Public Discourse: The BIG Problem with Technological Unemployment

Today at Public Discourse, I question the ability of proposals for a basic income guarantee (BIG) to solve the potential problem of massive unemployment due to automation in the future. I am skeptical on economic and spiritual grounds, but also hopeful that the future won’t be as gloomy as some predict.

On the economic problem, I write,

When income is procured through the threat system of taxation and redistribution, no wealth is created. Thus, when people who have contributed no wealth to an economy are given a grant from those who have, the money they spend is only the fruits of production being returned to the producers. The unproductive consumers are merely a conduit for funneling what was taken back to those who produced it in the first place. It is like trying to increase your bank account by writing yourself a check. And unless the receivers are required to spend 100 percent of the BIG, the result will not even be zero-sum. It will be negative-sum.

On the spiritual problem:

Labor puts us in a unique relation to our neighbors and the material world. It pulls us outside ourselves and situates us in society and the world around us. “Work,” wrote the Reformed theologian Lester DeKoster, “is the form in which we make ourselves useful to others.” Without work, we are left with a nagging sense of uselessness. According to Genesis, human beings were even made to work in Paradise—it is fundamental to who and what we are. As Arthur Brooks has pointed out, earned success is a key factor of happiness.

On why we can be hopeful for the future:

As time goes on, we will find that certain jobs are more resistant to automation than others. In something of a reversal of trends from the last decade or so, creative applications of the liberal arts may even increase demand for people with those skills. Furthermore, automation will create markets to serve its own needs. We will probably have a greater demand for mechanics and programmers, for example. No doubt, with our aging Baby Boomer population, we will see increased demand for elder care in the next twenty-five years as well. And who knows what markets may be created by future technology that few have yet imagined? Even if 47 percent of current jobs will be automated, new labor markets may be created to replace them.

Read the whole essay here.

Acton Commentary: The Unseen Good of Technology

For this week’s Acton Commentary, I examine the unseen good of technology and automation:

To circle back to manufacturing, more machinery does mean some less human work … at those factories … maybe. What people don’t see is that that machinery comes from somewhere. It represents entirely new industries that have been created and that employ many people of their own. That machinery needs to be maintained by people with the skill and expertise to do so. At the same time, because automation reduces the labor cost of production, it enables companies to lower prices to consumers while still increasing profits. What is a loss for the few is a win for the many.

Read the full essay here.