by
Adam Taggart
Automation
by
Adam Taggart
by
Adam Taggart
Charles Hugh Smith returns to the podcast this week to discuss the theme of his new book A Radically Beneficial World: Automation, Technology and Creating Jobs for All.
Automation and artificial intelligence are changing the landscape of work. Tens of millions of jobs are on track to be eliminated over the next decade or so by these advancing technological innovations in the US alone.
The way in which our current economy is constructed, the fruits of those cost savings are likely to go into a very small number of private pockets, while the millions of displaced workers will find themselves with no income and no work to do. It’s a huge looming problem that is not being address in national dialog right now.
But there’s opportunity to course-correct here. To use our new technologies to increase total productivity in a way that empowers rather than diminishes the individual worker.
Charles Hugh Smith: Fixing The Way We Work
by Adam TaggartCharles Hugh Smith returns to the podcast this week to discuss the theme of his new book A Radically Beneficial World: Automation, Technology and Creating Jobs for All.
Automation and artificial intelligence are changing the landscape of work. Tens of millions of jobs are on track to be eliminated over the next decade or so by these advancing technological innovations in the US alone.
The way in which our current economy is constructed, the fruits of those cost savings are likely to go into a very small number of private pockets, while the millions of displaced workers will find themselves with no income and no work to do. It’s a huge looming problem that is not being address in national dialog right now.
But there’s opportunity to course-correct here. To use our new technologies to increase total productivity in a way that empowers rather than diminishes the individual worker.
by
Gregor Macdonald
Executive Summary
- As goes Japan’s efforts to rescue it’s economy, so will go the U.S. and E.U.
- Japan’s options:
- Outsource its manufacturing base
- Replace as much human labor with automation as it can
- Rush to trade its depreciating currency for hard assets around the world
- What Japan is telling us about the Keynesian endpoint
If you have not yet read Part I: Abenomics’ Dismal Anniversary, available free to all readers, please click here to read it first.
Japan Is Reflecting the Future of Western Economies
While many observers continue to follow Europe as the proxy for post-growth dynamics in the OECD, it’s actually Japan that merits the closest analysis.
Much farther along in its post-growth phase, bloated with government debt and having tried a number of big-bang initiatives over the decades, Japan – not the U.S. or Europe – is leading the way. The country has never really recovered from the gigantic property and stock bubble over twenty years ago.
As proof, just consider the biggest trading story of the past 12 months. Was it the Federal Reserve’s intention to taper? How about the chaos in emerging market currencies in countries like India and Indonesia? Or perhaps the continued economic depression in peripheral Europe, as countries like Spain, Portugal, and Greece re-run the 1930s, with mass unemployment and people burning wood from forests to say warm? No, not even such dramatic suffering in Europe was enough to move markets or the EUR currency much this past year.
Instead, it was Abenomics and the front-running (and then chasing) of wildly huge moves in both the Nikkei and JPY that helped drive liquidity and speculative juices across all markets. It is not a coincidence that the peak of this frenzy in May heralded the peak in many markets.
But Japan has more than a financial problem. Despite the hand-wringing about Japan’s debt, the world has ignored for some time now Japan’s debt-to-GDP, GDP on an absolute basis, and Japan’s low cost of capital. Japan borrows. Japan prints. Japan devalues. But the world doesn’t care.
An issue the world may finally begin to care about, however, is that Japan has failed to launch itself out of deflation and is making very little progress in its struggle now. Indeed, Japan has a demographics problem and a resources problem that far outweigh its financial problems. To this point, instead of launching into recovery, Japan is running with the resources Red Queen, as every step of its currency devaluation is met with rising costs to import the raw materials Japan uses to make its goods…
We’re All Turning Japanese
PREVIEW by Gregor MacdonaldExecutive Summary
- As goes Japan’s efforts to rescue it’s economy, so will go the U.S. and E.U.
- Japan’s options:
- Outsource its manufacturing base
- Replace as much human labor with automation as it can
- Rush to trade its depreciating currency for hard assets around the world
- What Japan is telling us about the Keynesian endpoint
If you have not yet read Part I: Abenomics’ Dismal Anniversary, available free to all readers, please click here to read it first.
Japan Is Reflecting the Future of Western Economies
While many observers continue to follow Europe as the proxy for post-growth dynamics in the OECD, it’s actually Japan that merits the closest analysis.
Much farther along in its post-growth phase, bloated with government debt and having tried a number of big-bang initiatives over the decades, Japan – not the U.S. or Europe – is leading the way. The country has never really recovered from the gigantic property and stock bubble over twenty years ago.
As proof, just consider the biggest trading story of the past 12 months. Was it the Federal Reserve’s intention to taper? How about the chaos in emerging market currencies in countries like India and Indonesia? Or perhaps the continued economic depression in peripheral Europe, as countries like Spain, Portugal, and Greece re-run the 1930s, with mass unemployment and people burning wood from forests to say warm? No, not even such dramatic suffering in Europe was enough to move markets or the EUR currency much this past year.
Instead, it was Abenomics and the front-running (and then chasing) of wildly huge moves in both the Nikkei and JPY that helped drive liquidity and speculative juices across all markets. It is not a coincidence that the peak of this frenzy in May heralded the peak in many markets.
But Japan has more than a financial problem. Despite the hand-wringing about Japan’s debt, the world has ignored for some time now Japan’s debt-to-GDP, GDP on an absolute basis, and Japan’s low cost of capital. Japan borrows. Japan prints. Japan devalues. But the world doesn’t care.
An issue the world may finally begin to care about, however, is that Japan has failed to launch itself out of deflation and is making very little progress in its struggle now. Indeed, Japan has a demographics problem and a resources problem that far outweigh its financial problems. To this point, instead of launching into recovery, Japan is running with the resources Red Queen, as every step of its currency devaluation is met with rising costs to import the raw materials Japan uses to make its goods…
by
Gregor Macdonald
Executive Summary
- The transition back to an electricity-centric economy is regressive
- Declining net energy and peak expansion are co-incident
- Change that substitutes labor without providing a higher use for it is deflationary and results in inequality
- Our challenge is to find sustainable work for society
If you have not yet read The Siren Song of the Robot, available free to all readers, please click here to read it first.
Capitalism demands fast gains in productivity. Capitalism seeks revolutionary change. But it’s not clear whether a revolution in machine intelligence leads to a deflationary boom, per Schumpeter, or a deflationary bust.
Writers such as Paul Krugman have perhaps moved too quickly, too easily, to conclude that a massive increase in production from such technology leads sustainably to large growth in GDP without severe consequences. Indeed, in a recent essay responding to Robert Gordon's paper on the end of growth, Krugman takes the view that (positive) returns from technology are just beginning to unfold.
I conclude that Krugman is actually concerned about and open to the possibility that an enormous wave of disruption to manufacturing from robots could produce higher GDP initially and also problems thereafter. What happens to wages in the broader economy?
One does not have to be a Luddite about technology to fear yet another huge new round of wage deflation. The West has already been treated to an era of “cheap, quickly manufactured goods that enhance people’s lives” during the past two decades. And it’s not clear that a flood of goods has necessarily improved well-being.
While I certainly wouldn’t make the curmudgeon's case that electronic devices have reduced well-being, it’s not clear that the I.T. revolution has accomplished much in the way of delivering to consumers cheaper and better quality energy, food, or health care.
Why the Robot Age May Create a Massive Deflationary Bust
PREVIEW by Gregor MacdonaldExecutive Summary
- The transition back to an electricity-centric economy is regressive
- Declining net energy and peak expansion are co-incident
- Change that substitutes labor without providing a higher use for it is deflationary and results in inequality
- Our challenge is to find sustainable work for society
If you have not yet read The Siren Song of the Robot, available free to all readers, please click here to read it first.
Capitalism demands fast gains in productivity. Capitalism seeks revolutionary change. But it’s not clear whether a revolution in machine intelligence leads to a deflationary boom, per Schumpeter, or a deflationary bust.
Writers such as Paul Krugman have perhaps moved too quickly, too easily, to conclude that a massive increase in production from such technology leads sustainably to large growth in GDP without severe consequences. Indeed, in a recent essay responding to Robert Gordon's paper on the end of growth, Krugman takes the view that (positive) returns from technology are just beginning to unfold.
I conclude that Krugman is actually concerned about and open to the possibility that an enormous wave of disruption to manufacturing from robots could produce higher GDP initially and also problems thereafter. What happens to wages in the broader economy?
One does not have to be a Luddite about technology to fear yet another huge new round of wage deflation. The West has already been treated to an era of “cheap, quickly manufactured goods that enhance people’s lives” during the past two decades. And it’s not clear that a flood of goods has necessarily improved well-being.
While I certainly wouldn’t make the curmudgeon's case that electronic devices have reduced well-being, it’s not clear that the I.T. revolution has accomplished much in the way of delivering to consumers cheaper and better quality energy, food, or health care.
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