Minimum Wage and a Roboticized Economy

[socialist]

Many on the left want a $15 minimum wage. But they fail to realize that companies will downsize or use computers or robots to do the work of former minimum wage employees. One of America's fast-rising economists, Aaron Clarey, discusses this. This was an interesting 20 minutes from Captain Capitalism.

[Bonam]

The sooner we automate whatever can be automated, the better. If minimum wage policies help to speed that along, why not? Progress.

[ReeferMadness]

Wow. This guy is really full of himself. I'm not sure whether to respond to his views on human reproduction (which can best be described as Nazi-inspired), his deeply flawed views of technological advancement or his ridiculous views on people.

Suffice it to say, if the world were always dominated by simpletons like him, we'd still be fighting tigers with stone weapons.

[ReeferMadness]

The sooner we automate whatever can be automated, the better. If minimum wage policies help to speed that along, why not? Progress.

The problem with the way economists view the world is that they can only see value when money changes hands. Many of the most brilliant scientists, mathematicians, artists and musicians were either unappreciated or not fully appreciated during their own times. There's a lot more money to be made making minor improvements to smart phones than there is pioneering new science.

If automation can free people to pursue their dreams without having to find someone who will pay for each thing they do, we can spark a new human renaissance. But small-minded people like this guy will do their best to block it.

[bush_cheney2004]

Wow. This guy is really full of himself. I'm not sure whether to respond to his views on human reproduction (which can best be described as Nazi-inspired), his deeply flawed views of technological advancement or his ridiculous views on people.

I gots news for you...lots of technological advancement was "Nazi inspired".

[-1=e^ipi]

There is no such thing as a 'living wage'. Only a living income. Guaranteed income makes more sense than minimum wage policies.

[eyeball]

The sooner we automate whatever can be automated, the better. If minimum wage policies help to speed that along, why not? Progress.

Because the need for a vastly expanded welfare system will be an almost automatic consequence?

Maybe in the future people with jobs will be like rock stars and we'll read about and fantasize about being like, them. They'll brag about how many taxes they pay us instead of trying to hide them.

[Peter F]

In the Utopian capitalist world there are no employee's whatsoever - yet, somehow, people buy their stuff.

Of course the guy said such a utopian robotized existence will never happen. He's even fully in favour of income distribution in some

manner or other. So I'm not so sure why minimum wage drives capitalists nuts. As the man says jobs may come and go but other jobs will arise. Companies fail cause they go broke and other companies start up.

Minimum wage will have very little to do with a functioning economy.

Edited September 18, 2015 by Peter F

[bush_cheney2004]

Plus the machines don't scream for free health care.

[Peter F]

Well, no, of course not. They're machines. They don't scream even when melted down for scrap. The owner's of the machines certainly scream for maintenance though and they will scream very loudly until they get it.

[bush_cheney2004]

Well, no, of course not. They're machines. They don't scream even when melted down for scrap. The owner's of the machines certainly scream for maintenance though and they will scream very loudly until they get it.

A lot of the 'machines' are software automation, embedded firmware, etc.....nothing to melt down. Easy to update.

[Peter F]

...and maintained right?

[bush_cheney2004]

...and maintained right?

Depends on the product or service. Servers and PLCs have much higher MTBF than manufacturing machines and tooling.

[Moonlight Graham]

I doubt a $15 minimum wage will lead to burgers flipping themselves, bathrooms cleaning themselves, robo-daycares, & coffee & donuts flying out of a drivethru window.

But Bonam is right, an automated society is wonderful...so long as all people who want it still have a means to work and live with all their needs met. Robo factories did not destroy the worker, they're still needed to design, build, and oversee the equipment.

[PrimeNumber]

$15 minimum wages will not speed this up that much. The cost of going full robotic on your workforce is no where near plausible for many major corporations at this point. Raising their base employment costs by a pretty small percent won't speed it up that much.

[overthere]

Raising their base employment costs by a pretty small percent

$15 min wage will close the doors on a bunch of fast food joints in Alberta. People buy cheap food because it is cheap, and cracking the wages bill 50% will mean many fewer jobs.

And people work unskilled jobs because they are unskilled. That won';t change, other than the jobs avail;able at the new rate won't be there any more.

Oh, and going from $10/hour to $15/hour is not a small percent- it is 50%.

Oh, and a prime reason for the NDP to want to do this is less obvious, but for sure a factor. People making are not unionized in part because the union industry knows they cannot afford to pay even small dues. But it gets a lot more viable at $15/hour and up. And guess who organized labour votes for?

[eyeball]

$15 min wage will close the doors on a bunch of fast food joints in Alberta.

Encourage co-ops or employee-owned franchises to run them instead.

[WIP]

The sooner we automate whatever can be automated, the better. If minimum wage policies help to speed that along, why not? Progress.

Fine and dandy EXCEPT that we have a capitalist system which has thrown off all restraints since your side was able to get globalization and the dismantling of unions and workers rights and benefits over the last 30 years or so.

Under a capitalist system, a worker with no rights to collective bargaining, is a serf, who can be cast out when their work is no longer needed for the profitability of the company. If we had an economy organized around socialist principles, the introduction of automation would allow EVERYONE to work fewer hours and still be able to make a living.

This was actually the futuristic vision of John Maynard Keynes, who made the unfortunate assumption that the owners of capital were interested in the welfare of society at large, and not just in their own narrow self-interests. So, Keynes prediction of what should have become an 18 hour work week a few decades ago didn't happen, because the capitalists have taken all of the surplus benefits of increasing productivity!

[Topaz]

Do you people know that the largest sector for the Canadas economy is SERVICE coming in at 70% of the work force and the way my keyboard is working, or not working right now, i like to send it back to China and start making them here in Canada!!!!

[Bonam]

Fine and dandy EXCEPT that we have a capitalist system which has thrown off all restraints since your side was able to get globalization and the dismantling of unions and workers rights and benefits over the last 30 years or so.

My "side"? I was unaware that I had a side. I should get this side to start doing something for me I guess....

Under a capitalist system, a worker with no rights to collective bargaining, is a serf, who can be cast out when their work is no longer needed for the profitability of the company. If we had an economy organized around socialist principles, the introduction of automation would allow EVERYONE to work fewer hours and still be able to make a living.

Our economy does have socialist principles built into it. The question is one of how much socialism you build in.

This was actually the futuristic vision of John Maynard Keynes, who made the unfortunate assumption that the owners of capital were interested in the welfare of society at large, and not just in their own narrow self-interests. So, Keynes prediction of what should have become an 18 hour work week a few decades ago didn't happen, because the capitalists have taken all of the surplus benefits of increasing productivity!

If you do some simple math you'd see that this argument is deeply flawed. Just sum up all the extra gains that "capitalists" have made over the last few decades and divide that number by the rest of the population. The extra gains, once redistributed, would make only a small impact. Not enough to reduce people's work week by 1 hour, let alone 22.

[dre]

$15 min wage will close the doors on a bunch of fast food joints in Alberta. People buy cheap food because it is cheap, and cracking the wages bill 50% will mean many fewer jobs.

And people work unskilled jobs because they are unskilled. That won';t change, other than the jobs avail;able at the new rate won't be there any more.

Oh, and going from $10/hour to $15/hour is not a small percent- it is 50%.

Oh, and a prime reason for the NDP to want to do this is less obvious, but for sure a factor. People making are not unionized in part because the union industry knows they cannot afford to pay even small dues. But it gets a lot more viable at $15/hour and up. And guess who organized labour votes for?

People buy fast food mostly because its fast, and because for whatever reason they like the taste. Its not really that cheap any more. It cost me $25 to take my kids out to A&W the other day and we didnt even eat all that much.

Also not only do fast food restaurants have <15 workers. Normal restaurants do as well and so do grocery stores, farms, etc. Sooo the other food options would increase as well keeping the playing field somewhat level.

And the thing is... you might very well be paying that money already. If workers are paid less than what it takes to live, then they are probably supplementing that income with the use of government subsidies, social programs etc, that you currently pay for today. That basically ammounts to the public paying part of these workers salaries, so they can pretend stuff is cheaper.

[TimG]

And the thing is... you might very well be paying that money already. If workers are paid less than what it takes to live, then they are probably supplementing that income with the use of government subsidies, social programs etc, that you currently pay for today. That basically ammounts to the public paying part of these workers salaries, so they can pretend stuff is cheaper.

Spurious logic. Low/no income people get subsidies whether they are working or not so it is silly to "attribute" these payments as job subsidies. Moreover prices will go up which will reduce demand which will, in turn, reduce the number of jobs which only increases the amount that the government has to pay. Edited September 18, 2015 by TimG

[dre]

My "side"? I was unaware that I had a side. I should get this side to start doing something for me I guess....

Our economy does have socialist principles built into it. The question is one of how much socialism you build in.

If you do some simple math you'd see that this argument is deeply flawed. Just sum up all the extra gains that "capitalists" have made over the last few decades and divide that number by the rest of the population. The extra gains, once redistributed, would make only a small impact. Not enough to reduce people's work week by 1 hour, let alone 22.

Hmmmm... Im not so sure about. "Last few decades" is a little vague so I cant start with a data point, but only 54% of Canadas national income is allocated towards workers in Canada. The rest goes to business owners and shareholders. Thats lower than the US, Japan, UK, Japan, France, and Germany, and among similar economies. Of developed G20 countries only Italy and Australia allocate less to labor. If workers got 75% instead of 54% they would get a few extra months per year worth of income.

Not only that but the total pie might grow as well, because economies like ours based on consumption and services (80% of our GDP) grow faster when large ammounts of people have more disposable income to purchase products and services.

Our economy does have socialist principles built into it. The question is one of how much socialism you build in.

If the line between business and government wasnt so blurred, then I dont think we would need very much socialism at all. I would actually argue that socialism as a means of adressing income inequality is a really bad idea for the people on the wrong side of the income gap. Its basically a plan to shut people up and placate them by giving them a few extra scraps and handouts instead of really addressing the wild swing in how our economy allocates capital from labor to investment that we have seen over the last 30 years.

I would rather try taxing labor and investment income at the same rate, and addressing the fact that investors and business owners have a disproportionately large share of influence on the government and a disproportionate share of access, and ditching the whole idea of corporate personhood.

[TimG]

I cant start with a data point, but only 54% of Canadas national income is allocated towards workers in Canada.

Except the 'business owners' include a huge number of Canadians saving in their pensions and/or RRSPs. So your stat is quite meaningless.

I would rather try taxing labor and investment income at the same rate, and addressing the fact that investors and business owners have a disproportionately large share of influence on the government and a disproportionate share of access, and ditching the whole idea of corporate personhood.

Except this is largely myth. A corporation is not a "person" under the law. It is an entity that can sign legal contracts so it is treated like a person in some legal contexts but it is not a person in most contexts (e.g. a corporation has no right to life and can be terminated if the government see fit).

Saying corporations have a 'disproportionately large share of influence' is simply code for 'politicians don't do what I want therefore it must because of some conspiracy and not because what I want is just dumb policy'.

Edited September 18, 2015 by TimG

[dre]

Spurious logic. Low/no income people get subsidies whether they are working or not so it is silly to "attribute" these payments as job subsidies. Moreover prices will go up which will reduce demand which will, in turn, reduce the number of jobs which only increases the amount that the government has to pay.

No THAT is spurious logic. It would simply mean that the real price of goods and services was built into the price instead being paid for partially by your taxes. Like I said if full time workers are not paid enough to live without subsidies, that does not really make prices lower if you have to make up the difference at tax time. The same ammount of dollars are paid its just a matter of how they are paid. It does not increase or decrease demand because the cosumer eventually pays the exact same thing.

But congratulations. You just made an argument for increasing demand by making prices artificially lower through government subsidies.