Comment by coralreef | Hacker News Reader

Comment by coralreef | Hacker News Reader

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How do you know they're gaining the most?

Because profits go up, but wages are stagnant. Corporations are increasingly cutting benefits, pensions, and treating employees as contractors and outsourcing. Millennials today are poorer than their parents were. This is the age we live in, profit maximization over everything else. The rich got richer, but the middle class and poor haven't seen any of these gains. Why should anyone believe that anything would change otherwise?

Even the unemployed people will gain in the long-term as the gains trickle down and/or they gain from other technological advances.

In the short run, depending on how rapidly automation occurs, this class of people will suffer greatly. They will need to be retrained and educated. It may be worthwhile for the state to invest in its people.

There are always jobs, but people don't take them because the wages are too low.

If the only jobs available are low paying with terrible conditions, then that's not a society you want to live in.

Its convenient to hide behind the economic theories, making sure the graphs line up so we don't see any deadweight losses or inefficiencies. But the practicality of it is always a shade darker. People cheat, monopolies are held. Gains don't always trickle down.

> They will need to be retrained and educated.

And that's not even always possible. People who are easily replaced by robots aren't going to suddenly start building those robots; it's likely above their intellectual ceiling. As low skilled jobs are replaced by fewer and fewer high skilled jobs, low skilled workers will be left permanently out in the cold.

Education can be a solution generationally, but the notion that an older person is going to suddenly go back to school to learn a new trade is simply not how people in general work.

See lump of labour fallacy.

No, they can still build robots inefficiently at low wages. And thanks to the heavy automation their real wage would be decent.

> older person is going to suddenly go back to school to learn a new trade is simply not how people in general work.

What if they have good incentives to go back to school?

> See lump of labour fallacy.

I don't need to, I'm not making it.

> What if they have good incentives to go back to school?

No amount of schooling will make the half of the population with an IQ below 100 able to hold a high tech knowledge job. You are ignoring the realities of the human condition. All of mankind simply cannot and won't ever be able to do knowledge work. When you kill the low skill labor jobs with automation, you kill the only jobs some people will ever be able to do.

The people can take jobs with low nominal wages which will have higher purchasing power due to automation. Jobs never run out; see lump of labour fallacy.

> Jobs never run out

We're discussing the fact that change is happening faster than people can adapt; that long term jobs won't run out has no bearing on the issue being discussed, that the rate of automation is happening faster than people can adjust hurting low wage workers. Beyond that, when intelligent machine are invented, that fallacy will be outdated, the past is not always prologue. Intelligent machines are unprecedented in human history, this will invalidate many old fallacies. Jobs for low skilled people will run out, it's inevitable.

> Because profits go up, but wages are stagnant. Corporations are increasingly cutting benefits, pensions, and treating employees as contractors and outsourcing. Millennials today are poorer than their parents were. This is the age we live in, profit maximization over everything else. The rich got richer, but the middle class and poor haven't seen any of these gains. Why should anyone believe that anything would change otherwise?

CPI (a measure of living cost--note that living standards increase)-adjusted hourly wages have increased 8% in the past decade. That's not that good, but we're looking at one of the richest countries in the world.

But PPP (measure of purchasing power) adjusted GNI per capita in the U.S. has increased by 25% in the past decade.

If you look at India (where huge portion of the world lives), PPP adjusted GNI per capita has doubled from 2003-2013. You'll probably retort "that's just numbers", but I live in India ;)

Similarly PPP adjusted GNI per capita has increased greatly in most poor countries.

> This is the age we live in, profit maximization over everything else.

In which age people don't want more money? Corporations are owned by shareholder who are people who want to make more money like everybody. Obviously, they will profit maximize.

> If the only jobs available are low paying with terrible conditions, then that's not a society you want to live in.

You misunderstood my point; I mean that automation increases real wages thus creating jobs.

> Its convenient to hide behind the economic theories

Haha, the good ol' economist bashing.

Those stupid eCONomists with their statist-tricks who just play around with graphs. /s

Kind of ironical when you hear HNers talk about supporting science w.r.t climate change but when it's economics suddenly many are the opposite. I guess people only support science when it confirms their priors.

Economics is a real science just like physics, mathematics, etc. Papers are published with statistical rigor and empirical testing. Indeed, economics is complex and counter-intuitive because the world isn't simple.

Actually my bachelor's is in economics, I'm not against it, nor am I against technology. Economics is a study of the behavior of people, and people aren't numbers, so there is a bit of an art to it (but that's another discussion). What we mean is you can't just use the theory and assume the world will happily follow it.

In the US, real wages and purchasing power have been falling: http://www.pewresearch.org/fact-tank/2014/10/09/for-most-wor...

Places like China and India have obviously gained the most because their industrialization is just now.

Like another comment said, societies aren't just lines on a graph, they can only handle so much change at once. Its important to think about the people being affected, rather than just assume they fall into place.

> In the US, real wages and purchasing power have been falling

Where did you get the idea that real wages are falling? Even that graph seems to contradict what you're saying.

I used BLS data to compute an 8% increase in hourly wages CPI (cost of living)-adjusted from 2007 to 2017.

> Economics is a study of the behavior of people, and people aren't numbers

Yes, but that's useless. Atoms aren't numbers but we model them with numbers. You can't do anything with an abstract notion of "person".

> What we mean is you can't just use the theory and assume the world will happily follow it.

You haven't said why the theory is wrong. You can say the exact same thing about evolution. "You can't just use the theory of evolution and assume the world will happily follow it."

> rather than just assume they fall into place.

I'm not assuming they fall in place; I'm giving reasons why they will benefit in the long-term.

With regards to the original submission, see https://www.reddit.com/r/badeconomics/comments/5uo9p3/bill_g... and https://www.reddit.com/r/badeconomics/comments/5uoowk/beatin... .

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