All right, listen closely. I was at the unemployment office and I told them I was very close to getting a job with Vandelay Industries, and I gave them your phone number. So now, when the phone rings you have to answer “Vandelay Industries.” – Seinfeld
Notice it doesn’t say Texas Pain RELIEF Institute?
What are we going to do with everyone?
I’ve been (throughout my life) a proponent of the human race. I like it. I may not like certain individuals, but I’ve got a great degree of hope when it comes down to humanity. And up to now, the equation has been that more people equals more Einsteins, more Isaac Newtons, more Nikola Teslas, and more Stephen Hawkings. These are shining examples of humanity – folks who helped the human race achieve much more than we would have or could have without their knowledge. I read an article recently (I am not making this up) about rising obesity rates in Ghana due to KFC® becoming the restaurant of status and choice. And we know how much Einstein contributed to the secret government project that led to KFC™’s fried, greasy goodness.
There are seven billion of us, and 2.1 billion have the problem of being obese or overweight. Less than 800 million are suffering from hunger or malnutrition. This is a victory of the greatest magnitude. Yes, obesity is bad, but I would much rather have people having heart attacks in their fifties after having a tasty chicken wing versus starvation at fifteen. Everyone who has that choice would make the same choice, and raise their greasy hands up if asked.
In general, the world is getting better as we as a society create more wealth, as I talked about in previous posts (LINK). But I’m really concerned as I look forward with simple questions:
How much does the future need us for continued prosperity? How many people do we really need? How many can be actively employed in productive work?
There are various reasons that I’m wondering: Increasing Productivity, AI, Smart Machines, Robots to name a few, though there are other issues as well that we’ll skip today.
I’ve written before that trucking is a sure bet for replacement once self-driving trucks are approved by the Department of Transportation and the various states and a self-driving unit costs less than (about) $400,000 per unit. After those conditions are met, at least a million jobs (and likely more) will be gone as fast as the autonomous trucks can be produced. But it’s not just truckers. It will be fast food workers. It will be janitors. It will be an increasing number of lower and mid-skilled jobs throughout industry. If it can be described by an algorithm or computer program, it will be automated. A large number of sports articles and financial news articles are now produced with no human intervention. Journalists would worry, if there were enough of them left to worry.
And jobs that aren’t eliminated will be minimized. An example: a structural engineer nowadays runs calculations for a new bridge or skyscraper through a computer program that analyzes the stresses in the structure and optimizes the design for code and seismic conditions. It then chooses the beams and columns and other structural members based on tens of thousands of calculations and three dimensional finite element analysis, and then pops out design drawings. Sproink. (That’s the noise the drawings make when they come out of the machine.)
Fewer engineers are required, and the engineers don’t need to be as proficient since the engineering knowledge is built into the program. Both the number of people and the quality of people goes down.
Another example: I just bought (for $30) a device the will give me the data I need to order glasses online. No prescription, no optometrist, no waiting. Also, no glaucoma check, but I don’t have to take off time from work to visit the doctor. And the glasses I ordered online cost less than I would pay, even at Wal-Mart®. I may describe it in Friday’s blog.
Another example: I had a cold that I was pretty worried was heading into my lungs and I was worried that I’d get pneumonia. For $60 I got online from my basement (where I was in a cold sweat despite my 101˚F, got antibiotics, and got better. Otherwise? A $120 doctor visit where my copay would have been at least $100. Yes, a real doctor was involved in the visit, but it was incredibly efficient for them – I’d imagine they make $300 an hour. No office, no actual contact with icky sick people. It was a great transaction for both of us.
But . . . it means we need fewer Doctors. And fewer waiting rooms. And fewer nurses. Et cetera.
Efficiency is awesome. It lowers costs, and does that while quality is increased, in most cases.
When economists study inflation, they study the price of the item. I have a color TV in my house. When my dad bought his first color TV, he spent (on an inflation adjusted basis) over $3,000 in today’s dollars. With that kind of money today? You could buy a 75” Sony® Ultra HD that also has a popcorn maker and margarita blender built in. So, economists measure how much better a thing has gotten as well as what the thing costs. They call this measurement “hedonics” because it’s way more confusing than “measuring how stuff got better.”
So, we live in a world where getting sufficient food to eat is easier than at any point in history. We also live in a world where getting information is easier than at any time? Want to listen to a song? Unless it’s the Beatles™, it’s pretty much on YouTube®. And we can make more things, better, faster and cheaper, than at any time in history.
But why hasn’t efficiency hit, oh, say the Department of Motor Vehicles? Or the local County office where I go to get license plates? At both places, you have to stand in line. At both places, hours are limited, and you’d better get done before quitting time, because they’re serious about closing up at 4:30pm.
In a typical business, the best parking spaces are reserved for the customers. In government? The best parking places are reserved for the employees. And I think government is giving us a hint: the most important consumers of government are its employees. You and I are the product.
And why, in a world where I can apply for $100,000 credit at midnight can I only get my driver’s license between 9AM and 4:15PM (closed for lunch hour)? Why is it harder each year to deal with government? Why do their budgets keep going up, faster than inflation?
Because nothing the government does is intended to help you, the consumer. The bright folks that are hired to make wonder weapons? Jobs program. We do NOT want people that smart on the street. The people who work for NASA®? Jobs program. They don’t even have to make rockets anymore, and Elon Musk has clearly shown that if he had NASA’s budget he’d be building Burger Kings® on Mars, because he’s have a million people living there in the next decade. NASA spent money putting together braille books on the solar eclipse in August. That might explain why we have to piggy back a ride with the Russians to get to the International Space Station. NASA is a jobs program. Originally it had a job to get people to the moon. Now? It produces new classes of astronauts with no vehicle to fly. Thankfully they have a budget for cardboard boxes to sit inside and make rocket noises. There’s even a budget for markers to write “ROKET” and “USA” on the side of the boxes!
The Department of Education, which has taught no classes? Jobs program. The Department of Energy, which has never produced a Watt? Jobs program. The military? Parts of it are a jobs program, but most if it is real. But you better pay attention to what congressional district and state the new weapons will be built in . . .
Your liberal-arts college professor? Given a job so that they wouldn’t agitate for revolution in the streets, rather, they can agitate for revolution to rich kids who would much rather play Playstation® and X-Box©.
Ever wonder why they rip up a section of street that looks pretty good, and then work it for months? Yup. Jobs program. Not to say that the original Interstate Highway System wasn’t real. It was. But now what do we build? What infrastructure is left? Dams are awesome for hydroelectric power, but just try to build one nowadays . . . it’s easier to declare war on Ghana.
It really took me by surprises that this was the case – that most government spending is based on the concept of giving people money so that they don’t riot in the streets (dumb people) or so they won’t plot and plan a revolution (liberal arts professors) or build wonder-weapons in a James Bond worthy plot for foreign governments (government scientists)?
Why is government inefficient? It’s not. It’s a very efficient jobs machine. You’re just the product, not the consumer.
But what about the jobs that are already out there? A recent study says that the average worker works less than four hours a day.
Think of the creativity that creates! How to look busy for eight or nine hours a day when you’re done working after four? And how long will a business stand for this? Eventually, in private business, all of the “four hour a day” jobs will be eliminated – the business has to pay taxes, remain competitive.
But government will respond. New regulations will be created and enforced that require new employees to compile data and report it to the government. This is done mainly so that the government has excuses to hire more employees, but has the side effect to requiring more private sector compliance workers.
I actually had a job once where, on my start date, my office wasn’t yet ready. They told me . . . come back in two weeks from now. Did they pay me for the two weeks? Yes. And, who did this? Yup. It was a government job. And, although I saved them several million dollars, they were kinda disappointed. They wanted to spend their full budget.
But there will be in the next decade millions of people becoming unemployed as their jobs are minimized or eliminated due to clever business disruption, probably faster than the government can create jobs (hint: the government is broke (LINK)). I’d love to suggest a minimum basic income, but we can’t pay for it. We can’t even afford PEZ®.
What do we do?
There are millions of people in the United States right now that would love to work. And millions more in made-up jobs that produce nothing that would love to work in productive jobs. Around the world, this number is surely in the hundreds of millions.
And we need fewer of them every day.
How about . . . we let someone smart pay them to work on something really important . . . like going to Mars?
Paging Elon Musk . . . .
Unless someone else has a better idea? Raise your greasy hand and sing out!