very stable three-legged stool.

In the past there has been just enough upward mobility for those of us in the general population to look the other way and buy into the propaganda enough to keep the system stable. Most of us can’t join the true elite, but the middle class have been able to train in professions and become moderately wealthy, while the working class have been able to get jobs that pay enough to join the middle class. The poor have been too few and too divided to organize politically. I think what is starting to happen is that this system of upward mobility is starting to break down now on a large enough scale that a significant chunk of the population is no longer buying into the propaganda and supporting the elites, and the whole political system is starting to teeter. I think it’s due partly to economic factors outside our control, like automation, and partly due to the short-sighted greed of the elites who are insisting on gobbling up a larger and larger share of a pie that is no longer growing as fast as it once did, if all. Environmental factors may be starting to play a role too, although I am still unsure of that.

True democracy, to me, would be a system that allows us to come to a consensus on policies that most of us, not just a majority but almost all of us, can accept, even if these policies are not everyone’s first choice. In a U.S. context it also has to be about true equality of opportunity, if not equality itself. How can anyone look at what is going on in our society and political system and think we have “too much democracy”?

March 2016 in Review

3 most frightening stories

3 most hopeful stories

3 most interesting stories

February 2016 in Review

I’m going to try picking the three most frightening posts, three most hopeful posts, and three most interesting posts (that are not particularly frightening or hopeful) from February.

3 most frightening posts

3 most hopeful posts

3 most interesting posts

  • The U.S. election season certainly is getting interesting, although not really in a good way. ontheissues.org has a useful summary of where U.S. political candidates stand…what are the words I’m looking for…on the the issues. Nate Silver has an interesting online tool that lets you play around with how various demographic groups tend to vote.
  • Fire trucks don’t really have to be so big.
  • Titanium dioxide is the reason Oreo filling is so white.

Citi and Oxford on automation

Citi and Oxford have a long report called Technology at Work v2.0: The Future Is not What It Used to Be. Among the worrisome statistics and over-the-top infographics: 77% of jobs in China at risk due to automation, compared to 47% in the U.S. 77% seems like a recipe for serious unrest. 47% is still half. Still, maybe these are existing jobs and there will be new jobs created. Like robot repairman, for example. Being the guy who owns the robots seems like a very good option, if you can pull it off. Another eye opening statistic they show is the payback period for investments in robots at 1-2 years in China right now.

SOTU

I’ll pull out a few quotes from Obama’s State of the Union that are relevant to the theme of this blog.

First, automation and globalization:

Today, technology doesn’t just replace jobs on the assembly line, but any job where work can be automated. Companies in a global economy can locate anywhere, and they face tougher competition. As a result, workers have less leverage for a raise. Companies have less loyalty to their communities. And more and more wealth and income is concentrated at the very top.

What automation and globalization have in common is that if you are a relatively low-skilled worker in a relatively high-income country like the U.S., there is a risk your job could be replaced either by a computer (automation) or a low-skilled worker in a low-income country (globalization). Where they differ is that automation is starting to squeeze those low-skilled workers in the low-income countries too, and gradually it will also start to squeeze the higher-skilled workers in the higher-income countries. Obama’s solutions to all this – education and training, unemployment and wage insurance, healthcare and childcare benefits to make employment more flexible, lowering barriers to entrepreneurship, are the obvious ones, but we’ve been tinkering with these things for a long time with only slow progress, and the trends are only going to accelerate.

Second, biotechnology and genetics:

Last year, Vice President Biden said that with a new moonshot,America can cure cancer. Last month, he worked with this Congress to give scientists at the National Institutes of Health the strongest resources that they’ve had in over a decade. (Applause.) So tonight, I’m announcing a new national effort to get it done…let’s make America the country that cures cancer once and for all.

This seems to be a nod to biomedical research and biotech more generally, which I am convinced is the next big technology revolution akin to the information revolution we have been going through over the past few decades.

Next, climate change and fossil fuels:

Now we’ve got to accelerate the transition away from old, dirtier energy sources. Rather than subsidize the past, we should invest in the future — especially in communities that rely on fossil fuels. We do them no favor when we don’t show them where the trends are going. That’s why I’m going to push to change the way we manage our oil and coal resources, so that they better reflect the costs they impose on taxpayers and our planet. And that way, we put money back into those communities, and put tens of thousands of Americans to work building a 21st century transportation system.

Actually, I am not sure what he is talking about here. I would support a revenue-neutral carbon tax, with the proceeds invested in education, training, research and/or infrastructure. But I’m only speculating. If there was some initiative announced along these lines I missed it.

Finally, corruption in U.S. politics:

We have to reduce the influence of money in our politics, so that a handful of families or hidden interests can’t bankroll our elections. (Applause.) And if our existing approach to campaign finance reform can’t pass muster in the courts, we need to work together to find a real solution — because it’s a problem… Those with money and power will gain greater control over the decisions that could send a young soldier to war, or allow another economic disaster, or roll back the equal rights and voting rights that generations of Americans have fought, even died, to secure.

This is pretty vague. I would support a constitutional amendment to clarify that a person is a human being and a human being is a person. Human beings should have the right to free political speech, but corporations and other special interest legal entities should not. The law can be written to preserve the important rights corporations do have that create a fair and predictable playing field for businesses to compete – equal protection under the law, access to the courts, protection from arbitrary seizure of property, and so forth. But the richest and most powerful shouldn’t be able to buy politicians and write the rules of the game unfairly in their favor.

On the possibility of those right-wing self-interested corporate entities joining forces with right-wing grass roots impulses, resulting in something truly ugly:

But if we give up now, then we forsake a better future.  And then, as frustration grows, there will be voices urging us to fall back into our respective tribes, to scapegoat fellow citizens who don’t look like us, or pray like us, or vote like we do, or share the same background.

I wouldn’t have believed that was likely a year ago, but here we are approaching the official beginning of an election season that is turning out to be very surprising, with Obama riding off into the sunset.

Strong AI

Here’s an article about “Strong AI“:

This is how computers interact with us. They don’t understand English or whatever language we speak, but they do understand binary code. A human programmer tells the computer how to respond to you based on your input. The same thing goes for chess. The computer does not at all understand that it’s playing chess or any other game – it doesn’t even know what a game is. It only knows that, if you make a move in chess, that equates to some machine code to which it should respond. It then references its giant chess book – put there by humans and written in machine code – to decide how to respond to you.

Over the years, these tomes have become enormous. Using the chess example again, it would take many years for a human to sift through one of these tomes, but a computer can do it in seconds. As a result, you now have computers that simulate the total sum of human knowledge with regards to chess and yet they don’t understand a lick of it. What they cando, however, is obey the instructions put there by a human to beat you, handily…

Once we have the technology to make an ambulatory, perceptive robot using pre-written instructions (i.e. the ‘tome’), the challenge will then be to ‘birth’ one that has no pre-written instructions and no prior knowledge of the world, forcing it to learn like a human child. This sort of self-learning robot is an example of what Searle calls ‘Strong AI[10]’.