Dark Star

Those pushing the current version of AI are repeating the justification for replacing people with machines the same way as they always have: 'yes, AI will kill jobs, but will create new ones.' But the Pollyanna Pumpers never address the crux of the issue (Luddites before them, too): does the switch to more capitalist production yield a net increase in employment? There's little evidence that more capital intensive production has worked out that way.

First, of course, is that the jobs destroyed are most often done by the less educated, i.e. tasks that an automaton can accomplish with a bit of programming, be that a Jacquard loom or an HPC LLM AI module. Even the Pollyanna Pumpers admit that the new jobs nearly always require more skills, education, and experience (often all three) than the work destroyed. I'd wager that the Pollyanna Pumpers still live in the world of Henry Ford, who used the assembly ine method (which he didn't invent, of course) to increase productivity in making his automobiles.

According to Domm, the implementation of mass production of an automobile via an assembly line may be credited to Ransom Olds, who used it to build the first mass-produced automobile, the Oldsmobile Curved Dash. Olds patented the assembly line concept, which he put to work in his Olds Motor Vehicle Company factory in 1901.

But what is routinely forgotten, or buried more likely, is that the rise in employment attributed to Ford, et al, was the result of factors not necessarily available today.

- the skill level of the new workers was largely lower than the displaced
- the reduced cost led to reduced price
- the reduced price led to increased demand
- and the increased demand was met with increased output
- at the time of Ford's assembly line, oligopoly in autos didn't exist

So, in other words, there was ample demand to be satisfied by the large increase in output made possible by industrial progress.

What do we have today? Conventional manufacturing has moved to low wage sites on the presumed basis that labor is a large enough bite of the BoM to offset the fixed costs of automation. On the other hand, as capital gains an increasing share of the BoM, capital's financial gain falls as there's a decreasing amount of labor (of ever lower value in shithole countries, run by capital friendly dictators) to replace. The capitalist's dilemma. How much more of the BoM does capital have to suck up until it no longer can find labor to eat? Only The Shadow knows.

But we do know, sort of, what is likely to happen:
- as labor shifts to ever more educated, and ever more changeable, skills (how soon will AI engines replace accountants?)
- what happens to income distribution as capital eats more of the BoM?
- it is more likely than not that, in the near term (relatively), income will become more concentrated
- with income more concentrated, where will increasing demand come from to absorb more productive output?

In summary then, the real problem with automation generally, and now with primitive AI making folks nuts, is how to keep the macro-economy humming along when fewer folks have incomes to buy the widgets that factories spit out?

The scenario isn't original to my little grey cells, because I recall encountering it in a movie or writing a long time ago, but I don't recall the specifics. It goes like this - The Factory of the Future^© will have but one human, who turns on the power at the start of production, and turns it off when production is complete. He then discovers that his job is replaced by a robot.

The moral of the story? While labor transition has been a problem from the start of the Industrial Revolution, kicking the can down the road will, soon enough, no longer work. The near term answer is likely to be industrial dictatorship, where the .1% seek to be ever richer while the poor eat cake. The United States of Florida; I can't wait. Alas, that solution isn't sustainable, either. When the macro-BoM reaches its Tipping Point (I sure do wish I knew that value!), there will no longer be enough moolah in the hands of the masses to absorb the largess from automated production, and the capitalists will no longer be getting sufficient revenue to pay for the automation, since there's essentially no labor to remove from the macro-BoM and way too few consumers to buy the widgets.

The solution to the problem, as one might expect, is a new Theory of Distribution. Not that the Industrial Dictatorship will ponder the problem. They already have an existential threat staring them in the face, but choose to ignore it. All together now - climate change. -