Brad Wardell's views about technology, politics, religion, world affairs, and all sorts of politically incorrect topics.

imageAs pressure mounts to raise the wages of fast food workers, advocates may want to take note that such wage increases eventually pass a threshold where it makes financial sense to simply invest in automation. As Grocery Store cashiers learned, these jobs are not a given. We are all competing not just with each other but with robots. 

One of the primary reasons that the gap between the rich and poor has increased so much in the past 20 years has been the rise in IT.  Once we purchase a computer, robot, etc. its capabilities – its output and productivity are owned by the buyer which increases the wealth generated by that person.

As people demand McDonalds pay workers $15 an hour and the government insists that they also provide health care, restaurant owners are increasingly evaluating whether to simply replace their work force with machines.  

Naturally, in 2017 when today’s “living wage advocate” is ordering their Big Mac from a friendly touch screen and having it delivered momentarily by a robot they’ll make no connection between how their beliefs resulted in more people living in poverty. Instead, they’ll blame McDonalds. They’ll blame greedy restaurant owners. But they won’t consider that perhaps it wasn’t such a good idea to price people out of their workforce.

More reading:

http://singularityhub.com/2013/01/22/robot-serves-up-340-hamburgers-per-hour/

http://www.thestar.com/business/2012/11/29/automatic_burger_machine_could_revolutionize_fast_food.html


Comments (Page 5)
on Aug 19, 2013

Unions became "Greedy" when the Soviet Union was no longer a threat, and American business interests stopped being concerned about the American worker turning communist.

 

Also Bargain prices- it's hard to be picky when you don't have many resources- it's why Wal-Mart does great in recessions but during improving times they don't do as well (looking at same-store growth here)

 

 

on Aug 19, 2013

HG_Eliminator


But really is it the unions fault or Americas desire for cheaper stuff?

The thing you are complaining about, the desire to make goods available as widely as possible as cheaply as possibly while still being profitable, is the exact thing that has allowed the human race to reach an unprecedented (and still growing) level of quality of life.  The fact that exotic or expensive goods continue to get cheaper and therefore are more widely available is why even the "poor" in the United States typically have an average of over 1 car per household, a TV, a modern video game system, a computer and have a life expectancy into the 70s (higher once you account for violent crime).  

Eliminate the thing you are complaining about (which is really the driving force behind capitalism) and that all goes away.  We're back in a protectionist society where the poor can't afford quality of life items, where the ability to drive to find work isn't an option and where you don't have household quality of life improving devices like laptops and smartphones and TVs and whatnot.  Again, like most progressive ideas, this hurts the poor disproportionately.  The rich can and will always be able to afford those items whose prices you just drastically increased.  The poor can't. 

Instead of complaining about the "good old days" and how life today is so bad we should take the time to understand that capitalism and human nature are what they are and we should adjust for that.  The problem isn't companies looking to make a profit nor Americans looking for more access to goods.  Those instincts are good and lead to an increased quality of life for consumers (because the only way to continually make a profit is to continually improve or to make your goods more widely available by making them cheaper).  The problem is poorly thought out government programs designed to be the magic bullet cure all of our ills.  They distort the market against some people in favor of others and lead to all sorts of inefficiency and barriers to entry that only end up helping big corporations while hurting both the poor and the entrepreneur.  You can't blame the corporations for that, they are just participants in the system.  You have to blame the people making the rules for making bad rules.  

We keep voting for these idiots despite the fact that their magic bullets repeatedly fail, repeatedly make the problems worse, and half the time are only really designed to benefit political supporters rather than the people they will benefit.  We, the citizens of the US, have incentivized politicians to offer us gimmicks in exchange for real solutions because we'd rather feel good about the nice sounding gimmick than take the time to understand the nuance and complexity of the potential real solutions.   

 

on Aug 19, 2013

Kantok
The problem isn't companies looking to make a profit

 

Never said companies trying to turn a profit was bad, but when they start laying off workers not because their losing money, but only to increase their profit margin.."padding their own wallets" then yeh I take issue with it..especially if they use the extra revenues to vote themselves huge raises,...to me that's rampant greed.

Kantok
Eliminate the thing you are complaining about (which is really the driving force behind capitalism) and that all goes away. We're back in a protectionist society where the poor can't afford quality of life items, where the ability to drive to find work isn't an option and where you don't have household quality of life improving devices like laptops and smartphones and TVs and whatnot. Again, like most progressive ideas, this hurts the poor disproportionately. The rich can and will always be able to afford those items whose prices you just drastically increased. The poor can't.

Really?? Iphones, Ipads and unlimited data plans are cheap? Interesting...

Growing up in some of the poorer neighborhoods in so Ca., "ghost town" Pomona for example, I watched my mom struggle with 2 jobs at times trying to keep a roof over our head while providing electricity,gas, food and water, and clothing while driving an old pinto, her proudest moment for a long time was buying a 1975 Cordoba in 1984...

All the while most of my neighbors "Parent's" {as many had thier husbands or children's fathers living with them}. sat at home all day, driving newer Mercedes, Volvo's and having all the lavish goodies like color TV's, game consoles etc..Why? welfare.. they didn't buy the cheap stuff either and still don't.... walking around with hair done weekly and nails all done up, gold jewelry, expensive clothes.

Hell many of them live better than I do currently working... and it's not due to bargain shopping..

 

 

 

 

on Aug 19, 2013

HG_Eliminator


Really?? Iphones, Ipads and unlimited data plans are cheap? Interesting...

Growing up in some of the poorer neighborhoods in so Ca., Pomona for example, I watched my mom struggle with 2 jobs at times trying to keep a roof over our head while providing electricity,gas, food and water, and clothing while driving an old pinto, her proudest moment for a long time was buying a 1975 Cordoba in 1984...

All the while most of my neighbors mom's sat at home all day, driving newer Mercedes, Volvo's and having all the lavish goodies like color TV's, game consoles etc..Why? welfare.. they didn't buy the cheap stuff either and still don't.... walking around with hair done weekly and nails all done up, gold jewelry, expensive clothes.

Hell many of them live better than I do currently working... and it's not due to bargain shopping..

 

If you buy an iPad you're paying a premium for brand name.  Buy a cheap Android tablet.  Get 90% of the functionality for $150 or less.  Hell, buy a N7 and get 100% of the functionality for half the price.  But that's irrelevant.  Think of what you're getting for that price.  10 years ago you would have spent thousands for the same functionality.  

Hell 4 years ago your only choice was an iPad for $500+.  In 4 short years you have dozens of options, some of which are $100.  That's capitalism at work. Companies saw the market created by Apple and realized they could expand it buy offering alternatives that were cheaper, thus bringing tablets to the masses.  I can get my kid a really good tablet for school for $150.  This is a market that largely didnt' exist 4 or 5 years ago and now they're cheap that it's legitimate to save up and get one with a tiny bit of extra money each week.  Capitalism is choice.  You may not get an iPad specifically, but you have a whole host of choices that are cheaper now.  

Your example proves my point.  

The system is certainly flawed and the gaming of the social safety net is part of the problem.  But it's not capitalism that's at fault.  I'll say this again and again because ultimately it's the only point that matters, the fault lies with a government full of politicians who dream up magic bullet solutions without understanding the impact of those solutions, the likely problems caused or exacerbated by those solutions and, in the worst cases, not really designed to solve anything at all but to reward cronies.  

You and I agree that there's a problem.  We even agree on most of what that problem is.  The difference is you aren't willing to see that it's the system that is at fault, not the individual actors within the system.  Greed exists, the profit motive exists, but that's one of the reasons why capitalism works.  Because it aligns the incentives that spur human nature with the greatest possible impact.  When accompanied by the right rules it channels human nature in a productive direction.  Things go awry is when favor-monkey politicians muck around with the rules screwing everything up with either half-assed ideas or fully thought out ideas designed to help political friends at the expense of constituents.  

You're nefarious company, the one that is laying off productive employees solely to pad their executive's leadership?  They'll be out of business before long or they'll sell of a shell of a company and likely take huge losses in the process.  You said so yourself.  The system worked, by punishing bad management. 

on Aug 19, 2013

Kantok
The difference is you aren't willing to see that it's the system that is at fault,

 

No ..I never said the government hasn't had a hand in the failings of our economy, their no less culpable than those who have no viable excuse for outsourcing work to foreign interest's other than to fatten an already bulging profit margin.

 

My Point was that, OK we had a some what working economy then we introduced cheap products from foreign markets..US factory's lay off thousands and thousands of employees as the demand for the more expensive American products drops..increasing the size of the poor class as now these folks are jobless.. they now have to buy cheaper stuff..and thus increase the dependency on foreign products..In time the cycle continues as more and more people stop buying the American made products,, trying to save a buck,, essentially putting them selves out of work..

IMO the cycle will continue till the American workforce can no longer earn anything more that what other countries are paying their labor force. So US. companies can compete with foreign manufacturers. I certainly do not like the Idea of having to drop Americas quality of life to match other nations, I would have liked to see them being brought up to ours instead..

 

Kantok
If you buy an iPad you're paying a premium for brand name. Buy a cheap Android tablet. Get 90% of the functionality for $150 or less. Hell, buy a N7 and get 100% of the functionality for half the price.

 

Yes but in my experience, the majority of the folks buying the cheaper android, tablets and phones is the shrinking middle class.. I see plenty of folks from lower income household's running around Carrying the "Pricy Status symbols".

 

 

Do i believe the gov needs a reworking to get our economy streamlined? yes. Their current strategy of throwing band-aid's at a gaping wound Is laughable at best, tho the American public seems to eat that shit up faster than my mother in-law at a sizzler buffet.

As long as the Politicians can keep the average American acting like mushrooms, (sitting in the dark and living off what ever crap is thrown their way..)  nothing will change..

on Aug 21, 2013

Lets not play it off like we didn't know all along that greed is generally the driving force of success. To be successful generally one has to have a degree of greed in them. That touch of "I want more" lends to drive folks to go the extra mile trying to get ahead..

I've yet to meet a rich person whose motivation in life was material wealth.  Wealth tends to be a byproduct of doing something else.  I never set out to be rich. I just wanted to make really cool stuff.  It's not about wanting stuff. It's about wanting to DO stuff.

on Aug 22, 2013

With regards to how workers are categorized, they're always regarded as a "cost". That's just accounting. Companies have Revenues and they have Expenses. There's nothing wrong with being an "expense". It means that people (stock holders) find value in them. It is certainly a lot better than being a liability.

I understand where you are coming from. You are explaining. The problem here is that people like to be thought of as people, not "costs" and when an average person hears about corporations using those kind of words it makes one feel less than human. Tie that in with data you hear about, corporations sitting on a trillion dollars, 50,000 factories closing in the last 10 years because of out sourcing, unions getting busted, CEO's like Ron Johnson who made a thousand times what the average worker at JC Penny makes and you get a toxic mix. Ron Johnson got bounced but I'll bet he had a golden parachute. In this climate being an "expense" is like wearing a bulls eye on your shirt. That's far from being valued.

I've yet to meet a rich person whose motivation in life was material wealth. Wealth tends to be a byproduct of doing something else. I never set out to be rich. I just wanted to make really cool stuff. It's not about wanting stuff. It's about wanting to DO stuff.

Either cool stuff or the challenge of creating something that is better than what's out there. For some that's it but I am not talking about people like that. People like that and I know a person like that. He is the best person I have ever had the honor of working for. Yes I consider it an honor because he knows the value of a loyal employee. The problem with many "rich" people is that they have what I believe to be the same physiological make up as some serial killers or dictators. I am not saying that they are as evil as that. What I am saying is that they are anti social creatures. They do not connect with normal people. They cannot put themselves in the shoes of a guy working in an oil change place. I don't think that they give a crap about average people except for making money off of them. I think Ayn Rand was this sort of person and that her ideas are a good example of this kind of thinking.

on Aug 22, 2013

Chasbo

I understand where you are coming from. You are explaining. The problem here is that people like to be thought of as people, not "costs" and when an average person hears about corporations using those kind of words it makes one feel less than human. Tie that in with data you hear about, corporations sitting on a trillion dollars, 50,000 factories closing in the last 10 years because of out sourcing, unions getting busted, CEO's like Ron Johnson who made a thousand times what the average worker at JC Penny makes and you get a toxic mix. Ron Johnson got bounced but I'll bet he had a golden parachute. In this climate being an "expense" is like wearing a bulls eye on your shirt. That's far from being valued.

You're still blaming the players, not the people who control the rules of the game.  The rules of the game determine how people and organizations act.  And for the record you should be glad to be an expense.  I know I am.  It means I have a job and that my company considers me to be of value.    

Chasbo

The problem with many "rich" people is that they have what I believe to be the same physiological make up as some serial killers or dictators. I am not saying that they are as evil as that. What I am saying is that they are anti social creatures. They do not connect with normal people. They cannot put themselves in the shoes of a guy working in an oil change place. I don't think that they give a crap about average people except for making money off of them. I think Ayn Rand was this sort of person and that her ideas are a good example of this kind of thinking.

The problem with many "poor" people is that they have what I believe to be the same physiological make up as some sloths or toads.  I am not saying they are as stupid as that.  What I am saying is that they are lazy creatures.  They do not understand the value of work like normal people.  They cannot push themselves to get out of bed on time in the morning like a regular working guy can.  I don't think they give a crap about the fact that they are entirely dependent on other people's hard earned money. 

/sarcasm

Now... don't I sound like an asshole?  In a discussion like this generalizing an entire class of people is unproductive and pointless.  

"Rich" people, as you put it, are no more the shitty Hollywood movie caricatures you make them out to be than poor people are the caricatures I described above.  They're all just people with hopes and dreams and challenges and problems.  In both instances there are the occasional bad eggs in the "group".  But this idea that just because someone is wealthy it makes them some sort of villain is part of our society's problem.  The vast majority of wealthy people are regular, every day people who were very successful at something and should be emulated (their habits, their work ethic, their ability to align their passion with the job, etc).  Just like the vast majority of extremely poor people are sympathetic people in need of a hand.  Taking the extreme example of either as the generalized example is silly, at best, and is useless as a basis of discussion. 

on Aug 22, 2013

Frogboy
I've yet to meet a rich person whose motivation in life was material wealth.  Wealth tends to be a byproduct of doing something else.  I never set out to be rich. I just wanted to make really cool stuff.  It's not about wanting stuff. It's about wanting to DO stuff.

I guess you haven't met many people in finance.  I have, and most of them despise their jobs.  They're doing it because they can make a pile of money and retire as soon as possible.

You're probably referring to entrepreneurs.

 

on Aug 22, 2013

Very cool discussion. Sadly my englisch is not good enough to participate, but i would side me with HG_Eliminator.

on Aug 22, 2013

HG_Eliminator
IMO the cycle will continue till the American workforce can no longer earn anything more that what other countries are paying their labor force. So US. companies can compete with foreign manufacturers. I certainly do not like the Idea of having to drop Americas quality of life to match other nations, I would have liked to see them being brought up to ours instead..

Which brings us back to this threads main topic. The "reshoring" of American Jobs is already happening. For exactly the reason you said although the details are a little different. Things are starting to be made in America again because robots are becoming even cheaper then Chinese migrant workers. Technology has simply gone past the point where people can make a living pretending to be robots by doing simple repetitive tasks all day. It's not something people enjoy anyway.

on Aug 22, 2013

HG_Eliminator


IMO the cycle will continue till the American workforce can no longer earn anything more that what other countries are paying their labor force. So US. companies can compete with foreign manufacturers. I certainly do not like the Idea of having to drop Americas quality of life to match other nations, I would have liked to see them being brought up to ours instead..

 

 

I believe that this is the natural end, should we let the free-marketers run their course, but the 1% will not suffer anything from this, and reap nearly the entire benefit in the future.  Regression to the mean.

 

I think we can do better than that, or delay it enough so that technological advancement can outpace the regression to the mean, which is the minimum realistic goal.

 

The regression to the mean of the American workplace benefits those Americans who are immune to this regression, due to being able to use the global markets more effectively- this tends to be the 1% in general.   This creates inequality, and I would define this as an externality- so the free-market fails in this regard, and compensation is needed.  (like any other externality or market-power inequality that distorts the free market away from competitiveness)

 

Chasbo



Either cool stuff or the challenge of creating something that is better than what's out there. For some that's it but I am not talking about people like that. People like that and I know a person like that. He is the best person I have ever had the honor of working for. Yes I consider it an honor because he knows the value of a loyal employee. The problem with many "rich" people is that they have what I believe to be the same physiological make up as some serial killers or dictators. I am not saying that they are as evil as that. What I am saying is that they are anti social creatures. They do not connect with normal people. They cannot put themselves in the shoes of a guy working in an oil change place. I don't think that they give a crap about average people except for making money off of them. I think Ayn Rand was this sort of person and that her ideas are a good example of this kind of thinking.

 

I've read studies claiming exactly what you just said.  Plenty of wealthy folks are good people.   However, I've ran into a segment of the wealthy who really view their wealth in a way similar to folks view their achievement points, or a high score in a videogame. 

 

  I also agree with you in your philosophy about Ayn Rand, and why I consider objectivism an outright evil philosophy (note: libertarianism is not objectivism- the best comparison of objectivism is to libertarianism as Al-Qaeda or the Westboro Baptists are to Islam or Christianity)

 

I don't lump in all the rich with psychopaths/serial killers, but there are some out there, and they can cause massive damage, and the shareholder/dividend structure leads those sorts of people into leadership positions, because they are the folks who deliver the dividends and profits the shareholders want in aggregate.  (often the stakeholders have a fiduciary duty to their investors which precludes any ethical considerations)

 

 

on Aug 22, 2013

http://www.thenation.com/article/175834/how-become-part-time-worker-without-really-trying#axzz2ciZ707Qy

 

Sorry for the double post, but this is another article that should be read about this discussion.

 

Basically, Obamacare isn't what is causing companies to dump their full-time workers, it's just giving them an incentive to speed up the process.  Also, by proxy, speeding up the day where the poor vote in a class warfare-ish fashion, which I suspect will happen in a generation.

 

Obamacare is directly comparable to the minimum wage increase- as both effectively increase the cost of labor in order to deal with externalities in the labor market that distort the free-market process.

 

 

on Aug 22, 2013

Alstein


I think we can do better than that, or delay it enough so that technological advancement can outpace the regression to the mean, which is the minimum realistic goal.

The technology already exists the economy just hasn't shifted to a new equilibrium yet.

Alstein
http://www.thenation.com/article/175834/how-become-part-time-worker-without-really-trying#axzz2ciZ707Qy

Seems like that company is taking a huge drop in employee skill. I guess they must think it is worth it. Not all companies would agree. I'm not sure you can maintain your status as a fashionable brand when your sales people are all students with no training or incentive.

I've been stuck in the part-time worker trap. However I know who to blame and it's mostly government regulation. If the government says you have to pay full-time more and give them benefits of course companies are going to move to part-time. Government needs to equalize part-time and full-time regulation.  Also workers are facing reduced bargaining power due to high unemployment but I think that will fade as the economy adjusts. Workers will get training and jobs will open up in areas that require more skills. Then part-time will start to earn as much as full-time and companies will start to hire full-time again. Of course that is only in areas that aren't completely replaced by automation.

Software companies are a bad example because they require no physical proximity to consumers. 99% of jobs still do.

on Aug 23, 2013

I actually agree with you that there is a part-time worker trap, and it is caused by government regulation in some areas.

That doesn't mean that getting rid of some regulations wouldn't cause a bigger problem.

 

There's a reason why I think a ban on most employers from offering healthcare would be a better solution in the long-term than the employer mandate for Obamacare (I do support the personal mandate with the tax subsidies due to free rider issues)

 

I don't think you can eliminate the minimum wage without putting it a living standard lump sum for society.

 

Overall though, even if it's been proven wrong in the past, I do think we're heading to a point where automation is making many jobs redundant, without good replacements.   The past doesn't always predict the present.

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