US Unemployment Is 7.9%—Are Robots to Blame?

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Honda's humanoid robot, Asimo.

Robots want to invade your home, take your job, and steal your wife. Maybe not that last one (yet). But as unemployment remains stubbornly elevated (7.9%) people are searching for answers. Among the usual suspects—foreign competition, too much regulation, too little spending, banks—technology is increasingly bearing the blame.

In a recent episode of 60 Minutes (watch below), aired January 13, Steve Kroft notes “one of the hallmarks of the 21st century is we are all having more and more interactions with machines and fewer with human beings.” And as robots march “out of the realm of science fiction and into the mainstream” the result is “technological unemployment.” According to Kroft, “There is a lot of it going around with more to come.”

At this point we could level all the usual defenses—that automation has been happening for a few centuries. That there are now, and have always been, periods of discomfort as some jobs disappear and others are created. That for those taking part in technology’s rapid march, the last few hundred years have shortened the work day and week, witnessed the advent of retirement and vacation, increased income, added years to the human lifespan, and improved overall living conditions.

That while unemployment is stubbornly above average right now, it’s nowhere near the levels experienced for over a decade during the Great Depression. And as George Mason's Don Boudreaux points out, that was before “the Internet, the microchip, and even the solid-state transistor.” To imply the latest round of technologically-driven productivity gains are fundamentally new is misleading.

Which is why one of Kroft’s guests, Erik Brynjolfsson of MIT, clarifies, “Technology is always creating jobs. It's always destroying jobs. But right now the pace is accelerating. It's faster we think than ever before in history. So as a consequence, we are not creating jobs at the same pace that we need to.”

In the context of exponential technology, Brynjolfsson’s statement rings true. Maybe we’ve reached the knee of the curve, where the rate of progress turns up toward the vertical, and workers are no longer able to keep pace. We might be there. But as Sir John Templeton said, “The four most dangerous words in investing are ‘this time it’s different.’”

We can make statements about the pace of information technology over the last half century. But beyond the anecdotal, there is no good way of measuring technology’s broader speed or aggregate effects on the economy. And it’s even harder to compare this period to periods past. A dirty economic secret is the data gets spottier and spottier—strung together with shoelaces and duct tape—the further back you go.

Boudreaux notes (in direct response to the 60 Minutes piece), “Are robots in 2013, for example, replacing factory workers faster than motorized farm equipment in 1913 replaced farmhands? Maybe; maybe not. The answer isn’t obvious.”

But whether this time is different may be beside the point. There will always be a degree of uneasiness as new technology replaces human workers. The question is, "What can you do about it?" Or as it was posed in a recent members discussion thread, “What’s worth studying?” How can you predict what skills will be valued in the future?

The answer now, as ever, is you can’t. We may value learning new languages as business goes global. But soon real-time universal translators will do the job better. Today, doctors strive for an encyclopedic knowledge of medicine. But AIs like Watson may soon make rote learning less useful and analysis more so. Which is probably a good guide in general—you can't predict exactly what will be needed, but you can hone universal skills. Learn how to be a good learner.

Ultimately, technology frees us from one task so we can focus on another. Boudreaux again, “As was true 200 years ago, the falling costs of satisfying some wants (such as those for food and clothing) enable us to turn our attention to satisfying other wants, many of which today were unimaginable to our 19th-century ancestors.”

No job is secure from the coming robot invasion—not even the writing of news stories. But if robots taking over for humans in some realms allows us to pursue multitudes of new, creative, and as yet inconceivable paths…then long live the bots.

Image Credits: Honda

Jason Dorrier

Jason is managing editor of Singularity Hub. He cut his teeth doing research and writing about finance and economics before moving on to science, technology, and the future. He is curious about pretty much everything, and sad he'll only ever know a tiny fraction of it all.

Discussion — 334 Responses

  • ZeroIron February 7, 2013 on 10:54 am

    The number of struggles and amount of pain in moving to heavy automation will be directly related to how quickly our societies can move away from the past ideas and concepts of jobs, consumption, and production. The longer we hold on to the social economic systems of the past the more pain this transition will have on us.

    Cheap household and industry 3D printers will also have a similar impact.

    More time for humanity to; explore, conduct complex research, socialize, design, exercise the arts, and play. Less time wasted on repeated tasks and production.

    • Khannea Suntzu ZeroIron February 7, 2013 on 3:07 pm

      In this economic paradigm those who can’t generate an income, are abandoned, period.

      • digitalcole Khannea Suntzu February 7, 2013 on 4:57 pm

        People aren’t going to just lay down in the ditch and die. We’re already seeing the signs of open revolt and tension in the US is getting so thick you can cut it with a knife.

        • Khannea Suntzu digitalcole February 7, 2013 on 11:13 pm

          Let’s most certainly hope so. Right now they can still protest! My fear is that in a decade the automated systems have advanced to such a degree people won’t be able to protest much.

          • Improbus Liber Khannea Suntzu February 8, 2013 on 7:52 am

            I would say get me a guillotine but since we are in the United States I guess we will use firing squads on our evil elites.

            Me, I am a cheap bastard. I say we use arrows or machetes but since this site is about future technology how about death by robot gladiator? That would get some ratings. AmIRight?

          • jg Khannea Suntzu April 16, 2013 on 2:10 pm

            People dumb enough to organize their dissent over email, twitter, and the internet are not going to be able to dissent in the future…

        • jg digitalcole April 16, 2013 on 2:08 pm

          the problem is that we don’t have a successful alternative. Collectivism has failed, to the exact degree it’s been tried, everywhere in the world. The exception, of course, being the non-replicatable ones.

          Now, if we could adopt, say, the Norwegian model where we put very tiny numbers of people on top of very large oil reserves, maybe we could argue collectivism. But for the rest of the world, I don’t see any proven alternatives. Third way socialism certainly isn’t working all that spanky in the EU right now.

          • Curt Welch jg April 16, 2013 on 2:53 pm

            All modern societies combine a mix of collectivism with individualism today so to suggest they have all failed is obviously wrong. What metric of “success’ are you attempting to use to back your assertion they have all failed to the degree they have been tried?

            Socialism in the EU actually is working very nicely. What’s not working, is a few things. One, their economy is heavily tied to the US economy, so when we mess up, they suffer. Two, their attempt at using the single currency and central bank while not being a single country, creates structural problems when one country has financial issues that in turn allows the stronger countries to dictate fiscal policy that often is not in the best interest of the country that is suffering. Three, recently, they have made the mistake of applying austerity policies in response to the problems largely created by the US – which is never the right response. You can’t fix a depression, by cutting back on public spending. But that’s what they did, and it caused much of the EU to suffer a second recession instead of a recovery.

            There are many issues to look at, but the socialistic components in Europe is not their weakness, it’s their strength. Most of the European nations that are heavily socialistic have far better statistics when it comes to issues of life and happiness, than the US.

            What the US has, is strong GDP, and a crappy life for a majority of the people (including the rich which suffer from stress as much as the poor). If you measure “success” by GDP, the US is doing very nicely. If you measure it by stuff that matters, like health and happiness, then the US is one of the worst developed nations. We have more violence, more obesity, shorter life spans, more mental illness, more teen pregnancies, more people in jail, more homeless, etc. The reason we suck so badly in all these other metrics, is because as society, we have chosen to make GDP growth our national goal. It’s a really stupid choice.

            The correct social goal should be some measure of total human health and happiness.

            An interesting fact there is that one of the prime economic measures that correlates well to most concepts of human happiness, is wealth inequality. Countries with more inequality, have people who are less healthy and less happy. And it’s true not just for the poor, but the rich as well. Both ends of the wealth spectrum improve when inequality is reduced.

            One decent attempt to quantify a measure like this is this one:


            Which as you see, shows how bad the US is doing (we are 23rd on the list), and how much better, all EU nations with stronger socialistic programs are doing. Norway at the top is getting a nice boost for oil exports, as you mentioned above, but many other oil rich nations aren’t doing so well simply because they don’t share the wealth with their people.

            The solution to these problems is actually very easy and we do have it. We need to reduce inequality by redistributing a percentage of the wealth as a Basic Income Guarantee for all citizens. Many of the rich of course are against this, but the rich are a small minority and easily out voted in our democratic nations. What’s not easy to do however, it wake people up to the understand that such redistribution is not only socially valid, it’s required – as we inch ever closer to 100% automation in the economy.

            It’s odd, but it’s the people that are suffering the most, and who will benefit the most, from wealth redistribution in the form of a Basic Income Guarantee that are blocking it. They are so distrustful of everyone, that they choose see wealth redistribution as a license for “big government” to steal from them and they fear that. But by not voting for redistribution, the wealthy actually are stealing from them, but they are too blind to the complexities of the economy to understand that. They let their own fears keep them poor, when there is no need for it to be that way.

          • Robert Hoppin jg June 9, 2013 on 9:05 pm

            all those socialist european nations now have better credit ratings than we do. look it up.

          • Anne Ominous jg July 28, 2013 on 2:49 pm

            “Collectivism has failed, to the exact degree it’s been tried, everywhere in the world.”

            History is very clear on this point. Which is why it distresses me to see political factions — and the government itself — trying to force it on us.

            We KNOW it doesn’t work. So we should be very vocal in opposing it.

          • Anne Ominous jg July 28, 2013 on 2:59 pm

            @ Curt Welch

            No, it is not “obviously wrong.” And it is far from obvious for the exact reason you cited yourself: it is now so mixed in with other philosophies that it is hard to separate them.

            However, there is one way to tease out cause-and-effect, and that is via trends. And those trends generally support the premise that collectivism doesn’t work.

            Take Sweden for example. It is still often held up as the poster-child for people who want to point their fingers and say “Look! Socialism actually works!”

            Yet the truth is that ever since Sweden’s big turn toward a more Socialistic economy several decades ago, its economy has been slumping. Before then, it was one of the top-producing per-capita nations in the world. Today, it is merely average.

            See “The Swedish Model Reassessed: Affluence DESPITE The Welfare State” by Nima Sanandaji (emphasis mine)

            What “jg” asserts is correct, according to objective data: collectivism, as an economic policy, has consistently been a dismal failure.

          • Curt Welch jg July 29, 2013 on 10:14 am

            Silly comment system that doesn’t support unlimited replies! 🙂

            Anne Ominous writes:

            “Yet the truth is that ever since Sweden’s big turn toward a more Socialistic economy several decades ago, its economy has been slumping. Before then, it was one of the top-producing per-capita nations in the world. Today, it is merely average.”

            You have just proven my point. Go back and read my rant about how you and I have different underlying philosophical beliefs about society.

            You have declared Sweden a “failure” becuase it FAILED TO INFLATE IT’S GDP as fast as other countries.

            Why is it that you put GDP size and gdp growth as the single most important goal for society? Because inflating your own personal power is YOUR PERSONAL GOAL in life.

            Power seeking is not the ultimate goal in life and that’s the part people like you can’t see past. You have been indoctrinated into that belief and you haven’t been able to escape it.

            Sweden has succeeded and excelled in all the the most important aspects of life but yet you choose to be blind to that.


            Sweden tier 4. US, tier 33


            Sweden 25, US, 45 (lower is is more equal).


            US ranks 3, Sweden is 7 out of the 164 countries (not exactly bad even though the US is ahead).

            But, when we adjust for inequality:


            Sweden 3rd, US 16th – the US does far worse, than Sweden.


            US NUMBER 1@ at 716 per 100K population.

            Sweden NUMBER 180 at 67 — yes the US forces 10 times as many of it’s citizens to live in prisons than Sweden.

            Teen pregency:


            Results: Adolescent childbearing is more common in the United States (22% of women reported having had a child before age 20) than in Great Britain (15%), Canada (11%), France (6%) and Sweden (4%); differences are even greater for births to younger teenagers.

            Deaths by drug use:


            US 1.5 per 100K population putting it 37th.
            Sweden 1.3 ranking it 43rd.

            Death rate by traffic accidents:


            US 12.3 (middle of the list of a few hundred countries)
            Sweden 2.9 (second to last in the list).

            GDP per capita:

            US 7th at 49,965
            Sweden 15th at 42,217
            Out of 180 countries total.

            I can go on and on and on as long as I want to keep Googling quality of life statistics. But yet, you feel that Sweeden as “failed” becuase it’s in 14 th place out of 180 for GDP.

            They made the decision to focus on human quality of life, instead of focusing on power seeking, and the result as been that they are not just “average” on per capita GDP as you suggest, but in 14th place in the world out of 180. And by accepting that small drop in GDP, their life experience is one of the best in the world, their income inequality is one of the best in the world, their IHDI is one of the best in the world, their citizens are 10 times less likely to be forced to live in jail, than the US. Teens are 5 times less likely to get pregnant than the US. People are less likely to die by drug use in Sweden. People are 4 times less likely to die in a traffic accident in Sweden than in the US.

            But yet, all this stuff that shows Sweden it winning by leaps and bounds in the game of life over other countries like the US, You still want to declear them as proof that “colectivism” always fails.

            Need I say it again – YOU ARE A TYPICAL POWER SEEKING SOCIOPATH. Any attempt by government to take power away from YOU you see as the ultimate evil because you are addicted to power seeking – it’s a drug for you. The fact that you could give up a little bit of your wealth and power, and improve the quality of life of billions of people, is irrelevant to you.

            It’s more important for you to have a GDP of 50K, than one of 42K, and you are just fine with the fact it means that all these extra people are in jail. That all these extra people die in traffic accidents. That all these teens get pregnant. That life experience for everyone is lower. All this, you are willing to accept, just for that extra 8K a year in your bank account. It’s ok for people to suffer and die, as long as you get the money.

            I’ll repeat, it makes me SICK to live in a country where people that think money and power is more important than people’s lives and health and happiness.

          • Anne Ominous jg July 30, 2013 on 8:02 pm

            @ Curt Welch:

            Quote: “Because inflating your own personal power is YOUR PERSONAL GOAL in life.”

            Wow!!! Man, you sure did just prove my point, in spades! Simply because I *MENTIONED* per-capita production, you conclude that I am a money-grubbing power-monger???

            HAHAHAHAHA!!!!! You’re a riot. My comment was “you are trying to JUSTIFY your means by claiming that your goal is noble and mine is not.”

            And what did you do? You stepped right into it, with both feet.

            From where I sit, you appear to be dangerously delusional.

          • Anne Ominous jg July 30, 2013 on 8:10 pm

            @ Curt Welch:

            I was trying to have a LOGICAL, pleasant discussion with people here about economics.

            But your arguments — not to mention your references — continue to fail to prove your points.

            But now it’s worse than that. You have gone far beyond the limits of civil discourse, and have resorted instead to casting personal aspersions and insults.

            Apparently you aren’t satisfied with your inability to prove your point… you have sunk to the level of making direct, personal insults to people you don’t even know (and about things you could not possibly know about them).

            This is not acceptable behavior. I came here to have a discussion with adults, not to be insulted by a child.

          • Curt Welch jg July 31, 2013 on 3:59 pm

            Anne Ominous writes about me:

            “Apparently you aren’t satisfied with your inability to prove your point… you have sunk to the level of making direct, personal insults to people you don’t even know (and about things you could not possibly know about them).”

            “This is not acceptable behavior. I came here to have a discussion with adults, not to be insulted by a child.”

            Oh the irony is do deep here. You were doing so well not to sink to my level of insults, but then you just couldn’t hold back, and threw childish insults at me twice, in a message where you ranted about me throwing childish insults! 🙂 Good play!

            In a separate message you wrote:

            “Wow!!! Man, you sure did just prove my point, in spades! Simply because I *MENTIONED* per-capita production, you conclude that I am a money-grubbing power-monger???”

            Ha ha. No, I concluded you are a money-grubbing power-monger because everything you have posted in all your messages is straight out the right-wing conservative/libertarian handbook.

            You are right, I don’t know you at all. But I know the handbook you are playing from – I know it well because I’ve seen it in these debates for a very long time, from many different players. And it is that hand book you are playing from which disgusts me and causes me to result to these childish insults.

            To suggest you are holding some “high ground” in the debate is abused. You are reciting the tried and trued conservative beliefs, and I’m reciting the tried and trued liberal beliefs. I don’t recite them because I’ve read some liberal “books” and have been “brainwashed” into believing them. I recite them because I choose to think for myself, and came to the same conclusion that millions of liberals before me came to about government, economics, and public policy. Just like you, have studied these issues, and came to the same conclusion millions of conservatives before you came to.

            Why, if two intelligent educated people study the same data, do they come to such totally different conclusions? Have you spent time to try and figure that out? It doesn’t seem like you have. I have.

            It’s because we have a few very different fundamental ideologies we base our decisions on.

            Were you aware that your brain and mine is actually different? Conservatives and liberals actually have different brains. These ideologies are not just a product of nurture (those that plays a big role), nor are they are product of one group being “stupid”.

            Conservatives have brains that tend to lock onto ideas and not change easily. Liberals have liberal brains – ones that shift from idea to idea easily. Conservatives tend to try and understand their world in terms of absolutes . They shy away from anything that is poorly defined, or lies in a gray areas. The brain tends to flip their understanding to one side of a position or another quickly, and won’t allow it to linger and understand both sides of a point. A liberal brain, is much more of a “free thinker” – not constrained by past beliefs. Liberals are good at seeing paradigm shifts approaching. Conservatives are nearly blind to them.


            For example:

            “Researchers also noted that Democrats had larger anterior cingulate cortexes, which are associated with tolerance to uncertainty, while Republicans had larger right amygdalas, which are associated with sensitivity to fear.”

            The reason we have such a big divide in society, and why you and I will NEVER agree on these public policy questions, is because we have DIFFERENT BRAINS.

            It’s not a debate of economics as much as you seem to think it is. It’s a debate of fundamental needs and abilities wired into our brains.

            You are right that, “Apparently you aren’t satisfied with your inability to prove your point.”

            I’m dissatisfied not becuase my argument is invalid, but because I know I’m talking to a person with a brain that is literally incapable of understanding my point – and that the people with brains like your’s is doing immense damage to society which I have no power to stop, because you will vote your beliefs no matter what I write (and I strongly believe you have the RIGHT to vote your believes, even when they are wrong).

            But like I said in the other message, time is on my side. Technology is on my side. It will cause a massive paradigm shift towards socialism in the next few decades whether you like it, or understand it.

            Conservatives brain’s understand things just fine AFTER they happen. Liberals are more likely to understand them BEFORE they happen.

          • Anne Ominous jg August 4, 2013 on 12:59 pm

            @ Curt Welch:

            I would say “sorry”, but I’m not. Your arguments just don’t fly. Example:

            “Oh the irony is do deep here. You were doing so well not to sink to my level of insults, but then you just couldn’t hold back, and threw childish insults at me twice, in a message where you ranted about me throwing childish insults! 🙂 Good play!”

            What a joke. This is simply another example of your ignorance about how to make a reasoned argument. The first example you gave was not an insult you at all; it was a comment about WHAT YOU WROTE, and the fact that you had insulted me. NOTE: there is a difference between disagreeing with what you say, and a personal attack against you. And this is a difference that you pretty obviously do not understand, as illustrated by your second example. THAT was a general comment and did not mention YOU at all.

            If you feel that you were behaving like a child, then you might assume that statement includes you; but that is your assumption, no claim of mine. Methinks thou dost protest too much.

            Third, you demonstrate yet again an ignorance of politics and economics. Your statement that Libertarians “right wing”, for example, is simply wrong. That simply demonstrates that you have no idea at all of what you are talking about.

            I will point out that many liberals do classify Libertarians as right-wing, but that classification only occurs because Libertarians are not “liberals”, in the modern political sense. But the fact they are not left-wing is a far, far different thing from being right-wing. In fact Libertarians are neither. Again you are demonstrating your flat black-white picture of the universe.

            You also appear to be utterly confused about the dividing line between politics and economics. A left-wing Democrat, economically, might be fundamentally Socialist, or lean more toward Keynesian economics. (Or something else; those are only examples.) A far-right Republican might lean toward fascist-corporatist economics (NOT to be confused with capitalism), or also be a Keynesian. Or, again, something else. Neither Democrat or Republican is a school of economics; they are political designations.

            In the same vein, economically a Libertarian might be a Monetarist, or an Austrian, or yet again something else. There is no “Libertarian economics”, and there sure as hell is no “right-wing conservative/libertarian” school of economics. That very phrase is such a jumble of conflated (but actually separate and distinct) things, it is worthy of a 3rd-grader. But again: that is a comment about THE THINGS YOU HAVE BEEN SAYING HERE.

            Which brings us back to the main point: in your attempts to argue about an economic point, you instead made PERSONAL remarks about my character, rather than refuting my arguments. That is called an “ad-hominem” attack and it is one of the most fundamental errors you can make if you are trying to present a logical argument. Which, I repeat, you have consistently failed to present here.

            BASED ON THE ARGUMENTS YOU PRESENT HERE (not on your character), I strongly suggest you go back to school before trying to make a reasoned presentation on this topic. At the very least, take a class in logic 101, or maybe debate.

      • Giovanni Campanella Khannea Suntzu July 22, 2014 on 3:32 am

        This is a common economic myth (from my understanding so far). in the short term, tools, machines, etc. may or may not reduce jobs. If the result is ‘may’ though, it would only be short term, even if that job is completely lost to the market and human exchanges of goods, labor and services.

        Why? If you replace humans with machines in say, computer making or car making, you get cheaper goods and benefit society as a whole. As the common man takes advantages of increases in net wealth due to automation, resources can now move to new areas and new jobs can be created. Not to mention, the jobs needed to maintain and produce this automation to begin with.

        It’s counter intuitive, but so are lots of things. Ending the drug war, ending the ban on sex work or firearms for example.

    • VantageGreen ZeroIron February 8, 2013 on 9:35 pm

      I think you are on to something. We might actually have that great utopia the progressives only dream about, but instead of being enforce upon us by government it will be created by Capitalism!

      • Craig J. Townsend VantageGreen February 9, 2013 on 1:24 pm

        You are actually right on the money, as capitalism evolves it is becoming more social and also going toward its own negation (to use a Marxian term). A freer economic system without inflation has a natural deflation rate that is augmented by technological development, if we did not have the great amounts of inflation and intervention by government, we would already be falling down an asymptote in price. Our present form of government and its economic plans based on old fallacies is what is causing all of the problems we have today. All of the unemployment, pushing industry off shore, causing prices to rise, and a greater gap between the rich and the poor. A great book free online to read is “Deflation & Liberty by Hulsmann. “Age of Inflation” and “What has Government Done to the Economy” are also good reads. If the left would understand valid economics and give up the Ptolemaic economic system of Marx, they would see it readily. The techno-optimists are describing it now.

        • Khannea Suntzu Craig J. Townsend February 9, 2013 on 2:05 pm

          Oh please stop thinking in terms of “left” and “right”, it’s so silly.

          • VantageGreen Khannea Suntzu February 9, 2013 on 9:44 pm

            I hate the Left and I despised the Right. Both have the same idea. They want you to sacrifice something of a value to you and they want to force you to do it.

            I don’t except the concept of using force on innocent people that have not done any harm to others.

          • Craig J. Townsend Khannea Suntzu February 11, 2013 on 7:14 pm

            I dont, each is a propoganda fruad.

        • Anne Ominous Craig J. Townsend July 28, 2013 on 3:07 pm

          @ Craig T:

          It is refreshing to see someone who actually knows their economic stuff.

          Deflation has been made the big “bugaboo” by the very people who profit most from a policy of constant inflation: government, banks, and Wall Street. Very recently, and quite famously, Ben Bernanke sat in front of a camera and told Congress and the nation that the bugbear of “deflation” must not be allowed to happen, at all costs.

          Yet look at truly healthy markets, like the “computing device” market (I include smartphones & tablets in that category). Capability & performance go up every year, and cost for any given feature or performance goes DOWN every year. Hint folks: that’s called “deflation”. And it’s a sign of a HEALTHY segment of the economy.

          • Che Mort Anne Ominous July 30, 2013 on 11:37 am

            Hey Anne, I just saw your comment to me. I hate this web site. I can never find the debates going on, like the one between you and Curt. Where is it? I would love to join in!!! Can’t find it here at all.

            Did you see that the FED will stop its practice of trying to stabilize prices and will now engage in a 2% a year inflation rate? All of this is designed to fight the aggregate supply push, aka the law of increasing/exponential returns. What paleo-socialists don’t comprehend with the attack against technology and its “causing the great disparity between the rich and the poor” fraudulent propaganda meme, is that they are fighting for imperial corporate economics. J. Schumpeter wrote that technology was the one process that is driving the economy out of equilibrium. If you desire a static steady state economic system at equilibrium you have to find a way to shut down technological evolution. Wave a magic wand and “flim flam presto change-o,” technology is evil, it is causing a great disparity, it is unfair! Roll out the precautionary principle and stop evolution! It is all such fraud and the poor simple minded unlearned propagandized lemmings can’t figure out that stopping the Technium’s evolution benefits crony capitalist’s and creates rising prices in order to protect and increase their profit margins. This is inflations great hidden purpose.

            Stopping climate change is also not the real purpose, it is all about stopping economic change and the only way to do that is to stop technological change. One reading of that insane psychopath Monbiot and you understand where they want to take it. So you pay the producers not to produce! “Here rich fat bloated capitalist I’ll give you billions to stop making products!” says the crony socialist. Here’s the rope to hang yourself with, but oh, both the pigs and the farmers got together 100 years ago and are plotting what to do with the rest of the farm animals. So the fix is in, the left gets it draconian world Gov. and the right corporatists get their neo-fascist economic system. Everyone is happy! Except the people of the planet.

          • Che Mort Anne Ominous July 30, 2013 on 12:21 pm

            Also I gave curt Deflation and Liberty to read by Hulsmann free online here and I doubt he never read it.

            Equalitarianism as a Revolt Against Nature by Rothbard, a fantastic book, I think I also gave to him, and of course I doubt he is dedicated to intellectual honesty enough to challenge his emotive based theories.

            When socialism failed as a scientific theory, the left then jumped into the emotive arguments in order to defend it. Now they call you power mad and insane if you go against their emotive religion. Quality of life issues are now all the rage to defend socialism as against “capitalism.” How do you qualify a subjective quality? Greens use this to support the notion that keeping tribesmen poor is perfectly all right as they are happier. Sweden has had demonstrations by the people themselves wishing to roll back the welfare state.

            What is missed by this religious argument is the fact that the welfare state has stopped the evolution of society, that robbing from capital accumulation has kept prices artificially higher. Raise the minimum wage or lower the cost of living, which is better for everyone? A guaranteed income based on the present paradigm would bankrupt the nations, how do you pay for it? Taxation or inflation or both! If I took all the profit and wealth for everyone and redistributed it, it would last 1 year, after that the deluge. Grinding poverty. Without capital accumulation, savings, there is no production. No funds to continue R&D research, scientific and technological developments. You want a better fair world, stop inflating the money supply and bank credit and driving up all prices and profits and thus creating the great disparity between the rich and the poor!

            When he rants: “Need I say it again – YOU ARE A TYPICAL POWER SEEKING SOCIOPATH. Any attempt by government to take power away from YOU you see as the ultimate evil because you are addicted to power seeking – it’s a drug for you. The fact that you could give up a little bit of your wealth and power, and improve the quality of life of billions of people, is irrelevant to you.”

            He rants because you are taking POWER away from his god, the STATE. Individualism is always evil and selfish, but collectivism is always good. The STATE knows better than you how to use your productivity. How dare you stand in the way of his omnipotent deity!
            Complexity theory has already doomed socialism as we have known it. Like a chicken with its head cut off, the brain is dead but the body goes on running around the yard spewing blood and causing havoc and poverty. Since redistributism has never worked, it is of no consequence, he believes that his god can spin straw into gold; therefore it must always be tried no matter what the results. Intentions and emotions trump all reality. Science, economics, validity, be damned!

            “Where the Dow rules the Tao cannot” is all he sees. Yet he misses the fact that the market is an evolutionary, emergent order that follows the rules of the universe, it is moved by the Tao, however you conceive of that notion. It is social coordination, interdependence, and interrelatedness between and among everyone without the need for a top down command and controlling director, just as every eco-system in the universe.

          • Curt Welch Anne Ominous July 31, 2013 on 2:29 pm

            Che Mort writes:

            “Hey Anne, I just saw your comment to me. I hate this web site. I can never find the debates going on, like the one between you and Curt. Where is it? I would love to join in!!! Can’t find it here at all.”

            Oh so true. I’d reply a lot more if it were not such a pain to use this system. Once the reply thread gets too deep it won’t let you reply again so you have to try and find a message that is close to reply to. And when composing, if you try to scan through the messages to look at previous messages, it’s easy to get lost, and not even be able to find the reply box.

          • Curt Welch Anne Ominous July 31, 2013 on 3:24 pm

            Che Mort writes: “What is missed by this religious argument is the fact that the welfare state has stopped the evolution of society, that robbing from capital accumulation has kept prices artificially higher. Raise the minimum wage or lower the cost of living, which is better for everyone? A guaranteed income based on the present paradigm would bankrupt the nations, how do you pay for it?”

            I’d love to comment more on the things you guys are saying, but it’s such a pain now that these threads had grown so far.

            However, to point out how wrong you are…

            A Basic Income would simply cause income inequality to be adjusted. It takes the most from those making the most, and it gives the most, to those making the least. If we plot income vs population sorted by amount of income, we get a a very steep curve. Add basic income to that, and the steepness of the curve just gets reduced a little bit and lifted, so that than income starts at the basic income level (like 10K) instead of 0.

            It’s welfare for the poor, to eliminate poverty (or more accurately, just lift our notion of what poverty is), but also acts as a safety net for everyone, young and old.

            There would still be huge levels of wealth difference between the rich and poor. The poorest would have 10K a year. The most rich in the country would still have billions of dollars of income. The difference between what we have now 0 to billions, vs what we would have with a BIG, 10K to billions, is insignificant. There’s still enormous amounts of opportunity to motivate people to work hard and get rich. It’s the difference between what life is like when you do nothing, and what it is like when you work hard, that creates the motivation that drives capitalism.

            Look at how income inequalty has changed over the years:


            Right before the great depression, it had grown to an all time high, where the top 1% got 23.9% of the income. And then wham, the great depression set the economy of the entire world back for 10+ years and fueled WWII.

            Coming out of WWII, inequality dropped to it’s lowest levels in the US though the 50’s and 60’s and we saw a very strong economy. The top 1% income was about 9% of the total at the lowest.

            Then, starting in the 70’s we started to head back to larger levels of inequality, until again we returned to same dangerous territory that triggered the great depression, and again, we had another crash, that set the economy back for years. So far, no WWIII (keeping my fingers crossed on that one).

            If we add a BI to the high levels of inequality we have today, all it does, is reduce inequality back to what it was in 1970.

            So you, ask, “A guaranteed income based on the present paradigm would bankrupt the nations, how do you pay for it?”

            It’s paid for by everyone that’s working and making an income. They give up some of their enormous wealth, and return it to the people, so that inequality returns back to the levels we saw in the 70’s.

            To suggest such an act will bankrupt an nation is clearly wrong. The US wasn’t bankrupt in the 50’s and 60’s when the rich were willing to share far more of the wealth of the industry with the lower classes.

            Think of this issue.

            If a corporation has 500 workers, and generates billions in annual revenue, how is that revenue divided up between everyone in the company? How much does the CEO get, and how much do the workers get?

            Back in the 50’s and 60’s, the typical CEO was getting something like 10 times what the average wage was. Now, in today’s world, the CEO is getting something like 400 times the average worker.

            A BI, will simply force the CEOs and the stockholders, (if we tax capital gains), to share the corporate wealth, at the sorts of levels we saw back in the middle of the last century.

            The reason we see such high inequality in wages today, is becuase of technology. Back in the 50’s, we had corporations full of file clerks, and secretaries, and salesmen, and lots and lots of managers to manage all the people. Most the work done in the corporations was done by people.

            Now, the filing is done by machines – computers.

            Now, we buy advanced machines to let the “boss” type their own memos instead of using a secretary.

            The sales is done by web servers instead of no a phone with a salesman.

            The bookkeeping is done by computers.

            Computers, email, video chat, cell phones, are used to allow managers to manage far larger numbers of people, so less managers are needed first, because there are less people to manage, and second, because each manager can manager far more.

            Whatever the core business is, it’s likely implemented with lots of machines, that replaced what used to be done by lots of people.

            What this all means, is that corporations today invest a lot more of the capital, into their machines, than into their people, than what we saw happening back in the 50’s and 60’s.

            When the corporation makes billions, a large portion of that goes to the pay for the machines, not to pay for human workers. When the corporations make large profits, the profits are attributed to the “hard work” of the machines. And when the board of directors wants to use some of that profits to reward the “hard work” the money doesn’t get sent out to the workers as a big Christmas bonus, it’s gets eaten up by top management – who made all the decisions about what machines to invest in.

            Running a business in the 50’s was a job of investing in people. A corporation’s people, was the key to success of failure of the business. And not just the management, but the hoards of workers and middle management that knew all the ins and outs of the corporate systems.

            But today, managing a business requires far more wise investments in the right machines and technologies. People are increasingly becoming disposable. You hire a consultant to upgrade some tech, and when the jobs is doing, the consult is thrown away. All the important business processes that keep the business operation, is built into the tech, not into the head of the worker.

            Running a business is increasingly an investment game where the CEO and top managers act not as “people managers” but as “technology managers”.

            And in this light, the CEO is the one rewarded when the business investment in the machines pays off, not the disposable workers.

            This shift from labor, to investment in technology, even within our corporations, is what is driving the growing levels of inequality. Only a few are really good technology managers.

            Facebook is worth Billions, because of ONE GUY – Mark Zuckerberg. It’s worth billions, because he made amazingly wise decisions about what technology to create. Most of his programmers and “staff” are nearly disposable in respect to how important they are compared to how important his decisions were.

            Same thing for someone like Steve Jobs and Apple. Jobs had an amazing knack at picking what technology to invest in and what products to develop.

            The growth of technology, is what has made this need to become technology investors the key to success. The “old” technology business used to be built on was “humans”. But as we increasingly shift the important tech away from humans, and towards all these different machines, the people making the money, is not the machines – they don’t get paid like the humans used to. The old tech wanted a wage that was “fair”, The new tech “computers and robots” don’t – so the CEO and the stockholders gets the “reward” the human workers used to get.

            This keeps driving inequality higher, and will destabilize our economy and our society if it’s not fixed.

            A basic income gurnatee is the fix.

            Steve Jobs, and Mark Zuckerberg don’t need to be be paid 10 billion to be motivated to be great investors and inventors. If they are only paid 5 billion, when everyone else not working, is getting $10K, they will still be amazingly rich, and society will still reward them with an amazing ego boost for being some of the richest and most successful people in the world.

            If we don’t fix this, we will see inequality, continue to rise (back to the graph). We will see more economic meltdowns and depressions. We will see the lower and middle classes become increasingly irritated with the huge wealth flowing to the 1% when they are forced to cope with falling wages for themselves, and their children.

            To suggest the BI can’t work, is to suggest that what we had in the 50’s and 60’s never happaned and also couldn’t work. But it did work just fine, because people don’t need these huge levels of inqualty to be motivated to be prodcutive workers. And in our society where we only need a shrinking number of people doing the machine investment, most people simply don’t need to be part of the work force anymore – let them work for themselves, and for their families, and for their friends, instead of working for a paycheck.

            I don’t need to win this argument with you guys. Time will when it for me. In time, you and Anne will see how wrong you were. Technology is never going to stop advancing, and this problem is not going to go away just because you don’t belive it’s real.

            The conservatives believe all the problem is caused by debt, welfare, and government intrusion into the markets. The more we remove what the government does, the worse this inequality problem will become. So if you and the conservatives get their way, the economy will melt down.

            And of course, being conserv aties, they will blame the melt down on the liberals for not letting them “act” sooner!

            But in the end, the world will try greater levels of socialism, such a BIG, and things will be “fixed” and the conservatives will then conclude that the improved economy was not due to the BIG, but rather, to the conservative values, and if we could remove the BIG, thing s would be even better! (as they always do when they fail to understand a needed paradigm shift in society).

          • Che Mort Anne Ominous August 1, 2013 on 11:01 pm

            Anne I agree with you this web sites comment section sucks. I see Curt has pulled out every “big gun” the neo-left has invented to prop up a failing ideology, including methodologically flawed studies trying to show conservatives are one way and liberals another. As a techno-progressive I find the entire propaganda meme offensive as it misuses science to prove ideological biases. One study fro England purported to show the difference between two conservative PM’s and a group of college students in their 20’s of both sexes. See the methodological flaw yet? Anyone with a background in the psychology and physiology of aging see what the problem is with this study. Then you have to look at scientific and rational thinkers versus emotive and irrational thinkers. I would love to see that study done to see if the brain differences have more to do with cognitive abilities vs. a right-left effect. Most ideologically driven studies are tautologies.

            As for the rest of Curst voluminous exposition, ill quote from one of the best books written, Boundaries of Order by Shaffer:

            “Despite the foot-dragging of socialists to admit to the fact, mankind has figured out how to maximize human well-being. The empirical record of performance by free-market economic
            systems, compared with the stultifying consequences of state socialism, has resolved the pragmatic question of how best to satisfy our material needs. As thoroughly as the heliocentric
            model replaced the geocentric one, socialism retains its viability only within the minds of ideologues. Indeed, I suspect that it is our having answered the pragmatic material question that
            is giving rise to an examination of our inner, spiritual sense of being. Who are we?” pg 158.


            Since paleo-socialism lost the calculation and knowledge debate, so the debate was shifted to a religious one based on emotive feeling and “quality of life” issues, which cannot be calculated. Thus GDP and such are thrown out for subjective feelings and effects. If you then bring up the fact that the per capita income worldwide has risen or that poverty has fallen from 50% in 1960 to 18% today, they will cry you are a capitalist pig! You’re a psychopath etc. The argument quickly devolves as the poor uneducated paleo-socialist has no training in dialectics and reason.

            Hans Rosling has shown that the state of the world is improving and it is improving because of the economic growth of the world through global trade.

            Paleo-Socialists in throwing out Marx’s later works and adopting the nonsense of the Frankfurt school and the neo-Malthusian neo-left of the 60s has lobotomized themselves into infantilism. Their entire ideology uses fear to try to move people to adopt their propaganda crusades, and we have had nothing but one fear crusade after another since the 60’s, and then they state that conservatives are fear based. They cry how open minded they are and then show herd mentality and a rigid adherence to the catechism of their ideology and if anyone goes against what they believe they act like an inquisitor. They cry that they are progressive and then do everything to drag humanity back to the Middle Ages and use the church’s fallacious economic and social ideas of that time. They say they are open and they want civil rights and then want to give the state omnipotent authority which is what all conservatives do. As long as their mouth is screaming their ears can’t really ever hear what they are saying for if they did they would realize that they are the very conservatives that they project onto others.

            Open minded? Try getting one to reassess their stance on any of the pat certainties of their belief system. Global warming, any green issue, the “failure” of capitalism, Keynesianism etc Offer any valid scientific studies that might ding or refute the pat set in cement belief du jure and there is a riot. Name calling, the pulling of hair and the foaming of the mouth!

            The left isn’t progressive today, it is regressive and it has regressed to the conservatism of the catholic church of the 14th century.

          • fireofenergy Anne Ominous August 2, 2013 on 9:17 pm

            You people need to get along… Our collective future depends on it. I know “political systems” are very important, but to me, they appear to be based more on emotion than on actual collective benefit. Non-socialism was the best way to get everybody working for a dream, whereas socialism should be as Curt says when there is a great divide between rich and poor. That’s what taxes are for… and for infrastructure, speaking of which, is the reason why we need to all quit scrawbling about who’s personal fave social system is best for everyone else, when what’s really important is how to get along on a finite planet.
            The very nature of limitation is key to figuring out which social plan to adopt. If too few people gain all the funds, then too many are in a position of limitation. We can’t have that, especially if we are to meet our challenges, which should be the number 1 priority for choosing a social system.
            What is the most pressing challenge of our time? This right vs left debate? The global warming debate? The peak oil debate? Getting the third world up to par? Getting machines to make everything for free? Well, it’s all of the above and therefore we need to arrange our social system to best achieve these goals.
            I would say that excess CO2 is THE most important one because it is global in scope and requires a fundamental shift in energy policy… which is reflected by the current social system that allows a corpacracy to be placed in charge of fossil fuels (thus one reason why they are so cheap). This would then appear to require a collective, one to break the monopolistic grip on FF’s, and two, because collectively, it is we people who are actually causing change to occur via the physical and chemical reactions from excess CO2.
            But we also need the purely capitalist mode in order to raise the productivity needed to afford the tech fix…

    • jg ZeroIron April 17, 2013 on 6:33 am

      First, the “past ideas and concepts of jobs, consumption, and production” are not past ideas. They are the realities of our biology. Even where we to all upload to some machine, thermodynamics would still be in play for the need the maintenance. This brings us right back to scarcity, consumption, and production.

      We could envision a circumstance where our machines produce enough stuff to satisfy our wants with but little effort. Empirically, this doesn’t appear possible. Not because we can’t produce, but because human nature is demonstrably such that our desire ratchet up as they are fulfilled. History is very clear on this point, it operates at both the individual and societal level, with the exceptions being notable precisely because they are exceptions.

      History, the problem every people group has faced can be summed up this way: how do we achieve a level of economic prosperity sufficient to fund the military strength necessary to prevent other people from taking our lives, lands, and liberty? To date, material prosperity has not demonstrated itself as being sufficient to tamp down the warlike instinct. So you simply can’t hand wavely assert, as many do, that if we were to all share equally in prosperity there would be peace. Why is this germane?

      The whole problem is this. Humanity is always going to want more than it has, and the more it has the more it will want. At some limit, we are going to run out of physical space–and note that land has always been the most fought over thing to fight over. When that happens, even the most people collection of societies will turn to mutual conflict. For this reason, our economic paradigms are not fads and fashions that may pass: they are direct attempts to deal with our realities. Automation in any form or to any degree is not going to make those realities budge.

      • Curt Welch jg April 17, 2013 on 9:44 am

        jg writes: “We could envision a circumstance where our machines produce enough stuff to satisfy our wants with but little effort. Empirically, this doesn’t appear possible. Not because we can’t produce, but because human nature is demonstrably such that our desire ratchet up as they are fulfilled.”

        Exactly true. Human desire can never be satisfied. We don’t have a “full” meter on our desire. But, automation will end up doing all the production for us, so we have the issue that man won’t be working, we will become full time consumers.

        ” how do we achieve a level of economic prosperity sufficient to fund the military strength necessary to prevent other people from taking our lives, lands, and liberty? To date, material prosperity has not demonstrated itself as being sufficient to tamp down the warlike instinct. ”

        Very true on the history, but not true on damping down the war. Despite the unrest we see in the world today, there has been a steady decline in war, and a steady decline in the number of deaths due to war, the world over.

        Because we are becoming a global economy that depends on each other, the motivation to go to war keeps decreasing. We can’t afford to declare war on our suppliers, or our customers just because we have some ethical disagreement in society. We are steadily morphing into one large global family and the justifications of war are declining as that happens.

        What drives war and violence now, is inequality. If we refuse to do a better job of sharing our resources around the world, and allow the few to become super strong, it will create unrest and war. But if you share, (just at a fair level – not totally equality by any means), the motivation for war vanishes.

        “The whole problem is this. Humanity is always going to want more than it has, and the more it has the more it will want. At some limit, we are going to run out of physical space–and note that land has always been the most fought over thing to fight over. When that happens, even the most people collection of societies will turn to mutual conflict.”

        Just not true. Everyone accepts that there are limits on what we have. I’m not in the least bit motivated to go to war with my next door neighbor so I can take his land – we both have the same amount of land, and the same size houses.

        We don’t go to war over the fact that life is full of limits. We go to war over INEQUALITY. If I’m forced to live under an overpass, while other members of society have multimillion dollar estates, I’ve got a reason to go to war. I’ll go kill people just because I’m pissed at the fact that they are refusing to create a society that is based on human equality.

        We can end war, if we are willing as a society, to be democratic and fair and place human equality as a fundamental right. And throughout history, the trend has been just this way – towards more sharing, and more cooperation, and less rule by the strong. Progress can be slow at times, with two steps forward, and one step back, but progress has been consistent in the long run.

        Automation is creating this speed bump in history as we transition from a society based on human labor, to society based on machine labor, but we will get past it.

        • Anne Ominous Curt Welch July 28, 2013 on 3:23 pm

          @ Curt Welch:
          “We go to war over INEQUALITY.”

          Nonsense. That is only true when there is a large group of have-nots who live next to the haves, and are sick and tired of being the have-nots.

          Wars the U.S. has been involved in, over the last 5 or 6 decades, have had absolutely nothing to do with “inequality”. Invariably, the U.S. has gone to war with countries that already had less than the U.S. did. Take all the military activity that was intended (despite all the propaganda) to control oil supply. Those weren’t because the U.S. was starving for oil. It was because it simply wanted more.

          Furthermore, terrorist attacks and internal wars in the Middle East/Persia in recent years haven’t had a lot to do with inequality. They’ve been mostly over religion and politics.

          • Curt Welch Anne Ominous July 29, 2013 on 7:03 am

            “Furthermore, terrorist attacks and internal wars in the Middle East/Persia in recent years haven’t had a lot to do with inequality. They’ve been mostly over religion and politics.”

            Of course it’s all driven by inequality. Why do you think the US was attacked the way it was on 9/11? It was because the US has grown too strong relative to the rest of the world (the middle east in this case), and they were sick and tired of the US coming into their country and forcing our ideologies (secular capitalism and democracy) down their throats.

            The weak, when repressed by the strong, rebel. 9-11 was the weak rebelling against the strong in a very clever way. When there there is equality of wealth there is equality of power and no strong to oppress the weak. The US uses our wealth to invest in military equipment which gives us nearly unlimited power to push our ideologies onto the rest of the world and oppress them.

            That is what happens when inequality exists in a society. The wealthy start to see themselves as “right” just becuase they are wealthy and powerful. It makes no difference what nonsense they believe, or what ideologies they push, they see themselves as “right” just because they are powerful.

            And, since you don’t believe anything unless I can give you another person that says it is as well, here’s some references for you:




        • Anne Ominous Curt Welch July 29, 2013 on 12:38 pm

          Curt, it’s called “logical argument”. If you are going to engage in a debate, it behooves you to know the rules of logical debate. One of those rules is that you have to support your point; unsupported, blanket statements like “everything you say is wrong” carry no weight. If you want to get anywhere, you have to refute the other person’s evidence (if any).

          If you don’t follow the rules, even the informal ones, and just offer personal opinion, you can speak or write all day and still lose the argument.

          That is why I often cite references: to make it clear that what I am saying is not just uninformed opinion, but supported by actual evidence.

          To that end, I would like to note that the references you cited do not support your main point. Sure, they ARE evidence that power can corrupt in some cases. But that doesn’t say anything about your assertion that all wars are about inequality.

          As for your specific question: just about any analyst who doesn’t work for the government will tell you that the the 9/11 attacks were motivated by past interference by the U.S. government in the affairs of those regions of the world. Again, “inequality” has little to do with it.

          • Che Mort Anne Ominous July 30, 2013 on 11:54 am


            Curt is a very nice and intelligent person who has been bamboozled by the neo-socialist nonsense he reads. Thus he has a zest for equalitarianism, fairness, redistribution, etc. All the paleo-socialist propaganda memes being circulated today, which happen to also refute Marx himself. So whether you are an older Marxist, a classical liberal or a techno optimist, these neo-left wing memes are designed to insulate them from the reality of the before mentioned 3 philosophies. Neo-leftism defends Keynesianism so every propaganda device is used to protect it by the neo-left. Any mention of the Austrian school of economics, and they parrot the memorized slogans, fascism rah fascism rah.. Talk about Marx hating Malthus and being for the evolution of the Technium, and they say Marx is old and no longer cogent. Every reactionary apologetics has been thought out in advance and taught to the lemmings to parrot on que. If you mention the right-left fight, they will come up with “that is so last century and they are so beyond that,” and then send you nothing but radical left wing web sites and blogs to read. The lip service is there, but the reality is entirely missing.

            Jean Francois Revel’s Flight from Truth and Last Exit to Utopia should be mandatory reading today. We have a lot of delusional emotive debate based on nothing but whim. Tied to semi- post Christian theology all designed to defend a mediaeval age’s concepts of the universe, economics, and society. To bring the platonic heavens to earth, to Immanentize the eschaton, we need the static perfection of heaven brought down and imposed by force on earth.

          • fireofenergy Anne Ominous August 3, 2013 on 11:38 am

            @ Che… Actually, it is kinda hard for me to deal with this comment section, ya, I agree with most of what you say. That’s why I included right vs left but I know they both are used to divide the people and make them unaware of what’s really going on. I only think I have a clue, but I know I see through eyes distorted by the “norm”.
            Anyways, excess CO2 is a REAL problem (even though “everybody” will use it as an ulterior motive), because when I was born, there was about 320ppm and now, about 400ppm. This is the global air… not good when we “insignificant humans” can do that! I know bugs can do this sort of thing but probably not on such a scale in such a short amount of time. It is scientifically proven (centuries ago) that CO2 is an infrared absorber. So we need to deal with that by machine automation of solar, wind AND storage, or, for much cheaper, molten fuels nuclear.
            So, how do we do that in a sea of conflicting suggestions (“nobody” likes nuclear).

  • Improbus Liber February 7, 2013 on 11:41 am

    What are we going to do when the world is automated and we experience a Carrington Event ( that turns our power grid and robots into expensive paper weights? Should I have a secret stock of horse saddles and buggy whips?

    • Craig J. Townsend Improbus Liber February 7, 2013 on 2:03 pm

      The grid can be made solar flare and EM pulse proof. Poltical will and their wasting omoney elsewhere has not made it happen yet. With new coming tech, you will soon be off the grid entirely.

    • Khannea Suntzu Improbus Liber February 7, 2013 on 3:08 pm

      Research euthanasia and prepare. I know I have.

    • jg Improbus Liber April 17, 2013 on 6:40 am

      I lived through one (a) hurricane. My ability to 1. actually start a fire with matches 2. cook over it and 3. do things like sharpen and use a hand saw when the power is out earned me a surpising amount of the various beers, wines, and liquors. So, I can’t really argue against backstopping ones expertises with some cave-tech.

      Of course, people are jerks. At least one of the ungrateful *^*( that were so happy to have the eggs from my surreptitious chicken coop subsequently reported said chicken coop to the homeowner fascists….

    • Anne Ominous Improbus Liber July 28, 2013 on 4:08 pm

      I would put more money on shovels, saws, hammers, and guns than buggy whips.

      But putting away a stash of non-perishable food for a “short-term” emergency, ala Katrina, and like the Mormons do, is probably a good idea.

  • vmagna February 7, 2013 on 11:52 am

    So vibrators aren’t considered robots?

  • vmagna February 7, 2013 on 11:56 am

    It’s not the mechanical robots that cause all the unemployment. It’s the A.I.
    software, just software alone has and will continue to drop people from their roles at an alarming rate over the next few years.

    • t vmagna February 8, 2013 on 3:00 am

      Its all all of them……machines, robots, AI software, using sensors and algorithms.

      • Skip Nordenholz t March 17, 2013 on 6:57 pm

        Machines don’t directly cause unemployment, because a machine doesn’t take a wage, the money someone spends on paying someone to do something is freed up to pay someone to do something else. Now that doesn’t mean machines can’t create unemployment in other more subtle ways just as machines can create employment. As pointed out in this article it depends on whether people can adapt to the change. It is possible that it will become impossible in the future for people to adapt quick enough. Todays most people are not involved in making food and shelter, stuff that we need, perhaps as machines automate more, what people will do is what to us now would seem ridiculously frivolous. Just as people from 500 years ago would look at what most of us do today and say, but how can it keep going when so few people are involved in making the stuff that is actually needed. Though I am fairly optimistic about the future, we shouldn’t use arguments like things have gotten better in the past therefore they will continue to get better, it is equally possible that 1000s of year from now people will look back at our time as the pinnacle, where different forces came to there natural peek, never to be repeated, or cycling every 10,000 years.

        • Curt Welch Skip Nordenholz March 17, 2013 on 9:45 pm

          “Machines don’t directly cause unemployment, because a machine doesn’t take a wage”

          They do take a wage. The wage however goes to the owner of the machine, instead of to the machine. It’s no different than owning slaves. There is no limit to how many machines a single person can own, so there’s no limit to how many people he can displace from the workforce with his “slaves” and no limit to how many “wages” he can take for his own.

          The issue revolves around what new work is being created as each new machine technology is developed, and how easy it is for people who have been displaced, to find new work that pays the same as their old job.

          Sadly, we are getting to a time where most the new work is all in the high tech fields. If you don’t know how to design and build these new machines, or aren’t clever enough to figure out a new use of the machines for yourself, you will have to fight everyone else for a job in the shrinking pool of “average” jobs.

          We need lots more people that are clever with all the new technologies, and far less simple workers. We have far too many people that just need a simple job, and far too few people that have the right skills and aptitudes to create new businesses around the new technologies. Each new business created, is using fewer and fewer average workers. Too many of the “average” jobs have been replaced by technology which means the average jobs are seeing their wages eroded due to the excess supply of average workers.

          • jg Curt Welch April 17, 2013 on 6:49 am

            I’ll echo what you’ve said. I’ve seen many, many jobs that used to be ‘strong back weak mind’ that are have morphed into ‘strong back, not so weak mind’. Bar code systems, for example, were supposed to make retail/warehouse ‘simpler’. Not warehousemen have to know what to do when connectivity is lost, what buttons to push, etc. You need fewer of them, but you need them to be smarter and sharper.

            This transformation has happened at the same time as another shift from what I would call a ‘well grounded’ workforce to a ‘just plain dumb one’. Decades ago, a pimply faced teenager showed up at your door wanting to sweep floors. This kid had a 4 out 5 shot of having worked on complicated systems. Maybe he helped his dad rebuild an lawn-mower engine, or build an addition to the house, something and lots of it. SOME form of production or maintainence entailing the development of basic problem solving skills, use of tools, and ‘snap’. Today, that kid is 1 in 20 and the other 19 have only been ‘consumers’–of social networking, games, whatever. The two trends together are a huge problem.

          • Curt Welch Curt Welch April 17, 2013 on 9:21 am

            Those are good points jg about how kids are being trained to be consumers these days instead of being workers and problem solvers.

            Technology has pushed the problem solving form the back yard, into the mega manufacturing companies so that you can no longer even buy the parts needed to fix something like a weed wacker. They and everything else is so cheap by massive automation that it’s cheaper to just throw a unit away when it breaks, and grab another one coming out of the automated factory, than it is to waste the hours needed to fix it. But it means that the only skill a consumer learns is how to surf the internet and pull out a credit card.

  • Khannea Suntzu February 7, 2013 on 3:06 pm

    Bullwinkey! US unemployment is much closer to 20% counting people that stopped looking.


  • Iphaltuus February 7, 2013 on 4:50 pm

    Robots destroy nothing, opportunity thrives on transition. The most effective things at actually kill jobs are inefficient government programs and tax subsidies.

    Recommended reading, with love.

    Basic Economics, Thomas Sowell

    • Khannea Suntzu Iphaltuus February 7, 2013 on 11:14 pm

      Well do read this too:

      Basic Income, Khannea Suntzu

      • VantageGreen Khannea Suntzu February 8, 2013 on 9:09 pm

        That website is insane. I mean it feels right but it is totally immoral and irrationally wrong. I don’t know where to began. Let’s just make a government mandate on a minimum wage to raise it to $19.05 per hour. Nothing but good and brotherly love can come out of that!

        It is amazing people understand capitalism when it comes from Hollywood but when coming from a corporation their just infested with greed.

        I hope one day I can work and earn my money without carrying all the parasites of the country.

        • Chris F VantageGreen February 9, 2013 on 10:39 am

          Vantage, rather than throw around ad-hominems, I’d like to hear the specific reasons why you think an income guarantee won’t work. Personally I think it’s an interesting idea, something which at the very least deserves some serious discussion and analysis.

          I’m sure you’re aware that the US is one of the most unequal countries in the world in terms of income distribution, and simultaneously one in which social mobility is lowest (not to mention the high rates of incarceration, mental illness, gun crime etc). The evidence from other countries seems pretty compelling that shrinking the gap between rich and poor would solve a lot of these problems. I believe that the basic income guarantee is a good way to do this.

          • Curt Welch Chris F February 9, 2013 on 3:32 pm

            Exactly right!

          • VantageGreen Chris F February 9, 2013 on 9:33 pm

            When you get to wage guaranteed there is so much destruction that happens:

            1. If wages are higher than the market value for that position the employer will rationally higher less people, outsource the work load, cut expenses, lay people off, all the above, or Shut down the business. If everyone was making $40,000 per year (minimum basic income) there will be millions of people in the streets.

            2. Just like a business has to create a value (product) that will justified the price they want to sell the product so people have to create a value to justified the salary they want to earn. The market value of a bottle of water is $2.00. It will not sell at the present market condition at $20.00.

            3. Income Guarantee is also destructive to the employee because they will never gain self esteem (a human value) and what they have was not earn.

            If the goal is Shanty Towns, poverty at 3rd world levels, more income inequality, violence. Than Basic income guarantee is the road to get us there.

          • Curt Welch Chris F February 9, 2013 on 10:37 pm

            VantageGreen writes: “3. Income Guarantee is also destructive to the employee because they will never gain self esteem (a human value) and what they have was not earn.”

            “If the goal is Shanty Towns, poverty at 3rd world levels, more income inequality, violence. Than Basic income guarantee is the road to get us there.”

            Total nonsense. If getting something for free was destructive, then the fact we all get free air would have wiped out our human self esteem a million years ago. Millions of years of “free air” and never once did we have to “work for it”. Millions of years of a self-repairing body provided to us “for free” that we never had to work for, and still, our self esteem remains intact. Millions of years of free sunshine, that we never had to work for, and our self esteem remains intact.

            Your “self esteem” argument is total nonsense and it’s exactly the type of small minded thinking that is getting us into the problems we are currently in.

            There is still plenty for people to achieve, even when they don’t have to work for a living. You can achieve the love of another human. That is not easily bought with the money your society provides you. You have to achieve friendships. You can study and learn things and achieve the self esteem for having a trained mind – again, items that are not bought with the money provided by our machine economy but must ultimately be done on your own. Have children, work full time to raise them – get your self esteem from being a great parent. People can achieve leadership roles in society, by working to help others. Again, not something that is bought with the free things our machine economy will provide us.

            Times are changing. The new generations coming along have a very different world to contend with than our fathers had. A traditional “job” will no longer be the standard of life for them – and already isn’t for a large number of young folk currently starting out today.

            Just because your father filled his entire life “working” for a living, and taught you that was your destiny, doesn’t mean it will be the destiny of our children. Our general wealth in society is allowing people of all ages to work less, and retire sooner, and spend more time enjoying life, instead of struggling to survive. Give it another 4 decades, and that “less” work will drop to “zero” work for most the population.

            This doesn’t mean we won’t chose to do things that seem like work – just like how many people once they retire, take on hobby jobs or do volunteer work. That is, they might pick up a hobby of making bird houses, and selling them at craft fairs, because they like making bird houses, and going to craft fairs and selling their work to people. But it’s not “real” work, because there is no requirement to make enough income to feed, or house yourself – your savings and your BIG income will do that – just as those that retire have retirement income to live on. It makes people feel better to have something “constructive” to do, even if it’s only a hobby business. This sort of activity will be rampant in the future because it’s what people want to do, vs what we have to do, just to stay alive.

            What a healthy basic income guarantee will do, is reduce the motivation for some people to work. That will have an effect on the overall job market in that some will simply not try to be productive. However, the total GDP is not dependent on everyone working. That’s exactly what we are seeing now with this recent “jobless” recovery. Business are recovering nicely, GDP is growing at strong levels, and lots of people are still out of work. The “economy” doesn’t give a shit that 50% of the population simply isn’t working. If we put everyone to work, it wold not double GDP – it would have almost no effect on GDP – because most people contribute very little to the GDP even when they do work full time. More and more, it’s the machines that are producing all the real GDP value and we humans just stand around and help them produce the GDP for us. And most of us, don’t really help the machines much at all – particularly the 50% that current are not part of the job market. Their value to the economy might be worth $1 a day on average – if that.

          • Iphaltuus Chris F February 10, 2013 on 12:13 am

            Free is a term meant to describe a virtuous condition, like the word perfect.

            Our ancestors competed against every other species, even though we came a common ancestor.

            The air we breathe is limited to how much is totally available in any given area. You are in effect competing against every other thing that breathes air on this planet. We offset that cost with a wealth of plant life, which proves its value to us (read theory of relativity) as a source of breathable air. If our birth rate exceeds the balance of growth set by the birth rate of all plant life, the cost is shown in the scarcity of available air.

            This in turn leads to a demand for plant life, ergo anyone who has land, is good at growing plants, has seeds, etc. has an opportunity to “actuate” wealth through the distribution of plantlife.

            Fortunately, as far as we can tell, the universe will be able to provide material resources (in the case of plants, sunlight especially) indefinately.

            Each of us has an even-if-ever slightly different opinion on what to do with the resources available to us, and therefore must test our theories in practice and in competition and in comparison to the other, but always with each other in one way or another.

          • Anne Ominous Chris F July 28, 2013 on 4:52 pm

            Quote: “I’m sure you’re aware that the US is one of the most unequal countries in the world in terms of income distribution, and simultaneously one in which social mobility is lowest (not to mention the high rates of incarceration, mental illness, gun crime etc).”

            While those things are true, the assumptions you put behind them are not.

            The inequality in the U.S. has always existed, but it has gotten worse. No argument there. But the operative point is that has happened RECENTLY. As government policy has become more “collectivist” and interventionist over the last century, income inequality has gone UP. You can see the same trends in Europe, but perhaps to a lesser degree. And it has reached its peak under Obama. Coincidence? Hmmm.

            I’m not making any grand claims of cause and effect there, but the correlation is a simple, undeniable, hard fact.

            “… and simultaneously one in which social mobility is lowest.”

            Again, a RECENT trend. The U.S. used to be the country with the world’s highest social mobility. And again, the increase in this very big problem has happened right along with the INCREASE in “collectivist” and “interventionist” government policy over the last century.

            “… high rates of incarceration…”

            Directly attributable to bad law and “the war on Drugs”. Nobody knowledgeable about this subject seriously disagrees about that.

            “… mental illness”

            Well, when “mental illness” is DEFINED in such a way as to include nearly everybody (see “American Psychiatric Association’s Diagnostic and Statistical Manual of Mental Disorders Fifth Edition”), you’re going to have more cases of “mental illness”. QED. The psychiatrists have been expanding their definitions of mental illness with each edition, and this year they overdid themselves. By the definitions in that manual, YOU are mentally ill. Just another fact.

            “… gun crime etc).”

            Don’t get me started. But sadly, this subject is too complex for this kind of discussion. I could use up many pages. But I won’t subject the readership here to that. I will say, however, that many people harbor many invalid assumptions in regard to this issue.

        • Gorgand Grandor VantageGreen February 9, 2013 on 3:45 pm

          Of course, a basic income would as time goes by be less and less parasitic on the incomes of actual workers, because machines are long term trending to do all but the most skilled technical AI/robot work, so a basic income would then be parasitic upon an automated system’s labor, not yours, because like pretty much everyone you’ll be out of work, which is the exact reason such a thing is required. The automated system isn’t likely to be of the kind to care.

          This all raises the question of what use money would even be. The only purpose of money is to be used as a unit of trade, in essence to convince other humans to do work or trade an item to you. An automated system designed to simply do tasks without our extraneous human concerns has no need for wages, so perhaps food can be sold in stores for free. Superficially, there would seem to be no more need to tax any humans anymore either.

          However, surely even if such systems fix themselves we will want to have humans in control and able to reformat systems. Will the new income inequality be ownership of automated systems at that point?
          The whole current left-right paradigm must change at this point, just as it changed from the pre-capitalist monarchist vs republicanism/classic liberal paradigm. It seems as though the new 1% will be the techs, scientists, engineers in charge of tweaking the machine economy, but will we even care at this point given the fruits of a robot economy?

          • Curt Welch Gorgand Grandor February 10, 2013 on 9:37 am

            “This all raises the question of what use money would even be. ”

            Money is still highly important even if humans aren’t working. Think of the economy has a huge automated machine that at the moment, just happens to use a lot of humans as “cogs” in the machine as well as all the tools and machines that work with the humans.

            That “machine” is taking input from the human consumers – in the form of their purchasing decisions – and in turn, it’s optimizing the allocation of ALL goods and services and resources and technological, to maximize the delivery of thinks of value to the consumers.

            It’s a huge but highly important, distributed optimization process. It’s the invisible hand of Adam Smith at work optimizing to use of all our shared and limited resources (land, energy, raw materials, machines, etc).

            Money is the control signal by which this optimization process functions. Remove money, that is, remove the control signal, and the optimization process dies. At that point, we have NOTHING optimizing the allocation of resources for us which leaves many highly useful resources poorly managed. That leads to people not having food to eat when they need it because the complex problems of allocation machines and resources to produce all the needed food messed up and we can up 100 tons short of wheat for the year, and over the winter, there was no bread for anyone to eat because all the wheat was gone.

            Humans must tell the optimization process what is most important to them. Would they rather eat bread, or tofu? Fish or meat? Milk, or beer? And we tell the optimization process what is most impotant to us, by how we spend the fixed number of “tokens” we are given to “vote” with.

            This is important because even with advanced automation, we still have limited resources we must allocate. We only have so many square miles of land on the surface of the planet, and we must allocate all that land, to whatever use will allow us humans to get the most, of what we want the most of. We only have so much energy to work with. So much raw materials to build homes, and to build machines out of. Human desire is unlimited, but the resources we use to satisfy our desires, are limited.

            Money, is the control signal the machines will use, to optimize their behavior, so as to maximize the things things of value they can do for us, with the limited resources they have to work with. If you remove money, the entire system falls apart and the robots have no ability to decide what it should use a given square mile of land for. Should it build solar arrays on the land? Plant corn? Build a robot factgory on the land? Build humans for humans? Build a park?

            How do the robots know what to with all the resources if they don’t know what we humans desire the most, and if they don’t know how to calculate the infinitely complex ramifications of every allocation decision they make?

            The error of communism was believing that humans could make those allocations better than the free market. The free market is itself, a highly intelligent “machine” made up of many machines of less intelligence, and money, is the control signal that makes that machine work.

            Even now, we have allowed this huge machine called the economy to be built, and we allow humans to take part in the machine, along with all the machines and tools that also today make it work (which highly outnumber the humans at this point).

            But we have the social question to answer – now that we have all worked together to build this huge highly efficient “machine” which is turning out our GDP set of “things of value” every year for us, how do we decided how to divide up the “things of value” this huge machine is producing? We do it now based on ownership of the assets. Each human gets “free” ownership of one human body (their own), to make money for them. Everything else, like land, and business, we get to buy and trade, and create and however is best at making this machine “work” will end up with the largest share of the machine’s output.

            But with the arrival of advanced automation, the human labor component vanishes, and people are born “poor” since the “free body” they were given at birth is now worthless. Less than worthless, because it takes money to keep the worthless thing alive. So at that point, whoever owns the machines, “wins”. And in a game of trading, there are always a few guys that come out on top, and end up “owning” everything of value. There is no social fairness there. If we allow extreme darwinism to be the foundation of our society, then 90% of people will end up starving and dying. Not a good choice.

            But we can keep using money, and keep the optimization process working, by taxing the owners, and distributing a portion of their wealth back to all the consumers. If we apply a 25% tax, we are effectively saying to the owners, that 25% of profits regenerate by the things they own, must be shared with everyone, and 75% you get to keep for yourself. In effect, we are saying that in terms of how gets to benefit from the things they own, the real owners only get 75% of the reward, and everyone else gets to share 25%. Or in other words, it’s as if the public “owned” 25% of the entire production system. Or at least, owned the rights to the profit (but not the rights of controlling what is done with the property).

            So, we have a huge economy of all the machines and resources, that is producing all this stuff of value every year (the GDP), and 25% gets to be shared by everyone equally, and 75% of it goes only to the people that own the things of value.

            If we made it 100% instead of 25% we would have pure state owns everything communism. But if we have it only at 25% then we have 25% socialism mixed with 75% free market capitalism. As long as humans are part of the system, we need to keep them motivated to make the system work – which is why they 75% for doing that work. Even if the only decisions humans are making, are business investment decisions, like what business to start, whether to build a new factory, they still need to be “paid” for doing that real and important work.

            In the end, when machines make all the decisions for us, because the machines become better business managers than any human, then all the output of the system can be evenly shared across all the humans because literally, no human is contributing anything to making the system work. We just all become full time consumers telling the “machine” what is important to us by how we spend our fixed “tokens”.

            Money will always be important, and the big important things in life will never be “free”. But things like basic food, might become so cheap, that it will be free to us, just like water from water fountains are “free” today – even though they are not actually “free” they are so cheap, it’s not worth the effort to account for them by making people pay for what they drink. But if you want special high quality food and dining experiences, that you still have to pay for.

          • Iphaltuus Gorgand Grandor February 10, 2013 on 8:46 pm

            The problem here is that the fruits of robot labor are the new source of money/value.

            Imposing government regulation as to who/where any portion of the production goes is to directly undercut a person who has a use for that resource without having to prove that your method is more profitable than theirs.

            The proof-of-value element (if you will bear with me) that would be taken away, in this instance, is the vital element to ensuring that the use of any given resource is utilized to it’s highest potential production value.

            For example, if you came out with new technology that made the most efficient solar panel, you would deserve the wealth you recieve from those who are competing for your product. Since your tech is the best, you get the most bidders. That wealth in turn grows your company and production capability, but what’s more is that your discovery brought forth a new form of wealth. As new tech becomes increasingly more powerful the total potential wealth of an economy expands.

            Since the rate of technological innovation far exceeds the rate of increase of human population, the wealth of a truly free economy will spread beyond the basic needs of the population, and the spectrum will shift to excess.

            Our intelligence dictates that we will not be satisfied with the limits set upon our minds by passive evolution, and we are likely to continue to seek, find and implement ways to increase the capabilities of our minds.

          • Craig J. Townsend Gorgand Grandor February 11, 2013 on 7:20 pm


            You really need to study basic economics. I counted many economic fallacies in your post, as well as failures in logic. You need to understand capital, and also money especially the socialist calculation debate.

        • Curt Welch VantageGreen February 10, 2013 on 10:08 am

          No, minimum wages laws have serious problems. First, they distort the value of things made by the minimum wage workers. Minimum wage is nothing more than pure socialism, where we take from the rich and give to the poor (which is good), but minimum wage is a poor way to do it, because it doesn’t take from the “rich” – it takes only from the people who buy the products the minimum wage workers create. And most rich people, tend not to buy a lot of products made by minimum wage workers. It’s not the rich buying those McDonad’s hamburgers made by the minimum wage workers. It’s not the rich, buying the products from Walmart made by minimum wage factory workers and sold by minimum wage retail clerks.

          When we raise the minimum wage, the products and services created by those workers must raise in price. And whoever buys those products and services, are, in effect, are paying the cost of the welfare we just gave to the minimum wage workers. When we raise minimum wage, the cost of McDonalds hamburgers goes up – and it’s paid for by other minimum wage workers, and by the middle class – not by the rich. The price of a Ferrari doesn’t go up, when we raise minimum wage, so instead of getting the super rich to provide welfare to the poor, we are getting the poor and middle class to provide welfare for the bottom class. That’s not right.

          Now it’s true that some of those costs are going to trickle up to the rich, because once you raise minimum wage, other wages tend to raise some as well, and it all trickles up. But the majority of the “welfare” we have created this way, does not end up coming from the most wealthy who should be the ones providing the bulk of the welfare. It comes mostly from the bottom end of the social scale, forcing those just getting buy, to carry the burden of the not so well off. Minimum wage is welfare that the rich don’t have to pay for – which is exactly not the way to do it.

          In addition, minimum wage has another even more serious problem in the face of automation. It kills jobs and crates greater unemployment. When you raise minimum wage, it puts people out of work. If a business has a market opportunity to supply a product or service, and it needs human workers to provide that service, lets say, something not very important like a car wash, and there is no minimum wage laws, we might find the market will end up paying people $2 an hour to wash cars, and the car wash is sold for $1. That is, they are able to wash cars for $1 each and make the business work. But now we add in minimum wage laws, the car wash is forced to pay the worker, $10 and the cost of the car wash goes up to $5. But at $1 dollar, lots of people opted to have their car washed every week, and business was booming, and it employed 20 people. But at $5 a wash, most people just decided not to wash their cars, or to wash it themselves, so business tanked, and now, it stays in business, but only employs 2 people. 18 people lost their jobs.

          Minimum wage laws kill jobs. In the example above, it helped 2 out of the twenty get a much better job, but put the other 18 out of work. So 18 people had to give up their jobs, so that 2 could have a good job. So, in effect, it’s those 18 works that sacrificed their jobs, that provided the “welfare” for the 2 workers. Again, we failed to get the rich to pay for the welfare as they should have.

          Then we add automation into the mix, and now once automation becomes cheaper than a $10 an hour human, the humans lose their jobs to the machines. But without minimum wage laws, the humans could keep working at $2 an hour, until the price of the machine dropped below that level.

          So with approaching automation, minimum wage laws just help the machines displace the workers sooner. And now the rich, who own the companies that make the car washing machines, are getting the car wash money, instead of the low end workers – so we fail again to help the low end workers.

          Minimum wage is a BAD way to do welfare. It kills jobs, creates unemployment for low end workers, and isolates the rich from having to help lift the boats of the low end workers. It’s wrong on may levels. Not because it’s welfare, but because it’s welfare done the wrong way.

          That said, it’s better to have some minimum wage laws than to have no welfare systems in place, but there are much better ways to do it – with a Basic Income Guarantee being in my view, the best option – if only we could get more people to understand it.

      • Craig J. Townsend Khannea Suntzu February 9, 2013 on 1:37 pm

        basic economic ignorance. Ok, where will the money come form to pay a minimum living wage to everyone?

        1. Higher taxes.

        This has an immediate problem as all taxes takes from productivity. Slows down the growth rate of the economy. Less is available to reinvest in production so prices stop falling and greater productivity that would organically lower all prices and profits also stall. So by robbing from productivity you will actually cause inflationary effects in prices while decreasing the rate of the law of increasing returns.

        II. Inflating the money supply

        Since governments have a hard time taxing people at high rates it resorts to printing money. To give everyone a living minimum wage it would have to print a ton of money. Far more than the Fed is doing now. Inflation lowers the value of the currency. All savings is slowly wiped out, prices rise and hyperinflation can set in. Overtime inflation robs everyone, todays minimum living wage of $24k will be worth $10k and then $5 k over time, thus you have to constantly raise the living wage rate to keep up with inflation causing a spiral effect and a horse race between raising wages and the printing press, what we have now only on steroids.

        The economic illiteracy of 99.999% of the population and 100% of our elected officials is why we are where we are now.

        • Khannea Suntzu Craig J. Townsend February 9, 2013 on 2:14 pm

          In the current system basic income is impossible to fund. Can’t be done. It would bankrupt existing nations.

          However just wait what happens when the current system stops being able to provide people with anywhere near enough income (wage-based or otherwise) to have a life acceptable to them (or worse a life where they will actually feel hunger pains) – the moment we arrive there, there will be a completely new situation. This new system will find a way to liberate the funds people need to have a life they would regard as anywhere near acceptable.

          Mind you, we are very close to mass death of human beings, UNLESS. Technological unemployment isn’t the only game in town. Resource depletion, state debts, student debts, real estate bubbles, monetary bubbles, banking corruption, the pension crisis, entitlements, the environment, and massive disparity it will all conspire to rapidly decrease consumption. Not because we want to, but because the constraints of natural limitations kicks humanity back in its place.

          Yes these are contradictory agencies at work, much like a funnel forcing all humans to consume less, less, less. All humans, rich or not rich, no exceptions.

          One way to massively reduce expectations is literally to buy people with some form of free money to NOT do things. I.e. pay them a basic income, and then let people squabble over the remaining 16-32 hours a week left to make some extra money with paid labor. The total pool of money we can extract with labor to give all of us a “abundant” life will diminish quite rapidly (in a few years) because of this confluence of negative actors.

          Basic income will be just a means to ration out the bare essentials what people need. It won’t be pretty, but if we go about it smart, we won’t have to see massive riots, civil wars, famines, secessions, mass-migrations, terrorism and widespread crime.

          • Curt Welch Khannea Suntzu February 11, 2013 on 10:34 pm

            Craig J. Townsend writes: “If I rob the very wealthy and drain it all off to pay for social programs the money is spent, gone, it no longer exists to invest.”

            Your ideas of how to fix the economy is the same as mine, so we are basically on the same page. But your implementation has problems – though if it could be implemented, would have (almost) the exact same effect as mine. Your’s is just far more complex and buys the economy nothing for that added complexity and does actually create some real issues. I’ll explain.

            You understand that cash is just a trading token right? It never “goes away”. It just keeps circulating.

            You are talking about these things in the way a private investor should think, not in the way someone setting public fiscal policy should be thinking.

            As a private owner, I can receive income, and spend it. I can buy a burger, or I can but it in savings by buying a CD where the money “works” for me.

            In both cases the money is “gone” after I spent it on the burger or the CD. I no longer have the money. In both cases I have an “asset” I bought with the money. The burger is a short term asset. It has value that will decay very quickly. But it produces value for me, when I eat it. I get the joy and satisfaction of the burger. The CD on the other hand, generates interest. Lets say 1%. That means the the $5 I invested into a CD will produce 5 cents per year, forever. If we discount those future cash flows so we can compare it to the current cash flow for the burger, we find the value of both “investments” are identical. Neither is “better” for me.

            The money I paid the burger joint, goes into the bank of the burger joint. It’s “still in the market”. The money I paid the bank for the CD, is likewise, “still in the market”. The money is still there. In neither case did it go “poof”.

            The difference is that I as an individual, get to select whether I’d rather have a burger now, or wait 70 years, and then have 2 burgers.

            The economy does not care which option I pick. Business that need money to start a new venture, can still go to the bank, and get the money, whether I bought a CD with it, or a burger. Neither of my two options helps, or hurts, the money supply for capital investment by industry.

            The job of industry, is to optimize the production of the produces we consumers say we want. If I buy burgers, the economy needs to optimize for the production of burgers. If I buy CDs the bank needs to optimize it’s operation for selling CDs.

            Both businesses need to make capital investments for their business to work. The burger joint had to buy or maybe lease retail space. It needed to spend money to build out the space to turn it into a burger joint – buying all the needed kitchen equipment and the like.

            The Bank needed to set up it’s internal IT systems and accounting practices to support customers buying CDs. It needed to set up a branch office, or web sites, and phone systems so I could buy the CD.

            Both the bank and the burger joint needed to make large capital investments, to start up their business long before I gave them 5 dollars for a burger, or 5 dollars for a CD.

            They get that money from the captial markets – they go “least” the money (aka they get a loan). There are many different ways for business to get money. If they have good credit, they will already have a line of credit established with their bank, and all they have to do is write checks. If they don’t have enough established credit, and they don’t have their own personal savings to use, they can turn to others. They can create a partnership with people who have money. They can create a private corporation ans sell stock to private investors if they can find the private investors. They can go to venture capital firms – which not only give you money, but give you advice, and connections to industry insiders to help you succeed. Larger business have the option to sell corporate bonds. The ways to get money is nearly ENDLESS. There is NEVER a lack of ways to get money in the US.

            If lots of business were trying to make investments, and the money supply was too low, interest rates would go up. The cost of money would go up. With higher cost of money, people looking to start a new business, like open a new burger joint, would have to decide if the new joint would be making enough money, to pay back the interest. The cost of the money adds to the overhead cost of running the business, which means it’s less likely to turn a profit. So in times of higher interest rates, investors are less likely to start a new business – only highly profitable businesses can be started in those times – so less businesses get started when interest rates raise too high.

            The fed, has authority to pump as much money into the market as it wants or take out as much money as it wants, to keep interest rates and inflation in check.

            Nothing we do, such as buying burgers, vs buying CDs has ANY EFFECT AT ALL, on whether there is money in the money markets, for business to invest with. It’s all controlled by the FED.

            Now, your idea is to have a fund, that is jointly owned by all the people. That is called public ownership. That is called “government owned”. Now, we could set up a separate government to own and mange the fund, so that our “other” government, which runs the army, and the courts, can’t touch our money, but no matter how you look at it, this “fund” must be owned by a “branch” of the “government”. it can’t magically “exist” on it’s own, without having rules and regulations about how it’s manged, and operated, and how shares of ownership are tracked.

            And if you want business to invest into the fund, why would do Exxon do that? Are you saying the people would just ask nicely and hope Exxon would do that? They won’t unless the laws of the land force them to do it. Or at least, any sort of unsubstantial investment won’t happen – you might get a one time small “donation” as a PR write off for them.

            So you have this government fund set up – which is fine, and we pass laws saying all business must put money into it. How is the share of their investment determined? You have not explained.

            But no matter how it’s determined, the correct word for it is “a tax”. How you are making this work by not creating a tax to force business to put money in the fund you have not explained. But feel free to do so.

            So now we have a fund with bussines putting money injto it. Again, fine. What do we do with the money? Buy Burgers? By CDs? Buy stock? In which businesses? By US treasury bonds? How are the investment decisions made? Do we hire a fund manager to mange it and what guidelines do we give them? How do we change the guidelines over time? Do we set up a board of directors to review the policy every 23 months and update they directives to the manger as needed each 3 months?

            Ok, so to implement a decent sized basic income payment, this fund will get HUGE. It could become the works single largest investment fund. What the fund manager chooses to invest in, will have huge effects on whatever markets the fund is investing in. It will “move mountains” if the fund manager decides to sell all its APL stock and move it into XOM. Or if invests in Gold, vs silver, or invests in Yen, vs oil futures. This “fund” could have huge world ranging political implications – depending on who it was managed. Whoever manged that fund, could make or break entire countries by how it invested. So how do we, the people of the US, limit the power of this fund manager? It would need to come under the control of the President and Congress in some way so that the US Government’s foreign policy was not being effected by how it operated.

            And, since we have a fund with trillions of dollars in it, owned and manged by the US government, and they go out and buy stock in lots of US corporations, they would have the power to buy majority control of many different private corporations – turning them into public, government controlled corporations.

            So tell, me, how are you going to set this “fund” up to prevent it becoming the above – the US government simply buying and managing a huge percentage of all previously “private” corporations?

            None the less, what happens is that this “fund” owns lots of assets ithas bought, and as such, has now got the right to own, the income streams the assets generate. So when it owns a burger joint, it gets the right to own the profit stream from the operation of the business. That profit stream, is the money we then give out to the “shareholders” as their income payments.

            Now, with my way, there is no fund. So there is no fund to mange. We instead, just tell every business, to give the government, some percentage of their profit stream. We then pass it to the people.

            the only difference in your way, and mine, is that you have a fund, where the fund “owns” say 25% of the burger joint, so it gets 25% of the profits of the burger joint that is sent to thge people. My way, there is no fund, but 25% of the profits stll get sent to the people.

            It makes no difference, if there is a fund or not. The same money, sends up being sent to the people.

            The “assets” that generate the money, is NOT the shares in the fund. The assets that generate the money, is the building, and kitchen equipment and the chairs and tables, in the burger joint.

            I have no need, or desire, to own that kitchen equipment. I don’t need to own a share of stock in a fund, that owns 25% of that business. I only need a share of the profits it generates. If I own the business, and the business goes out of business, I’ve lost my investment. I not only lose the small stream of profits, I loose the much larger investment.

            I don’t want to own that risk! I want a guaranteed safe stream of revenue to fund the people. So I tax the profits on the business, and if the business has a loss, I don’t have to pay them. And because the tax is applied to all business of all forms, this means the people end up owning a right to all the profits from all the businesses – but only those that are making a profit – the ones that don’t make a profit, pay nothing.

            If the Basic Income is paid by the profits of the fund, then the Basic income can only be funded by things the fund can invest in. It can’t be funded by private corporations – which means Walmart is not helping to fund the basic income Guarantee (they are private not public). But when it’s done instead, with a tax, then Walmart has to help fund the Basic Income as much as Exxon and Apple does.

            So, in summery, I think we both want the same thing, and your desire to “keep money invested in the economy” has your heart in exactly the right place – but I don’t think you understand the larger picture of how the financial markets work. There is no need – and lots of reasons not – to set up a fund where the profits from the fund, are used to pay the pay the basic income payments. We don’t want the people of the US OWNING 25% of Exxon through a shared fund. We want instead, to just take a share of the profits (and personal incomes) _as_if_ we owned the business by way of taxes, which isolates the people from down side capital loss, and automatically acts AS IF we owned a percentage of every US business without having to actually own any of them.

        • Chris F Craig J. Townsend February 10, 2013 on 3:23 am

          Craig, I agree with you that inflating the money supply is not a solution. But I like your first idea very much. Why not raise tax levels for high earners ? I’d personally be happy to pay, say, 70% tax on any earnings over $80K. That’s enough to live a very comfortable life – the excess will then get passed on to someone who needs it rather than just sit in my bank account. I can’t see why productivity would suffer – right now, the cash is sitting under my mattress benefiting nobody. Surely if there are more consumers participating in the marketplace, everyone gains ?

          Here’s a great video by a very wealthy individual who makes exactly the same argument far more eloquently than I can :

          • Lonie Chris F February 10, 2013 on 9:23 am

            Chris, let’s make the high tax rate a voluntary thing… that is let a fool (and his money are soon parted) overpay his taxes (or move to France where it is the law) and allow those of us who don’t just sleep on our money keep most of it and put it to good use. The govt. has shown that they are not too proficient at putting our money to good use, in many instances.

          • Curt Welch Chris F February 10, 2013 on 10:26 am

            Lonie, I agree the government is poor at spending our tax money – which is why I advocate getting them out of the loop by switching from our current welfare systems, to a Basic Income Guarantee.

            Much of what the government does for us, is a hidden form of welfare. If they build roads for us, but don’t charge us of using them based on whoever is using them the most, the roads become a welfare benefit we get from the government. And without a charge, we are left with a resource allocation problem where we never seem to have enough roads because we “give them away for free” and then people use too much of them – like by choosing to live an hour away from work because there is no commute tax for road use.

            These forms of welfare should be taken out of the hands of the government, and put into the private sector, and people should be made to pay for the roads they use.

            Welfare should then be made explicit by a tax and Basic Income Payment we all receive from the government, so we can choose what we want our “welfare money” spent on. If we don’t want to use the roads, we should be able to spend our money to buy a bike instead. Businesses that ship goods all over the country should be made to pay their fair share of the shipping instead of having the roads provided for “free” as a welfare handout from the government.

            I believe the government is far too large, exactly because we are using it to do all this “welfare” work for us. All that welfare work should be reduced to just taxing, and sending out Basic Income checks to everyone, and let us each spend the welfare money the way that is most important to each of us, and allow the privet sector provide all the goods and services we buy with our welfare money.

          • Khannea Suntzu Chris F February 10, 2013 on 10:28 am

            I am fairly sure that if we implement a basic income where the government has no say in its implementation or distribution we can save a LOT of money by firing welfare bureaucrats, controllers and eliminating the whole welfare checks&balance infrastructure.

          • Craig J. Townsend Chris F February 11, 2013 on 7:48 pm

            Sounds good, but think about it. Rich people don’t spend everything they make, they invest it and save it. If I rob the very wealthy and drain it all off to pay for social programs the money is spent, gone, it no longer exists to invest. The more you consume capital, the slower the growth rate of everything. Wages go down, there is less to invest. Prices stay artificially higher. Where do you think venture capital comes from? The great disparity is a product of intervening in the economy to make things fairer through redistribution and inflation. Stop it and the gap narrows as the bottom poorer earners rise. All of our thoughts are based on feeding the law of decreasing returns. Linear minds promoting linear limited ideas.

            Also rich people pave the way for poorer people. They buy products and goods when they are the most expensive and the rest of us cant. The rich got indoor toilets, indoor gas lighting which led to electrical lighting, the first computers etc. If it wasn’t for them paying for production before the economy of scale kicked in, we wouldn’t have cheap products, or they would be greatly delayed in arriving to us. I’d rather the rich put their savings with the X prize and other such NGOs, that and that alone will change the world. If the X prize had no money, we would have no way to fund the only way to truly change the world free of the dead hand of the servile State and its parasites who always seek to eliminate their competition. Europe isn’t the future, it is the past, there is a reason their growth rate is usually low.

          • Curt Welch Chris F July 29, 2013 on 8:36 pm

            Anne Ominous writes:

            “You are contradicting your own earlier comment. I noted that your comparison of minimum wage with things that are “free” like air is a logical fallacy, because the minimum wage is not free. Air is not manufactured by your neighbor, but your neighbor may be an employer. If so, he has to pay that minimum wage.”

            Excuse me for not correcting your error when you first made it. I never equated minimum wage with “free air”. Go back and read the thread this time. And understand as you read it, that “Basic Income Guarantee” is not minimum wage. It’s a welfare (redistribution) payment made no matter whether someone works or not. And then also take the time to notice the context of my statement. It was in reply to VantageGreen who wrote: “3. Income Guarantee is also destructive to the employee because they will never gain self esteem (a human value) and what they have was not earn.”

            The person was making the claim that getting a BI payment without having to “earn it” would prevent them from gaining self esteem. My counter was the simple truth that we get air without ever having to earn it and and I see no signs of people losing self esteem becuase of all that “free air”.

            None of this relates to what you CLAIMED I said about minimum wage – which was not even being discussed until YOU brought it up.

            “If that were true, I might agree with you. But it is not, and I do not. The vast majority of our economy is in small businesses, and it is those small business owners, not “the rich”, who pay those minimum wages.”

            You are so small minded. The small business owners DON’T PAY. They just raise their prices. It’s the people they sell to that pay the bulk of the welfare. The small business owners ALL have to pay the same minimum wage (except the ones that cheat), so they are all competing on a level playing field. If a small business owners can’t “win” that competition (aka manage to stray in business), they won’t “win” if we remove minimum wage either becuase the other small businesses will beat them no matter what the minimum wage is.

            But again, You are the one bringup up minimum wage. I was only talking about a Basic Income Guarantee and I was the one making the argument we should eliminate minimum wage, and replace it with a Basic Income Guarantee exactly because minimum wage laws are a very poor way to do welfare and have various bad side effects (like job elimination).

            We do it with minimum wage laws instead of doing it correctly, exactly because we have a lot of political pressure to force people to work for their welfare, and minimum wage is a simple way to force them to work for their welfare. The entire point society will at some point grasp, but it will take some time, is that jobs are not the answer when technology is in the process of displacing all human workers from the economy.

            “If I linked YOU to a page on how to do basic arithmetic, would you feel better informed, or insulted?”

            I wouldn’t give a shit either way. I don’t need people to provide links and references becuase I know how to use Google. I also know how to think, and when someone says stupid things, I don’t need to see a link to someone else who has said the same stupid thing.

            So first you bitch about me not providing references and links to back up my points, and then I provide them for you and you say I’m insulting you. Sort of a no win situation with you isn’t it?

            The point is, I know everything you are going to say long before you say it, because I’ve seen your type in these arguments many times before. You all read the same nonsense, and repeat the exact same nonsense as “evidence” when there is no evidence to support it. You do not argue facts, you argue ideologies.

            And I don’t mind someone having an ideology and standing behind it. But it irritates me to no end when someone like your argues an ideology, and tries to pretend you are arguing facts. That approach is a classic technique of the entire right wing. They think that reality is based on “values” instead of facts. And when asked to provide facts, they dig up misrepresentations that sound like facts, and argue them as if they were facts – because apparently, most the right wing doesn’t know the difference between a fact and a belief.

            The small mindedness of such an approach just irritates the living s*** out of me because ideological ignorance is not somthing one can debate with.

      • Anne Ominous Khannea Suntzu July 28, 2013 on 3:30 pm

        @ Curt Welch (again):

        Quote: “Total nonsense. If getting something for free was destructive, then the fact we all get free air would have wiped out our human self esteem a million years ago. Millions of years of “free air” and never once did we have to “work for it”. Millions of years of a self-repairing body provided to us “for free” that we never had to work for, and still, our self esteem remains intact. Millions of years of free sunshine, that we never had to work for, and our self esteem remains intact.”

        The problem there, Curt, is that you are equating a minimum wage with things that are “free”. But it is not. It is very, very far from free.

        It is true that a minimum wage hike can do a little bit of temporary good, but we are back to actual, real-world history again here: invariably, the good it does is very temporary. Eventually, wages across the board adjust (which induces inflation) and everybody ends up worse off than before.

        The following is a famous argument but that is so because it is a valid argument: If mandatory minimum wages actually worked, why stop at a few more dollars? Why not make it $25 / hour? Or $40, or $200?


        • Curt Welch Anne Ominous July 28, 2013 on 4:02 pm

          “It is true that a minimum wage hike can do a little bit of temporary good, but we are back to actual, real-world history again here: invariably, the good it does is very temporary. Eventually, wages across the board adjust (which induces inflation) and everybody ends up worse off than before.”

          Totally FALSE. The arguments you have made here, and in all your other posts today are obviously invalid.

          You think they are valid, however, because you and I are not arguing the same point.

          I argue, that as a society, we should work to maximize total human happiness – to minimize, human suffering and discomfort.

          You, and those like you, on the other hand, argue that we should instead, work to maximize GDP no matter how much it makes people suffer. That seeking power, is your innate purpose in life – no matter how many people end up homeless, and no matter how many we have to put in jail, and how many people go hungry each night without enough food to eat, if the total GDP of the nation has been maximized, all that “suffering” is worth it to you.

          Inequality here is the key difference between these two arguments. There is no law that states maximising GDP will raise all boats. Anyone that falls for that argument is being played as a fool. The more technology we add to our economy, the more just the opposite is true. The more technology we add, the more all the most productive work is done by the few, and the more people we find existing in the society, who are unable to produce enough to justify their cost to society – that is, they aren’t productive enough, to pay for their food and housing – and as such, much DIE in order for the system to maximize GDP. That is, increasingly, we are wasting food and land and energy, to keep these unproductive people alive, and by killing them, and eliminating the resources they are wasting, we could raise the GDP produced by the rest of us.

          This desire on your part, to seek power, by maximizing GDP, at the expense of sacrificing the happiness of so many, is SICK. It makes me sick to think I live in world, where so many people like you can make these arguments with a straight face. That you think it’s more important, to build another Ferrari, than it is, to make sure no one in the world has to go to bed hungry, does not make you not “economically wise” but instead, it makes you a psychopath.

          • Anne Ominous Curt Welch July 28, 2013 on 4:16 pm

            Quote: “Totally FALSE. The arguments you have made here, and in all your other posts today are obviously invalid.”

            Hahaha. That’s pretty funny. I cited examples and even gave you references. Unsupported bald claims of “everything you say is invalid” are without substance. I happen to be a long-time student of economic history. You, however, are not. The fact is that many of your assertions are disproved by actual (and in some cases, oft-repeated) history.

            And stop abusing the word “obviously”. In the words of Inigo Montoya: “I don’t think it means what you think it means.”

            Quote: “You think they are valid, however, because you and I are not arguing the same point.”

            BS. Yes, we ARE arguing about exactly the same thing. And we both have exactly the same goal. However, you are invalidly trying to justify your imagined MEANS of achieving that goal, by claiming that your goal is noble and mine is not.

            I say again: BS. Our goal is the same. The difference is that I have done my homework and I know that the means you propose don’t work.

        • Curt Welch Anne Ominous July 29, 2013 on 8:04 am

          “It is true that a minimum wage hike can do a little bit of temporary good, but we are back to actual, real-world history again here: invariably, the good it does is very temporary. Eventually, wages across the board adjust (which induces inflation) and everybody ends up worse off than before.”

          Again, as I posted before. This is total nonsense Anne.

          Minimum wage does not cause inflation. The point of minimum wage is to distribute wealth from the rich to the poor. It’s a system of redistribution. Redistribution DOES NOT cause macro inflation. The only thing that can cause inflation, is expanding the money supply, or the same thing in reverse, which is a change to the demand for money.

          Minimum wage forces businesses to pay poor workers more (given them welfare), which forces the business to cover their costs by a small increases in the products and services they sell. Whoever buys those products and services, then end up paying for the welfare for the workers.

          If the minimum wage workers were the only ones buying the produces and services, they would just be giving their higher wage, back to themselves. They would be paying for their own welfare. There would be no redistribution of wealth.

          But of course, minimum wage workers at not the only ones that buy the higher priced goods and services. Those with more money, not only buy the goods and services, they also tend to buy more of it, simply becuase they have more money.

          Minimum wage laws can be seen as welfare for the poor, funded by a consumption tax – those that buy the higher priced goods and services produced by minimum wage workers, are paying for the welfare.

          Prices and wages do adjust throughout the entire system as a result of the minimum wage laws, but they do not adjust EQUALLY everywhere as you are suggesting.

          As a simple example, assume that without minimum wage, the free market would pay some people $2 an hour. And others, $3 an hour. But with minimum wage, both of those go up to $8 an hour. (and some lose their job). So to start with, 2 going to 8 and 3 going to 8 is clearly not an “equal” adjustment across the board.

          But if we say the average increase in wages was 50% at the low end due to the law, then the prices of everything would have to double in the rest of the system to “offset the minimum wage” as you suggest. This just doesn’t happen. It can’t happen. The value of fiat currency is controlled by the money supply. It’s a commodity of limited supply that has it’s value set in the free market by trade just like all other commodities. It’s value is regulated by supply and demand.

          For the value (as measured in dollars) of all other goods and services to double in the local currency, the money supply would have to be doubled at the same time the minimum wage law went into effect.

          The doubling of the money supply would cause all wages and prices to double in time, which would in effect, cancel out the redistribution effect of the minimum wage laws.

          But, since minimum wage laws do not come with a doubling of the money supply, they do keep working as welfare for the poor, funded by a consumption tax.

          Of course, the government does keep expanding the money supply slowly over he years, so if we don’t raise minimum wages overtime to keep up with the inflation created by the expansion of the money supply, then they do stop working.

          And again, since you need me to show you where others say this as well:

          “That relation between money and prices is historically associated with the quantity theory of money. There is strong empirical evidence of a direct relation between money-supply growth and long-term price inflation, ”

          “Here at Inflation Data we believe that all other things being equal the primary cause of inflation is an increase in the money supply, i.e. “too much money chasing too few goods.””

          Now, on to your next lack of understanding:

          “The following is a famous argument but that is so because it is a valid argument: If mandatory minimum wages actually worked, why stop at a few more dollars? Why not make it $25 / hour? Or $40, or $200?”

          Minimum wage is a REDISTRIBUTION OF WEALTH funded by a consumption tax. The more you raise minimum wage, the more we are talking from the rich, and giving to the poor.

          There is only finite total GDI to “take” from the rich and give to the poor. Average income is around $50K I believe, which is a wage of about $25 an hour. If you raise minimum wage to 25 an hour, you have in effect tried to create total equality by forcing the system to provide the same wage to everyone. What would result, is a massive rise in unemployment, where the system would find ways to produce the goods without the use of low cost humans. Many jobs would be pushed from the business, to the consumer – as happens for example when we pump our own gas, instead of paying someone to do it for us. Or when we scan and check out our ourselves at the grocery story instead of paying for a person to do that for us. There are many jobs like that we would rather do ourselves, than have to pay $50 an hour to have it done for us. In effect, the business hires the consumer to do the work in the form of an invisible wage that is less than $50 an hour.

          You can’t just keep raising minimum wage to any level you want exactly becuase it’s not “free money”. It’s redistributed money from the rich, and the “rich” only have a finite amount of money to take.

          I’ve seen some articles that bitch and cry about minimum wage as the government trying to “legislate wealth”. That in fact is about as wrong as it can get. The government is trying to “legislate INEQUALITY” not total wealth with laws such as minimum wage. Minimum wage is just yet another form of welfare for the poor, paid for by the rich. It’s wealth redistribution.

          “”The following is a famous argument but that is so because it is a valid argument: If mandatory minimum wages actually worked, why stop at a few more dollars?”

          Again, it’s not a “valid” argument. It shows the social immaturity or the ignorance of the person making it. Anyone that actually understands economics and minimum wage laws knows that minimum wage laws DO WORK to redistribute wealth from the rich to the poor, and in so doing, reduce inequality in the system. But they are also a poor way to do it, becuase it also puts pressure on unemployment. The more you raise the minimum wage, the more redistribution you get, but the more pressure you also get on unemployment – which can lead for example to business cutting back on hours for minimum wage jobs so even though people are paid minimum wage, they don’t get to work 40 hours a week.

          At the same time, it has the problem of causing business to find other ways to get around the high price of low skill labor. So minimum wage certainly does work, as long as it’s not raised too high. But currently, we are no where near the point of it being “too high” to work, becuase of the fact that many people in society are selfish sociopaths that want to seek power for themselves instead of using their power to help lift the society they are a part of. They want to pretend the society doesn’t exist, and doesn’t affect their ability to have power when in fact, all the wealth we all have today, comes from the free gifts we have gotten from 1000’s of years of human society of the past sharing their wealth with us who are alive today.

          But yet, some people, believe they have the “right” to hoard that wealth from the best for themselves just becuase they can get away with it.

          • Anne Ominous Curt Welch July 29, 2013 on 12:58 pm

            You are contradicting your own earlier comment. I noted that your comparison of minimum wage with things that are “free” like air is a logical fallacy, because the minimum wage is not free. Air is not manufactured by your neighbor, but your neighbor may be an employer. If so, he has to pay that minimum wage.

            THEN, you state above that “You can’t just keep raising minimum wage to any level you want exactly becuase it’s not ‘free money’.”

            Which, of course, was exactly the point of my question about why you don’t raise it to $200. You contradict yourself.

            “It’s redistributed money from the rich, and the ‘rich’ only have a finite amount of money to take.”

            If that were true, I might agree with you. But it is not, and I do not. The vast majority of our economy is in small businesses, and it is those small business owners, not “the rich”, who pay those minimum wages.

            As for whether the minimum wage causes inflation, that cannot be established as either fact or fiction; it is an issue over which economists strongly disagree. We could both cite references on each side of the issue, all day long, and nothing would get settled.

            But your link to Wikipedia’s page on “money supply” is nothing short of an arrogant insult. As I mentioned before, I am a student of economics. And I am not stupid.

            If I linked YOU to a page on how to do basic arithmetic, would you feel better informed, or insulted?

          • Anne Ominous Curt Welch July 29, 2013 on 1:09 pm

            I will add to my earlier comment:

            Yes, the money supply is limited. But it is not AS limited as you claim. Money supply can be increased by a variety of means.

            However, I did not “suggest” that minimum wages apply equally across the board. You misunderstood what I meant.

            When minimum wages go up, other wages that are NOT at the minimum go up as well. They have to; otherwise burger-flippers today would earn as much as engineers.

            Professionals charge amounts that are RELATIVE to the incomes of non-professionals. And in a market that has any pretense of being free at all, it has to be that way. Professions that require years of education and experience are simply worth more per hour than unskilled labor.

            Therefore, yes, minimum wages DO make other wages go up. It is a logical certainty. But I wasn’t saying that they necessarily cause other approximately-minimum-level wages to go up “equally”.

          • Curt Welch Curt Welch July 29, 2013 on 8:51 pm

            Anne Ominous writes:

            “Therefore, yes, minimum wages DO make other wages go up. It is a logical certainty. But I wasn’t saying that they necessarily cause other approximately-minimum-level wages to go up “equally”.”

            I was responding to your logic here:

            “It is true that a minimum wage hike can do a little bit of temporary good, but we are back to actual, real-world history again here: invariably, the good it does is very temporary. Eventually, wages across the board adjust (which induces inflation) and everybody ends up worse off than before.”

            If the wages do not go up equally, and the new steady state of the system converges on one where the low end worker is still getting more, relative to other workers, than before starting minimum wage, then obviously, the “good” is NOT short lived as you suggested – it is long lived.

            If your comment about minimum wage being short lived is correct, then all wages must go up in relative lock step. If they don’t go up in relative lock step (which I agree, they don’t), then your comment about minimum wage being short lived is OBVIOUSLY WRONG which was my first point you objected to and said it wasn’t obvious.

            It’s true, that an increase in minimum wage, never has as much benefit as it seems to have, since the extra income the minimum wage worker receives, is also “taxes” to pay for the minimum wage increase – in the form of the higher prices they must pay for goods and services produced by other minimum wage workers.

            But the effect of the minimum wage not being as good as it seems to people, is not an argument against minimum wage – it’s an argue that we must raise it more than would seem obvious for it to do the good we were trying to do.

          • Anne Ominous Curt Welch July 30, 2013 on 8:17 pm

            @Curt Welch:

            Quote: “I was responding to your comment…”

            I know what you were responding to. And I was explaining that you misunderstood what I meant by that comment.

    • Chris F Iphaltuus February 9, 2013 on 11:55 am

      Recommended reading :

      The Lights in the Tunnel
      The End of Work
      Race against the Machine

      All making the same basic point that robots are competing for jobs that previously only humans were capable of performing, and are beginning to drive humans out of the labor force. This trend is accelerating. Why would I hire a human for minimum wage, if a robot can do the job for free ?

      • Iphaltuus Chris F February 9, 2013 on 5:23 pm

        The human brain is worth it’s weight in gold a billion times over. Human brains can build robots for labor because that’s what labor demands. Our minds are wasted on such tasks.

        • Curt Welch Iphaltuus February 9, 2013 on 5:55 pm

          That’s just not true. The brain is worth what you can sell it for – which for many people is minimum wage and for many others – they can’t find any work so it’s worthless. Most human brains in fact can not build robots – they don’t have the training and many simply don’t have the IQ to learn to build advanced AI robots even if they were given the “education” for free. Many others that can learn, will require 10 years of education to get them up to speed, and if they are already 35 years old when they got displaced by a robot from their previous line of work, they will be 45 before they can start their robotics career, and by then, they will have a hard time earning enough to pay back that 10 years of education and the 10 years of being supported by debt as they were educated.

          In another 30 years, most people won’t be smart enough to be productive members of society anymore and their “brains” will be nearly worthless in the economy. But we will not abandon those people because the entire point of our democratic society is not to allow a small minority take control of all the wealth of our society, but instead, to build a society that is able to support everyone.

          The entire problem with all the automation and technology we create is that it’s causing the once great and powerful human brain to be devalued in our economy. It never was worth “it’s weight in gold a billion times over”. Look at how much slaves were bought and sold for if you want to know what a human brain along with a human body was really worth. But today, it’s worth even less, and our value in the market is steadily declining. By 2050 humans will be worthless hunks of meat in our economy. We will be wroth more dead, than alive. And if we don’t get this fixed, we will be killed in mass by the elites exactly because we are wroth more to them dead, then alive.

      • Curt Welch Chris F February 9, 2013 on 6:06 pm

        Another excellent must read for your list is:

        Aftershock: The Next Economy and America’s Future

        I’m just reading it now but so far it looks excellent. Short and too the point.

        It will open people’s eyes to the real danger driving all this which is wealth inequity. That’s what automation is creating now, and why our economy is having such major problems. His advise for solving the problems is a negative income tax (along with other wise measures) which is almost the same thing as a Basic Income Guarantee and one which I believe might be easier for people to swallow. He’s been advocating this for decades and he’s seen the problems coming for decades and watched as it gets worse and worse.

        It’s by Robert Reich who has worked in the Ford, Carter, and Clinton administrations so not only is based on someone with boots on the ground policy experience, he also has some idea of what is more likely to be possible based on our current political system.

        • Chris F Curt Welch February 10, 2013 on 3:27 am

          Thanks for the recommendation Curt, buying it now…

        • shaker Curt Welch February 16, 2013 on 12:11 pm

          I really like reading what you wrote. It seems that you actually have a very good understanding of the economy and can explain it in layman’s terms.

          I have always thought about ways to end poverty and hope we as humanity can find the answer soon. We will never enter an age of enlightenment so long as so many are poor.

          But my basic understanding of economy leads me to believe that government is not the answer, that government destroys far more than it creates. that is why i am not a very big advocate of the welfare state even though i am a liberal socialist at heart.

          – i agree with you that we should “remove” government from the economic equations. it seems to me that in our quest to eradicate poverty using the welfare state actually leads to more poverty due to inefficiency.

          if i ruled the world i would simply do this:
          – Cut Government spending to ZERO
          – Institute a progressive income tax
          – institute a wealth tax (pay taxes on items owned)
          – get rid of the minimum wage
          – Take all that money (3-5 Trillion yearly) and have a wage PLUS program based on the bell shaped curve.

          Example: Company A pays employee A an hourly wage of a penny. wage plus gives company A $5 dollars an hour.
          $0 hourly = WP of X($5) + 0
          $2 hourly = WP of X + $2
          $5 hourly = WP of X + $5
          $6 hourly = WP of X = $5
          $9 hourly = WP of X + 2
          $11 hourly = WP of X
          $12 hourly = WP of X -1
          $16 hourly = WP of X – 5 ($ZERO)

          By instituting a Wage plus program we accomplish multiple things.
          – supplemental income is given to productive members of society. (you actually have to work to earn)
          – we increase wages without increasing business costs as is the case with minimum wage.
          – The “company” can choose to give Wage Plus to its employee or pocket it (they can increase their profits using wage plus or drive down their operating costs.)
          – increase profits will result in more competition from the outside forces (if McDonalds increases profits 20% more people/investors will get into the hamburger business)
          – reduction in operating costs will drive down prices, the opposite effect of a minimum wage increase. ( we could actually compete with China on the world market & have lower priced goods domestically. This would help out the lower and middle class even more. you don’t need more money if the money you have buys more…)

          please let me know how you feel about this solution.

          • Curt Welch shaker February 18, 2013 on 1:09 pm

            I don’t understand your wage plus formulas.

            “Cut Government spending to ZERO” —
            But you can’t cut government spending to zero or else you would have no government. No courts, police, laws, military. So I have no idea what you think you are suggesting by saying cut government spending to zero. Do you mean cut welfare spending to zero?

            “institute a progressive income tax”. We already have on in the US so why would this be a change? How do you collect and enforce a tax with no government?

            “institute a wealth tax ” – Almost everyone in the US is paying such taxes now, such as property taxes. Some places have intangible property taxes for things like stocks as well. The largest issues however is that most t hings people own are too hard to assign a fair price to so the overhead of trying to tax something you can’t assign a price do becomes prohibitive. Which is why most taxation is done on money flows instead (income and sales tax). If there were a simple way to evaluate all the assets owned by a person, assets based taxes would make a lot of sense.

            Your wage plus ideas has a serious problem. It’s based on hours worked. I’m sell employed. I work for myself. How do I report my hours worked in order to get my “wage plus” check from the government? Lets just make the claim I worked 40 hours this week and that I paid myself 1 cent an hour. So the government needs to send me my 40x$5 check for $200 dollars this week, or around $875 for the month.

            No matter how much by business makes, I will always claim that what I’m being “paid” by my own business is only 1 cent an hour so I get this “free” $875 check every month.

            Anyone that wants free money, can simply start their own business and file the correct forms and get themselves $875 a month for free as well without having to do any real work.

            Same problem for larger bussines. They will be motivated to lie about how many hours people worked. I hire my friend to work for me, in my auto garage and he is only able to work 10 hours a week, and I pay him $10 an hour. But he and I decide to lie to the government and I say he really worked 40 hours, but not lie about what I paid him. I tell the truth that I paid him $100 dollars. But because I lied about the hours, it looks like I’m really paying him 2.50 an hour – so we get lots of “free money” from the government – and he and I end up splitting the money under the table. If we are audited there is nothing in the books that shows the error since we went ahead and recorded 40 hours of work each week. As long as he’s not working somewhere else that’ being reported, we can get away with this lie.

            The lack of any good way to track and verify hours worked, kills any ability to give welfare based on hours worked.

            Even if we could track how long someone was at work, a welfare handout based on hours spent at work would not motivate people to be productive, it would motivate them to spend hours hanging around work.

            This is the danger of all forms of welfare that our means tested. If you condition the welfare on doing something, you will motivate them to find ways to cheat your monitoring of what they expect you to do. Unemployment is conditioned on people “activity” looking for work. What that turns out to mean, is almost abusrd. It doesn’t mean you have to come to the welfare office and show that you are actively calling employees and sending out resumes and going on job interviews. It just means you have to show some semi-fake evidence you have sent at least one resume out every week. 5 minutes of work is all you have to do to get your “weekly” free paycheck.

            This is why a basic income has an advantage. It doesn’t create pointless means testing that can’t be verified anyway. It doesn’t encourage people to become “government cheaters” which is just a slippery slope that gets people into the mind that it’s “ok” to cheat the system since everyone is doing it.

            If we are going to give out welfare for the purpose of trying to offset an economic system that fails to care for the weak, don’t waste any time and energy trying to figure out who the “weak” are. Just give it to everyone.

            The point here is that we don’t need to motivate people to work. They work because it allows them to create a better life for themselves. They are already motivated to work. Giving people free stuff does not remove their motivation.

            We get all the air we want for free – but yet we are still motivated to work. If we got all the food we want for free, we would still work, because we not only want food, we also want a nice home to live in. If we gave eveyone a home to live in, they will still be motivated to work because they want a nice car to drive. Give them free transpiration, and they will still be motivated to work because they want money to see movies, and travel and have nicer clothes.

            NO matter what you give people for free, if there is something they want, which is not for free, they will work to get it.

            One of the big mistakes of most our current welfare programs is that they are given for free, but they are taken away when a person them doesn’t “need” them. So if you don’t work, you get welfare, but if you start working and don’t need the welfare, it’s taken away from you. That creates a NEGATIVE incentive to work. That ends up cuasing far too many people to not work.

            It’s not giving things for free that is the problem – these systems that create these incentives to cheat, or incentives to not work, are bad – and many of our current welfare programs do just that.

            Basic Income that is never taken away, creates no negative incentives to be productive. It does reduce the pressure to work, but people don’t need large amounts of pressure to work. We are motivated by relative rewards not by absolute rewards. If working produces a better life for us than not working, we will choose to work.

        • Anne Ominous Curt Welch July 28, 2013 on 3:40 pm

          I certainly agree that wealth inequity is a problem. But this premise fails for one very simple reason: wealth inequity is a SYMPTOM of bad economic policy, not the cause.

          It is no great shame for an author to mistake a symptom for the disease itself. Mainstream economists do it all the time.

    • Craig J. Townsend Iphaltuus February 17, 2013 on 12:46 pm

      Sowell is ok, but I recommend the Austrian school of economics for valid economics this side of the singularity. They are the only school with a valid theory of the biz cycle that actually describes historical events and makes cognitive sense. The Socialism calculation debate is a must read along with complexity theory. Deflation & Liberty by Hulssman is incredible, pdf is free online and it describes why the disparity between the rich and the poor increased. Planned Chaos and the Anti-Capitalist by Mises is very good His Economic Freedom and Interventionism is quite fantastic, and Egalitarianism as a Revolt Against Nature by Rothbard is incredible and they are all free online.

      Basic economics which even the older Marxist and Lenin agreed to is fundamental.

      1. The greater the amount of capital (savings) put back into the lines of production, the more efficient and productive labor becomes the more prices fall as production becomes more efficient and greater.
      2. Also the more the natural wage rate increases.
      3. The more the rate of profit standardizes throughout the economy and it falls to the marginal productivity level of costs/prices.
      4. A natural rate of deflation is thus part of a feerer market system. Prices naturally drop and the purchasing power of money increases which gives a second impetus to real wage rates and to all savings.

      ALL forms of interventionism are Imperialistic as they drain away the excess “capital” needed to continue the process of increasing/exponential returns and thus keep all prices and profits artificially raised. This is done by several ways,

      1. Inflating the money supply (Devaluing the currency).
      2. Increasing tax rates, progressive taxation. (Everyone has less of a savings fund to fund production out of the more they have to borrow to do so. Etc.)
      3. Artificial resource restrictions by over regulation and legislation. (all prices are artificially raised)
      4. Redistributing income, resources etc, which creates a vicious cycle, [example: the more I do welfare payments the more I have to spend, the more I have to raise taxes, the more I have to inflate the money supply the more the currency drops in value the more prices in the economy go up due to inflation the more I have to increase all welfare subsidies etc, round and round and round. ]

      Utopia cannot be reached using the present interventionist Inflationary economic ideas.

      *for a thorough discussion of the Socialism calcuation debate see, SOCIALISM, ECONOMIC CALCULATION AND ENTREPRENEURSHIP Hans desoto. free online as well.

      • Iphaltuus Craig J. Townsend February 19, 2013 on 2:53 pm

        Thanks Craig. As a person living in poverty for the majority of my life, I am well aware of the massive misunterstandings that permeate throughout my community. Still yet, I am baffled whenever someone claims free market capitalist economies are more akin to totalitarianism than the monarchies of old, and further that socialism/communism is less akin to feudalism.


        Furthermore there is a great misconception that (without subsidies) private business leaders encounter less competition as the move up the economic ladder. I mean I know it’s publicized online, but in many cases I find it to be more severe in real life.

        • Che Mort Iphaltuus March 1, 2013 on 12:24 pm


          Sorry I just saw your response to an old post, the Sing-Hub has to upgrade this web site, I can’t follow the train of post and when emailed can’t go back to reply to whomever is responding! Aghh.

          As far as inflation, once you understand what increasing the money supply and artificially lowering or raising the interest rate does, you then can comprehend where all of our problems today come from. Those who receive the new money first, bankers, corporations, the wealthy well politically connected etc are in the best possible position as the value of the currency hasn’t dropped yet. The last to receive the new money, Welfare recipients, the retired on SSI or fixed pensions receive it last after it has fallen in value. All savings are also eaten up as its value drops. Also the lowering of a currencies value drives all prices in the economy upward, so as a persons received wage goes down in value the costs rise causing a double devaluation of wages.

          Thus inflation hits the poor, the retired and the lower middle class hardest, while lifting the rich and the cronies of political power. Inflation drives the great divide between the rich and the poor. All borrowers are helped by inflation as they are paying back debt over time with a currency going down in value as well as the effective balance of the debt is going down in value as well. So the debtor receives a double benefit from inflation. Governments are thus the prime beneficiaries of inflation as they get to pay off their huge debts over time with money they themselves print, which causes the very devaluation of the debt itself.

          The one fact that derails this printing press utopia is that inflation causes the natural/real interest rate to rise. Then gov steps in and artificially lowers it to benefit itself, which it cannot do for long as this can set off hyper-inflation as surely as printing too much money does. The high interest rates of the 70’s and 80s is a prime example of interest rates trying to correct for too much money in the system. The feds have to raise the rates to stop inflation going too high and they do so as they have to match the real interest rate that is rising.

          Inflation puts the people on a hamster wheel that they can never get off of as it spins faster and faster causing the people to have to run faster (to work more) just to keep up.

          Deflation and Liberty is a great little book on this subject as is the Age of Inflation and the Age of Inflation continued. All good reads. Without a firm and real understanding of what truly causes the businesses cycle, you cannot solve any of the problems of today.

          Everyone mentions the fact that the real wage rate in uninflated dollars has not gone up since 64. If you don’t understand both inflation by government, and deflation by the evolution of the Technium, you can never come to understand this phenomenon. Ex: If government inflates the money supply by 3% a year and your wage rate is tied to the CPI so it goes up 3% a year, your real wage rate is flat. The prices in the economy also go up each year but they are offset by technological development, greater productivity and the economy bringing all prices down 3% or more % a year. Many of these costs are not in the CPI index. So though your real wage rate is flat statistically, the drop in prices have actually given you more purchasing power and thus kept the economy from collapsing decades ago. Yet this natural deflation rate is hidden from view as gov statistics do not record them and use them. This is done purposely for if everyone began to recognize that natural deflation benefits everyone but the gov and the rich, there would be a riot tomorrow.

          So if anyone says that greater scientific and technological development causes a greater divide between the rich and the poor they are profoundly ignorant and upholding an ideological belief and animas against technology.

      • Anne Ominous Craig J. Townsend July 28, 2013 on 3:54 pm

        Once again well said, Craig.

        But I would add one thing: Austrian economists have not just explained past economic events, they also PREDICTED them in advance. This is an important distinction, because any scientist will tell you that a theory is only as good as its predictive power.

        On YouTube, for example you can see Peter Schiff, of the Austrian school, predicting the coming collapse of 2008, back in 2006. (He actually predicted it prior to that, but that’s what is in the video.) The other people there, including Art Laffer (dyed-in-the-wool Keynesian and promoter of the infamous “Laffer Curve”), were literally laughing at him.

        But it goes back further than that. Austrians predicted “stagflation” prior to its occurrence in the 70s, while mainstream (Keynesian) economists actually claimed it was impossible! Until it actually happened, that is… and lasted for nearly a decade despite “mainstream” government-interventionist policy and “stimulus” measures.

        Early Austrians predicted the Great Depression, in print, at least a year before the big stock crash. While Irving Fisher, a “mainstream” economist (who would today be classed as a staunch Keynesian and government-interventionist) famously announced that “The economy is doing great!”… one day before the crash.

        So if you are looking for valid economic theory, look to the Austrians. History has proved them out. Repeat: a theory is only as good as its predictive power. And if predicting coming economic events were a game, Monetarists have scored pretty well; Austrians have scored even better, and they Keynesians… have consistently kept shooting at the wrong goal. If they scored any points, it was for the other teams.

      • Anne Ominous Craig J. Townsend July 28, 2013 on 3:56 pm

        Oops… almost forgot the link:

  • Andrew Atkin February 8, 2013 on 3:01 pm

    No. Or if so, only temporarily.

    Automation leads to reduced costs, and so the consumer spends their money elsewhere. Those industries supporting those ‘elsewhere’ products and services then expand. This has been going on since the beginning of time – it’s just economic development.

    We could do with less work, anyway. No-one’s got the time.

    • Khannea Suntzu Andrew Atkin February 8, 2013 on 3:09 pm

      I criticize your opinion as extremely shortsighted. The glaring hole in your rationale is of course income. There is a perverse incentive to use corporate money to marginalize large numbers of people from exercising their democratic rights – this is already happening with Koch industries money. If a lot of people are effectively displaced and banned from making an income, our current capitalist system dries up as consumer power of the majority of people evaporates. Mind you there will still be as much demand – sadly this demand will originate from the top of the consumer hierarchy – an ever smaller group of very rich people will still consume, however this consumption will never trickle down to the flesh economy.

      I agree that we could work less. However this is not what has been happening since the late 1970s. The reality is that in every family the women also were forced in to the work force, largely because wages for most people have not actually increased squared versus inflation. Wages have only increased in the top 10% of income scales. In the lowest 50% people make less than they did in the 1970s, in terms of most essential consumer needs.

      The issue is not that we could do with having to work less, because clearly most people only HAVE to work more to make the same money. I believe this is called Red Queen race, and it has been getting a lot worse in the last decade.

      • Craig J. Townsend Khannea Suntzu February 9, 2013 on 1:44 pm

        You see the effect since the 70’s do you know what caused it? The race, the need for women to work, the lowering of real wage rates? etc. FYI: The Koch thing is a propaganda tool to keep people yelling at the Orwellian scape goat projected onto the screen. Such Medieval puppet acts occupy slow witted individuals. The low intellectual level of the left today is truly pathetic. One must protect the catechism from all attacks no matter how illogical, idiotic or revisionist they are.

        • Khannea Suntzu Craig J. Townsend February 9, 2013 on 2:16 pm

          You have a fetish for humping straw men. It is not arousing for watching you hump these straw men in plan view. Please keep that activity private.

          • Craig J. Townsend Khannea Suntzu February 17, 2013 on 11:18 am

            your ad hominems miss thier mark. To bring up the propoganda pets of the zeitgeist is to show lack of depth.

      • Andrew Atkin Khannea Suntzu February 19, 2013 on 8:20 pm

        These issues you speak about are real, but ultimately have nothing to with technological development. If they did, then technology would have marginalized us all out of employment a thousand years ago.

        • Curt Welch Andrew Atkin February 19, 2013 on 10:18 pm

          Andrew, I’m not sure who your comment is directed at, but it seems to be directed at the idea that technology is marginalizing workers. That is, causing many works wages to drop.

          The reason we have not seen the effect so strongly until recently is due to the fact that humans have skills that until recently, the machines couldn’t touch. The human brain was the most important and limited asset in the work force. All the other machines were important in improving our productivity but did not challenge the dominance of the human brain. The industrial revolution brought machine brawn to the picture, but not brains. The result was that the horse and ox were marginalized out of the work force. It became very difficult for a million horses to still find work in 1950 as they were employed in 1850.

          As a result, the human role in the work force shifted mostly from physical labor, to mental labor. That’s how humans managed to stay employed. They became the “brains” of the back-hoe, the tractor, and the truck. But as computer control systems advance, our brains are now becoming marginalized. More and more jobs once only done by a human brain, is now being done by computers. Elevator operators replaced by computers, Book keepers replaced by computers. File clerks replaced by computers. Secretaries replaced by computers. Store clerks that once had to be trained to do math fast and accurately in their head replaced by computers. Grocery store cashiers that once had to memorize the prices of 100’s of items replaced by computers reading bar codes. Grocery store cashiers replaced by self check out counters. Gas jockeys replaced by automated gas pumps. Librarians replaced by Google. Navigators that once knew how to do complex course tracking and operate a sextant now uses GPS. Air planes now mostly fly and land themselves. Cars are starting to drive themselves. Musicians lost jobs to recording equipment. Switch board operators replaced by automated phone switches. Automated language translation of documents is finally reaching a workable quality after being promised to be just around the corner for 50 years. Speech recognition getting very close to human levels of recognition after also being promised to be just around the corner for 50 years. Facial recognition and tracking work surprisingly well finally. Hand written address reading and sorting of mail, and checks, is now replacing humans that once had to process them. Chess players replaced by machines. Jeopardy players replaced by machines. Xray reading. Medical diagnoses. Financial trading. The list goes on and on.

          Not only are the machines equaling human performance but in most of the cases, the machines out perform even the best humans and do it for a lower cost.

          The machines are slowly steeping up their game while the humans are getting squeezed between the current level of the machine performance, and their biological performance ceiling.

          This is the first time in history that advancing technology has reached such a height that the squeeze has become significant. It’s the first time the machines have become so powerful, that they are actually giving the humans a run for their money. This is why the luddite cries are finally becoming a problem society must face.

          One of the important jobs that still remains (but won’t remain forever) is investing and business management. Owning the right assets is quickly becoming the most important way for a human to still make money. But when humans compete in a free market for asset ownership, all the wealth tends to shift towards a small handful of the best investors leaving everyone else looser. When our economy was mostly that of labor, equality was maintained. But the more it shifts towards asset ownership, the more it tends to collect in the hands of a few superstar investors.

          Advancing technology is creating this one two punch of squeezing human labor out of the job market, while at the same time, the shift to less human labor and more capital investments in machines, is creating a less stable and less equitable distribution of wealth.

          It’s different this time for the first time in the history of humans, because machines are close to the level of intelligence of humans. Hammers and wheels were no where near close to the ability of a human with a brain, but a machine with a computer controlling it, is starting to give humans a real run for their money now.

          • shaker Curt Welch February 20, 2013 on 9:11 am

            you are a smart guy but i am not buying any of this. technology can help create as many new product as it destroyed. The problem is that it is easier to destroy old products with Tech than to create new products. It takes time to create new products and employee people.

            Google might have destroyed librarians, but it also created jobs in literally thousands of fields. it might take another 10-20 years for people to figure out to properly use google to create jobs.

            There are 2X as many people employed on this planet than 15 years ago. Don’t let what is happening in America slant your view point. the global economy is not shrinking, nor is the global workforce.

            Yes, 1st world countries are shrinking, but that is because they had no competition for the past 60 years and were able to “hoard” all the jobs.

            i don’t understand why in all your posts you never look at the fact that it is EASIER to start a business now. You don’t need to employee 10 people at $10 an hour or open up a storefront for 3K per month. A simple website, some google advertising, a designer in NY and a tailor for $2 hourly in india is good enough to compete with the biggest clothing merchandisers on the planet. that is what you can do with technology.

            The problem is we have so few people who actually want to do anything. they either lack the desire or the gumption to try it.

            in almost any business the barrier to enter is easier and costs less. this should result in far more companies. if it isn’t then the problem is not technology. it is the people who are part of that particular economy.

            you basically need to ask every person you meet the following question: Why don’t you own your own company?

  • VantageGreen February 8, 2013 on 9:24 pm

    What is everyone afraid of? If the government keeps their greedy hands off these new industries and shove there regulations where the sun don’t shine. Robots will drive the prices of products go down while increasing the quality. They will create more jobs by creating more value in markets that do not exists today. Wealth will be created out of thin air like it always have by creating value. This new technology will be no different.

    • Chris F VantageGreen February 9, 2013 on 10:26 am

      Vantage, the issue is that sophisticated robots and AIs are increasingly competing with human labour, driving down wages. Within a couple of decades, machines will be able to do everything that you and I can do (including jobs that require creativity, empathy etc) – and they’ll be able to do it faster, cheaper and better than us. How will a capitalist society survive if the majority of citizens are unable to earn a wage ?

      • Craig J. Townsend Chris F February 9, 2013 on 1:53 pm

        They don’t drive down wages. The more productive and trained labor becomes the higher their natural wage rate also becomes. It is not the machines that are causing all of the problems; it is the destruction of capital accumulation through regulations, over taxation and inflation. Real Wages drop when interventionist measures cause capital flight. Keynesian economics is all about destroying natural savings and debauching the worker through inflating the money supply. That was supposed to bring about full employment, it never did, it only drove up the costs of production so that industry now seeks lower paid workers elsewhere in order to save its profit margins. Foreign workers are not as productive as American workers. What keeps all the companies from coming back to the US is over regulation, high taxes, inflation, etc. You want a world of lower prices and higher wage rates and more employment? Increase the amount of capital invested per worker. That and that alone will solve all these issues. The slowing of the growth rate in the western economics since 1970 has one and only one cause, government intervention. The fact that they have survived at all to this crises and didn’t collapse in the 1980s was the Law of Exponential returns, the evolutionary growth of the Technium.

        • Chris F Craig J. Townsend February 10, 2013 on 3:54 am

          Craig, what happens when a machine can do everything that a typical human can do ? If I can buy such a machine for a modest initial outlay, why would I ever want to hire another human ? What is going to happen to the millions of humans who will no longer be able compete in the workforce ?

          • shaker Chris F February 16, 2013 on 1:06 pm

            if you can buy a machine than why cant everyone else?

            our economy will then revolve around designing, producing, and keeping machine going. that in itself will employ everyone.

            – if you drive the cost of good down using machine that means people can retire earlier. If the cost of every good on the market dropped 50% tomorrow, people could all retire 50% faster.
            – if costs go down then why do 2 people in a family have to work? maybe the husband decides to stay home, or vice versa…

            what you are basically saying is that a super productive economy is bad for society. this makes no sense.

          • Curt Welch Chris F February 16, 2013 on 3:26 pm

            Shaker writes: “what you are basically saying is that a super productive economy is bad for society. this makes no sense.”

            It does make sense, and you need to think a little deeper to understand the issues.

            Overall a super productive economy is excellent for society IF and ONLY IF we have some reasonable amount of sharing. But the problem is that the more advanced the machines become, the less sharing there is. Advancing technology for the past 200 years has be driving us towards every greater amounts of wealth and income inequality.

            To offset the trend, we keep adding more and more laws to force sharing. When things got really bad in the 1800’s we first made slavery illegal to force people to share more wealth with the one time slaves. We added anti trust laws. We made unions legal as a technique of forcing corporations to share with the workers. We added labor laws to reduce work days from the common 12 hours down to 8, and forced time and half pay for overtime by law. We then added all sorts of worker safety laws – which forced the corporations to spend money on the health and safety of the workers which is more forced sharing. We god our shared government to provide increasing amounts of services to society like public schools, and roads – paid for by the rich, but benefiting the poor – which is more forced sharing. We added flat rate taxes which made the rich pay more than the poor. We then changed to progressive taxes, to make the rich pay even more than before. We added unempolyment insurance, food stamp programs, housing problems – all more forms of making the rich take care of the poor.

            For the past 200 years, as technology advanced, we needed to keep adding more, and more, and more of these ways to force sharing of the wealth in order for the rich not to gain to much power and control, and in so doing, subjugate the poor.

            In the past 30 years however, we stopped this trend, and started to reverse the trend one brick at a time. High end progressive taxes were drastically lowered. Capital gains were lowered (a tax paid more by the rich). Social programs were reduced and limited.

            And and the result is as expected – the rich saw all the economic gains, and the middle class and poor got nothing over the last 30 years and the result is that our society has deteriorated with growing levels of discontent.

            It’s great that our society is getting super productive. And it will be even better once the machines take over all the work. But unless we reverse this tend of the rich hording all the productivity gains for themselves, we won’t have a society at all because the poor will revolt and burn the society down. For the poor, it’s better there is no society, than to have to live in an unfair society.

            This is the risk we face, and the one we must fix. Once that’s fixed, we can more forward into this new future of robots without having our society torn down in the process.

            And the way to fix it, is with a basic income guarantee that lifts the fortunes and social status of the poor while at the same time reducing the fortunes of the rich so as to bring wealth inequality back to a socially fair level.

          • Anne Ominous Chris F July 28, 2013 on 4:01 pm

            Don’t expect that to happen within your lifetime.

            Most of so-called “AI” today really isn’t AI at all. It is merely more and better of the same old kind of software that has been around for 80 years.

            The capabilities are greater, and they “thin” faster, but that is only because of hardware improvements and clever programming.

            But anything approaching “true” AI, it AIn’t.

          • Anne Ominous Chris F July 28, 2013 on 4:02 pm


      • shaker Chris F February 20, 2013 on 11:03 am

        you can always earn a wage. there is no such thing as ZERO wage. you can always sells your services for a Penny an hour. that is a wage. people who are currently unemployed are simply asking for too much money. but before you think i am harsh i do understand that no one wants to work for $1 an hour; that is not the type of society i want to see. i am simply replying to your statement.

        you are overlooking an obvious fact: with better production comes lower prices. I would argue that as we begin to produce more via technology you will not need as many jobs. Both spouses work today because they half to. If you cut the price of every current good in half then only one spouse would have to work. If you cut the price of current goods by 75% than only 1 person would have to work and for half as long.

        In the future we might see a work life from in between 16-40. if the prices of everything drops every year do to automation and technology then why would you work till 65-70? you could save up enough money in 10 years to retire. Early retirement means that we will constantly need “new” members” of the labor force.

        you cannot just imagine a future society with unlimited machine production and then leave out factors such wealth creation.

        what so many people do is what you did in your post. “machines will take over every job… what will happen to humans…”

        the better question is: What will happen to price?
        Every single good and service is cheaper to produce today than even 10 years ago. good and services will only get cheaper.

        Automated cars = drastic reduction in shipping, JIT inventory, no auto insurance, no need to own cars, less roads – infinite change if you ask me.
        abundant energy = underground farms, unlimited production, etc

  • Khannea Suntzu February 9, 2013 on 12:37 pm

    It gets worse

  • Gorgand Grandor February 9, 2013 on 4:24 pm

    There’s no need to destroy merit to only gain equality of poverty. The totally automated economy is the perfect chance to please BOTH the mainstream left and the right (except for the extremists) and have prosperity. Welfare can now come not from taxing people’s hard earned wealth, but by directed machine labor. Machines don’t need wages (unless we wanted to design machines with such specific human concerns, but they aren’t going to be the workforce then), and they’ll do their jobs without having to be convinced by “tokens of trade” (money). The people who build machines need wages, but as machines are able to build machines they will dwindle to a few merely directing and controlling the process. Once we’ve reached this paradigm breaking point, we will have achieved the possibility of government without taxation. Super-productive directed machine action can build our roads and houses so long as they have energy and resources, and the materials of the Earth are plenty, and solar energy and nuclear fusion are very viable. This world is not fantastical, but achievable, and we’ll get there sooner and with the least drawn out pain if we focus greater efforts towards AI and automation tech.

    • Curt Welch Gorgand Grandor February 9, 2013 on 6:21 pm

      Yes, we are getting there – and it’s not that far away. Only a handful of decades. However, there will still be taxation and capitalism. However, it will be mostly the machines that slave under capitalism, while we humans are freed to become full time consumers. We will still operate under capitalism, but we will no longer have to “make” our money. We will be given a fair (and large) share of the wealth produced by the machines (as if we owned them, but yet not having to own them). But we will still have the option to save and invest our share of the wealth, instead of spending it on short term consumables (beer and weed). We can still be investors if we want to be and take the risks and rewards of the chances we choose to take and individuals that invest wisely will still become super rich. But most, will live a safe, secutry, and happy life, without having to work at all – most of us, will live a retired life style as may do today, after their life of work. Only in the future, the machines will do the “life of work” for us, so our entire life will be one of retirement where we do whatever it is, that makes us happy.

      The economy (aka machines and human investors) will still be taxed, to create the basic income we all get to share. But also, to fund whatever we want the government to do for us – which will still be determined by legislation we vote for. Do we want, for example, our government to take over all health care instead of implementing it as a private business (that we pay for with our BIG payments)? We have the option to do that, and the economy will have to be taxed to proved that. Do we want as a society to have the government support basic research in all those areas that don’t have an obvious short term pay-off that will attract private investors? That would have to be taxed as it is now. And standard police and other services will be done by machines, but will still need to be paid for by taxes.

      • shaker Curt Welch February 17, 2013 on 11:05 am

        I agree with much of what you said, in all your posts. i my self believe that you need to “force” the system to distribute wealth or eventually it will all end up in the same place – my whole black hole theory.

        i will still not complete agree with you that unlimited production is bad.

        We truly don’t know what will become of the world if we have “endless” production. For you to say that you guarantee that it will end up with a large portion being destitute and a very tiny portion living like kings is just one of many things that could happen.

        We don’t know what will happen when/if people can produce their own energy, food, when they can “print” our an endless supply of goods and services; when they can have robots build houses for them and automated cars drive them anywhere.

        To me the world of endless production is an unknown one.

      • shaker Curt Welch February 18, 2013 on 8:06 am

        I do agree with the premise of “basic income”. However, i would like to try my method of Wage PLUS (supplemental income for workers) first before we moved to Basic Income for all of society. Wage Plus encourages people who are working. Basic income might not…

        – you made a point earlier about the ZERO sum system. You gave an example of Person B is 80% as skilled as person A and yet Person A gets all the business because it is in the best interest of the consumer to go with the better person/product. This is only true if both “charge” the same. In capitalism, quality + price = sales, not just quality. A porche is a better car than a toyota. we don’t all drive porche’s because they cost 3X as much as Toyota’s.

        Person B can always sell “himself” for less than person A and still get some business – in fact he/she/it can often times make an inferior product and make more money/sales. The reason entities such as Google and Facebook have nearly 100% of the market is because they give their services away for free. If google started charging $1 per search i would start using Bing because it is free even though it is inferior.

        it is almost impossible to corner the market on both price and quality. I don’t know if automation will ever get rid of this.

        • Curt Welch shaker February 18, 2013 on 12:20 pm

          shaker writes: “Person B can always sell “himself” for less than person A and still get some business”

          You are missing the larger picture. Most money is not made by selling “yourself”. It’s by owning assets OTHER than a human body. Donald Trump makes money not because he sells his body, but because he owns buildings. The buildings are the source of income. The land the building sits on is the source of income (aka it’s location). Very little money is made by selling human bodies these days – almost all money is made by non-human assets. Factories, buildings, patents, the Facebook servers and all it’s source code. Goggle’s servers, software, and data. The oil wells and refineries and distribution systems owned by oil companies. Human labor is still an important part of the equation – but it’s part is constantly shrinking and becoming devalued.

          When one person owns better assets than another, but complete in the same market, the person that owns the better assets make more profit – his wealth grows, while the wealth of his competitor shrinks by comparison. The growing wealth, over time, allows them to buy other high quality investments – or to upgrade the quality of their own investments.

          Every time the leader does this, the guy falling behind is, as you said, is forced to sell his services at a lower rate – reducing his profits and at the same time, increasing the profits of the guy that was already making larger profits. This is a feedback system that causes all the wealth to shift to the guy making higher profits – assuming he can continue to make better investments than the other guy.

          So even in the short term, the guy that is not “as good” could get business by reducing prices, in the end, this feedback continues to the point that he just can’t keep up at all and at some point, his assets are no longer making a profit – he’s loosing money every year he stays in business until his losses exceed the sale value of all his assets and he is forced to go backrupt.

          When we are born, we are all given on asset to manage for free – our body. And we can lease asset to anyone we want. But if we can’t complete, we can’t just keep selling our services for less an less becuase it costs a real amount of money to keep this asset functional – aka feed and house it. If you can’t make enough money to feed yourself, then lowering your prices is NOT going to allow you to “still get some business”. You will just die.

          This is the very problem we face in society today. Humans are becoming devalued in the market place. We can’t sell our “bodies” into the economy like we once could. Some people can, and make very good money. But the builk of society has seen a consistent decline in what a “human body” is worth in the market place over the past 30 years. And if not for the various welfare/redistribution programs like minimum wage wage, labor bargaining, food stamps, and the like, over half the population today would not be able to make enough to feed themselves because the human body is not what it once it was. It’s becoming an economic asset as obsolete as the buggy whip.

          You can’t sell your body as s ditch digger, because ditches are not dug by humans – they are dug by expensive machines. And if you don’t have enough money to buy, and sell the services of one of those machines, then you can’ t “make money” in the ditch digging business. Unskilled and low skilled labor is becoming devalued and the trend will only continue as more and more of the economy is generated by machines and assets which are not human.

    • Iphaltuus Gorgand Grandor February 9, 2013 on 10:49 pm

      To place welfare on machines is still to place burden on the people that utilize those machines for wealth, and in turn hurt the ecnomy as a whole.

      Ex- If a company has 100 robots, each capable of producing 100 items/hour worth $1 each, the company has the potential to generate $100/hour. 100/100 of those dollars may be decided what to do with by said company.

      However, if you tax at company at 10%, they may only utilize $90.

      For argument’s sake, let’s say that the $10 taxed would otherwise have gone to an employee. Instead, it is now channelled through a government welfare program, set up to provide financial security to the unemployed.

      Now, the government must determine, out of all possible candidates, who are the most in need and therefore the most qualified to recieve the subsidy. They must now hire someone to spend their time to undertake this task (social worker). Let’s say this person is payed $3 of the $10 taxed.

      So, instead of having an extra employee to increase the productivity/ingenuity/rate of innovation of the given company, we would be spending $10 just to make sure that same person (figuratively speaking) get’s $7.

      This in turn has a negative effect on the economy as a whole, which compounds as the years pass and the distance between the technological and innovative standards between two separate economic spheres (countries) become increasingly apparent.

      As the stagnation of the circulation of wealth increasingly shrinks the economic wealth of a sphere on a whole, the resources gained from taxes shrink in turn and everyone who was technically benifitting from such resources (welfare recipients) must make due with less and less.

      • Khannea Suntzu Iphaltuus February 10, 2013 on 7:29 am

        A company will hire workers at a certain minimum wage, let’s say 10$ an hour for the sake of argument. Workers ‘worth less’ are shit out of luck and have no effective access to the labour markets. Hence, these “useless” people stop working and get welfare for a while, and when it runs out they find alternative means of generating an income. So for a while whatever society does, everyone will be paying for people who are not taking part of the formal economy by paying either welfare for a while, or eventually by paying disability. It ain’t exactly difficult to be interpreted as “disables” and receiving lifelong income guarantees in the form of a disability pension but for those who do not the most relevant alternative is the shadow economy. In either case society gets to pick up the tab – there is still a strong democratic majority to pay for disability, since most people are very concerned about the alternative – in that THEY eventually don’t get any, in case they would become disabled, OR the alternative, is that too many people become so desperate they turn to criminal career paths. Once people are on criminal career paths (most significantly narcotics, a rapidly expanding industry) they end up recidivists, and stigmatized and they are generally lost to the formal economy. In either case society gets to pick up the pieces in damages, rapidly ballooning law enforcement costs, parole boards and the gargantuan bloated prison industrial complex so prevalent in highly disparate societies. The system clearly predates on electoral fear using a range of self-evidently racist symbols, thereby stigmatizing large parts of the population, and further increasing their chances on taking part in society. Either way, society picks up the tab in terms of affirmative action, and a positively insane (counter-intuitive pathological decission feedback cycle, see what happened at chernobyl) “war on drug”. See how that worked out for you.

        By implementing a basic income you get a completely different mechanism. Link Basic Income to the ballot board, and make it go up and down. My suggested default is to link BI to the REAL unemployment percentage – if unemployment is 25%, then that year the state (society, the people, the country, whatever) applies a retroactive tax on all income and spreads that around to everyone (including the taxed) as a basic income. But there may be other, more manageable mechanisms.

        Once you have a basic income, there are a few immediate benefits.

        1 – do not give BI to first generation immigrants. Nuff said. Those people get to compete in local job markets without basic income. As an alternative don’t give immigrants a BI for, say, five or ten years. If they don’t like those odds, they can go back. Then open the borders for all prospective immigrants.

        2 – allow everyone to work in addition to the basic income. No constraints. Then fire all welfare bureaucats. Go and find other employment. I guarantee you, you can also lay off a LOT of prison industrial complex people if all people have a basic income.

        3 – when there is a basic income, get rid of minimum wages.

        I can come up with several other interesting applications of BI, such as

        4 – give out small bonus incentives to basic income for desirable behavior – get good grades at school? small bonus. Live very healthy? small bonus. Thus it should be possible to range basic income between (for western european terms) 400 and 800 euro. I’d link NOT having children to giving out a bonus. I think we have enough of those, to be honest.

        The next step would be to harmonize Basic Incomes internationally by treaties. Granted, getting some dictatorial states along might mean trade sanctions, but that wouldn’t be a bad thing at this stage.

        • Curt Welch Khannea Suntzu February 11, 2013 on 9:41 am

          Another important use of BI is to do market shaping with though taxation. If we agree as a society that we want to reduce fossil fuel use and invest in alternative energy, the BAD way to do that, is to let the government tax the fuel companies, and then hand out grants to alternative energy companies. It’s bad, not because of the tax, but because the government is REALLY BAD at making wise investment decisions. Get the government out of the investment game.

          With a BI in place, we can do that. The government taxes all fossil fuel use – such as taxing every ton of coal dug out of the ground, and every barrel of oil pumped out of the ground evenly, and the puts the tax revenue into the BI payments. This causes all products and services that are based on fossil fuels to have a price increase, but at the same time, gives that money back to the consumers evenly, so they have the money to pay for the increase. But, the people that buy products that use less fossil fuels, get an automatic “win” they have extra money to spend because their goods might have gone up by $100 due to the fuel taxes but their share of the BI revenue was $200. they are rewarded for being a low fossil fuel user. People that are high energy consumes are punished, because their cost of goods rose more than they receive in extra BI money. Which motivates them to reduce their consumption of products that use lots of fossil fuels to produce.

          And, at the same time, all alternative energy options have been given a market advantage over all fossil fuel options – spurring the MARKET (not the government) to invest in the best alternative options.

          The government then uses it’s fossil fuel tax rates to regulate fossil fuel use and cause investments in alternative energy without having to become a BAD investor itself. Let the free markets do all the investing – they are much better at than any government. Such taxes must start out small to prevent shocks to the system, but can raise over time to force any level of reduction in fossil fuels we believe is wise.

          This same technique can be used to regulate any market behaviors we feel as a society is important, without it resulting in more money in the hands of our governments to make bad spending decisions with.

          This is a fairly important extra “benefit” of having a BI as a part of our economy.

      • shaker Iphaltuus February 18, 2013 on 8:11 am

        But as people have pointed out before, with a BI system you don’t need a massive bureaucracy trying to figure out where that $10 would go. We simply mail a check to someone – kind of like SSI for all. Social security uses very few Gov resources. with fine tuning it could use even less.

        • Curt Welch shaker February 18, 2013 on 12:24 pm

          Actually, I was thinking one way to implement basic income in the US would be to just expand the social security system and add on a BI component to it . So we just increase social security payroll deductions by including some small fixed percent which is not capped like SS is. And then register and send social security checks to everyone. Everyone currently enrolled would get their regular payments + the BI payment, and everyone else would just get the BI payment. In time, the BI component would grow, and the old social security component would shrink and be phased out.

  • Iphaltuus February 9, 2013 on 5:34 pm

    Economic axiom = The health of an economic system, no matter what title it is given, is ultimitely dependent on efficiency.

    All that is destructive is inefficient, and will therefore dissolve in a truly free market system.

    All that is seemingly destroyed in a truly free market is in actuality reconstituted into new resources utilized by all those who foresee profit in such action and those who can be convinced to invest.

    Reconstitution requires insight and understanding to be distinguished from destruction.

    • Curt Welch Iphaltuus February 9, 2013 on 6:36 pm

      Yes, that’s true. But the problem is not one of efficiency. It’s a question of which humans get to benefit from the economic output of that efficient system. A healthy (aka efficient) economic system that makes 1% of the people super rich and drives the rest to poverty is NOT a healthy HUMAN SOCIETY. Capitalism is not human society. Capitalism is a tool, just like a hammer is a tool, that our human society makes use of, in order to maximize our human happiness and well being.

      When human labor was the prime driving force of the economy, and people got a share of the wealth based on their labor contribution, then we were able to create a fairly personable amount of total human happiness by using unregulated capitalism. But the more technology and automation we add to the system, the less human labor was responsible for the wealth and the more the technology became reasonable – and the more the wealth tended to flow to a minority who were able to form investment monopolies – who were able to buy up the rights to all the technology and resources.

      The economy remains highly efficient, GDP keeps growing exponentially, but the output of the system, stops being shared in any way that could be considered “fair” to the human society that allows this tool to be used. To offset these growing tends of “unfairness” we layered on many additional tools, starting back in the late 19th century and continuing to this day such as anti-trust laws, labor unions, welfare programs, progressive tax structures, food stamps, government housing, unemployment insurance, labor laws to protect the health of workers, minimum wage laws. All this was added on exactly because the tool of capitalism, on it’s own, created efficient production, but not “fair” sharing of wealth. Automation and technology has reached such high points now, that all these other systems are failing to keep the system “fail”. they don’t have the power needed to work anymore. To tool we need now (the one we really needed 30 years ago) is straight out taking from the rich, and giving money to the poor with no means testing. Everyone now needs to get an even share of welfare in order to allow this “efficient” economy to continue to serve its goal of making life better for our human society.

      • Iphaltuus Curt Welch February 9, 2013 on 9:33 pm

        The question of which humans get to benefit from the economic output is in itself a question of efficiency.

        A healthy economic system does not streamline the wealth to 1% of the population.

        The reason we have a disproportionate distribution of wealth is not because of automation, it is due to misappropriated taxes in the form of government subsidies and social welfare institutions. It isn’t so much that the wealthy are able to avoid paying a great deal of their taxes via shelters such as charities, it’s that those who are not wealthy have to pay so much in taxes and tend to receive less in return.

        The only way to institute a tax that is optimally efficient in itself is to impose it as a flat tax, distributed equally to each citizen. This is only to ensure that no single private business entity (big or small) is given an unfair advantage and or burdened with a disadvantage.

        Ergo, if I am making $200 a month and “Bob” is making $2000 a month, the key element is that Bob has ten times the wealth of me. If you tax either one of us more or less than the other, one person is given the advantage and the other the handicap.

        The greatest destructive ramification of this unbalance is that it was not decided by the force of the free market, and therefore not through the combined will of the people.

        Human labor is vastly inefficient compared to the power of the mind, and that power is greatly recognized and capitalizes technology, such as automation. We each are tremendously better off as robot managers than laborers.

        Monopolies do not and will never work in a truly free economy, due to the fact that the more wealth and power one person or group of people (CEO’s) acquire, the further they are distanced from the original source of cycling information that made them wealthy in the first place by the inherent burden of responsibility that is irrevocably tied to the increase of wealth and power. It does not take a whole lot of searching to find evidence that the majority of all truly successful businesses were started outside of well established financial spheres (read on the history of Wal-Mart, Costco, Bill Gates, Steve Wozniak, Steve Jobs, etc.).

        The only thing any company in a capitalist, free market economy can do to ensure itself an unfair advantage is to financially back a member of the government (senator, presidential candidate, house representative) who will push through legislation that ensures subsidies for the industry in which they hold major stakes (read up on oil and farm subsidies in particular).

        A human society is driven collective consensus of all persons within that society. We as human beings are descendant of single celled organisms. These organisms were driven by information embedded as genetic code into their/our DNA. This information is what tells us what to eat, what dangers to avoid, etc. It is all based on efficiency. Any advocate of evolution will probably agree that efficiency is the key to natural selection, and something all living creatures adhere to in our attempt to survive. Our ecosystem is an example of an economy.

        In my mind, capitalism in a free market economy (and only in a free market economy) is what evolved from the inefficiencies of socialism, feudalism/etc. It simply posits that a system which utilizes our instinctive concept of self preservation by capitalizing on the dependability of said instincts to form a symbiotic relationship of which the benefits to society as a whole and to each person individually are directly proportional to the ability to act on said instincts without the interference of a third party is the best approach.

        • Iphaltuus Iphaltuus February 9, 2013 on 10:23 pm

          * It isn’t so much that the 1% is able to minimize their losses through taxes as much as it is this in combination with people with lower incomes are less capable of affording the resources necissary to capitalize on loopholes/shelters/what have you.

        • Curt Welch Iphaltuus February 11, 2013 on 10:17 am

          “The question of which humans get to benefit from the economic output is in itself a question of efficiency.

          A healthy economic system does not streamline the wealth to 1% of the population.”

          That’s not true. An unregulated free market passes the wealth (aka resources) to the people who are best at managing those resources. If Bob is twice as good as George at managing a given resource, Bob gets ALL that resource to manage, and George gets NOTHING. And Bob gets all the output, of that resource as his income stream. Bob gets nothing.

          So if Bob is the best apartment manager, Bob ends up getting to manage (and own) all the apartments. To give George even one unit to mange, would be reducing the efficiency of the system, so the economy won’t do it. It has nothing to do with how hard George tries to do his job, or how many hours he works. If he’s not as good as Bob, the economy allocates 100% to Bob, and 0% to George.

          An unregulated free market, passes all assets, to however is the “best” in the market, and takes it away, from those that are second best. If Bob is 5% better than George, Bob still gets ALL the apartments to manage, and George gets nothing. There is no “fair sharing” based on skill levels.

          The reason the free market has worked well in the past, is because Bob was not able to manage a million apartments by himself. The more he tried to manage, the worse he became as an apartment manager, so then George was able to step in and pick up some apartments to manage even though he was not as good as Bob.

          In addition, there’s one resource we are each given to manage, that we can never lose – our own body (now that we outlawed slavery). No matter how bad we are at managing this assets (not making it work 12 hours a day, not investing it’s improvement), we never lose control of it – it’s ours to manage (aka sell into the economy).

          But now we add technology to the mix (cell phones, email, computers), and what happens? Suddenly, Bob, with the help of technology, can mange 1000 apartments at once, instead of just 10. So now Bob steals more apartments away from George. As technology advances, Bob is able to manage ever growing numbers of apartments, and George gets the shaft.

          Technology widens the reach of the top performers, and allows them to leverage their small skill advantage, into a huge economic gain. Technology widens our power to produce, but widens our ability to compete, and steal markets at the same time. in 1900, if you were a really good general store manager, you still could only own and operate one general store. In 2000, you become a really good store manager, and you own and operate every Walmart across the country, butting all those second rate store operates out of business. The second rate operates might be 80% as good as the Walton, but they don’t get an 80% share of the wealth of the retail store business, they get put out of business and get zero.

          Same thing happened in the music industry. Before recorded music, people had to hire local musicians to perform. Lots of people found work as musicians, even though some were really great, and lots were just ho-hum. But enter recording technology, and now every local joint no longer needed to hire musicians – they just bought recordings and played them. But who got to make the recordings? Not the thousands of musicians there were once paid to play, but only the top 1% – the best of the best got the recording contracts, and the rest got near nothing. We say this clearly in the film industry with the switch from silent films. At the time of the silent films, all movie houses at to hire local musicians to play for the films – every showing, a local musicians got work. Then the “talkies” came out, and put all those local musicians out of work. The “superstar” effect causes the economy to shift all the wealth to the 1% of musicians.

          This effect keeps happening with the advance of technology. Each segment of the workforce that gets displaced, is forced to re-tool (learn new skills), and find work in another segment. But commonly, those that are displaced, are more likely to end up in lower paying jobs instead of suddenly breaking into some new high-paying carrier. The wealth shifts towards the few.

          The more technology advances, the more the wealth concentrates into the hands of the superstar performs – the 1%. The faster the technologies advance, the faster people become displaced, and the harder it is to find new jobs – leaving the lucky superstars that had the right skills, and the right luck, to find a 1% job.

          The free markets do not share. It distributes wealth to the “best of the best” and away from everyone else. As technology advances, the market reach of the “best of the best” expand, creating growing inequality in the “sharing”.

          At the same time, now that machines are starting to reach human brain levels of performance, human labor itself is becoming devalued. So that “free gift” of being given a body to own for a life time, is worth less and less, each year, again, creating growing inequality of wealth.

          The good side of the free market is that it does a great job of optimizing, and growing, productivity – which generates great wealth very quickly and efficiently. But the evil side of the free market, is that it does not do ANYTHING to fairly share the wealth it produces. And worse, the more technology advances, the worse the “sharing” becomes. The end game, is that once machines are more powerful than humans, all the wealth will fall into the hands of a few super investors – the ultimate “winners” of this monopoly game we are paying – and everyone else goes bankrupt and must leave the “game”. Unless, we step in, and decide as a society of humans, that our true purpose is not to maximize productivity and power by sacrificing 99% of the population, but instead, to maximise the happiness of all those that are alive, by creating a fair level of sharing of the great wealth our society is producing and offset the strong tendency of the free markets to concentrate the wealth into the hands of the 1%.

        • Curt Welch Iphaltuus February 11, 2013 on 10:36 am

          “The greatest destructive ramification of this unbalance is that it was not decided by the force of the free market, and therefore not through the combined will of the people.”

          You have this all so wrong. The free markets are not the “will of the people”. They are the “will of the dollar”. And by that, they reflect the will of the consumers where each dollar a consumer spends counts as “one vote”. When one person gets to spend $100 a month, and the second person gets to spend $1000, that second person gets 10 times the voting power of the first in determine the “will of the people” you talk about.

          The “will of the economy” is biased by individual voting power, not by any type of “fair” distribution of the “will of the people”. And currently, 1% of our people, get to define 40% of the “will” of the economy.

          The “will of the economy” aka 40% controlled by the top 1%, gets to control how all our resources are allocated and used.

          The economy is not serving the “will of the people” it’s serving the “will of the rich”.

          Thank god we still have a functional democracy that is not yet too far corrupted by the “will of the economy” that truly does reflect the will of the people with one vote per person.

          But the more wealth inequality grows, the more the will of the economy and the will of the rich will use their social status to distort and tear down our democracy.

          If this growing economic imbalance is not fixed, we will lose our democracy and it will lead to great human suffering which was totally avoidable.

          • shaker Curt Welch February 18, 2013 on 8:27 am

            – do you think your case is based on a global view or is your viewpoint highly influenced by the goings on of the U.S. the income disparity you speak of is not as prevalent overseas.

            i think one of the reasons we have such a large income gap is because our Gov just borrows money whereas other Gov’s cant. We can give away free money to both the populous and to the “investor class”. once we can no longer borrow you will see this gap shrink. Either we give away less services (populous revolt) or we tax high earners more.

            i still don’t see how more machines = more problems for society.

            it is not income the determines the quality of life. it is cost of goods. more machines = lower costs. We might not need a society in which 50% of the people work because a 10% work force might be able to sustain us all.

            one day quite soon one person might be able to pay for their entire family – spouse, parents, children, cousins, etc.

            If you don’t have job, and you don’t have family then you are indeed SOL.

  • Curt Welch February 9, 2013 on 5:34 pm

    It’s not just different “this time”. It’s been different for a long time now. The real problem with technology is not unemployment, but rather, wealth inequity. Wages are being systematically devalued by advancing automation. Total human unemployment is the end game, but we are not there yet. It will happen this century for sure but for now, we have to deal with the other effects it’s creating. What it’s creating now, is growing levels of wealth inequity as the work force changes from humans, to machines.

    The wealth inequity is growing for a few reasons. In the US, it’s been getting much worse for the past 30 years due to bad fiscal polices. But despite those mistakes, the underlying root cause of the problem is technology and automation. This is because the flow of wealth being produced by our economy, is shifting away from labor, and towards capital investments. People make money today, not by working, by owning (and investing) in the right resources. The advances in technology keep growing the investment options – more machines, more technology, more business plans, to invest in, and less investments are being made in human resources. Humans are being marginalized as we are replaced by large IT infrastructures and investments.

    Wealth created by investments however is not shared fairly. It’s a winner take all game where the best investors win all and and the rest get nothing, or lose money. It’s a social problem because it means more and more wealth is being sucked out of the economy, and directed to the investors, instead of the “workers”. It gets harder and harder to find “good” employment which means the middle and lower class are seeing their spending powers eroded which in turn takes markets and sales away from industry, leaving only the “rich” able to keep buying. So the economy shifts to serve the rich, instead of the middle class and the poor. We see a rise in luxury products for the rich, but a drop in middle class products – we see more workers making and selling products they can never afford to own, or buy, and growing unemployment.

    In addition, technology advances exponentially in speed. Every year, it’s advancing faster, than the year before. Jobs are being limited faster than every before, and new potential jobs are being created. Humans on the other hand, by comparison, are standing still. We can’t learn new skills any faster today, than we could 500 years ago (or at least, not much faster – improved education technology helps some, but mostly, we are limited by how fast the human brain can learn). What this means, is that people are losing their jobs faster to technology today, faster than at any point in the past – and they need to learn new skills, to get the new jobs. But we can’t train new people fast enough to keep filling the new jobs because people are slow learners.

    In addition, most jobs being replaced by computers and automation these days are the low skill, easy to learn jobs. Those are the ones that are the easiest and cheapest to automate. So every time automation advances, and puts more people out of work, those displaced workers are forced to up their education and skill sets. When truck drives get replaced by self-driving trucks, we will need to retrain the truck drives for the new work. But the new work will be designing and building more advanced self-driving trucks. How many truck drives are likely going to be re-trained to become robotics engineers? Not many of them – leaving the rest of them to struggle in a shit job.

    This skill creep created by advancing technology is deadly to our well being. More and more people can’t find good paying work because they don’t have the high end intellectual skills to fill the new jobs that are being created by technology. We need more people with Masters Degrees, and an IQ of 150 to keep filling the new jobs, and the population simply doesn’t have enough of them. So the high skill jobs in short demand are seeing salaries go though the roof, while the low level average Joe is seeing his wages drop through the floor.

    The net result of all this is growing wealth inequity that won’t end. The economy, if left to it’s own ways, will drive most people into poverty, while a small elite, become super rich. The poor will lose their land, and their homes, as they are forced to sell everything they own, just to get enough food to stay alive, leading to a homeless existence living out the trash cans filled by the rich. Of course we won’t get all the way to that point, because the occupy movements are going to transform into a violent uprising before that happens if we don’t fix it.

    The end game is that capitalism alone can’t support a human society and provide for everyone fairly. It will in the end, allow a small elite to take over control, and kill off the masses since with automation, the elite no longer need the masses to work in their factories. The elite have no need for the poor period – so like we did to the American Indians, we will just kill them off. And the elite will justify their actions by pushing the poor to the brink of starvation, and then, when they turn violent because they were left with no other options, they will be killed as “terrorists”, and “criminals”.

    The fix, is simply forced wealth sharing. We take from the rich, and give to the poor as a way to cap the amount of inequality the economy is creating. We already do this with all our current social problems, our progressive tax structures, and our labor laws. But these techniques have reached the breaking points of what they are able to do. Progressive income taxes can’t fix inequality beyond wage levels. When allowing people to pay no taxes at all, still doesn’t give them a fair wage, then the progressive tax tool has lost it’s ability to fix the problem. Unions allow workers to extort higher wages out of the economy – but only if the human workers have a monopoly on the work. Once machines are available to do the work, the humans lose all their bargemen power and labor unions have no power to force higher wages. We already see this happening.

    Minimum wage laws have the same limits as unions. They only work as long as companies have work that must be done by humans. Once the work can be done by a machine, and once the machine becomes cheaper and better than humans being paid minimum wage, the humans just lose their jobs. Once machines can look burgers, minimum wage laws stop providing any benefit to those out of work. Minimum wage laws only motivate companies to invest more into machines to reduce the size of their workforce. That’s not bad for the economy, but it’s bad for wealth inequity as more workers get driven to minimum wage work, or are just put out of work all together.

    In the end, we need to wake our society up to the fact that working for a living is on the way out. Our economy is plenty strong, but the wealth is not being shared fairly, because most our wealth today is not created by humans, but by machines and technology and the wealth they create, is flowing increasingly into the hands of the 1% instead of being shared.

    The cleanest, and easiest way to fix this, is to understand that in our technological society, we no longer need to expect everyone to work for their living. A small number of our super smart workers are increasingly going to be taking care of everyone. They should be expected to carry the weight, for everyone. We start, by transforming our welfare programs, into true and fair welfare for everyone instead of trying to identify only the “most needy”. We tax the economy, and distribute a portion of the wealth, to everyone, in the form of Basic Income Guarantee payments that creates a fixed bottom poverty level everyone gets just for being good law abiding citizens, and consumers. We can eliminate progressive tax structures, and replace them with the BIG payments. We can eliminate many of the curren social problems, and replace them with the BIG payments. And we can eliminate labors laws meant to “spread the wealth”, like minimum wage laws. This will solve the unemployment problem because it will allow businesses to hire people at what they are really worth to the economy, for simple jobs that might only be worth $1 a day – but jobs that some humans would like to have but could not afford to live on without the help of their BIG payments. It allows businesses to hire 10 people at low wages, instead of forcing their business to work with 3 people at minimum wage. This gives people a great psychological advantage of being able to contribute to society, and be part of the work force, even when they have very little to contribute.

    Many jobs will be “charity” jobs – due to the fact that real work is being done by machines, and the minority of people that have the advanced skills and education to continue to make important contributions to the economy. Those few will still get super rich compared to everyone else, but we will force them to lift the bulk of society out of poverty as they do it.

    • Khannea Suntzu Curt Welch February 10, 2013 on 7:38 am


    • Iphaltuus Curt Welch February 10, 2013 on 6:06 pm

      Well it’s a good thing you got all that figured out, becuase it’s been hard to predict the future until you came along.

      • Khannea Suntzu Iphaltuus February 10, 2013 on 8:01 pm

        Well it sounds pretty obvious.

        • Iphaltuus Khannea Suntzu February 10, 2013 on 8:23 pm

          That is precisely my problem with his conjecture.

          • Khannea Suntzu Iphaltuus February 10, 2013 on 8:25 pm

            Ahh you don’t like the world we are drifting in to and he’s the messenger of bad news and you want to punch him in the balls?

          • Iphaltuus Iphaltuus February 10, 2013 on 8:56 pm

            The world we are drifting into is anyone’s guess. And no person has ever been acurate about anything with such complex implications.

            I’d say that if anything, he’s doing himself a disservice by underappreciating the total number of possible outcomes of this type of major change to society.

          • Curt Welch Iphaltuus February 10, 2013 on 11:43 pm

            Well, I truly appreciate how impossible it is to make predictions about what path the future will take. And though you might _assume_ that I belief what I write about the future is what I believe will happen – it’s not. It’s what I believe we SHOULD make happen. I’m not trying to predict the future in these posts, I’m trying to create it.

            The hardest part about predicting the future is the things we don’t see coming that have major impacts. None of us can correctly predict what we don’t see coming. But much of what is coming, we can, and do see. So let me just outline a few major factors I’m dead sure are coming.

            Machines will become more powerful than humans this century, and highly likely, before 2050. And by “powerful” I mean more intelligent as well as stronger (which they already are of course). And by “intelligent” I mean everything a human can do today, will be done far better, by a machine later this century. And the result of that, is that no human could then be paid to work, at a rate more than the machine – and typically, would not be worth anywhere near the cost of the machine.

            The cost of these machines is harder to predict – but based on some good estimates by people like Kurzweil based on lots of hard evidence and numbers, they will be dirt cheap by 2050. And if that estimate is wrong, it’s likely only to be wrong by a few decades, and not wrong on the question of how cheap they will be, due to the exponential growth of power and corresponding exponential drops in cost over time.

            I don’t just trust people like Kurzweil on this. I’ve been playing with AI for 35 years, and I understand the progress that has been made, and how close we already have to this technology.

            I also understand that our economy, is an external manifestation of the same technology, that makes our brains work – that makes us as individuals “intelligent”. Our economy, is in effect, one large “supper brain” created by the networking of our individual smaller brains. And our individual brains, are themselves, created by the networking of even smaller and simpler “profit maximizing circuits” (distributed reinforcement learning networks).

            I also understand that most people understand none of this. That they think the economy is controlled by us humans – when we are too small to see and understand the workings of this “larger brain” we are a part of – in the same way our neurons can not “understand” the larger workings of the entire brain they help create.

            We are taught to be very “human centric” in our views. We mostly think the universe revolves around us (far too many are so stupid as to believe the universe was created for us by some super-intelligence). But this tend to think in human centric terms blinds many to understand the larger forces that shape our lives – and most important, to the larger forces of this “bigger brain” (the economy) we have created.

            The economy, like our human brains, are just an optimization process. They constantly search for ways to “do better” and keep making changes in directions that get closer to whatever optimization target we define. We control what the process does, by what optimization target we give it.

            We are giving our economy the wrong optimization target, and as as a result, it’s slowly fucking most of us over. But few understand this – they think the only “intelligence” at work here, is the humans. They falsely believe that if we each work to optimize our own best interest, that the free market, will automatically, and magically, optimize for the same “best interest”. It will not. I don’t have enough room to explain further so I’ll stop this line here.

            But the above, is all stuff I _know_ is already true. It’s not a prediction about the future, it’s what exists here and now. But because I know this, it allows me to know some things about the risks, and opportunities, that await us in the future that many are totally clueless of.

            So, those risks include the _fact_ that humans won’t be able to work for a living in the near future, (a future that’s coming far faster than most have any clue of).

            It includes the _fact_ that our economic production system is so efficient, because it is, at the high level, and “intelligent process” (the same type of process that makes us each as individual intelligent), and that we use money as the control signal that creates that super-intelligence that is constantly optimizing the allocation of goods and services for us. If we think we can throw out money, or that things will become “free” (the same thing as throwing out money), we will have lost the intelligence that has been working for us, and all the efficiency of our economy, will crash and burn. So, I know that getting rid of money – is not an option.

            I also know, that if we don’t add more forced socialism to our society in the form of income redistribution, that this “super-intelligence” will eat it’s young. That is, it will allow the bulk of humans to die off leaving a small elite to take control. It will then “eat the young” of the small elite as well, leaving only the super-elite, and will continue that way, until the people left finally figure out they will all die, if they don’t start sharing – so at some point, either the human race dies, or we learn to share more.

            What I can not predict at all, is how stupid people will be, and how many bad choices they will make, before they figure out what has to be done. And I can’t figure out how much damage will be done, to the human race, and the earth, and all our societies, before they figure it out. This will will just have to wait and see.

            I also know that most people are very small minded thinkers. They have little interest in understanding the deeper issues, or the bigger pictures, and want instead to only focus on their own problems. And when they have problems, they want a leader to give them a simple answer, and a simple scapegoat, to blame, so they can feel good again about the future, and go back to their small minded thinking about their own lives. But none of what we are facing here, is “simple” – which means we as a society, are stuck in a train wreck, and will have to hope the wreck is not too bad, before we get the ship turned.

          • Iphaltuus Iphaltuus February 11, 2013 on 10:31 am

            What happens if we use synthetic biology to continually enhance our brains?

            What if we merge with non-invasive nano technology to enhance the capability of our brains?

            If we were capable of creating a truly artificial spurce of intelligence, the implications of doing so are incredibly diverse.

            You make the assumption that people are all just going to want to become retired citizens who have robots take care of all of their needs and wants.

            But the problem here is that no robot, no single source of intelligence is capapble of computing all ofmat information, and would have to be able to read everyone’s mind.

            We are far, far aeay from any sich society, and the proof of the matter is that any and all taxes and subsoquent subsidies do greater damage than help.

            I think your problem is that, while you give a great deal of credit to a “super brain”, even if we had a physical manifestation of this brain, it would be constricted by time, and therefore would have to prioritize it’s computative focus.

            Anything that a person can do in this universe requires computation. And the nature of existence to be infinite in turn dictates that there are an infinite number of things that can be done. Since this is true, no amount of computing, whether by human intelligence or other, will ever be enough.

            For example, let’s say that there was, in fact, a super intelligent artificial intelligence that had a million times the capability to solve problems as the average human. That intelligence is less likely to be focused on the relatively simple problems we face (disease, hunger, etc.) and mote likely to be used to solve problems that are much, much more complex and naturally require a super, mega-intelligent being to understand.

            Ere are an infinite number of problems that affect us, that we have yet to even realize, and there always will be, no amount if intelligence will ever change that fact.

          • Curt Welch Iphaltuus February 11, 2013 on 3:13 pm

            Iphaltuus writes: “You make the assumption that people are all just going to want to become retired citizens who have robots take care of all of their needs and wants.”

            “But the problem here is that no robot, no single source of intelligence is capable of computing all information, and would have to be able to read everyone’s mind.”

            I have no clue what you are talking about.

            If I have human slaves taking care of me, they can’t compute everything either, but yet, they are quite able to take care of me without me having to do any work at all – except of course TELL THEM WHAT I WANT so they don’t have to read my mind.

            Maybe you think the human mind is some soft of magical God given power that no computer can duplicate. You are wrong if that is what you believe, it’s exactly the type of ignorance that will take down our society if too many people believe that and block the public policies we need to implement.

            Or maybe, you are just thinking that humans will keep working along side the machines. That is what is happening now, but it won’t be long before all humans are put out of work.

            The machine doesn’t need to be anywhere near as smart as the human, in order to get the human’s jobs. Gas pump attendants are far smarter than our current automated gas pumps. They could wash windows, check oil levels, but yet, these automated pay gas pumps, got all the humans fired because they were so much cheaper than what the humans cost.

            Bank tellers are far more versatile and intelligent than the ATM machines, but yet, ATMs got lots of bank tellers fired, because again, the ATMs could work 24 hours a day for far less than it would cost to hire humans to work 24 hours a day.

            There comes a price point with all these machines, where the humans simply can’t compete anymore and won’t be able to get a job. Humans won’t be working side by side with the machines when we get to that point.

            The machines will not only replace manufacturing, but also the design and creative work. They will do the business management. Computers already do most the financial trading work in the world. They will design and build new automated factories, as well as maintain, and fix them. hey will take over all construction work building our buildings and roads and bridges and tunnels. They will do all the mining for us. They will do the scientific research. They will drive our cars, and run errands for us. They will act as teachers, and advisers for us. They will become prostitutes. They will be our doctors, and fix our broken bones for us. They will create art and entertainment for us, like music, and movies.

            EVERYTHING that you now pay a human to do, will be done by a collection of machines in the near future. If you offer to work for someone else – like, asking if you can wash their car for them, they will just politely ask you to leave because they know their car is cable to wash itself better than any human and they don’t want you messing with their car. There will be NOTHING we can do for each other, in the way of traditional “work” that others will want to pay us for. What we will do for each other, is just be friends as we are now.

          • Curt Welch Iphaltuus February 11, 2013 on 3:43 pm

            Iphaltuus wrotes:

            “What happens if we use synthetic biology to continually enhance our brains?”

            In the long run, we will transform what it means to be “human” and that will have complex effects on how our society evolves. But in the shorter term, we don’t need to do such major modifications to our body just to make us “smarter” because we are made “smarter” just by using the external tools like the internet, and Google, and Wikipedia. We use calculators to math for us so we don’t have to make our brains “smarter”. We ask advice from others so we don’t have to make our brains “smarter”. We sit inside a back-hoe to extend the powers of our body to be a better “ditch digger”. But if we can make backhoe itself smart enough to operate itself, then there is no need for a human to waste their time doing that, when all the human needs to do is tell the backhoe what to dig and leave it to do the work on it’s own.

            No matter how much we modify our “brains” they will never be as advanced and as quick thinking as a football sized warehouse of 2050 computer technology. The machines we will build to do all our work for us will be specialized for whatever type of work they are meant to best at doing. A single human, can’t be better at 1000 different jobs, than 1000 machines, each specialized for that one job. All the work in the future will be done by machines specialised for each of the types of tasks that need to be done. A medical diagnosis “robot” might be 1000 times smarter than any human, and “live” in computer room, which is networked to allow it to examine patients remotely all around the world – and fast enough to process 1000 patents in parallel. Surgical robots might work the same where there control computers that contain all their knowledge fills up a warehouse somewhere and where it’s networked to remote “arms” in surgery suites. That last thing anyone would want once we have this technology, is to have a human doctor trying to “fix” you.

            No single human, no matter how modified they become, can out-perform all these specialised intelligent robotic systems that are each optimized to do one specific type of work.

            There will be no real “work” for humans in this future, and all we will be doing, is telling the machines what we want, and what we don’t want. How we choose to fill our days will then be up to us. The options are limitless.

            To suggest people don’t want this is absurd. If I offered to give you $1000 a days for the rest of your life, would you turn it down because you would rather have to work for the rest of your life? Or do you think you might be able to cope with the problem of having all that money to do deal with? You could still work at any job you wanted (and could get) even though you had the money – but the point is – you would be working only because you wanted to, not because you had to in order to create a safe and comfortable future for yourself.

          • Iphaltuus Iphaltuus February 11, 2013 on 4:28 pm

            That was a rhetorical question, Curt. But for the record you and I have quite different opinions as to what constitutes intellectual capacity.

            I can’t carry on a conversation if you insist on pretending to be capable of understanding things that are -indeed- beyond the capacity of any person to understand to speak so certainly of. If you, or the author of the book you are reading were, you would be capable of out performing capitalism.

            My problem is that you seem to have little understanding of the basic concepts which form the foundation of my opinion. Concepts that would be vital to the success or failure of your proposal.

          • Curt Welch Iphaltuus February 11, 2013 on 5:55 pm

            Iphaltuus writes: “My problem is that you seem to have little understanding of the basic concepts which form the foundation of my opinion. ”

            I understand many of your concepts just fine and they are amazing stupid.

            You suggest the reasson we went from income inequality in the 60’s where 1% of the population had 9% of the income, to the inequality we have today, where 1% controls 24% of the income, is because of unequal taxes. You suggest that if we switced to a flat tax, where everone as taxed at the same rate that the ecoomey would then “fix” the inequaity.

            In the 60’s to rate marginal taxes for the rich were around in the 70% to 90% range. The poor got a huge tax break compared to the rich. Today, the rich, who get most their income from captial gains, pays 15% tax rate which is around what a lot of the middle class are paying. It is fairly flat.

            But this lowering of taxes closer to a flat tax, did exactly what anyone but a fool would expect it to do – it made the rich richer. It increasing their wealth, and power, and increased their power to manipulate the system to there advantage – to gain even more wealth. And the result is that today, the top 1% control 24% of the income, and 40% of the wealth.

            And you are suggesting, as one of your idiotic ideas, that if we switced to a true flat tax, which would raise the taxes of the poor even further, and lower the taxes of the high end, that this would “fix” the inequality.

            I’ve never heard of an thing so stupid. But those are the “ideas” you think I can’t “understand”.

            You are right, there really is not much much point in us trying to continue the debate. We are SO far apart there is no hope of seeing any agreement even on minor points.

          • Iphaltuus Iphaltuus February 12, 2013 on 3:50 pm

            There’s no reason to put words in my mouth. I didn’t suggest anything about the 1% and their relative possession of wealth from the 60’s, 70’s, 80’s ( I could keep going ).

            You seem to be making me out to be someone else, and misunderstanding my points. They are quite elementary, which shows me that you really don’t want to listen to what I have to say.

            So, I’ll leave you alone, but just play with this little nugget in your head;

            If Bob makes $1000/month, and Sally makes $10,000/month, Sally has ten times the wealth Bob has.

            Sally can therefore afford ten times the goods and services that Bob can, every month. She deserves the income because she has proven herself more valuable to the rest of the world, the rest of the world being all those who pay her for her goods and or services.

            Because they are responsible for the well being of the economy, and in turn the well being of her own business within that economy, Sally has incentive to invest in important private markets, such as Education and Healthcare. Because of her investments, those markets grow in value and are capable of expanding to meet the needs of more people like Bob, having a reciprocal effect. The incentive for the well being of the community is that Bob (and others like him) not only benefit from important things like Education and Healthcare, but are in turn a greater asset to the community, adding value to the economy as a whole. The businesses who realize and act upon are in effect making investments into the well being of their economy, and are more likely to succeed than those who neglect such important factors.

            For example, Harvard University (a private institution) receives approximately $24.3 billion/year in endowments. This money comes primarily from private businesses who are seeking to invest a stake into the next generation of economic leaders, research and development, etc. The point is that Harvard has undeniable value, and remains a place of quality education, which in turn ensures their continued value, etc. etc.

            However, if you tax Sally at 20%, and Bob only at 10%, their respective incomes per month are $8,000 and $900. Now, Sally has only nine times the wealth of Bob (though she clearly deserves ten times Bob’s wealth).

            Despite the fact that Sally now makes less money, all of the costs that she has to pay to ensure the continual flow of her deserved success become harder. She is given less incentive to succeed because the financial incentive continually weighs less than the obligation of responsibility which is consistent with increased levels of competition.

            On the other hand, if you tax Bob 20% and Sally 10%, Bob now has less money to pay for relative education and healthcare. And Bob’s status continually declines. Eventually the evidence is found in the case of the 1% increasingly possessing a greater amount of the total economic wealth available.

            No matter how you slice it, however, any and all tax monies take away from financial opportunities deserving of finance. They in turn place it in the hands of people who would (ironically) be jumping at the opportunities taken away by such taxes.

          • Curt Welch Iphaltuus February 13, 2013 on 11:59 am

            Iphaltuus writes:

            “If Bob makes $1000/month, and Sally makes $10,000/month, Sally has ten times the wealth Bob has.”

            Well, income, not wealth. But ok.

            “She deserves the income because she has proven herself more valuable to the rest of the world”

            No, this is where you seem to fail to understand the biger picture. Income is made in two ways, one is by wages, money we are paid for renting our body to someone, and the other is by capital gains – this is income we get not because “we” are valuable, but because of the assets we have managed to gain control over.

            Most income is in the world today is not made by the work of our hands and brain – our true value as an individuality – it’s made by the assets we have managed to acquire.

            Warren buffet is not the most wealthy man in the world because of who HE is. HE is not the value. It’s the portfolio he has managed to aqure control of, that puts his name on the top of the worlds wealthiest people list.

            Take his portfolio away from him, and he would no longer be on the list – even though people will obviously still pay him huge sums of money to manage their assets for them.

            That is “his value” to _THE_ _ECONOMY_.

            But you have made an even larger error. You seem to have no understand that economic value, and social value, are two totally different things.

            What is the value of a person to our society?

            If I have a 2 year old son, I assign my son two totally different values. His economic value is something like negative 500 dollars a month, due to how much money I have to spend to keep him alive, and based on the fact he owns nothing of value except his own body, and has no income. But the social value I assign to him is far far higher. I believe he deserves to be taken care of, and given an opportunity to grow and learn and thrive.

            If his only value was his economic value – I would have him killed so that I could stop loosing 500 dollars a month on him. I don’t have him killed – so clearly, he has true value to society (the society he and I create together), is very different from his economic value.

            This is not just true for my 2 year old son. I picked that just to make it more obvious. It’s equally true for my wife. She has a social value to me. And my friends, they all have social values to me, and the people on the street, which I’ve never met.

            Now, the reason social value is different from economic value, is not some fault of the ideas of a free market, but instead, a fault of how we MEASURE IT.

            We can see my wife has value to me because she provides friendship and moral support. She has sex with me. She is there to take care of me, when I’m sick. All these are valuable services, which we simply do not botyher to assign a dollar value to. And the fact that we don’t assign a dollar value to it, is exactly what her social value, is different from her income reported on a tax form.

            The differences are due to ACCOUNTING ERRORS in effect.

            All economic value is created by the value system that exists in our brain. Our brains are value driven learning systems and it’s this fact, that explains where value is defined in our economy. But since we have no meters implanted in our brain (we might one day), we have no real way to accurate translate those internal brain values into external prices. But we do the best we can using a few tricks. And what we do, is using an accounting system to calculate values based on our trading behaviors. But this “trick” of using trade values as a rough estimate of the true values calculated by our brain introduces errors into the measurement system. And at times, they grow to be HUGE errors. It’s these accounting system measurement errors that are the problem of our economy, and the problem you seem to be totally unaware of in your arguments.

            So, let me give you some examples to think about.

            Lets assume, instead of using dollars traded as the true measure of someone’s worth, we instead, put sensors into people’s head to accurate measure the real value people were assigning to thinks and use that as a basis of calculating someones true worth to society, instead of using their bank account as you seem to want to do.

            So, when I write a post, like this one, and 100 people read it, and really like it, their brain measuring propes picks this up, and cridts my “account” with value points. That is, I get “paid” for writting this letter, simply because it created a postive value for some people.

            But at the same time, 20 people read it, and it upsets them. They hate my message and my point – it makes their life “worse” by having to be exposed to my bad ideas. So now my account has value taken out of it for causing “negative value” to be injected into their world.

            Same thing happens when I work. I do something for a company to help make a product, that product is transferred to a buyer, and the buyer’s brain assigns a value to how much better his life is now that he owns this product. That “value” is then transferred, to the company, and though some type of system, is distributed back to all those that helped make the product. So I end up getting “value points” in my account for the work I did for the company.

            But do you see the problem with that last part of the example? When 100 people work together to create the ultimate end value for a consumer, how do we divide up and transfer those points back to everyone that contributed?

            The answer is that there simply is no right way to do it. We are faced with a basic problem where 1 + 2 = 10. To contribute my share, only costs me 1 “pain” point. And the effort my co-worker contributed only cost him 2 “pain” points. But the result of us working together, produced a think of value worth 10 points to some consumer. So how do we divide up the “credit” we should get for the work? There is no right answer to this – it’s arbitrary. Certainly, if I’m not paid at least 1 point for my effort, I won’t continue to do this work if I have any ability to do something else that yields a higher return. And the other guy needs 2 to justify working. But the reaming 7 “value points” are up for grabs. I can take 6, and give the other guy 1, and we will both be motivated to keep working. Or I can take 1, and he takes 6.

            What happens in real life, is that we try to “cheat” each other on these issues. We try to make the best deal for ourselves – but we cheat, because we attempt to keep secretes. If I offer the other guy 3 points for doing the work, he will accept it, because it is a good deal for him. But if he knew I was getting 7 total points out of the deal, when he was only getting 3, he would feel cheated and would instantly revolt in some way.

            So if we were not basing the distribution of value on who was the best trader, we could for example just use some rule like splitting the profits based on the investments. So I “invest” 1 unit of work, and he invests 2 units of work, so he gets twice the return than I do, meaning I get paid 3.3 points and he gets 6.6 points for his effort.

            Now, lets look at another part of the accounting errors. A handicapped person may literally have a negative value to society when we use this automated system of brain implants to measure and assign value to each other. Having that person be part of society, is sucking value out of the rests of society. So by pure value maximizing terms, we would want to just go ahead and kill that person in order to maximise the total value of society.

            But most of us are not complete sociopaths, and have empathy for other humans – that is, it causes us emotional harm (aka negative value) to know a human is suffering – or that a human was not given the chance to live a comfortable life. So though on their own, the person has negative value to society the act of killing them to “fix” the drain on society, has a far greater negative value to all the rest of us, than the small negative drain of allowing them to be cared for.

            So, when the accounting is done correctly, using the true values our brains assign to these things, we choose as a society to have the handicapped person cared for.

            But if we used economics only to define social value of a person, we get a very different result, and the system would then elect to just kill the person, rather than take care of them.

            Next, we look at how our money based value measuring systems work and we see how much wealth is assigned to different individuals. But if we had the brain implants we could see what all our fellow members of society really valued a person at. And we would find that someone who worked 40 hours a week, and only made $10K a year, while another person works 40 hours a week and makes a million dollars a day, is a sever miscarriage of social equality. That is, most the people in the world would see that as evil (some like you would be blind to the evil – but most of us see it as evil). If you add up the total value we find that allowing one person that much wealth, is in itself, creating a great negative impact to many of the brains in the world. But yet that negative impact, is not reflected in the dollar economy – it’s yet another accounting error in the system where the true social value of things are not correctly reflected when we use trade dollars to try and measure human values.

            So, to summarize. The monetary economy is one based on maximizing the production of value (profit). And humans, as well, act so as to maximize the production of value. So it’s totally consistent and valid, to create a society, based on the maximizing of value.

            But the economy, based on trading skills of members, and based on asset accumulation skills, is only an poor stand-end measurement tool for the brain probes we don’t yet have in society. It is full of systematic accounting errors that make it fail to accurately calculate true social values. And the worse of those errors, are the ones that tend to be cumulative. That is, they aren’t just a simple Gaussian noise distribution error that cancels out over time in the system, but rather, they create a bias error that accumulates making the error grow larger and larger over time.

            Specifically what I’m talking about is the problem of asset accumulation. A small error in the accounting of true value, can cause a systematic flow of assets towards a person in excess of what that person is really worth.

            It’s those types of value accounting errors in the money economy that we try to fix by applying external constraints to the system – such as antitrust laws; such as labor unions to prevent a business owner from using his power to take an unfair share of the “value” profits generated when people work together.

            And a big systematic error that happens in the free market, is the tendency for profits and wealth to shift towards the top. Those that are best at “cheating” the errors in the accounting system, tend to accumulate more power – which allows for larger amounts of “cheating” which then shifts even more wealth in an never ending cycle that causes power to shift into the hands of the few.

            The basic income tax and distribute is there to adjust for these accounting errors. A large amount of wealth inequality creates huge amounts of negative value (emotional pain) in society which the money system does not measure and account for. The BI tax and payment, offsets that error by reducing the inequality and by making sure we don’t create take large amounts of social pain in those of that actually have empathy, for all those that have ended up at the bottom of the standard of living ladder.

            It’s obvious IP that you are a highly rational person – and likely are a true believer in Ayn Rand’s Objectivism. The lock of her arguments are 100% rational. But they fail to account for this “accounting” error that exists between true human values that are calculated by our brains, and the values that we see our economy calculate.

            If you take Ann Rand’s ideals, and correctly apply them to true human values, instead of economy accounting error values, you will have the right way to structure a society.

            But if you make the mistake of believing monetary values are the same as human values, and don’t understand the accounting errors that exist in our economy, and that’s where you have made your logic error and where your rational thought process has gone off track.

          • Iphaltuus Iphaltuus February 13, 2013 on 8:32 pm

            Curt; “Well, income, not wealth. But ok.”

            Income is wealth.

            “No, this is where you seem to fail to understand the biger picture. Income is made in two ways, one is by wages, money we are paid for renting our body to someone, and the other is by capital gains – this is income we get not because “we” are valuable, but because of the assets we have managed to gain control over.”

            Even bigger picture-

            Assets we’ve managed to gain control over, most commonly with wages;

            Assets we’ve competed over, assets which have a continuous cost which must be justified by the gains made from their utilisation. Assets that are available to anyone else who can find a way to make more gains while making lower losses in comparison.

            “Most income is in the world today is not made by the work of our hands and brain – our true value as an individuality – it’s made by the assets we have managed to acquire.”

            Assets are only as good as the minds which utilise them. Certain companies can make higher quality goods with those assets and beat out others for gains. What makes their products better? More advanced technology. What makes advanced tech possible? Those who use their minds to discover and innovate. Who get’s paid? Those who innovate first. All value leads to the brain.

            “Warren buffet is not the most wealthy man in the world because of who HE is. HE is not the value. It’s the portfolio he has managed to aqure control of, that puts his name on the top of the worlds wealthiest people list.”

            Again, Warren Buffet used his brain in competition with all others who are trying to be in the same place he is. Everything he’s acquired has been during the management and utilisation of the resources he had at hand during any given time throughout his career.

            “Take his portfolio away from him, and he would no longer be on the list – even though people will obviously still pay him huge sums of money to manage their assets for them.”

            Because the development of Warren Buffet’s brain empowered him with the unique set of skills to successfully manage assets. Assets must be moved. The only way any company can artificially guarantee that their assets do not become eventual losses if they aren’t moved is to have legislation passed which guarantees gains to their money via taxes in the form of government subsidies.

            “That is “his value” to _THE_ _ECONOMY_.”

            His value enriches the value of the economy. We have a Warren Buffet to utilise! I wish North Korea wishes they had a Warren Buffet right about now. But they only have a totalitarian military regime which forces harsh taxes upon it’s people, stricken with famine, who depend on depleting Chinese food subsidies to survive on.

            “But you have made an even larger error. You seem to have no understand that economic value, and social value, are two totally different things.”

            Social value has economic value. It’s no secret.

            “If I have a 2 year old son, I assign my son two totally different…”

            Measure the total cost of raising the average child to the total production of the average person throughout their time spent working. You will find that the potential value of the average child more than makes up for the cost of that child, including the cost of children who do not live to see adulthood, who are physically/mentally challenged, etc.

            China has a crisis with it’s workforce;

            Since they had adopted policies during generations prior to their current workforce, the young people who are just starting their careers are being overburdened by the cost of taking care of the members of their community who have retired. This is because there are too many retirees in relation to young workers. The cost of China not appreciating the value of parenthood can now been seen in it’s struggling workforce.

            “We can see my wife has value to me…”

            Same situation as your kid. Your wife utilises time that you cannot (since you are at work) to take care of your child, and to help him develop as he grows.

            Besides, if social value has no economic value, what is the point to advertising?

            “All economic value is created by the value system that exists in our brain. Our brains are value driven learning systems and it’s this fact”

            First off, what authority do you have to make such a claim. Secondly, your conception of true value does not account for the fact that any given material is only as valuable as what we might know to do with it.

            Carbon is everywhere, and it is so cheap that we commonly use it to write (graphite, a form of pure carbon) with. However, due to recent innovations, we have discovered graphene (another form of pure carbon), that is stronger than steel, conducts better than copper, etc. This in turnwill greatly increase the value of carbon, though you can easily use graphite to make graphene (another technological innovation-wealth of the mind).

            So as you see, “true” value is an unreal concept, as any may be utilised in a way not previously understood, at any given time.

            “Lets assume, instead of using dollars traded…”

            Money was invented as a way to mediate the value placed on a good and or service by any given person. People already get paid more than others based on the popularity (perceived value) of their publication. Money is a way to connect the value of something measured by how much we need it (food, cell phones) and something measured by our personal preference (music, art).

            “But do you see the problem with that last part of the example? When 100 people work together to create the ultimate end value for a consumer, how do we divide up and transfer those points back to everyone that contributed?”

            No, the points, in the form of money, are redistributed as the are fought for. If you pay someone a wage at is less than what they think they deserve, they can leave your company and try to go into business for themselves, or join another company. If the other company can justify the cost of the higher wage paid to said worker by the incremental increase of overall gains made for their company (attributed to said employee), the position will have in effect utilised a higher quality employee in a manner that increases the advantage the company has over at which decided to underpay said employee, and is now losing business as a result.

            Nothing can be more dangerous to a business, especially a large one, than losing competitive ground. The historical rule is that they are never able to catch up, and eventually are replaced by the new wave of business.

            “What happens in real life, is that we try to “cheat”

            Again you bring circumstance into play. The company whose employees cheat each other will lose out to the company whose employees do not.

            “But if you make the mistake of believing monetary values are the same as human values, and don’t understand the accounting errors that exist in our economy, and that’s where you have made your logic error and where your rational thought process has gone off track.”

            Human values are what drive monetary values.

            A free market thrives on efficiency.

            Everything that is destructive and has detrimental effects is inefficient, and will lead to failure. All of the human value you mention indeed has monetary value, and it is left up to people to realise that in a free market. We are the value of our economy, but the market hasn’t been truly free for nearly 100 years.

            Our economy has been suffering erosion caused by taxes, and our growing poverty levels are direct evidence of that.

          • Curt Welch Iphaltuus February 16, 2013 on 9:48 am

            Curt; “Well, income, not wealth. But ok.”

            Iphaltuus: “Income is wealth.”

            I don’t know if you are being stupid or what here. Income is change in wealth. It’s the first derivative of wealth. To say income is wealth as you have is as wrong as saying speed is distance.

            I can’t tell when you write these little bits of nonsense if you are just being obstinate, or if you really are that ignorant of the basics of economics.

            Iphaltuus: “Income redistribution amounts to social inequality.”

            You have made it clear in statements like that along with all your other messages that you believe the only fair society is one based on unregulated Darwinist competition where the strong are allowed to acquire anything their strength enables them to acquire. It’s the rule of the strong and the subjugation of the weak you are supporting.

            Mankind struggled for a very long time to escape that type of society – which is how we ended up creating democracies. But yet. people like you have not learned the lessons of history and want to drag us right back to the “good old days” by once again using unregulated free market competition (the rule of the strongest) as the foundation of our society.

            People like you will, soon, be taken down in the coming revolution you are creating for yourselves.

            Hopefully, you will be taken down peacefully by being voted out of control as we saw happen in this last US election. But if that fails, you will be taken down by violence.

            Did you see the recent news where Christopher Dorner was driven over the edge by not being allowed to be a part of society? Where he was pushed out of society, by the strong? Did you see how reacted to being treated like that? He went ballistic and started killing people. He’s just a fringe example of what happens in society when the strong believe it’s there right to take away from the weak anything they can instead of understanding it’s their obligation to help the weak – to share their strength with the weak.

            Advancing technology is giving the few growing powers to dominate and control the economy. If we don’t put systems in place to offset that trend, (some forms of increasing forced redistribution of wealth), the imbalance of power will create revolution.

            You can stick you nonsense Iphaltuus and wait for the revolution, or you can wake up and realize preventing the revolution is better for you and for the rest of society, than waiting for it to happen.

          • Iphaltuus Iphaltuus February 16, 2013 on 11:28 am

            There are a lot of key elements missing from each of your arguments.

            First of all, the “darkness” we came from was unregulated government authority, this world has yet to see a truly free market.

            Secondly, you seem to over simplify the concept of roaming wealth.

            Finaliy, you’re “solution” is only going to lead to a more widely dispersed and powerful government.

            None of your predictions are new, and they’ve been misconcieving the way the world works for centuries.

          • Anne Ominous Iphaltuus July 28, 2013 on 4:28 pm

            I have another problem with it: everything he’s proposing has been done before, in one form or another, and it’s never worked.

      • Curt Welch Iphaltuus February 10, 2013 on 11:01 pm

        🙂 I’m glad I was able to help. 🙂

        • Khannea Suntzu Curt Welch February 11, 2013 on 8:40 am

          Uhuh 🙂

        • shaker Curt Welch February 16, 2013 on 2:12 pm

          you make a lot of great points.

          to me capitalism is like a miniature universe. It simply optimizes energy.

          One day the universe/economy is creating a beautiful star/company. the next day that star/company is eating up everything around it.

          As is the case with the universe, eventually that energy will begin to clump, becoming concentrated. That will lead to black hole with sucks all the energy out and eventually destroys the system itself.

          If that is the case, then we do truly need to take steps to ensure that the “energy/money” does not become to concentrated. we need to save the system from itself.

  • Lonie February 10, 2013 on 9:03 am

    Maybe it’s time to get out ahead of coming unemployment inevitabilities. That is, pass a new business tax based on number of robots a company employs in its manufacturing, sales or distribution.

    Make it a very small tax, but one that Congress cannot touch for any reason. Then when chronic unemployment becomes the norm, distribute these replenishing funds when regular unemployment runs out and in a way that keeps people afloat, at the very least.

    We pay farmers not to plant crops when there is an overabundance… when the labor force exceeds need or demand, it should also be treated as a commodity.

    And while we are at it, there should be an effort to teach sustainability to any who seek it.

    • Lonie Lonie February 11, 2013 on 6:29 am

      Just finished reading more of the comments and I see iphaltuus previously made a comment with a similar theme as mine, i.e. taxing businesses based on the number of robot machines.

      This of course proves time travel, even if only for a period of one day in that it allowed iphaltuus to travel ahead one day, read what I wrote, then travel back to February 9th and post similar to what I wrote on February 10th. ‘-)

    • Curt Welch Lonie February 11, 2013 on 11:25 am

      It’s not about the robots Lonie. It’s about ALL technology, The robots coming these days are just making it more obvious where we are headed. Automated elevators put elevators out of work. Web sites automated the jobs of salesman. PCs and email and calendar programs put secretaries out of work. Computers put bookkeepers out of work. The tractor put millions of farm workers out of work. Every new advance in technology is causing human displacement.

      In the past, that only meant each displaced human had to find a new place in the economy. And since humans were the driving force of all work, that was never so hard – even it often meant their “second carrier” was a lower paying one than their first.

      But the skill level of the machines are rising – and not just at a slow linear place, but an exponential one. Which means every year, the skill of the machines advances faster, than the year before. faster and faster, machines are talking more and more of the work away from us humans. Today, humans are still a very important part of our production system. In about 30 years, there will be no room for humans at all. It’s coming very fast – and because it’s growing exponentially, it is catching most people off guard – they have no clue what’s about to happen or how soon it’s going to happen.

      There is no single technology or company you can turn to and say “it’s your fault for using robots – we will tax you and no one else”. All the technology together is squeezing humans out of the labor market. And the end result of that, is growing levels of unfairness in the sharing of the wealth our economy is producing.

      The solution is to “tax the robots” – but that means taxing all technology. Or in short, tax all businesses evenly.

      The problem the robots are creating is not unemployment. (that will come in spades soon – but not today). Today’s problem is one of hugely unfair wealth and income inequality crated by all the technology as humans get slowly squeezed out of the labor markets by all the different machines.

      Wealth inequality is what peaked right before the great depression in 1929. It then fell to low levels though the 50’s and 60’s and then started to grow again in the 70s. It returned to the same levels it was at before the great depression, and whack, it causes another economic “trip” in 2008 with the great recession.

      The reason this inequality returned, was because of technology. We “fixed” the inequality by applying a collection of different wealth sharing laws and social programs to our society to offset what the technology had created. But the technolgy never stopped – it kept pushing us to higher levels of inequality which meant we had to keep adding more social programs to the government to offset it – which inflated the size of our government and taxes. But then in the 70’s people got tired of this never ending growth of taxes, and social problems and big government, and decided to go the other direction, and start cutting the very programs that were offsetting the wealth inequality – and by 2008, it returned to the levels that causes the crash of 29, and we had our second big crash. From our lessons of the great depression, we knew we had to use government spending to shore off the collapsing economy, and we did that, creating a “great recession” in 2008 instead of a second great depression.

      The problem here is that we need to stop inflating government social programs, and replace it with a flat out Basic Income transfer or money from the economy to the people – not leaving it in the hands of an inflated, inefficiency government, to spend.

      To fix this, we must tax the entire system, and share a part of the wealth with all citizens – for the entire purpose of offsetting the growing tend of wealth and income inequality. Technology is so advanced now, and the wealth inequality it creates is so great, that it can no longer be kept under control just by giving low income earners tax credits with a progressive income tax. Minimum wage laws don’t help when human labor is so devalued, that raising minimum wage takes away more than it gives, due to the jobs lost. Labor unions don’t help, when their only bargaining chip – human labor – becomes devalued by machines. All the old tools for trying to cope with the problems of machines devaluing labor, no longer work. We are at the point that we just have to take from the rich, and give to the poor, not based on their worth to the economy, but based on their worth to our society – as humans. Is this a society who’s goal is to take care of humans, or is a society that only cares about taking care of the rich?

      We should have implemented a basic income back around 1970 when 1200 economists signed a petition and sent it to congress telling them it was needed. But our country instead turned back to the same errors that created the great depression, drove inequality back through the roof, and created the second great economic mistake of our nation in 2008 when the rich and powerful got too strong and let their greed take down down the world’s economy. And then most the people that took down the economy, got huge bonuses for their effort, and the people paid for it.

      But in fact, it was the people’s fault but letting the rich tell them “the free market will save us” – and “a basic income” is immoral back at the end of the 60’s. To fix this, the people must wake the fuck up, and force their government to implement a Basic Income Guarantee where a portion of the output is taken directly from all the economy based on income and profits (or sales), and distributed back to the consumers – we must pay people to be consumers now that their labor is becoming useless and they can no longer “buy” the right to a fair share of the wealth by working.

      • Chris F Curt Welch February 13, 2013 on 1:39 pm

        Curt, I’m in awe of the quality and sheer number of your posts here ! You have a real talent for explaining these concepts so clearly and concisely. I’ve learned a great deal from reading your posts – I just wanted to say thanks, and keep up the great work !

    • Iphaltuus Lonie February 11, 2013 on 1:59 pm

      No Lonie, we have different viewpoints, I believe that “taxing robots” is not the solution.

      I believe that the best option is to drop the taxes and that the efficiency of a free market will provide better well being to our society than any government institution (i.e. taxes) could ever hope to.

      • Khannea Suntzu Iphaltuus February 11, 2013 on 11:32 pm

        Iphaltuus your almost religious faith in “free markets” terrifies me. I do not share your faith. I bear witness that I do not trust the strange magical invisible hand you claim to see.

        • Iphaltuus Khannea Suntzu February 12, 2013 on 5:11 pm

          What seems more invisible to you is the evidence. Stand a free market next to any previous market (Socialist, Communist, Feudal) and draw contrasts.

          What scares me is people who fail to see the obvious because they are blind to the past.

          • Khannea Suntzu Iphaltuus February 13, 2013 on 1:52 am

            Who says I am interested in socialism or communism?

            Who says what we have isn’t feudalism?

            Dear – violence, unionization, protest, sabotage, secession, terrorism and revolution is part of a free market of supply and demand too. In other words – make conditions worse enough for human beings, and you will need a steadily escalating number of prison keepers and pay tax for it. At some point the price for keeping all your destitute behind fences is bigger than the price of resorting (as you would label it) to “socialism”.

            The thing is – I don’t call that “socialist”. I call it common sense social democratic.

            But these days lots of dumbasses just don’t study history and international politics. Once the concept of “income redistribution” and “social equality” comes up, they see visions of Stalin and gulags. The only thing that proves to me is several years of McCarthyist cold war persecution and propaganda. Kinda boring by now if you ask me.

          • Iphaltuus Iphaltuus February 13, 2013 on 10:33 am

            “Who says I am interested in socialism or communism?”

            “At some point the price for keeping all your destitute behind fences is bigger than the price of resorting (as you would label it) to “socialism”.”

            I do not “label it” as socialism. The definition of socialism “label’s it” as socialism. These words are much less subjective than you would have them be.

            “Dear – violence, unionization, protest, sabotage, secession, terrorism and revolution is part of a free market of supply and demand too. In other words – make conditions worse enough for human beings, and you will need a steadily escalating number of prison keepers and pay tax for it.”

            I’ll leave it up to you to find the irony in this statement.

            “But these days lots of dumbasses just don’t study history and international politics. Once the concept of “income redistribution” and “social equality” comes up, they see visions of Stalin and gulags. The only thing that proves to me is several years of McCarthyist cold war persecution and propaganda. Kinda boring by now if you ask me”

            Income redistribution amounts to social inequality.

            Read up on Lenin’s regrets after he had implemented socialism and communism in his country. Read about how he misunderstood the difference between how his ideologies played out in theory versus practice.

            Measure the progress of North Korea, China and Russia versus the progress of the United States and get back to me on states of social inequality and destitute living conditions.

          • Iphaltuus Iphaltuus February 13, 2013 on 10:35 am

            Oh and I’m not even going to start on the Feudalism remark.

          • Khannea Suntzu Iphaltuus February 13, 2013 on 11:15 am

            It isn’t about you. It is about what any audience concludes in our free exchange of ideas. I am sure many would agree our western world has drifted quite close to corporate oligarchic feudalism.

          • Iphaltuus Iphaltuus February 13, 2013 on 2:36 pm

            And I am sure you are ignoring fundamental reasons for why things don’t actually play out that way.

          • Khannea Suntzu Iphaltuus February 13, 2013 on 3:14 pm

            In this world there does not have to be a duality of either socialism or capitalism. Either can be under given circumstances free or just happen to turn out stiflingly autocratic.

            From what you say I conclude you do not regard Europe as “socialist”, yet there is considerably more taxation and welfare (which you summarize as state enforced income redistribution. I call it justice.) than in, for example, the US. Also, Europe is doing far better than the US for the vast majority of its citizens, and in many parts of Northern EU despite consistently implementing “a lot of anti-Randian income redistribution” we have a decidedly more efficient economy than the US currently has.

            I challenge your conclusion that all forms of “socialist policies” are by definition “tyrannical”. Furthermore I insist that right now the capitalist model has far more aspects of tyranny, holds its citizens in a far more cruel and unfree state and is far more of a police state than most more egalitarian alternatives.

            I go as far as stating that what you appear to be championing (do let me know if you are not) “Capitalism”, “Free markets”, “globalism” and “unfettered supply and demand”.

            Let me part with a final salvo – I am fairly convinced that in a non-egalitarian society progress is effectively impossible, due to revolt and sabotage, as we have seen in most tyrannical societies, including Soviet Russia, Saddam’s Iraq, or the France of the sun King. These tyrannies tend to collapse under the weight of repression and cruelty. The measure of such tyrannies is how they treat their poorest, and the measure of how detached and psychopathic their elites are. I do not think the liberating technologies we all aspire to are possible outside an environment of

            (1) severe societal disparity
            (2) police states

            My conclusion is – the US has aborted its own technological progress when it became an feudal oligarchy. Right now the US is just as must a failed state as the Soviet Union was, and I dare say it is just as close to systemic collapse.

            However – there are many other states and countries, in the world, each nuances and subtly different in a host of ways. Few to none are truly “socialist”, and what it has come down to is how much their politicians and elites think they can afford in terms in “tolerating” freedoms.

            Freedoms cost money. Tyranny is just what in this economical climate passes as “efficiency”.

          • Iphaltuus Iphaltuus February 14, 2013 on 11:51 am

            I feel you do not respect what I have to say, for if you did you would consider it.

            What I mean by what I have to say and what you apparently think I say and what you claim I have said are two different things.

            As I continue this conversation, I feel as if I’m taking two steps backwards with each post. My efforts are continually being split between countering to your points and having to re-explain my own.

            For future reference, I’d suggest that you take a look into the history of Germany, starting with Otto von Bismarck.

            From there, follow the events of Kaiser Wilhem II into World War I. Pay close attention to what was done to the German free market and it’s role as the catalyst for triggering the great depression.

            Also, following the effects of food and oil subsidies (among others) will give you a great sense of how government programs actually play out, in contrast to how politicians package them during election time.

            Take it for what you will, but I promise you will be empowered by the honesty of the evidence.

  • Drazil February 11, 2013 on 8:48 pm

    that video is awesome of those robots doing that 🙂
    the bad is a person suppose to make a living?

    it gets slimmer for people in this world to make a living..
    cause there are hardly any available jobs to even try
    and many lose their homes cause nothing is available
    what is the future for the human to do to make their living farther in the future?
    (when there ends up being nothing left cause companies will want the robots instead)

    • shaker Drazil February 18, 2013 on 8:47 am

      one problem i have is that people do not look at the “supply side” of things.

      – there is something called “creating your own job”. we need to get away from the worker mentality. We are asking people to create an industry and then just give us work. We do need citizens to take on more responsibility.

      – we have to let citizens know that they need an education
      – we have to let them know that they need to create their own companies, not just work for someone else.

      30 million unemployed people just means that 30M can start their own company tomorrow. I know it is easier said than done, but we at least have to plant that thought in peoples head instead of just taking a woe is me attitude.

      – although i am liberal there are parts of the left that i just hate.
      – the “rich” are not trying to steal everything
      – you as an individual can always make your life better
      – education is still the key.

      we use to be a world where people went out and got their own.
      then we became a world where we worked for large companies.
      we might be becoming a world where you again have to go out and get your own.

      – find out what you love doing and start a company. do not sit around waiting for someone else to employee you.

      • Curt Welch shaker February 18, 2013 on 1:35 pm

        “one problem i have is that people do not look at the “supply side” of things.”

        The problem in the US today is that we have done nothing but look at the supply side for the past 35 years and it has driven us into the worse financial condition the country has been in in 100 years.

        The truth is that we must keep the supply and the demand BALANCED and today, in the US, we are way out of balance.

        For the past 35 years we moved the country back towards the supply side based on “Reaganomics”, and the “rising tide will lift all boats” argument. The idea is that to grow the economy, and help everyone, we must help the job creators. It sounds good on paper, but suffers badly in reality. We lowered taxes on the rich, restricted welfare, and the result was an increase in power and wealth and income to the top – to the supply side. But what that did, was not lift all boats. It did grow the economy nicely (until they “supply side” greedy ones fucked up and killed the world economy in 2007). But all the growth went to the top – the middle class and poor saw no relative growth at all. There was no “rising tide” effect at all.

        When we crashed, it reveled just how weak our economy really was and how much was really just a house of cards waiting to fall down. Our slow recovery continues to reveal that underlying weakness.

        To offset the problems of the crash, we use the Fed to loosen money supply. they “print money” hand over fist which drives interest rates to zero – which gives the supply side, “free money” to expand with.

        But yet, it’s doing almost nothing. The economy is recovering at painfully slow rates. That’s because we are missing the demand side of the equation. The supply side will not create jobs, if there is not market of consumers to buy the products and services with. Many of large business don’t even need the free money. They have their own free money by the billions sitting in their banks. And yet they refuse to spend it because there is no demand for new products and services. The consumers don’t have any extra money to spend.

        This is all because we are way out of balance with plenty of supply, but no demand. For the past 35 years, we starved the demand side, pushed all wealth to the supply side, and now we are paying the price of having lots of supply, and no demand. Zero interest rates shows exactly how out of balance we are. In a balanced economy, we would see higher rates.

        If demand were to grow too large – if we were to flood the consumers with cash, it would causes a rush by businesses to try and expand to keep up with demand. Interest rates would shoot up though the roof.

        But today, we don’t have a supply problem, we have a demand problem, and though much has been causes by public policy decisions over the past 35 years, the larger and more important underlying causes is technology growth which expands the economy, but at the same time, drives down wages and devalues the worth of the human workers. And as that happens, demand will dry up if the workers aren’t allowed to act as consumers of the products and services the economy is able to produce. That is where we are now.

        A basic income is needed to bring the economy back in balance and give the demand side more strength. If we go too far with the basic income, we will produce too much demand, and be out of balance in the other direction. So we must carefully set the BI levels correctly to keep demand and supply well balanced at the point that maximizes economic growth.

        • shaker Curt Welch February 19, 2013 on 10:08 am

          my friend i completely agree. my “supply side” comment was not made about todays economy. I was geared toward the future. When technology/robots take over lots of current jobs we cannot say what new jobs/products (supply) will be created.

          to say that half the jobs of today will be automated leaving 50% unemployed is pretty foolish. With greater technology comes the opportunity to create jobs/products. I just created a product in the past year that i could not have done 5 years ago, let alone 10. I do not begrudge people who have not been as fortunate, but i do think we need to let people know that there is a lot of opportunity, and that opportunity will only get better.

          there was a time when women sat around waiting for men to take care of them. Then they realized that it is far better to take care of themselves. I feel that is how we have become as citizens. We are either waiting for Gov or a Corporation to take care of us. There has never been a better time than now to start a side business. Pursue your passion.

          Our economic problem has far more to do with global competition than it does tax policy. Americans are not getting paid as much because they are simply not as valuable as they use to be. Why pay an American Wages + Taxes + Medical when you can go online and find a foreign worker for 1/10 the price? This is not going away and it will only get worse for another 20 years until everyone is employed globally. only then will global wages start to rise.

          Can a global basic income or a wage PLUS policy change this? Yes. However, you are far more likely to benefit your own life than any Gov policy ever could.

          • Curt Welch shaker February 19, 2013 on 12:18 pm

            “to say that half the jobs of today will be automated leaving 50% unemployed is pretty foolish” — yes which is why I don’t say that. The problem is not loss of jobs, the problem is inequality. GDP continues to grow exponentially, but the wealth is increasingly shifting to the top It’s not being shared. As long as we don’t put too much artificial constraints on jobs with minimum wage and other labor laws which burdens the employer with too much overhead, the economy will always create plenty of jobs. But the majority of jobs are increasingly seeing a sustained drop in value with all the huge gains going to the top 10% and most going to to top 1%.

            “With greater technology comes the opportunity to create jobs/products.” yes. But you are failing to see the bigger picture. The greater the technology, the more likely it is for a shrinking minority to be the only ones to benefit. This trend is seen repeating over and over for the entire history of man. Technology allows people to dominate others. The more advanced the technology the further the reach of that dominance. The “superstar” effect gets magnified. One highly talented singer can’t dominate the entire market for singers when they have to travel to each town to perform. All the other singers get work entertaining the local people when the “superstar” is not around. But add in the technology of recording and live broadcasting and that superstar can steal work away from other singers – the other singers find they can no longer make enough to support themselves so they go look for other work.

            Mom and pop stores get put out of business by large chains, because the one “superstar” store manager gets to compete not just against the other mom and pop store in his town, but against every other mom and pop store in the world – because the technology of communication and transportation extends their reach. The other mom and pops then go to work for the super star, and make less than they did when they ran their own store.

            Every new technology allows a few to climb up above the rest – to climb on the backs of the rest and take some of their wealth away from them in the process.

            You can ignore the data and just pretend that there’s “always some new “better” opportunity for everyone” created but the facts do not support that dream. The invention of new technologies drives not only GDP higher, but at the same time, inequality higher.

            The only reason society hasn’t melted down from inequality is because we enacted never ending laws to offset the huge inequality growth. But our techniques are starting to run short – because they are are based on the false belief that only humans “work” and everything else is a “tool”. Machines work and generate value on their own now and have for a long time.

            “Our economic problem has far more to do with global competition than it does tax policy.”

            That’s is SO wrong I don’t know where to begin. The reason outsourcing gutted the manufacturing jobs in the us is because of TECHNOLOGY growth. It’s the advancements in transportation and communication that made it possible for the “superstar” workers in the east to enter the US manufacturing market. It’s the same problem at work. Advancing technology allows the money to flow upwards into the hands of a few. Chinese manufacturing is making tons of money, where once american mom and pop workers used to be making that money. And now Foxcon is designing and building it’s own robots and has announced plans to install millions of them within 3 years. So the “work” is now being “outsourced” to Chinese robots.

            Advancing technology always lets the few dominate the many. It’s true whether we are talking about war, or just our modern limited form of war we call the economy. Advanced technology is what Rome used to take over the world. It’s what England used to take over America from the native Indians. It’s what china used to take over manufacturing of US goods (the advanced technology of cheap labor along with cheap international phone and data networks as well as cheap long distance transportation).

            Technology is a good force as long as we offset it’s trend to allow a minority to oppress the many with it. Which is why we have anti-trust laws, and legalized labor unions, and forced industry to carry a never ending higher burden of health care and short 40 hour work weeks and progressive income taxes.

            But because technology keeps advancing, the inequality keeps growing as well. To keep the few from taking advantage of that and using their control over the new technologies we must as a society keep adding more offsetting laws and systems to force the few to take less (share more) with the many.

            The smarter the machines become, the less they need human workers at all, but the more they need lots of serious capital to invest in the huge automated factories that are now costing 100’s of millions of dollars. So whoever controls the access to large amounts of capital controls who gets rich in the economy. No small guy that just lost his $50K a year job has a hope of getting $100 million to create an automated factory to compete with the business that just laid him off.

            The problem in the US is not outsourcing. Not in the least. It’s the fact that we have chosen to stop offsetting the flow of wealth to the top. The rich talked the country into believing that in order for the economy to improve, and create more jobs, and lift all boats, that we should vote to give them more money by lowering their taxes, and they would lead us to wealth and prosperity. Americans bought the story, but the only ones who were led to wealth and prosperity, were the rich leaving large numbers of people who voted for that approach in the dust.

            “This is not going away and it will only get worse for another 20 years until everyone is employed globally. only then will global wages start to rise.”

            Not in the least. Many low wage workers have seen their life styles improved and wages grow by the opportunity – which is good. But the larger trend is just the opposite. They are now starting to see their jobs threatened by them being “outsourced” to even cheaper labor – the robots.

            “there was a time when women sat around waiting for men to take care of them. Then they realized that it is far better to take care of themselves”

            I think most woman would disagree with you on that. Even when the traditional approach they used was to “find a man”, they worked very hard at attracting and holding onto the “best” provider. It was very much a “job” that “paid” very well for them even if the “pay” was not a paycheck but rather a home and family funded by the man. They very much always “took care of themselves”. They just didn’t do it by getting a paycheck. In fact many woman Know are better at taking care of themselves than the men I know.

            “We are either waiting for Gov or a Corporation to take care of us. There has never been a better time than now to start a side business. Pursue your passion.”

            You are so naive. Yes, I operate three business. But that doesn’t solve the global problem that is here with us today. When 100 people try to start a business today, 1 might do really well, 9 manage to survive, and the rest fail. That’s not “equality”. That’s 1% get rich mentality. Not everyone has the skills to manage a business well enough to compete with that 1% that are really good business managers.

            “Pursue your passion.”

            But you just said that everyone must now become a business manager and not pursue their passion. Running a business is not the same thing as say, writing code, or cooking. And that’s exactly the problem we face today.

            Before, one guy that was good at running a business, could hire 4 really good cooks, a clerk, a bookkeeper, a salesmen, and other skilled workers, and have a nice little business where everyone made a good living. But today, only the person that knows how to do it all is able to succeed. They need to know how to cook, do booking, build a web site, write legal contracts, do marketing, sales, and be a good all round business manager in order to succeed in their “own business”. Not everyone has the right mix of skills to make a small business succeed because no matter what they try, there will be someone else, sometimes on the other side of the world, competing against them (thanks to technology), so they have to be better at all these skills, then their competition in order to succeed.

            Even though there are lots of new opportunities for success – there are more opportunities for failure today, than there are for success. The creation of the iPhone opened the market for apps, that millions of would be programmers jumped into to try and make money on. Some got super rich, most lost money (though might have fun trying none the less).

            These new opportunities seldom lead to social equality. They tend instead to drive greater levels of social inequality and that’s the growing problem which can only be solved at the government level.

            “Yes. However, you are far more likely to benefit your own life than any Gov policy ever could.”

            People are suffering exactly because they are all too taking care of themselves instead of helping each other. It’s the problem of the boiling water. Put a frog in water and slowly raise the temperature to a boil and he will never realize he needs to jump out – he will just let the water cook him to death (or so they say). People are so focused on their own little ups and downs in life they don’t notice that life is getting progressively worse over time for the majority – so they just accept it.

            It’s time for people to stop being frogs and for once pay attention enough to larger problems we have in society instead of being so focused on their own situation. It’s that self focus that makes people bitch about taxes and bitch about “big government” (which is really just a buzz word for “I want to keep more of that money for myself that I see sent to the government”) but it’s the taxes that allowed their situation in life to be what it was in the first place. Without the taxes and government, most of them wouldn’t have been making the money in the first place but they don’t take the time to look beyond the “pain” of that tax check they have to write.

  • xomox February 12, 2013 on 1:37 am

    why do you publishers perpetuate the BS unemployment rate of THE State? You DO realize that that rate does NOT take into account people that are still unemployed after their Unemployment insurance has run out, right?

    • Khannea Suntzu xomox February 12, 2013 on 6:08 am

      One of the most criminal lies ever purveyed by any state are these attempts to make humans completely inconsequential in governmental statistics. There is a layer in Hell for politicians that stop taking human beings in account.

      • Anne Ominous Khannea Suntzu July 29, 2013 on 1:10 am

        You can include the way they calculate the “inflation rate” in that criticism. It is one of the worst current government abuses.

  • DigitalGalaxy February 15, 2013 on 8:14 pm

    When it’s robots all the way down….where does money enter the picture at all? You just have robots make food through hydroponics. Robots don’t cost anything to make when the robots are self-replicating themselves. If the software they run on is open source, then nobody can control the software and charge money for it. When robots are made out of scrap metal (essentially valueless), you don’t have to charge anyone to build them. You just have robots 3D print buildings and mine out cement materials, or do automatic aluminum extrusion. Once our needs for food and shelter are sustained by robots, all of humanity can turn its gaze to higher pursuits. Science. Space travel. Global education.

    Imagine the entire planet as a first world nation! No more massive corporations. No more people suffering at menial jobs they hate. No more hunger. Just the freedom to exist, with our machines fulfilling our every biological need. No more paying for food or shelter. Maybe you might pay for art, or literature, or something else only humans can provide. We will be ready to take the next step in our progress as a species: interplanetary travel and colonies.

    Capitalism and socialism will be irrelevant. There will be only one challenge; to educate yourself, to improve yourself, to move to the next plateau of human evolution. All made possible through the global collective of the Internet. Which, of course is run on computers. When of course, are made by robots.

    There’s no money involved here, only code. Open source code. Open source has no price tag. One man (or woman!) programs it, then it’s available instantly worldwide. To anyone. Free. Including the code to make robots self-replicate to hydroponics operators or 3D printers large enough to construct buildings. Or build wind and tidal turbines to get our free energy. Get ready for the wave.

    We are Borg.

    You will be assimilated.

    Resistance is futile.

    • DigitalGalaxy DigitalGalaxy February 15, 2013 on 8:23 pm

    • Curt Welch DigitalGalaxy February 16, 2013 on 3:07 pm

      DigitalGalaxy writes: “When it’s robots all the way down….where does money enter the picture at all?”

      To pay for raw materials, energy, time, and space.

      “Robots don’t cost anything to make when the robots are self-replicating themselves.”

      That only becomes true once ALL resources are limitless. You can not make all resources limitless so it’s never true. Energy, matter, space and time are all finite resources and must be optimally allocated to maximize our desires.

      Money is the control signal by which the robots self-optimize the use of resources to maximize the desires of the consumers.

      Even if, as you dream about, we have high tech powers to transform trash into new finished goods, the transformation takes time and the finished goods take up space. So the space and time must be allocated to meet the needs of the consumers.

      So if in this distant future, I want a trash pile turned into a working full scale model of the Star Trek Enterprise complete with a crew, for a party I was going to have Friday night, I still have to buy the right to use the trash pile for that, and pay for the space to store the Enterprise. Other people in the world had things they want to do with that trash pile as well so we have to fairly allocate all these things between the billions of people that have different idea of they want to use these resources for.

      Money is the control signal by which the robots optimize their behavior in there work to keep us humans happy.

      In the future, when all humans are well and completely removed from the process of working, we will have the ability to implement pure socialism. All the shared resources like land and space and energy and raw materials can be jointly owned and shared by everyone. Those limited resources which we must share will then be leased by the machines. The money collected from the leases, will be the shared income of society. We each get an equal share of the lease incomes every day, and we are free to spend it any way we each desire. The value of different resources will be determined by the free market. Some land might be very expensive to lease, some will be very cheap. If we want a lot of land, we can lease as much as our income permits. Or we can lease only a bed to sleep in, and save our income for one weekend where we want to throw this huge party in a life size replica of the Enterprise. The robots themselves all must be shared, and to have a robot work for you for an hour (instead of working for someone else), you have to pay for it’s service. So we can get the robots to do or make anything we can dream or – or anything they can dream up to suggest to us – but everything they do, will have a cost that we must pay for.

      But the entire concept of working to justify your share of the wealth would be gone in that future. Everyone gets an equal share of the wealth, because they are a human, and because this is a human society we have chosen to build.

      Today, we still need humans to work. At least some of them. So we need to motivate them to do so. But unregulated free trade does not create any sense of a fair sharing of the wealth of society – so this is why we do live in a society today that is a mix of the dog-eat-dog past of unlimited competition with the strong ruling the land, and the future we can one day create, where we exist in a fairly Utopian society of financial (if not social) equality. So for now, we create solution that are a mix of the two, by adding large amounts of social programs and shared services to our free trade competition. But recently, we have failed keep up with the addition of social sharing and the result is a very unstable shift of wealth and power and control to the high side and we need to fix that.

      But money, will always have an important role in our future simply because we need a system that drives the machines to optimize their decisions. Money is how we tell the machines what is important to us so that they can tell they are doing the things that most important to all of us.

      • DigitalGalaxy Curt Welch February 16, 2013 on 9:52 pm

        I see where you are coming from, but I’m not sure I agree. You are saying that raw materials aren’t limitless, so therefore we need a “limit” placed upon each person’s ability to produce, and that limit might as well be called money. Technically that’s true, but in a practical sense I think will ultimately be false, at least as we get far enough into the future.

        We have so much iron that we could never possibly put it all to use. Is that iron limitless in the sense that it is truly infinite? No, of course not. But, as far as we are concerned, it might as well be. We throw away far more iron than we consume, and there is no sense that our iron deposits will ever run out in any meaningful timeframe. Iron is one of the most abundant elements produced by dying stars, so there’s plenty of it around. Even if we run out on Earth (doubtful), the asteroid belt and Mars have plenty…

        And there’s no need to pay for trash. Once you throw something away, you have renounced any moral claim to it, so that object can be mine if I just bother to pick it up. If you toss out a microwave, and I go dig it out of your trash bin and turn the raw metal into a robot, have I done anything wrong? Of course not, I haven’t stolen a thing. (Unless I’m also fishing out some old bills to use as an identity thief! Then we might have a problem!) There are iron scrap yards in China that are so tall a camera can’t even take it all in at one shot. Before we start talking about “limited” resources, let’s use up those first. Then we can talk about “limited”. There might be other resources which truly are limiting, such as petroleum for plastics or something similar, but for now let’s stick to how to create more robots. Besides, eventually we will be able to create petroleum by subjecting biomass to the requisite temperature and pressure, making plastics a renewable resource. Iron creates food through automated hydroponic systems, creates shelter through 3D printing homes, creates most of our consumer goods by being the basis of most factories…so all we really need is iron. And silicon and copper for computer chips, I don’t think that’s running out anytime soon either.

        Energy is also not a limited factor. Solar, wind, tidal, geothermal…none of these sources ever run out. Once robots are creating and installing wind/tidal turbines and geothermal plants on their own….forget about energy shortages. We may eventually run out of the raw materials for solar panels, but that’s probably not going to be for a while. Of course these renewable sources will run out…about a million years from now when our star becomes unstable. By then we will be long gone to other star systems. That’s not even counting nuclear, which produces so much energy per unit of fissable material that it might as well be limitless, even though we technically will run out eventually…

        When you say “time” I’m assuming you mean “production time” in a fully automated factory. That can be limitless on a practical sense too once we have enough factories. That might be limited at first, but eventually we we will just automate the production of more factories. If our current number of fully autonomous factories is ever maxed out, we can just fabricate more factories. There might be restrictions on enormous projects like a full scale Enterprise for a party, but as we get more and more factories, those restrictions will become less and less meaningful. Your monthly “ration” might be so much that you could never spend it all.

        And space…. Space is the one item on your list which actually IS limitless in a technical sense. Space ON EARTH is limited. Even if you build underwater domes, and dig underground, space on Earth still becomes limited. But, once you get out into orbit…space is not a limiting factor at all. Moon colonies…Mars colonies….gas giant moon colonies…lagrange point space stations…orbital rings….the possibilities are endless! And that’s even BEFORE we reach Alpha Centauri! No, space is not a limiting factor. Only space on the surface of the Earth is limited, but that’s no limitation at all. We will be in comfortable in space long before we run out of room on Earth.

        Maybe I’m being overly optimistic, or maybe I’m just trying to look too many centuries ahead, but eventually I don’t think there will ever be the need to “ration” either our energy (full-on renewables will take care our energy needs), production time (autonomous factories in space!), or raw materials (plenty of iron) to make robots. Certainly off-world space will never need to be rationed, even if Earth-surface space is. Maybe I’m just not being as realistic as you are, but I don’t think I’ve made any assumptions about any technology that isn’t either present already or will be present soon. I haven’t even mentioned a Dyson bubble or anything esoteric like that.

        You’re talking about money being an “optimizing principle” for robots, but eventually we will be able to afford to live inefficient, non-optimized lives because we will have that much technology, that many autonomous factories, and that many resources.

        Maybe in the near future, the next century or two, you are right, and we will need a “rationing” principle such as a monthly “resource ration” of money. But look a little farther ahead, and I think that will go away too. Eventually our production capacity will simply become so high that no meaningful limiting factor will be required, and we can dispense with the rationing entirely. Space will never need to be rationed

        We can get to building Cubes instead….

        Prepare to be assimilated!

        • Craig J. Townsend DigitalGalaxy February 17, 2013 on 12:14 pm


          I agree with you as I have researched this area extensively. As I just posted the idea that things have to be managed for efficiency or to make sure there is enough for everybody is a fallacy. It has never worked; government management causes all of the shortages and problems that its implementation is supposed to cure. Complexity theory and economics has proven and upheld the classical liberal economist’s insights and ideas. The entire socialism calculation debate by the Austrian school of economics is now upheld.

          It was always in front of everyone’s face, covered over with 18th and 19th century biases. Today we know there is no central controller of: nature, the universe, ant colonies, ecosystems, and human societies and the economic market system. The more you try to make an interrelated complex emergent evolutionary system more efficient by outside control and interference the more you destroy the very functional holographic web of it. All of our ideologies are based on old metal constructions now refuted. Conservatism and archaic socialism/communism are slated to go into the tar pit of history once the new paradigm catches on.

          To understand money, you need to understand its function as a distributor of knowledge. It coordinates the entire economic system and all of its resources axiomatically. I do not need to know how much of any resource there is in the world to start production of any good. To bake bread, electronics, glass etc, I don’t need to know how much wheat there is, how much copper or how many grains of sand there are in the world. I can look at its price and know its relative scarcity. If too high I can substitute other resources for it, I can invent a new resource that has never existed before in nature. New technology is invented that allows us to find more of that resource and to produce it more efficiently and cheaply.

          Innovation cannot be managed or ever predicted. It arises from the very evolutionary nature of the system itself. A proctologist helped create fiber optic cable that went on to revolutionize communication. Tons of copper were recycled, now they are going to use graphite to make circuit boards. Nano-wire for electrical power is only a few years away, how many more tons of copper will be recycled? Digital photography did away with all that silver use. Computers are vanishing as they get smaller and smaller and smaller. Dematerialization is everywhere and Buckminster Fuller’s idea of Ephemeralization is now so wide spread that only the ideological blind cannot see it.

          “All resource shortages are artificially contrived,” Fuller once said and he is correct. Where ever there are commodity price increases the dead hand of the state acting on behalf of a crony partner is always found, artificially limiting resources. Ideologically archaic socialism creates the very shortages that its adherents say socialism needs to be implemented in order to ration effectively so as to stave off exhaustion. All of it based on conservative tory fallacies. It is why Marx hated Malthus and called him an imbecile.

      • Craig J. Townsend Curt Welch February 17, 2013 on 11:52 am

        “To pay for raw materials, energy, time, and space.
        “Robots don’t cost anything to make when the robots are self-replicating themselves.”

        That only becomes true once ALL resources are limitless. You cannot make all resources limitless so it’s never true. Energy, matter, space and time are all finite resources and must be optimally allocated to maximize our desires.”

        Curt true, the Zeitgeisters have no valid economic basis, the idea that since machines will make machines that will make machines ad infinitum then they cost nothing is a huge fallacy. They base it on the old defeated labor theory of value. The Zeit-guide is full of errors like that one. “Free” is not a function of lacking “mysterious” labor forces magically imbuing objects (a truly primitive mindset). Modern economics has so many more descriptions of the real process that continually cause prices to fall that to go back to 19th century refuted labor theories is absurd and ridiculous and shows unscientific religious catechetical thinking.

        But for all extant and purposes resources can be considered “infinite” as the human intelligence has infinite potential. Julian Simon in The Ultimate Resource I and II makes this argument and backs it up with historical economic figures. Many others also have taken up this line of research and exploded the neo-Malthusian ideas, Kelly, Ridley, Diamandis, Kurzweil et al. Scientists miss the economic basis of this idea, the law of increasing/exponential returns, the substitution effect, the compound learning curve, increasing economy of scale etc. the discovery of and creation of new resources etc. all work to make resources more abundant as their price continually falls if left free of interventions.

        Though I have to point out one possible error in your thought. The idea that resources can be managed for “optimal efficiency,” outside of the market, a spontaneous, emergent, complex, evolutionary eco-system, is itself a fallacy and is a blatant bias from 19th cent. scientism. Complexity theory and economics destroys it and is the proving of the ASE socialism calculation debate correct after all. Any top-down command and control system of management is as dead now as the phlogiston theory of combustion. Our 18th and 19th century fixations based on static Newtonian and Cartesian reductionist models are now exploded. The paradigm has shifted.

        The internet follows the real laws of the universe and the market was an early form of internet, decentralized, spontaneous, emergent, coordination of all actors synergistically that distributes knowledge as its number one function (Hayek). Emergent intelligence is one of the surprising aspects of all network systems. And as Kurzweil mentions in The Singularity is Near, it is the “chaos” of the system that drives it toward evermore efficiency and creativity. The socialist bias, picked up from the Tory conservatives of the “anarchy” of the system, which required its top down control, was always a “conservative” fallacy based on Mercantilist ideas.

        The primitive mind thinks everything must be controlled, that someone must guide everything from a central location, just as they once viewed God as a king managing and controlling the entire universe from his throne through intermediaries down to the lowest minute level. They transferred this idea then from the church to the king and then from the king to the STATE. The simian mind needs an alpha male to worship and be protected by, the new evolving brain does not need that old pyramidal shaped societal paradigm. As the technium evolves it is being torn apart from the bottom up.

        • Curt Welch Craig J. Townsend February 17, 2013 on 3:49 pm

          Craig J. Townsend writes: “The idea that resources can be managed for “optimal efficiency,” outside of the market, …”

          I’m not sure who you were directing your comment to (this use of comment threads to try and carry on a discussion is awkward), but if it was me, I think you have missed an important point I believe in. I too very strongly reject top-down control in these complex systems. They are too complex to be “controlled”. Their behavior is an emergent property of the interaction of all the independent agents.

          The failure of classic communism was causes by rejecting the automatic control of the free market and trying to replace it with government committees. The government committees had no hope optimizing the allocation of resources as well as Adam Smiths invisible hand could optimize it.

          You write, “Emergent intelligence is one of the surprising aspects of all network systems”.

          The reason I got into studying all this stuff about economics and the future is exactly because of my work trying to create human level intelligence. And after playing with that for 30+ years I’ve come to some very intersting conclusions along these lines.

          Human intelligence is itself, created by a process of independent agents in the brain working in a “free market” (so to say), with each agent trying to optimize their own behavior independently of the others. Our human intelligence is just an emergent property of a network of agents working together – but each only trying to solve one small piece of the larger puzzle.

          But they don’t work together because they are just “chaotic” as you seem to suggest. They are made to work together, because they share a common goal signal. Chaotic systems without a common goal DO NOT show emergent intelligence. A bag of gas molecules does not show emergent intelligence – it only shows emergent gas laws and nothing else.

          But if you give the chaotic agents a common goal signal, then they can work together to create emergent intelligence.

          Humans are reinforcement learning machines – the brain attempts to use it’s network of free agents to optimize a single brain-wide reward signal that is the underlying control signal which forces the agents to work together for a common cause. It’s why goal seeking behaviors naturally emerge from our “chaotic network” of neurons in our brain.

          Our economy works the exact same way. It’s a network of agents sharing a common control signal that links them all to solving the same global problem – which is profit maximizing. Our economy is, a true, separate intelligence, from the intelligence of each human that makes it up.

          The invisible hand of Adam Smith isn’t invisible at all – it’s the intelligence of the network he is talking about.

          At the same time, let me say that science fiction for a long time has talked about the AI monsters we create tasking control of our society away from us. In fact, this is nothing something that might happen in the future. It’s something we have already created. When we choose to work as independent trading agents in a society, we have created a super intelligence AI “robot”, that is far more intelligent, than any human. Just as a human, is more intelligent than the individual neurons that makes up the “society” that operates in our brain.

          Humans are motivated by tghe reward signal that is hard wired into each of us. We have internal brain circuits that define what is a negative reward for us, and what is a positive reward for us. All the things we think of as pain are the hard wired negative rewards, and all the things we think of as pleasure are the positive rewards. Our independent agents each work to maximize those signals and the result, is the emergent behavior we call “intelligence”.

          And when we create a free market economy, we have already built a super brain, which too has it’s reward signal it’s trying to optimize for. That reward signal is defined, by the spending habits of the consumes in the free market.

          This super intelligent AI robot we created, is way smarter than any human, but it optimizes it’s behavior, to fit whatever we motivate it to do. We control what it does, not directly, but indirectly, by what control signal we give it.

          Just like evolution is able to control us, by the control signal it gives us. Evolution makes damage to our body a negative signal, and the result is that we optimize our behavior, and our environment, to prevent damage to our body. Evolution makes the act of reproduction fun, and we optimize our behavior so as to reproduce. Evolution controls our leash, by using this control signal, even though it does not tell us what to do, and what not to do. We are free to make our own choices, but we are slaves, to only picking choices we believe will lead to a future filled with higher rewards. Evolution has this strong, but indirect, control over us.

          Likewise, we have a strong, but indirect control over this super intelligence we have created called our economy. We control it by how we spend. And we control it by how we set and regulate the prices of raw materials.

          If we want this super intelligence to implement the will of the people, and we want every person to have an equal power to “vote” on what this super intelligence will do for us, we must give very human an exactly equal number of votes to cast each voting period. Or, in other words, we must give them the exact same amount of money to spend every year.

          But, humans perform two important functions here. They are consumers – where we vote as to what we want this super AI to do for us. But we are also cogs in the machine of this super AI as well. We must be motivated by the machine, to do the best job we can. That’s where we are given different amounts of money as rewards, for our effort.

          But these two jobs are at conflict. The more we let one person receive higher rewards (more money), the more it unfairly gives that person more votes to control the super AI. The more the “beast” is under the control of the rich.

          Right now, 1% of the population controls 40% of the wealth and 24% of the income. That means they have at least 24% control of this AI monster vs the rest of the population which is only allowed 75% control. And most of that is in the top 20% with the bottom 805 having almost no significant control of this monster we have created.

          A fair society; a democratic society, would create a monster, and give every human equal control over what it did. It would give us each the same number of “rewards” points to spend.

          But since for now, we are also workers inside the machine, we need to keep us motivated and give people higher rewards for better work. But rewards are mostly relative. It’s relative to what others get, that motivate us. If we are more productive that other workers, we expect to be receive higher rewards. But we have little eal expectation of how high the rewards are. If the 1% is getting 10x times more than the average worker, they are still highly motivated to work hard. They don’t need to get 1000x times more. As long as the best workers are getting more rewared than eveyone else, thigns work fairlly wel.

          So we need to balance the needs of the two jobs we have. As consumers in an democratic society, we should each receive an equal amount of money to spend in order to motivate the economy to do what we each want. But as workers, we must be rewarded with the more productive members receiving more.

          Our current economy is badly shifted towards the 1% which means the economy mostly works for them, and not for “us”. We need to fix that.

          A basic income created by taxing the ENTIRE economy equally at a flat tax rate on profits which is then distributed to all the humans (aka consumers (aka the people who control the leash of the super AI monster called the economy)), gives each a closer to fair share of the control of the economy. It simply caps inequality.

          The more humans are removed from the beast, and replaced by machines, the less we need to motivate them to be good workers, and the closer we can get to true democratic control of the beast, with each citizen having equal control of this super intelligence called the economy.

          There is no “top down” control of the beast here by humans trying to do economic “planing”. The economic planing is all done by the beast – by the economy, based on the inputs from the consumers – by how they spend their “votes” every month. The economic planing is all done by invisible hand of Adam Smith, not by government committees trying to set production quotas every month.

          Learning to control this super intelligence we call the economy, is the exact same problem we will be facing when we learn to control the new crop of truly intelligent robots that we are about to see emerge into our society (BTW).

          All this intelligence is nothing more than an optimization process. But every optimization process, must be given a top level optimization goal. We control it’s behavior, by what top level goal we give it. We have created one such process with our free markets, and by how it’s structured, it will optimize all economic activity so as to meet the needs of the consumers – biased by how many votes each consumer gets to cast each month. These is not some big “chaotic and impossible to understand” process. It’s really quite simple in how it works and what it does. It picks behaviors that maximize profit. But we define how “profit” is measured by how we spend. What’s nearly impossible to predict is what behaviors this process will “find” as optimal solutions. But the fact that it will find whatever behavior produces the most profit, is a given (within the error created by the systems limited ability to make good predictions).

          If you give this monster a motivation that makes it harm humans, we have done exactly what the sci fi stories have been talking about. But if we give it democratic motivations to help all humans, then this “monster” is a super intelligent slave working to make us all happy.

          Our current government social policies are motivating this monster to use 40% of it’s power and intelligence to take care of the 1% while abusing the 99% and the 99% are getting pissed at being abused by the “monster” that is under the leash of the 1%. The 99% are going to rise up and kill this monster if we don’t fix this and that would be a same because this is a great and powerful monster that would be happy to take care of all of us, if onlyw e asked it to.

          • shaker Curt Welch February 18, 2013 on 9:18 am

            this is a great post. i think the basic goal of the economy should be to figure out how much we need to “reward” people to keep the “monster” going.

            right now we reward people too much. if we could reduce that reward it could benefit society more. however, some economist will tell you that by reducing the reward even 1% you weaken the monster and thereby hurt everyone. i personally don’t believe that.

            -I don’t believe an increase in taxes of 5% reduces my desire to work.
            – i don’t believe a “wealth tax” would prevent me from wanting to become wealthy.
            – i don’t believe a “basic income” of $500 would prevent people from wanting to work

            I personally hope we move towards a digital currency system. We can then index every transaction and institute a wealth tax.

            imagine a system, that is monitoring the spending habits of every human on an instant by instant basis. imagine a system that increases and decreases taxes based on every purchase, not just annually or on a state by state basis. We could monitor the money/wealth supply at any given moment and disperse/redistribute it one goal in mind: to perpetuate the flow of money.

            i will disagree with one thing:
            “A fair society; a democratic society, would create a monster, and give every human equal control over what it did. It would give us each the same number of “rewards” points to spend.”

            we cannot give every one equal control because control is based on choices. If someone chose to become a carpenter and someone chose to become a doctor we cannot reward them equally. it would destroy the system. now we can give the carpenter 0-X% of the doctors income because we know that in order to have a functioning SOCIETY we need both the doctor and the carpenter.

  • Craig J. Townsend February 19, 2013 on 9:14 pm

    Curt you said, “Overall a super productive economy is excellent for society IF and ONLY IF we have some reasonable amount of sharing. But the problem is that the more advanced the machines become, the less sharing there is. Advancing technology for the past 200 years has been driving us towards every greater amounts of wealth and income inequality.”

    This is historically incorrect, up until the creation of the Federal Reserve the wage rate of workers was rising and prices continued to fall. There is a natural movement to make the wealth gap smaller in an economic system not destroyed by inflation. Inflation causes the huge wealth gap we have today, not technological advancement. Technology lowers the price of all goods created while making them more abundant. Inflation rises all prices, artificially inflates the profit margin, destroys savings, capital accumulation etc. See Deflation & Liberty, Hulsmann, A small book with a huge impact to help you understand what is the real cause of all of our problems.

    Inflation requires the welfare state measures, income taxes etc. If not for the Fed costs would have declined more than 400% (not factoring in the law of increasing returns) since 1913 instead of the 2,500% inflation in prices since then. Imagine what everything would cost today if there had been a 2,500% deflation in prices instead? What welfare would be needed? Would the STATE need more taxes? Would we even need a base income? Your dinner out would be a few pennies, your new car? $800 or less. Your new house? $2,500 bucks! If we stopped blaming effects for being causes and understand the causes themselves, we then would know what to do.

    What income inequality is there when desktops first came out they were $25,000, then fell to $5,000, then by 89 they were $3,500 then by 2,000 they were $300! And they had far more memory and were light years better in quality. That was a 988% decline in price in 30 years! What wealth gap is there? 30 years ago only the wealthy could afford a desktop, today everyone can. TV.s,. indoor plumbing, heating and air, cheaper bread and food, etc .This has happened to everything that the dead hand of the STATE has not touched.

    • shaker Craig J. Townsend February 19, 2013 on 10:29 pm

      you are right about inflation. But why do we have inflation? we partially have it because of poverty in other parts of the world. we have to constantly devalue the dollar in order to compete with other parts of the world. if the dollar was too strong we would have higher unemployment.

      i believe we need a more bottom up approach. Basic income or an even more progressive tax system or a wage plus type of system would really help do away with both poverty and inflation.

    • Curt Welch Craig J. Townsend February 19, 2013 on 10:35 pm

      Craig J. Townsend writes: ” Inflation causes the huge wealth gap we have today, not technological advancement. ”

      I’ll check out the book you mentioned later when I have time, but I have read a few of the people that try to argue the fiat currency and the federal receive and their creation of inflation is the root of all our economic problems. I’m sorry, but they are just complete IDIOTS that are doing nothing more than allowing their emotional need of self control to override all the facts. They don’t like other people telling them what to do (it’s a personality trait they just happen to have), and the result is that they spend endless hours rationalizing about how anyone taking away their “liberty” is an affront to nature. It’s BULL SHIT emotional bias talking, not reason.

      Why is it so hard for people to understand that money is an arbitrary numbering system, and then when you create inflation, or deflation, the only thing that happens is that ALL the numbers in the system change together. ???? Relative value doesn’t change.

      ” Imagine what everything would cost today if there had been a 2,500% deflation in prices instead? What welfare would be needed?”

      Ah, dude, when we create deflation, the prices of goods drop, but SO DOES ALL WAGES. It makes no difference if I make $100 a week and bread costs $1 or if I make $1 a week, and bread costs $0.01. Inflating or deflating the currency does not change anything. It does not make anything more or less expensive relative to my income because my income inflates and deflates in perfect lock step with the prices of the stuff I want to buy. Why is that so hard to understand?

      • shaker Curt Welch February 20, 2013 on 11:37 am

        I think we are all trying to over simplify the argument.

        in any economy there will always be people who have value, and people that don’t. the question is will it be easier for people to make themselves more valuable in the future. In society value comes from knowledge. It is getting easier and cheaper to acquire knowledge therefore i would think it would be easier for people to make themselves more valuable.

        10 years from now you will have FREE virtual education in all fields. Yes, you can go online and become a doctor for free. Couple FREE education with Free virtual chat rooms (super skype), blogs, free news and what excuse will people have for being poor forever?

        there are only three ways to “balance” an economy. Compete with those that have, create something new, or redistribute wealth.

        you can chose which direction you want the world to go in. I think competition is the key. it does make/force us all to become better, but at the same point i would like to see some form of basic income, revenue sharing, wage plus, and whatever else people can think of.

        • Curt Welch shaker February 21, 2013 on 1:49 pm

          “the question is will it be easier for people to make themselves more valuable in the future”

          No, that’s not really a question even worth asking. People have become more valuable for the entire history of man as we advance the understanding in our culture and improve communication and education. Of course people of the future will be more valuable in that sense.

          “In society value comes from knowledge.”

          Knowledge helps create value, but knowledge alone is NOT value. All value comes from manipulating physical matter into states of higher value. If you do not own the physical matter, then having the knowledge about how to manipulate it does you no good at all. Knowledge is NOT value. Physical matter put into the right state is value. Knowledge is one of the keys, but not the source, of value.

          Creating value is mostly a game of controlling ownership of the physical matter.

          As much value as we see being generated by the “information” businesses like Google and Facebook, they are nothing compared to the companies that control the oil, and the land, and the seeds, and the water. Take a look at the worlds largest companies by revenue:

          Only 3 or 4 of the 58 could be considered “information” business. Most are energy companies that have gained their wealth by gaining physical control over energy sources (mostly oil and gas).

          The few that can be considered information businesses are in fact just playing games of trading ownership of physical matter with others – they use their information to gain more ownership of the physical stuff that value is created from.

          We are headed towards times where information is becoming free because sharing of information with the help of high speed computers and networks becomes very cheap. We could in theory reach a time where all information essentially is free – where it’s so cheap, that we don’t bother to do any accounting for who it using it.

          But we show no trends in society of making the physical matter free or even fairly shared. So whoever is able to gain control of the physical stuff will gain control of the wealth.

          A very important part of the physical stuff that created wealth in the past was physical human bodies. Whoever controlled the humans, controlled the wealth. You had to have humans doing the wealth production because there were no real machines that could produce any substantial amount of wealth without the addition of lots of humans. This is why many people falsely understood economics as being based on human labor.

          All past human cultures were founded around controlling the humans and were a struggle over who had the right to control the humans. Many cultures simply became a rule of the strong. Whoever was the strongest would gain control of all the other humans and all the other humans had to do what the strong guy told them to do – like tend “his” fields, or build castles for him, or fight battles so that he could gain control over slaves, and over a wider range of other humans – as in the expansion of the large empires.

          But we realized that for everyone in society to do better, we had to move away from the rule of the strong, and switch to a shared rule by all – a democracy where we all get to share in the rule of our own societies. Democracies are certainly not perfect in that they create oppression by the majority. But oppression by the majority is a clear lesser of two evils than the oppression by the strong elite. Sadly, too many people today don’t know how bad things were, and only see the problems of the oppression by the majority and want to escape that as well. But they have this false dream that if we just switch to a libertarian free market we will have elimited all oppression by the majority and created a “free and equal” society. Nice dream, but the facts don’t uphold the dream. Free unregulated trade takes us right back to the rule of the strong. But this time, instead of the strong getting power with an army and physical force, they get their power by winning the game of free trade – by gaining control over all the physical matter that value is created from.

          As long as humans were the prime source of value creation, and as long as most humans were generally fairly equal value creators, and we outlawed slavery and other forms of forced interactions, then free markets would automatically create a somewhat fair distribution of wealth. Anyone that wanted to create wealth using their own body (work) could do so, and expect to end up with a fairly reasonable amount of wealth as the result.

          But the more we add other machines that do the value creation for us into the mix, the more it has upset this balance. A single person hand building a car has very little value, compared to a modern highly automated automobile factory. But yet, a single person can, and sometimes does, own entire factories like this. Which means they control the factory, and get the wealth it produces, where as the human hand building cars, only gets the wealth his hands are producing.

          Human hands simply are not worth what they once were, and they are becoming less valuable by the day. This decline is quickly shifting the economy away from an economy based mostly on human labor, to an economy based mostly on non-human “labor”. Never in the history of man has this shift happened before. It’s a totally new factor in the economy we have never have to deal with before.

          No amount of education and training and information will restore the value to human hands. The value is going away, and it will never return once it’s gone.

          This means our economy is shifting away from the stabilizing force that once existed where every human was given a free pair of “hands” to own for life as their “stake” in the economy. With this shift, comes a shift towards ownership of everything non-human (capital) as the key tool used for capturing a percent of the wealth produced by our economy.

          Such an economy simply is not stable at all. Ownership tends to accumulate into the hands of a few members of society, instead of being shared our democratic society will be lost and we will return to a rule by a small elite of the strongest. The strong are economic traders today, instead of warriors as they were in the past, but the result is the same either way – everyone else suffers under their boot.

          If we don’t fix this accumulation of ownership by forcing some form of additional sharing (lots of ways to address it), our democracy will be lost.

          Information sharing as we see happening on the internet is a step in the right direction, but it’s not significant enough to fix the problem. Even if all privacy was lost and we shared openly all information (eliminating all rights to ownership of information – such as patents and copyrights), we will not have fixed the deeper underlying “fair levels” of sharing the physical stuff that wealth is created from – like the oil, and land, and the robots.

      • Craig J. Townsend Curt Welch February 20, 2013 on 8:53 pm

        Curt, who did you read? Mises, Hayek? Rothbard? You ever read Mises’ The Theory of Money and Credit?, as you seem to not understand moneys full function totally ( . Please do read and go back to the board on this as you need to come to comprehend the entire subject matter, by reading the books you are reading with their neo-leftist slant, you will stay in the reactionary revisionist zone. No economic school has a description of the business cycle if they ignore inflation or discount it. Over production and under consumption theories fall apart as they don’t describe historical events. The competition theory fails for the same reasons and Marx went off the rails advocating it as does all his heirs do today. The Schumpeter theory of technological change as the foundation of the boom bust cycle fails. Animal spirits is utter nonsense. A theory MUST fit historical events and describe them, if they don’t it fails. The business cycle has been understood in certain quarters since Hayek’s work in the 20’s which he won the Nobel prize for in the 70’s. Of all the business cycle theories I have studied, only the ASE one makes sense and fits the facts of history. Using their ideas I myself predicted the present economic downturn 2 years before it happened, so have a lot of ASE economists. The power of prediction shows something is right.

        The entire economic thought of today is suffused with nothing but fallacies for the 18th and 19th cent. The vast majority of which are based on the false idea of immiseration started with David Ricardo and fighting a phantom menace, which every school has created its own versions of Imperialist ideology to bleed away extra capital (savings), to counter the natural deflationary effects of the economic system. If you want to keep profits artificially higher, you must stop the natural deflationary processes. Over taxation, regulation and inflating the money supply, all bleed it away, but the most is redistributed by inflation which is the root cause of so much of what you decry that when you understand it better you will go “OH, it all makes sense now!” It all comes together into a syncretic whole. That is what I found studying all of this for the last 20 years.

        FYI: As the amount of savings invested per worker increases, the profit & prices decrease and the natural wage rate actually rises. The NATURAL process of deflation, and don’t get this mixed up with the large deflation after an artificial boom. The Natural process caused by the increasing economy of scale, INCREASES the workers wage rate by lowering all costs and prices in society. Thus the wage rate increases in two ways, the worker is more productive and their wages rise and the prices continually fall making his wage rates purchasing power increase.

        Your depiction above is based on fallacies created by people who don’t want you to understand the disastrous effects that their economic policies create. They wish to institute state socialism by bringing capitalism down now, while the false champions of capitalism pretend that they are trying to save capitalism while also doing the same thing. That is what all of these economic fallacies foment. Keynes based his fallacious economics on debauching the workers wage. His idea to achieve full employment was to inflate the money supply and bring down the value of the currency so that the wage rate would equal the market rate of labor, thus increasing employment. Real wages drop in value as too much money is printed. Why do you think the wage rate is stagnant? If I inflate the money and wage rates drop in value 50% in a decade and prices drop 50% in a decade due to LOR, what has happened to the real wage rate? Flat, you can basically buy the same basket of goods with the higher wage rate ad as inflation goes along you buy less and less even with an increasing wage rate as you are being paid in devalued dollars.

        The rich get richer as they have first access to the new money before it drops in value, fixed incomes and welfare recipients are the last to get it and are devastated. Please do read Deflation & Liberty, the author goes over this fully and much better then myself in this small venue. When my book comes out later this year it explains all this in full.

        • Curt Welch Craig J. Townsend February 21, 2013 on 11:43 am

          Every page I looked at on the internet to describe Keynesian vs Austrian was a diatribe by a true believer in Austrian economics trying to convince people why Keynesian economics was wrong. Not a single Keynesian economists was wasting their time to debate these people.

          “The Natural process caused by the increasing economy of scale, INCREASES the workers wage rate by lowering all costs and prices in society.”

          Wage rates are just another cost. When prices lower due to deflation, wages lower with them. Praying to the god of unregulated free markets does not make life better for people.

          People do not receive a share of the wealth because of their work. They receive it based on what assets they own. A wage worker “owns” his body and receives wealth for leasing it out to some business. But a business owner owns the entire business and all it’s assets, such as tools, and land, and buildings, and brand names, contracts, and increasingly, advanced automation technologies. The more important all these other assets grow in the production of the GDP, the more the human asset value of a work, shrinks. The more their wages drop.

          The only way to keep up, is not by investing in their one asset of a human body such as by sending it back to school, but by buying and managing their own business assets.

          But sadly, when all humans try to buy(or start) and manage a business, we find huge amounts of inequality generated exactly because some people are way better at this type of work than others and their large successful business end up domination markets with their economies of scale. And that drives up inequality. It does not lower it.

          What your arguments fail to address, is that humans are NOT THE WORKERS anymore. The machines already are the most valuable assets. Not just “robots”, but computers, web servers, shovels, tractors, all of it. The owners of the machines, are getting increasingly larger shares of the wealth because the machines are doing an increasingly larger share of the work.

          “The rich get richer as they have first access to the new money before it drops in value, fixed incomes and welfare recipients are the last to get it and are devastated.”

          Yes, I’m well aware of that argument. It’s true that the “first access” gives the banks a financial advantage, but highly irrelevant to the larger picture. The advantage only gives them a very small extra income – easily offset with taxes if you want to take the advantage way from them.

          What’s obvious in the US, is that when we have a top marginal tax rate of 90% that we had far lower levels of inequality. When we let that rate drop, and let the capital gains rate drop, and limited services to the poor so they had to use their wage money to cope, it allowed the rich to hold on to greater amounts of their wealth, they got weather at the expense of the poor. Any “Austrian” that suggests this change in policy had nothing to do with the shift in inequality, is an idiot. Let me repeat myself. An Idiot.

          None of the Austrian economic philosophies of unregulated free markets are able to cope with the disaster that approaches us as automation displaces humans from the work force. It’s exactly that lack of ability to cope why most people have turned away from the Austrian philosophers and why when you look for information on the internet, all you find is people looking to pick fights with a Keynesian.

          These philosophies have a lot less to do with the truth and far more to do with the personalities of the people pushing them. People tend to develop either dominate personalities where they expect to have the right to tell other people what to do, or submissive personalities where they are willing to follow the path led by a dominate personality. It’s the strong dominates that are so incensed with “big government” telling THEM what they should be doing – like paying higher taxes. It’s these people are drawn to the Austrian ideals of “free market” is the “obvious right approach”. All the data and arguments they put forth is nothing but hand waving they use to justify their own personal preference for having more power to play a dominate role in society.

          “When my book comes out later this year it explains all this in full.”

          Good luck trying to make it about the economy and the needs of the society instead of about your own personality.

        • Anne Ominous Craig J. Townsend July 29, 2013 on 1:18 am

          @Craig: I am not trying to tell you what to do, but I wouldn’t even bother to try anymore to argue logically with this fraud. His reply to you is an excellent example. Notice how he never cites any sources?

          Everything he says that I’ve read so far (I admit that’s not everything because he has been gushing so much) has been sheer speculation and imagination, without any sources or historical reference or even a link to an article.

          It is possible that I’m wrong. He could be sincere. But even if he is, that doesn’t make him right.

          But in all honesty (and I mean that seriously: honesty) I think he’s a snake-oil salesman. He may even believe in the snake oil he’s trying to sell, but there is no evidence or factual basis behind it. As far as I can tell, anyway.

          I’d like to see him start citing sources for the outrageous claims he is making.

  • Andrew Atkin February 20, 2013 on 11:14 am

    You’all need to understand where unemployment comes from. Then you can see technology has nothing directly to do with it.

    • Curt Welch Andrew Atkin February 23, 2013 on 8:40 pm

      Andrew, your thoughts are about 100 years behind the times and exceedingly naive. You need to look at what’s happening today.

      What’s happening today has never happened in the entire history of the the planet so you can’t look back to the past to understand it. People like you that are trying to live in the past will only cause the current problems to drag on longer, and do more damage, as society is forced to wait for all those like you to catch on to what’s happening.

      At no time in the past, was technology advanced enough to have such an enormous impact on human employment. When machines become better workers than humans, the humans lose their job. Even an idiot should be able to understand the reality of that.

      John Henry, no matter how hard he tried, could never again get a job as a “steel driver” (even if the story is fictional, the truth of what happens when automation replaces a worker, is clearly not).

      Over the past 100’s of years, are machines keep getting better. We keep developing new and better machines that keep taking over more of the jobs done by humans. The advance of the machines is not linear. They don’t get better at a constant rate every year. It’s exponential Every year, they advance at a rate of improvement, faster than the year before. This is because we use these new advanced machines, to help us create the next wave of machines even faster. The compounding of improvements is showing no sign of ending. In fact, when people plot the progress backward in time for 1000’s of years, they see it’s been the same basic exponential growth curve over the entire period. The rise and fall of civilizations, didn’t slow it down or speed it up. It’s been exponential for the entire recorded history of humans.

      Humans on the other hand, have shown NO PROGRESS on that time. Biologically, we have changed so little in the last 40,000 years that the change is virtually impossible to measure.

      Guess what happens when the dead flat curve of biological advancement, is placed against the exponential curve of machine advancement. The machine curve flys past the human curve and blows humans out of the work place as it does. We won’t just loose our jobs as steel-drivers. We we lose all our jobs not because the machines are just as good as us – but because they are 100 times better than us at anything we try to do.

      This point in time where machine ability flys past human ability is estimated to happen not in 100 years, or 200 years, but in 2045 – only 32 years from now.

      And it makes no difference if the estimations are off by a factor of 10. Because if they are, it only means it will take a few more years – not 100’s of more years, exactly because the rate of improvement of the machines, will be that fast in another 32 years.

      But 32 years is the point at which ALL human jobs are lost and will never return. It’s the end of the road, not where the problems just “start”. The problems already started in a big way back a the beginning of the industrial revolution. We have been fighting the problem for over 100 years already. But the machines are advancing so fast now, our efforts to offset the problem are failing us.

      When humans get displaced by machines, they must retrain and find a new jobs the machines have not yet taken away. But mostly, it means that the machines have taken away the “easy” low skill jobs, forcing humans to climb the skill ladder up to a job the machines have not yet taken away. Many humans, once displaced mid-life, don’t have the time, to re-educate and start a second career, and advance in that career to the levels they had once seen in their previous career. They suffered for the rest of their lives. But the good news was always that we had a new generation emerging, and when the farmers lost their farms, and suffered for the rest of he lives, their children were able to train to become factory workers, and ended up with a better life than their parents. So despite the suffering the displacement created, society as a whole, was still able to move forward with the next generation. At any point, the number of people suffering from displacement, was not very large. Society as a whole did ok even if some had to suffer.

      But machine technology keeps advancing faster and faster every year. This means a large portion of our society is suffering from displacement each year. It means the skill creep requires each new generation to achieve every higher levels of education, just to start out. And it means those displaced, find it even harder than in the past, to re-train mid-life. More and more people find themselves under underutilized after being displaced.

      Humans are now being displaced faster than we can retrain them. The new jobs created are high skill jobs, and there is no more creation of low skill jobs. We have a glut of workers that could not attain the level of education and skills needed to enter the top end of the new job market (get a job a Google or become a financial trader), and they are stuck in a bloated low-skill low-pay market competing for minimum wage jobs as sales clerks at places like Starbucks and Wallmart.

      These recessions just amplify the problem and expose the structural weakness of our economy created by this problem of technological displacement. The machines are advancing exponentially, and only the humans that are able to keep ahead of the machines, are going to find good employment. But that faster the machines advance, the more humans we will see falling out of the high end job market and sliding down to minimum wage work – or simply giving up trying, and becoming unemployed.

      This is not MEDICINE Andrew. It is not something that will go away once to the markets adjust. The problems will continue to accelerate until even the likes of you catch on to what’s happening.

      The only solution to this problem is socialism. The only solution, is more sharing of the wealth. There are millions of ways to force the sharing of wealth, but until society wakes up to understanding the problem, massive numbers of people will continue to suffer needlessly.

      The recession makes the problem manifest itself as high unemployment. But jobs are out there, so we don’t need to see high unemployment. People can work as long as they are willing to give up hope of finding another $50K job and accept that they have to start living on a part time minimum wage job giving them only $10K a year with no benefits and share a home with other family members. The real problem is not unemployment, but historically huge levels of wealth inequality as the few that manage to stay in front of the advancing machines, make a financial killing, while everyone else that fell off the job wagon, suffer in near poverty.

      How bad does it have to get before people like you will wake up Andrew and actually work to help your fellow man instead of just stomping them in the face with your boot?

  • fireofenergy February 23, 2013 on 5:57 pm

    VERY good commentary, especially how the time is fast approaching when machines will become the majority of the workforce (even more so that could be created), that those who owns the machines shall be on top, and that many people will not (even want to) understand forced (machine created wealth) sharing, because they were, understandably, taught to work hard (and had to like the most of us).
    Very good 60 min video too, until at the end, just suggests that machines will not become self aware.
    This is where I tend to disagree.
    Not that the “robotic race will self initiate” and destroy all mankind, but that those individuals “on top” which owns (and already bought out most the other) machines can make it appear so.
    These individuals do not have to be of international corporate interests either. They could be of a more old fashioned ideology… communism. By being the world’s manufacturing site today, they merely use the global capitalist system to their own empowerment and delete (costly) laws that we must retain so they maintain a cutting edge.
    They sell us machine made solar for example, at just below whatever the market (which is good for local installers) but when we make machines that make them cheaper, China will simply buy a (better) copy of that machine and undercut yet again… The central communistic system serves NO humanitarian needs other than what they have to, in order to buy debt, to leverage and get what they want…
    Or am I being overly paranoid?
    Closer to home, I know there are international laws that even the most ruthless of dictators must abide by, and supposed anti monopoly laws to curtail extreme mergers into making a “world king”. However, it seems that more and more laws are becoming forced upon the common man, as if part of a top down “plan”. What once was a slap on the hand is now an automatic jail term, etc, etc.

    I often wonder if there really will be drone wars everywhere. (Billions of them made from all kinds of competitors)!

    • shaker fireofenergy February 23, 2013 on 10:28 pm

      Most of what i have read on this thread is paranoia and not based in facts.

      – our world is barely educated. Automation will lead to a universally educated society and that education will be available for FREE. it is up to people if they want to be part of the “intelligent” workforce or if they want to sit around and do nothing.

      – unless you are a dictator/king, no human can own all of anything – period. Even the most wealthy amongst us today have very little market-share. As products become more valuable and “resources” become less valuable (more available) the ability to control will dwindle even more.

      – i keep reading that those “with the machines” will have all the wealth/power and those without them will be destitute. why will machines be any different than a smartphone? everyone owns a smartphone. even poor people in 3rd world countries own cell phones. I don’t buy that 1/100 will own machines and the rest of us will simply go lie down and die.

      – we will live in a future society where EVERYONE will be educated and EVERYONE will own machines. What will that society resemble? Who will be the winners and losers. Will it be Utopian or dystopian? will wealth be more spread out or concentrated?

      – if i was a betting man i would say it would be a far greater society. Unlimited access to education, free communication, language translation, a society where people use there brains and not their brawn, a society where basic needs are easy to meet will in all likelihood lead to good things, not the horrors that some conceive.

      – the internet means that “wealth” cannot be concentrated like before. wealth is spreading out globally and will continue to do so.

      All my thinking is about a society “pre-singularity” because i have no idea what happens when machines come alive.

      • Curt Welch shaker February 24, 2013 on 12:28 am

        ” Even the most wealthy amongst us today have very little market-share.”

        Your idea of “very little” is whacked. In 2007 the top 1% in the US owned around 34% of the wealth while the bottom 60% owned only 4.2% of the wealth. Even though the richest person in the world only held a small amount of the wealth (which I assume is the point you are trying to make), his relative holding was HUGE compared to others. And most important, the rich as a controlling block of “friends” end up with massive influenced over everyone else due to the relative imbalance.

        How do you think a dictator keeps control over a million subjects? After all, he’s not a God, he has no more physical power than the others. Any 3 of the subjects could easily overpower and kill the dictator. But yet, the dictator, is able to remain in control over his subjects of very long periods.

        It’s because of his relative social power. He’s more powerful than the next person below him in the social hierarchy. It’s relative power that is important, not absolute.

        ” why will machines be any different than a smartphone?”

        Oh my god. Are you that naive? Do you know what it costs to build a steel mill? Why don’t any individuals own their own steel mill? How about a hydroelectric damn? how about a semiconductor manufacturing facility? How about 8000 walmart stores? We are talking 100’s of millions of dollars here. These are the type of “machines” we are talking about the “rich” getting control over, not a stupid still little iPhone.

        Do you want to try and compete with the Walton’s? They own 8000 stores and all the processes and procedures and IT technolgy, and contracts with manufactures that make them work. You can not buy yourself an iPhone, and use your “machine” to take over the market of the Walton’s.

        You can not buy yourself an iPhone, and use it to build 10 million iPhones, so that you can complete with Apple and take their market share away from them.

        The Waltons with Walmart and McDonald’s are the two largest non-government employers in the world with about 2 million workers each. In 30 years, all those retail stores will be nearly totally automated, and 4 million workers will be out of work.

        So let me here it, you are going to buy a little $500 dollar robot, and put Walmart and McDonads out of business? Really? You think you can compete with either of those giants by buying a few robots for yourself? They will own 10 million robots each and a huge IT infrastructure that tracks products, drives their trucks to deliver produce to the stores. Robots that unpack the trucks and stock the shelves. Robot shopping carts that follow the customers around as they shop, and give them advice and find out what they like and don’t like – what new things they want. They will have robots that analyze all these conversations with all their customers to figure out what products to develop next. Robots to negotiate the costs of the products and do market testing in select stores. They will have robots that help them design robots. Robots to repair their broken robots.

        You can’t compete because you won’t have the 10 billion dollars you need to built an infrastructure large enough to compete. You don’t have access to the customers to do constant customer marketing studies like the Walmart robots would have. Your one robot sock store won’t have the profit stream needed to do the R&D to develop new robots for your little sock store. But Walmart will have the R&D department constantly creating better robots for use in their stores. when they develop one new robot at the cost of 1 million, they then copy it 80,000 times and put it into all their 8000 stores. You spend 1 million to develop your own robot and you put it in your one store.

        There are economies of scale which is why corporations like Walmart and McDonalds already dominate these markets. The more automation we add, the more they can lay off workers, and the more they can reduce the wages of the workers they retain, because the automation makes the training and replacement of workers cheaper so they don’t mind a high turnover rate due to how crappy their wages and benefits are.

        “- we will live in a future society where EVERYONE will be educated”

        Do you not grasp that this is not possible! Education is not a once size fits all issue. In order for humans to be useful in modern society, we have had to become highly specialized. Total human knowledge is now so vast, that any one single human can only comprehend a tiny fraction of it.

        Even the most educated in the world, only understand a tiny fraction of what humans know – it’s just too much for everyone to be an expert in genetics, and economics, and math, and biology, and electronics. Every field has not fractured down to 1000’s of sub specialties where no one is expected to really understand much outside of their specialty.

        There simply is no such thing as “an education”. There is only “a life time of training in only one specialty”.

        One of the things the robots will beat us on (and already are), is that they can learn more than any single human can, and they can learn faster than any single humans, so that can apply a wide range of expert knowledge to a problem, instead of what we are forced to do today – which is create a committee of 10 different experts from 10 different fields, and see if we can get them to “think together” to solve a problem. We see what this has already done in the game of Jeopardy and how one robot with a lot of knowledge, could blow away even the best human player.

        Think of how many experts with different skills it takes to make a business succeed? Imagine what happens when all that knowledge and more is in the head of a single robot running the business. Think how much faster that single super broad knowledge AI could make wise business decisions without having to call together a panel of experts to evaluate a business plan. Think what happens when we build robots that have both 10 times to storage capacity so they can become as wise as 10 of the best human expertness in different skills, but also can think 10 times as fast as any human – and of course can work 24 hours a day 365 days a year running all the Walmart stores. No matter how good the Walton currently are at running the business, these super-AIs with broader knowledge and faster thinking ability will blow them away. What might take the human Walton’s a month to explore, these super AIs will explore over night, and in two days, have the new business plan implemented and working in all 8000 stores.

        And you, with your home-bot, are going to put them out of business? How are you going to buy yourself that cheap $100 home bot, when you don’t have a job and don’t have food to eat?

        “the internet means that “wealth” cannot be concentrated like before. wealth is spreading out globally and will continue to do so.”

        In 1995 when the internet dot com explosion took off, the top 1% in the US got about 14% of the income. 15 years later, with the help of the internet, they controlled 24%. How exactly do you translate that into “the internet is helping spread the wealth”???? It’s doing no such thing. It’s making a small shrinking elite supper rich. It’s doing a great job of spreading information, but it’s not spreading wealth in the least. It’s in fact doing exactly the opposite – it’s amplifying inequality.

        Last I checked, Mark Zuckerberg was not spreading any of his wealth to me.

        You ideas Shaker show a marked discount from the facts.

        Why is it that humans are so easily able to enslave, kill, and then eat, pigs and cows and chickens with no regard for what “they” want? Whey do we kill bugs with almost no thought for their well being? It’s because we are so powerful, we have no fear of the animals rising up and hurting us. We abuse them because we can get away with it. We abuse them to our hearts content, because of the power inequality that exists between humans and these animals is so great, we can get away with it.

        Why did the Europeans come to America, and just wipe out all the native populations that existed here? When the 100 or so people landed and set up Jamestown, the native population of indians in the area were around 30,000. 100 years later, and the English were 20,000 and the native Americans were something like 5000. The English hard started a government policy of killing the Native Americans.

        It happened because of WEALTH and POWER inequality. The less equal our society is, the more we rich will abuse the poor – the more they rationalize that the poor don’t “deserve” the same rights the rich do.

        This is a sad basic fact of what we are as humans. Absolute power corrupts us absolutely. No human is totally immune from it, and no society of humans has a chance of being immune from it because the ones most easily corrupted by the power will quickly rise to the top and take control.

        Already in America and the rest of the developed world we are looking at inequalities that are allowing the rich to inflict untold damage to the poor – mostly in underhanded complex ways that the poor don’t even realize is being done to them. The rich for example, sets up Fox news, for the single purpose of spreading propaganda which supports the rich – and do it with such clever marketing and salesmanship, that the very poor that are being taken advantage of are made to believe the rich that screw then over, are in fact their “saviors”. The more inequality that exists, the more the rich have the power to manipulate the poor in these ways – which is a self sustaining feedback loop that gives the rich even more power, and the poor less power. And the larger the inequality grows, the more the rich look down on the poor as unworthy fools – the more the poor start to look like cattle to the rich.

        The stuff you are trying to sell here Shaker, only proves how good the rich are doing at pulling the wool over your eyes – how well they have done at using their money and power to turn attention away from the damage they are creating and to make people think “all is good – except of course that evil Obama and his debt”.

        • shaker Curt Welch February 24, 2013 on 2:33 pm

          “Your idea of “very little” is whacked. In 2007 the top 1% in the US owned around 34% of the wealth while the bottom 60% owned only 4.2% of the wealth…”

          – There was a time when kings owned nations. Yes, wealth has begun to distribute over time. We have had a “bump” in the road the past 2 decades, but the overall trend is wealth distribution. You are richer than your father. Your child will be richer than you. Will he be relatively as rich as the wealthiest person of his generation. Doubt it, but who cares? Do you want poor people to become richer or you just want rich people to become

          “Oh my god. Are you that naive? Do you know what it costs to build a steel mill? How about a hydroelectric damn?”

          – I am not talking about “owning the plant” I am talking about owning a machine. We don’t own the Iphone plant, nor do we own the car plant. So what? The average Joe has never owned the means of production. They end up owning products that can produce wealth. You don’t need to own a plant to own a machine. And once you own a machine you can do anything…

          “Do you want to try and compete with the Walton’s? They own 8000 stores and all the processes and procedures and IT technolgy, and contracts with manufactures that make them work. You can not buy yourself an iPhone, and use your “machine” to take over the market of the Walton’s.

          “Yes, you can. That is what people like you do not realize. You don’t realize what FREE labor can do for a company. Cheap labor leads to more competition due to easy entry.
          The Waltons with Walmart and McDonald’s are the two largest non-government employers in the world with about 2 million workers each. In 30 years, all those retail stores will be nearly totally automated, and 4 million workers will be out of work.”

          So what?
          The storefronts that McDonalds and Walmart have today will not be an “asset” after the arrival of automated cars. They will become “liabilities”
          I bet you Walmart as we know it will not exist the day Automated cars arrive; nor will McDonalds. Eventually, when goods come to us instead of us going to goods, we will not go to walmart to buy anything. Nor will go to McDonalds. We will simply be able to order goods online from 1000’s of distributors (walmart amongst them)., etc. Automated cars will completely change distribution and end “super stores”. I can image a day when anyone can flip burgers at their house and sell it via the internet, a day when you order food from your “local” homemade burger joint. FREE automated distribution will lead to that business model.
          You will be able to “buy” any goods and sell them out of your house once goods go to people and people stop coming to goods.

          “So let me here it, you are going to buy a little $500 dollar robot, and put Walmart and McDonads out of business?”

          “This is the part of capitalism people like you never seem to understand or talk about. I call it the “old apple mentality”
          One of the reasons why I respect steve jobs so much is what he said to his workforce during his first speech after he was rehired as CEO, a speech he was booed for. He said “we are not going to compete with Microsoft Windows…” at the time, everyone assumed that the only way for Apple to make money was to take away market share of Microsoft windows. But Jobs, the visionary, knew then that he could not compete with Microsoft windows, but he could outflank them in other areas. Thus he created the Ipod, Iphone, Ipad, Itunes, while Microsoft was sitting around developing windows 7.
          We are not going to compete with Walmart. We are going to create new companies and new products that are bigger and better than Walmart could ever be. Are you going to build that company? Or are you going to sit around complaining about not beating walmart.

          “You can’t compete because you won’t have the 10 billion dollars you need to built an infrastructure large enough to compete. You don’t have access to the customers to do constant customer marketing studies like the Walmart robots would have. Your one robot sock store won’t have the profit stream needed to do the R&D to develop new robots for your little sock store.”

          Small stores don’t need to do R&D. And a million “small” stores making millions of changes is better than 1 giant store making small changes. That is how new companies come out of no where. they don’t do research. They create, try and sell. either the succeed or fail.

          If big meant you would stay around forever then we would have Sears Robuks on every corner.

          Walmart, apple, McDonalds, Microsoft, Google, Facebook were all started for pennies out of garages.

          Competing with old money in a world filled with new money is stupid. Smart business people don’t do that. If you think that way you will fail as a business person. The great thing about our current technological climate is the ability to create “NEW” wealth with new products. Amazon is HUGE. It came out a garage – it will soon become bigger than walmart.

          “- we will live in a future society where EVERYONE will be educated Do you not grasp that this is not possible! Education is not a once size fits all issue. In order for humans to be useful in modern society, we have had to become highly specialized. Total human knowledge is now so vast, that any one single human can only comprehend a tiny fraction of it.”

          What? You’re explanation makes no sense. Advanced A.I. means FREE teachers – in any field. Go online. Go learn, anything. No matter how specialized.

          “Even the most educated in the world, only understand a tiny fraction of what humans know – it’s just too much for everyone to be an expert in…

          That’s where “FREE COMMUNICATION” comes in. it allows people to connect. Bring the best and brightest from around the world. 10 years ago I had no access to the best and brightest. Today, I can go on or and find PHD level people. I started my company without even meeting one member of my team in person. This will only accelerate.

          There simply is no such thing as “an education”. There is only “a life time of training in only one specialty”.
          One of the things the robots will beat us on (and already are), is that they can learn more than any single human can… Think of how many experts with different skills it takes to make a business succeed? Imagine what happens when all that knowledge and more is in the head of a single robot running the business. What might take the human Walton’s a month to explore, these super AIs will explore over night, and in two days, have the new business plan implemented and working in all 8000 stores.

          And you, with your home-bot, are going to put them out of business? How are you going to buy yourself that cheap $100 home bot, when you don’t have a job and don’t have food to eat?

          In this fantasy world of yours will all my family member be out of work and poor too? If so, then I will have to borrow money – either from banks or financing via the rapidly growing crowd source funding community. That’s how you do it. The difference is I don’t need to borrow 1 million dollars to hire the “best and brightest” I can borrow $1000 and rent your “theoretical know it all robot” which will be sitting on a cloud server. Then, it’s up to me to put it to work on my idea. And ideas are infinite. Some ideas will bear fruit, others will not. Yet, it will be cheaper and easier than ever to bring those ideas to market.
          A world where anyone can have an idea and then put a “know it all robot” which is 1000X cheaper than todays human labor is a BETTER world, not a WORSE world.
          “the internet means that “wealth” cannot be concentrated like before. wealth is spreading out globally and will continue to do so.”

          In 1995 when the internet dot com explosion took off, the top 1% in the US got about 14% of the income. 15 years later, with the help of the internet, they controlled 24%. How exactly do you translate that into “the internet is helping spread the wealth”???? It’s doing no such thing. It’s making a small shrinking elite supper rich. It’s doing a great job of spreading information, but it’s not spreading wealth in the least. It’s in fact doing exactly the opposite – it’s amplifying inequality.
          You are looking at this on a very short timeline. Deficit spending and lower taxes on the super rich are also leading to disparity in wealth, not just “technology”. You are also not putting China and India into the equation. The internet has led to those countries gaining wealth. Stop looking at the last 10 years and the U.S.
          Last I checked, Mark Zuckerberg was not spreading any of his wealth to me.
          You ideas Shaker show a marked discount from the facts.
          The stuff you are trying to sell here Shaker, only proves how good the rich are doing at pulling the wool over your eyes – how well they have done at using their money and power to turn attention away from the damage they are creating and to make people think “all is good – except of course that evil Obama and his debt”.
          No one is pulling the wool over my eyes. I believe in balance. I am not here to say the world is great or that it is coming to an end. The world will be what it always has been. Some will, some will lose.
          I have already stated I am for “wealth” distribution through a progressive tax, wealth tax, asset tax, Basic Income, Wage Plus and any other means. I am not some Austrian right winger.
          One of the reasons I am arguing so vociferously on behalf of the future is because I am really tired of a the woe is me mentality. Go get an education and get to work. That is how you make life for you and everyone better. You can’t complain your way to prosperity.
          People like you always take todays society, introduce machines into the equation, and then say “everyone will be unemployed”

          • Curt Welch shaker February 25, 2013 on 10:06 am

            Shaker writes:

            “And once you own a machine you can do anything…”

            That’s not true. I own a welder, but to make things, I need to buy steel. If I had a robot that cold make anything I could describe, I would still need to buy the raw materials for the robot to work with. Where do I get the money to buy the raw materials? I won’t have a job so I won’t have the money to buy the materials. I won’t own any raw materials at all.

            If I try to make money by having my robot build things for others, I will fail. Because I have to pay to buy the robot, and I have to pay to buy spare parts of the robot, and I have to pay for the raw materials the robot uses to build the things the robot makes. And the cost of the raw materails includes the cost of transporting the small amount of raw materials to my, for my robot to use.

            Even if my robot is so advanced, that I could hand it an iPhone, and say, Build 100 of these for me, and it could reverse engineer the iPhone, and duplicate it, I still have to pay for the raw materials. And the cost I pay for these low volumes of special materials, will never be competitive with Apple, who buys the raw materails needed to make 1 million iPhones.

            The final cost for the iPhones my robot makes, will be 10 or maybe 100 times, what it would cost if I just went to the store and bought one of the mass produced phones. So my robot makes $1000 iPhones. How do I sell them, and make a profit, when everyone else else can get the same thing, for $100?

            It’s the economies of scale, that blow the whole idea of “private robots” out of the water. A big massive factory set up and optimized to produce and ship a million iPhones, will always be far more efficient due to economies of scale, than any private individual with his private robot trying to compete.

            It will be so much more efficient, that the raw material costs for me will exceed what I would have to pay at the store for the finished product.

            If we have machines that can turn trash into iPhones, we still have to buy the trash. If trash is so easy to convert, there will be no dumps where trash is thrown away. Trash will be sold to the recycling companies.

            And still, we need energy to turn trash into iPhones and that energy will be very expensive relative to the price of stuff like trash in a future where energy and pounds of trash were the limiting factors of what you needed to “have stuff”.

          • Curt Welch shaker February 25, 2013 on 10:24 am

            shaker writes: ” Automated cars will completely change distribution and end “super stores””

            Well, yes, you have a good point there. We already see a massive shift to home delivery with retail giants like Amazon, and we will see more of it. But the retail store is not going away any time soon because for lots of products, we want to see and touch the product before we commit to buying it. Yes we can have it shipped to us, and then send it back, but it’s far more efficient to walk the isles of a shop and check out 1000’s of items in a hour, than it is to have 100 of these shipped to us so we can check them out, and then have 95 of them shipped back.

            If virtual reality got a lot better, we might use that, but I don’t see that happening any time soon. It’s very hard to make virtual reality good enough, so that we can really get a sense of the subtle details like color and feel and smell of products while keeping it cheap enough to make us not want to spend the 30 minutes it takes to go to the store. It’s fun to go see all the cool stuff we can’t have, but that we can look at and often play with in the stores. It’s an entertainment experience we are willing to pay for.

            In addition, shopping is a social experience for many. It’s not just a mechanical lonely process of collecting goods we need. Many of us like being out in public interacting with strangers in a store rather than sitting at home alone ordering stuff.

            Restaurants for example are as much about the social experience we create by eating with others as it is about the food. And that includes the social interaction with the staff. They aren’t going to go away just because we could have the food delivered by a machine to our door step.

            Video stores have been wiped out by home deliver, because there really is nothing the store offers over the web site. There is nothing to touch and feel that is so important to travel to the store for it.

            Music stores likewise have been wiped out for mostly the same reason, and book stores are dying fast. But for physical consumer goods, like furniture, and clothing and food the retail stores will remain even after fully automation arrives. But when we buy things, we might very well just hit some buttons to say we want it, and instead of having to take it home with us, it will just get delivered to our home from the warehouse so it will be there waiting for us when we get home.

            We will still need the retail showrooms for a long time into the future.

          • Curt Welch shaker February 25, 2013 on 11:15 am

            Shaker says: “Walmart, apple, McDonalds, Microsoft, Google, Facebook were all started for pennies out of garages.”

            Yes, but you seem to have gone completely off track here again. The problem is Technological Inequality. The fact that two guy, manages to bootstrap Apple out of their garage, and displace other giants that couldn’t keep up, like IBM, does NOTHING for the million guys that didn’t mange to do that and who end up working a part time minimum wage job.

            The argument you were trying to make, and totally failed, was that once the little guys could get their own robots, they would ALL become the next apple. They would all become “rich”. Bull Shit. You are not explaining how inequality is solved.

            It’s the economies of scale that creates the economic need for big companies. And so far, the more technology we have created, the more opportunities have emerged for greater economies of scale. We have huge chains like Walmart and McDonalds and Starbucks because they are able to leverage technology to create larger economies of scale. The little guys can’t compete with them in general because without the same economies of scale, they can’t produce products with the same price/quality.

            In almost every case of a little start up taking over a giant, it works because the little start up creates a new market (one that did not exist at all before – like the personal computer for apple) and rides the new market as it grows, to great heights. Apple and Microsoft didn’t out perform IBM because apple was better at creating business computes than IBM was. T hey did it by creating a new market and took advantage of the fact that it’s very hard to turn a giant like IBM and transform it into a personal computer company.

            It’s the growth and decline of new technology, that allows little companies to become big, and big companies to fade away. To be a success story, you have to find a new market wave and ride it better than anyone else in order to become rich.

            The bottom line, is that we have a growing Technological Inequality problem, and nothing your are talking bout addresses it. A few are getting supper rich while the bulk if society is seeing their share of the GDP decline, and for many, even their absolute wealth decline, instead of grow.

            It’s happening for many complex reasons, and many of the reasons are just temporary and cyclical like the recent depressions. But the larger underlying driving force which is not in the least be cyclical, is technological Inequality. Machines are giving a shrinking minority of people the power to become super rich, and the power to block others from the wealth – by replacing worker functions with machines, and by using economies of scale to monopolizer and hold onto markets and sources of income – to rent seek.

            Growing technology gives people and organizational growing powers to monopolize revenue sources through rent seeking.

            There’s no technology on the near horizon that shows any sign of offsetting that. All the near horizon technologies show the power to do just the opposite – push us into greater levels of inequality.

            The few control the many though the items they need most in life – which is food, clothing, shelter, health care.

            In order to take the power away from the 1% with some new technology, you have to put into the hands of the individual, to power to feed, cloth and house themselves, cheaper than it can be done with the technologies the 1% control. There simply is no technology on the near horizon (next 50 years) that shows any ability to do that.

            If I have my own land, I can grow my own food, build myself some shelter, and ignore the clothing and health care issue and just run around naked. and say “fuck the 1%”. But it takes a good bit of land to supply a food to survive the winter.

            The 1% however, using their technologies, can make my land produce a lot more food than I can farming with my hands. And what happens, is that that the food needs of the 99% ends up forcing me off my land. If I don’t just sell it out right, they will just come on to my land with guns and take me off, or kill me, and then take the land.

            The land is a resource that is too valuable, to let one guy try to use it to take care of himself, when the same land, with the help of the technology controlled by the 1% can take care of 10 people instead.

            So the poor, don’t have the social power, to get the simple resources they need to survive – like land, or seeds, or fertilizer. Economics of scale in mass production techniques means the resources are always more valuable to rest of society, if the resource is given to the 1% so they can turn it into more products and serves than the 99% can.

            Even if we invited some magical matter transforming device, that required no resources, like energy to work with, and restructure matter to turn lead into gold, or crap into hamburgers, then we STILL have an economic problem. All a guy would need to survive, is a small bit of space to live in (1000 cubic feet say), and small collection of matter to transform over and over gain, and one of these magic tools.

            But the rest of society wants more than that. They want big places to entertain them – like move theaters and night clubs and disney worlds. They want massive amounts of space dedicated to computing resources that are busy crating new ideas for entertaining the humans. So they don’t want to give up even 1000 cubic ft of of space to someone they believe doesn’t “fit in” to their society. So they take your 1000 cubic feet away from you. And they kill you for being a worthless looser, and take your wasted body and transform it into something they consider actually useful.

            We do not create equality, by mixing technology, with free markets. That only generates every rising levels of inequality.

            The only technology that creates, and maintains, equality, is a democratic government.

            Everybody that thinks less government control and more “liberty” will create a society where everyone “gets what they deserves” is an idiot.

            If we don’t use the one technology that does create equality – our democracy – to stop these growing levels of inequality crated by the combination of technology and free markets, we will lose our democracy, and end up in an oligarchy with no sense of equality.

          • Curt Welch shaker February 25, 2013 on 12:18 pm

            Shaker writes:

            “One of the reasons I am arguing so vociferously on behalf of the future is because I am really tired of a the woe is me mentality. Go get an education and get to work. That is how you make life for you and everyone better. You can’t complain your way to prosperity.”

            Is that what you think I’m doing? My net worth is over a million. One year, I had to pay over $300K in income taxes. I own a good sized home in one of the richest counties of the country (Fairfax VA). Number 2 on this list:

            I have a BS in computer science. I currently get income from two different business I own. I’ve been part of multiple high tech start ups and I was on the Board of directors a publicly traded Nasdaq listed tech company I helped found (Touchtone Software Inc) for 10 years.

            I’m a white male, tall (6’1″), not ugly, and have an IQ of around 130 to 140. These things I was born with, make life easy for me here in the US. Combine them the right family and schools, to get a start in life, and you get a free ride to the top without even trying. If I had actually worked hard to make money, I would likely be worth 100 million today. I don’t care to work that hard. Money is just not that important to me. If I were raised in a family that put a high social premium on making money, I would have ended up feeling the need to make more money. But I wasn’t.

            I also currently have a job working at Mount Vernon (historic home of George Washington) that pays me only $10 an hour as a blacksmith. And I work with people who are making the same sort of money, and trying to support a family on a minimum wage income. One guy for example, works full time, and his wife works full time. They have a single young baby they are trying to support. Their washing machine just broke, and they don’t have the money to fix it. So they have to run out to their parents almost every day to do landry before and after work. They will “save up” and buy a new machine or get the old one fixed, but the fact that you have to “save up” and sacrifice other things in life, just to get a washing machine, is just sick considering how rich our society is.

            These are good people that deserve a far better life. The deserve to own their own working washing machine and not have to live paycheck to paycheck with both family members working full time. But they have no hope of having the type of easy high income life I’ve had, due to the society we are living in.

            I have multiple friends in the same situation – struggling to just get by, for no fault of their own, except being born with a lower IQ.

            “People like you always take todays society, introduce machines into the equation, and then say “everyone will be unemployed””

            You have no clue who I am. I’m one of the people that has spent his life, creating the very technologies that are making the people like my friend with the broken washing machine suffer.

            And the technology I’ve been working on lately, is strong AI – making robots smarter than humans. It’s a technology problem I’ve been playing with over 20 years as a hobby. I know how close I am, and hos close many others are, to actually making machines smarter than humans. Few people grasp this. Most people think they are “protected” by some magical powers humans posses called “consciousness” that gives them an advantage no machine will take away from them.

            They are IDIOTS. And the world is full of them. And it’s those IDIOTS that are totally blind to what’s about to hit them up side their jobs and what’s happening to their economy due to how close we are coming to replacing all humans.

            Back in high school in the 70’s I was interested in this problem of AI and making machines act like humans as well. Around 75 when I was in college, I bet a good friend that either I, or someone else, will create human level AI within 10 years. In ’85 I lost that $10 bet. (not sure If I ever paid him).

            In 2005, I made the same bet with the same friend again (except for $100 this time). After following all these technologies, and working on them myself, I could tell it was finally time for it to happen. In 2015 I will again loose the bet again if it doesn’t happen. Right now, I’m pretty sure I’l be wining that bet. That’s how close we are. But if It doesn’t happen by 2015, it will happen shortly after. We are not talking 50 years, or 30 years, we are talking 5 years before the first of the smarter than human general learning machines show up. These will be computes that can learn like humans, and learn anything a human can learn. Anything you can teach a human to do, these machines can learn to do. And once you have taught one of them, you can just copy their memory, and produce 1000 with the same skills overnight. Teach one of these robots to be an electrician, might take 5 years – but then overnight, you build 100,000 of them, and all the electricians in the country are out of a job the next day.

            These first machines are going to be so expensive, they won’t take over all the jobs a first. But they will come down in price very quickly. They don’t need to be robots. They can just be computer “brains” that live in the server rooms that take over office tasks – like acting as aids. They can be made to operate construction equipment remotely without having to create humanoid robots.

            I’m associated with one of the teams that’s participating in the current DARPA robotics challenge and I know what these robots we have today are able to do, and how much closer they are getting to working like humans, which are general purpose learning machines, instead of hard-coded special purpose machines.

            It takes huge amounts of coding and engineering, to hard code a robot to do a complex tax like work on a construction site. But once these new learning robots are perfected, there will be no coding needed at all. They will be taught exactly like humans are taught, and they will be able to any job a human can lean to do – but learn it faster, and do it better.

            They won’t have the sensor limits humans have. If we need a robot that would work better if it has eyes in the back of it’s head, we will build one that has 10 eyes, instead of two. If we need one that has supper hearing, we will give it the 10 times hearing ability o humans. If we want to build one with 8 arms instead of 2, all you have to do, is add them, and the generic learning system will learn on it’s own, how to make use of them – no programmer needed to write the code.

            No human can be a construction worker and compete with a 8 armed 10 eyed super strong robots – robots that can work in dangerous environment with no fear of dying and only the same fear we have with our machines, of not wanting to damage an expensive machine, so they can work in far more dangerous conditions to get jobs done.

            Construction sites will quickly become too dangerous for humans to be around – humans will lose their jobs, simply because it’s unsafe to work on the new sites.

            All this is going to quickly unfold, in the next few decades.

            My problem is not that I want the rich to take care of me. My problem is not that I fear robots, or technology – I love them, it’s what I do. I’m not paranoid about the “rich” – I have spent most my live living and working with them (though I’m not rich enough to be part of the 1%).

            What I know, is that my work (and the work of others like me), all this cool technology I’ve spent my life creating, and the cool things I’m currently working on, is only causing growing levels of suffering due to Technological Inequality.

            I’m arguing so strongly i these forums, because I now what the only solution to this problem is – socialism, and simple wealth redistribution.

            But most of our society doesn’t understand what’s happening. Especially the Right. We have all been taught in America that we must work for get in life, and that we must self relient. We must take care of ourselves.

            That’s all well and good, but in this new world that’s about to hit everyone in the face, it simply IS NOT POSSIBLE anymore. Times are changing.

            When we mix this powerful technology we have today, and the even more powerful technologies coming tomorrow, with unregulated free trade, we do not get prosperity and rising tides for all. We get a social melt down due to inequality. Free trade in this environment of advanced technology does not create any level of fair sharing. The technology in fact ends up being a tool by which the 1% takes power and wealth away from the rest.

            I don’t want to see my technology, used as a tool for the rich to steal even more from the poor. I even less want to see the US use it as a tool, to steal even more from the rest of the world.

            I’m such a strong supporter of these ideas because I know most the people don’t understand them, and in fact think socialism is the evil that will kill our prosperity. If they don’t grasp what’s happening to them soon, and change their voting habits, life will get far worse than it already is due to the last recession and housing bubble.

            It’s very frustrating to sit by and which this unfold, and even more so, knowing I’m playing a role in it by working on these new machines.

            I don’t know how to get through to the far right that are so brainwashed into believing socialism is the world’s worse evil – but somehow we must.

      • fireofenergy shaker February 24, 2013 on 7:38 pm

        I admitted to mine… (paranoia about China).
        Anyways, it’s rather hard to determine “facts” concerning the future of machines and politics.
        Automation should lead to free education, however there were those who didn’t want to allow it… Luckily, that dictatorship like law is not in force anymore.
        Here’s another one…
        The current system will do just about anything to use laws to stop competition (or make revenue. We have “city folk” who restricts signs until they are “permitted”). It’s all about the fees.

        I assume that by “the wealthy have very little market share”, you mean that in proportion to “how it was” in medieval times. I’m talk’n the difference in the machine created jobs of much more recently as opposed to machines taking even those in the not so distant future.
        The gap between poor and rich is widening (I believe I don’t need a link to back that one). The cell phone analogy might not apply because they are cheaper than old fashioned long distance costs, and even save gas. When burger flippers, clerks, and even managers are replaced, there will be a lot more people looking for work.
        No problem, I’ll paint houses (or do other construction). What happens when these other people can’t afford that… I lose work myself!
        Now, I’m hoping that solar panels will become so cheap due to machine competition among the “giants”, that they will actually create jobs… but by then, cars will already be driving themselves and a lot more people will be out of work (even Chinese workers will be displaced). However, these jobs should be dedicated to coal miners who will be displaced by the (understandable) fear of excess CO2 (and or machines). Even the hope of 100,000 square miles of solar install jobs would most probably be displaced by self driving robotic installers!
        We’all can’t afford a $100,000 robot, perhaps, barely afford a new car. Yet someone will and they’ll do 4x the work as I could ever hope to do. It takes good credit and business smarts…
        Another thought: If, for some reason, cars and robots get so cheap we can all afford them, then no one needs to hire anybody else (why would I pay for your robotic service when I can do it myself). Ok, answered my own question. We’all would have like just one of different robots, thus “trading services (again). However, someone would own “all kinds of” robots…
        This is definately where some kind of basic income guarantee is needed!
        So the guy who had “the best” parents wins the game.

        I DO like your optimism (but I might find it very much harder to get a job than before)!

        • Curt Welch fireofenergy February 25, 2013 on 9:49 am


          I’m very positive about free education. That’s going to have a important impact on the future. I’ve taken a bunch of the Corsera and Udacity courses myself. It’s not only reducing the cost of education, but opening up opportunities for people all around the world that simply didn’t have access to the education they needed.

          But free education is going to have no important impact on what I’m now calling Technological Inequality. Due to my work in Blacksmithing these past few years, I’ve gotten to know a lot of what I could call blue-collar people (people who I’ve generally not known in my life). They are very hard working, honest people and many have some amazing talents such as physical skills at blacksmithing (or painting). One does not appreciate how much time and effort it takes to develop these skills until they have tried it. But many don’t know how to deal with fractions in math, and have no clue what trig is. And for many of these guys, it’s not just a question of education – they simply don’t have the type of brain that picks these highly mental abstract concepts up very quickly. People like that, simply have no hope of getting a high paying job in our current technology economy. And our world is filled with these people. Half the population has an IQ less than 100.

          To succeed in these new high tech businesses you must have the right brain for it. This is something we are genetically endowed with, not something we develop by education. Look at this “average IQ” scores for college majors here:

          To compete and succeed in these programs like finance, and computers, and engineering, you need an IQ of 125 and up. Only about 5% of the population has an IQ that high. 95% of the population simply does not have an IQ high enough to compete with these guys.

          Here’s how the population breaks down by IO in case you don’t understand this:

          Microsoft did testing long ago to try and determine the odds of someone succeeding in their company. The only factor that was important, turned out to be IQ. The only test factor that predicted how good a programmer someone would be, was IQ.

          In the past, that 5% of our population acted as the leaders, and as upper management, as the officers. The 95% worked on the assembly line, or in the fields, or on the construction site, or as enlisted men. But in today’s economy, the assembly line job is going away. The only jobs left, are upper management jobs. The only jobs left that pay well, are for people with IQs of 125 and up. If you don’t have the IQ, you won’t compete well and you will lose your job – or most commonly, never have a chance to even get it.

          In the past, when some high IQ guy like Andrew Carnegie built a new business, he needed to hire thousands of average IQ guys to make the bussines work. The economy needed all those average IQ guys. But today, when a high IQ guy like Mark Zuckerberg starts a new business, he needs ZERO average IQ guys – he needs 4000 more high IQ guys. The “average IQ” work is done by the machines now. We are a nation of high IQ office workers now, not a nation of average IQ skilled laborers. The more technology advances, the more average IQ work we replace with high IQ work.

          There are a few sectors that still employ large numbers of the “average IQ” guys and pay well – such as construction, because construction work is very hard to automate. But other “average” guys are working as truck drivers, delivery men, and taxi cab drivers, or in auto repair shops and all these jobs are at risk to automation. Within a decade it’s likely we will see massive automation of cars and trucks causing yet another big hit to the better paying jobs of the average IQ guys. And when the truck drivers flood the other blue collar jobs, it raises labor supply which drives wages down for the rest of them.

          This is what we have been seeing with the hollowing out of the middle class. The economy has an excess of people with average IQs and a supply shortage of people with IQs of 125 and up. If we could raise the IQs of the average guy by 20 points, we could fix everything. The economy needs lots more entrepreneurs and professionals starting up all the new high tech businesses that are just waiting to be created. But we don’t have them. We have a growing excess of not so smart, good hard working honest people, that he economy just doesn’t need. And each time time one of the few high IQ people creates the next business, he needs a lot more high IQ people than average IQ, and simply can’t find them.

          Retail is a place where average IQ can find work, but it’s so flooded with excess labor already, and the work has been made so simple with the help of computerized inventory, scheduling, check-out, that the wages have been driven down the minimum wage already. And as places like McDonadl’s and Walmart find ways to reduce staff with the help of better automation, these trends only get worse – less jobs, lower wages. And when they switch to more automation, they need more high IQ people in the automation business, but less average IQ, and they just can’t find them.

          There is no way to fix the average IQ people. They just aren’t needed anymore and no amount of free education is going to fix what is essentially a “birth defect” they have no power to overcome.

          So as a society, we have to decide what we want. Do we put all the average IQ people out to pasture in slums, or in the jails? Do we kill everyone with an IQ less than 100 in an electric chair or by lethal injection so we can raise the IQ of the population by selective breeding? Do we sterilize people with average IQs so as to improve our human “stock” in society? This is exactly what we are doing when we refuse to address the issue and let the free market economy kill them by slowly starving them to death. It seems this is what the conservatives believe is correct. They want everyone with an average IQ to starve to death.

          Or do we chose to allow them to be part of society, by sharing some of the massive wealth the guys with IQs of 125 and up, are creating?

          If the high IQ people weren’t able to create enough on their own to take care of everyone, then sadly, we would just have to force the low IQ people to struggle and suffer on their own. But the high IQ people are creating MASSIVE amounts of wealth with their technologies and can already afford to house, feed, cloth, and provide basic medical care for the entire world’s population and still have enough left over for them to all have 10 to 100 times more “stuff” than everyone else – for them to still be socially “super rich” compared to everyone else. But as a society, we have so far chosen not to make the 5% take care of the 95% anywhere near the levels they are able to.

          In a democracy where the 95% have all the voting power they need to make the 5% take care of them, it’s interesting that the 95% have no chosen to do it. And the reason they have not chosen to do it is simple. The 5% are smarter than the 95% and the 5% are using their intelligence, their technology, and their power, to manipulative the 95% into believing it’s morally “wrong” to make the 5% take care of the 95%. And the 95%, being in general a low-IQ bunch, are falling for it.

          • shaker Curt Welch February 26, 2013 on 8:47 am

            I really like this post.

            this can actually happen. If we do get to a time where the “evolution” basically has no use for people who lack high iq’s then those people are in trouble. we will just have to wait and see. maybe their a “universal mechanism” that create ‘normal” distribution, meaning nature simply does not allow some to get that powerful while killing off others. who knows.

            this is a very interesting topic and it is playing out right before our eyes. in another 20 years, let alone 10 we will see what is going on on planet Earth.

            peace, my brother

        • Curt Welch fireofenergy February 26, 2013 on 4:12 pm

          “this can actually happen. If we do get to a time where the “evolution” basically has no use for people who lack high iq’s”

          This brings up another issue I like to talk about that’s at the core of all these ideas. That’s the question of what type of society is the correct type of society to create, and why.

          Since the spread of Darwin’s ideas, multiple people have advocated Social Darwinism. That is, the idea that the correct form of society is one that upholds the inherent Darwinian struggle of life that created us – competition and survival of the fittest. The thinking goes that to try and fight this, is like trying to fight the will of “God”, and the result will always be worse than if we just let the struggle continue. The classic example of course is the failure of various attempts at Communism where life did not get better for people, but worse, when they attempted to create a society based on equality, vs a society of inequality and strife.

          I argue that such thinking is wrong.

          The foundation of my argument is based on what I understand, and believe to be true about our brain, and how we humans make decisions.

          Though the human species can not escape the forces of evolution, and our bodies are the product of evolution, the way our brain works, is disconnected from evolution. We do not act so as to maximize our odds of survival as a species. If that were true, no one would use birth control, or drink alcohol, or use drugs. Evolution does not drive our behavior.

          To build a society based on the desires of evolution, would be acting against, the forces that control our behavior – it would be acting against, our human nature.

          Though human nature, and the nation of evolution are closely aligned, they are distinctly different. And it’s this difference that drives us into these debates about socialism vs capitalism.

          The human brain, is a learning machine – it’s a module designed by evolution for the purpose of increasing the odds of our survival. We have a brain, because it helps us survive. But surival is not the goal of our brain. Pleasure seeking is. This is becuase there is no wa to build a brain with “surival” as it’s goa. There’s no way to hard-wire into a generic learning machine the goal of “surival”.

          If evolution could wire into our brain the goal of surival, it would do just that. But it can’t. So it did the next best thingit could. it hard wired in sets of goals, that just happen to work well for helping the human species surive. And those goals are the basic things that cause us pain and pleasure. Anything evolution needed to be import for us, that it could wire into our brain, it does.

          So if our body is damaged, it hurts us. Evolution wired into us, the goal of protecting our bodies from damage. It could do that, because it did manage to wire damage sensors all over our body, and wire them to the learning circuits of the brain, so that our behavior would adapt to do whatever worked, to keep our bodies from harm. Likewise, we are wired to like having food, and wired to dislike running low on energy (hungry). Likewise, we are wired to like sex, and wired to like babies.

          All these things, are good stand-ends for the goal evolution could not wire into us – which is survival. Humans that keep themselves fed, product their bodies, have sex, are highly likely to survive. Which is why evolution built these into us as our goals. But it is also where we differ from evolution.

          So evolution desires us to survive. But we desire us to protect our bodies, eat, and have sex.

          To create the optimal society for humans, we should create a society that maximizes our human desires, not one that maximizes the design of the process of evolution. It is not OUR JOB to survive. That’s above our pay grade so to say. We have been given a job, by how are brains are wired, to product our bodies, eat, and have sex. Or more generically, we just call this, “have fun and be happy”.

          So I suggest, that to take the position that the “purpose” of society is to maximize or odds of survival, is missing the point. That is not our purpose at all, that’s evolution’s purpose, not ours. Our purpose, is to maximise our own happiness. We are actually wired, to be selfish because we are wired to product our own bodies, not the bodies of others, and we are wired to fill our own stomach, not the stomach of others, etc.

          Humans however, can every easily cause each other great amounts of pain, and suffering, as well as great happiness in each other. And we learn at a very early age, that if harm others around us, they will take revenge and harm us back. And likewise, if we help those around us achieve their goals of happiness, they will in turn, be far more likely to not harm us, and instead, help us achieve our goals of happiness.

          So even though we are wired to be selfish, we learn very quickly, to be altruistic because it’s the best way, to maximize our own happiness.

          So, my belief here, is that if we build a society based on maximizing the odds of survival, per the desires of evolution, we will have failed, to do what we are wired to do, which is maximize our happiness. And with that failure, we will have made our lives worse, then we otherwise could have.

          So I argue that a society that is willing to sacrifice the happiness of many, so as to allow the few to gain a survival advantage, has failed to do the job they were built to to – which is maximize their own happiness.

          The typical conservative view of society is one based on survival of the fittest. They “fear” not being able to survive. They have been taught to think that way by their culture, even if what they were taught, goes against their natural instincts. They are taught that it’s ok to allow many to suffer, and that if they suffer, it’s “their own fault” and not their responsibility. They have been taught that suffering builds character, and that without character, a man is worthless. They are taught that suffering, and struggle, is the natural way of life, and to accept it, because it makes “us” strong. They have been taught that those that are not strong, will die, and that to let them die, is the natural order of life – to sacrifice our own strength, to help someone unworthy of living, makes us weaker, and in turn, makes us unworthy of living. To help the weak, will only weaken the “herd” of humanity. The stereotypical religious conservative has been taught that too much pleasure is a “sin” to be avoided.

          Evolution loves the fact that it has managed to inflect all these survival memes into the hearts and minds of the conservatives because it means evolution has gotten “its” job done. People that fall for these memes, turn out to be good little survivors, and evolution loves that, but they must sacrifice, the very things that are actually wired into them as the most important things in life – happiness.

          People who have tried to make various forms of Utopian societies work are seeking what they should be seeking – a future filled with maximum happiness. Some have worked fairly well, such a buddhists, and mennonites, but lots more have failed.

          But our real job, is to create the most Utopian future we can possibly created, not to struggle a hard life in the name of survival. And though capitalism plays a very important role in maximizing our happiness, by maximising our allocation of resources to create maximum value, (and value btw is a measure of happiness – which I won’t go into now), it’s down side, is that it does not inherently, share the value fairly, and when that sharing gets too far out of alignment, it ends doing more harm, than good – which is exactly what motivated various societies to reject capitalism and try different forms of socialism. But all the strongest societies in the world today, are the ones that are attempting to find the right mix of capitalism, and socialism.

          Though Europe is closer to the correct track, I believe the US has failed to understand that survival is not our purpose, and that happiness is, and as a result, we continue to sacrifice far too much happiness, in the name of surviving, and most importantly, we totally ignore the happiness, or more accurately, the pain and suffering, of everyone outside our boarders, as we struggle to inch our odds of survival, just a little higher, by building one more aircraft battle group, or one more drone, instead of using our strength to create more internal, and external, happiness.

          In short, the US has no clue what our true purpose in life is.

  • Che Mort February 24, 2013 on 3:13 pm

    Curt Said: “The only solution to this problem is socialism. The only solution, is more sharing of the wealth. There are millions of ways to force the sharing of wealth, but until society wakes up to understanding the problem, massive numbers of people will continue to suffer needlessly.”

    He finally came out of the closet, it is all out in the open once again, the only solution to any problem is the old tired and worn out Trojan horse repackaged for another generation. Doesn’t matter that it has never worked, doesn’t matter that the laws of the universe and economics castigates this replastered over backward facing Trojan horse to the dust bin of history, it is always revived like all failed religions are. “We have to manage the world to solve every problem!” Yes, and the more you do so the more problems there are (see Marx on interventionism). Complexity theory/economics upheld the Austrian schools socialism and knowledge calculation debate, there is now independent confirmation with up to date science. Its over for neo-Marxism and it always was as it violates Marx’s main evolutionary teachings/thought. That is why Marx himself called it “vulgar Marxism!” When the founder of the philosophy refutes you, your refuted!

    Paleo-Socialism can only manage a static steady state economic system at full equilibrium (an impossibility which Marx himself understood), and the entire world left now agrees with Mises and Hayek as that is the system they are advocating and want to put into place. (FYI: Green socialism also violates older original Marxism).

    You castigate Andrew for being 100 years behind the times but do not have enough historical research under your belt to understand or comprehend that neo-socialism is an 18th and 19th century ideology that like Tory conservatism wants to go backward. It is based on the reductionist ideas of Cartesian and Newtonian mechanistic thinking infused with German Romanticism and Conservatism (Bismarck). This leads one to assume that a top down command and control of society and all production is more efficient, not only has history destroyed this fallacy, (collapse of the USSR, Communist China adopting a freer market) complexity theory/economics does as well. Scratch a socialist and you will always find a medievalist in one form or another. As for poor John Henry, boo hoo hoo. What happened to all of those black smiths, wheel & cart wrights that the evil automobile put out of work? What happened to all those whalers when petroleum distillation mothballed their fleets? What happed to the 45% of the US population who left agriculture after WWII? Then the US population grew by at least another 100 million since then. Why don’t we have a 99% unemployment rate in the US today? Why don’t our streets look like Calcutta? Because, the economic system is not static! All fallacies begin with a static linear mind and view of the universe and then extrapolate from there! (Kurzweil, Diamandis, Mises et al). Curt, how any humans are need to terraform Mars and Venus? What inventions will come along in the next 20, 30, 100 years, name them please for us. Cant? Boy why not? The bugaboo of machines putting everyone out of work has been a feature of western pseudo-intellectuals since 1800. Like Malthus, all of their predictions have been false. But please in your omnipotence, tell me what causes unemployment? Especially permanent unemployment? What causes the great divide between rich and poor? Machines? Technological advancement? RFLOL!!

    Why can’t you “neo-progressives” understand or comprehend spontaneous, emergent, evolutionary complex forces and network systems and the law of increasing and exponential returns? Nope, it’s always right back to the worshiping of the divine omnipotent big alpha silver backed gorilla static state which you empower with Malthusian fears. If someone or some elite group isn’t in charge, like god on his throne organizing everything, then your infantile primitive tribalist mind goes ape sht. All of your ideas are based on the law of decreasing returns! Scarcity, lack, minimalization, negativism, dour pinched views, an old Calvinist would approve of your puritanical theology. In the end we are all dead, lets organize ourselves to redistribute the proceeds of today, thus consigning the proceeds of tomorrow to extinction. Every generation since 1850 has been wealthier and better off than their predecessors, but the paleo-left wants to limit us today, so that they will have more tomorrow. Sound logical to you? FEAR, FEAR, FEAR! “Do what we say, give in to our control and we shall eliminate your fear!” ‘Um, you are causing the fear you wish to eliminate by your backward iditology, do you comprehend that?’ “Don’t look at the man behind the curtain, ignore him, and listen to us!” ROFLOL, what infantilism!

    The internet shows us what a truly free network system can do and how it allocates resources effectively and efficiently with no central controller, just like the market system, which is an internet of its own and as they merge the global brain is arising from it. It is also eliminating “alienation,” as Anderson relates in his new book Makers, work is becoming play again. So why not let evolution continue on its own course? Why not get out of its way and let the technium evolve free of the dead hand of politics? “Can’t have that, someone has to be in charge and guide all this anarchy!!! Someone has to be the king and in control!” Such antiquated old ideas! An evolutionary system evolves the solution to its problems, who was around to solve every crunch in biological evolution? Show me a committee that planned evolution? Show me a top down command and controller in the universe. What council decided on any of the universes evolved forms? There wasn’t any. There is no central controller of the universe, the human brain, ecosystems etc. Socialism as it is today is not a natural evolutionary design, it is primitivism defined and based on a pyramidal shape, power at the top, slaves at the bottom. Of course it is all for your own and the planets good! Cries the approaching looter and despoiler.

    Then there are all the refutations of the economic fallacies that socialists (neo-Marxists) won’t give up and cling to like precious religious relics of dead saints. The errors of David Ricardo and other classical economists inherited by Marx and found throughout Keynes. Same fallacies repackaged and fed to gullible mindless sycophants. Labor theory of value (units of labor), refuted, falsified, dead! Along with its demise went surplus value, et al. Under consumption, overproduction, the competitive theory of the business cycle, all nonsense that doesn’t square with accurate historical economic events. If you will not or can’t understand what truly causes the business cycle you can’t design any true fixes. So off you careen fighting phantoms while basing everything you do on the one universal fallacy of all economic illiterates, confusing effects as causes. You can put a bone though your nose, put on a loin cloth and dance around with the “animal spirits” all you want, it doesn’t make it anything but a form of neo-primitivism!

    Get with the 21st century, and give up long refuted theories that don’t square with history. Malthus is dead, even Marx and Engels refuted him, (Meek, Marx & Engels on the Population Bomb, 1953) so did Julian Simon et al. it is over, science has relegated these old scientistic ideas to the dust bin of history. You can cling to a religion that always fails or adopt a scientific outlook based on empirical evolutionary science and facts, not emotion. Human beings have an infinite capacity for self-delusion, and amongst the neo-left I have found this capacity to be ubiquitous. “As long as I don’t read anything that might hurt my faith, I’ll be fine!” LOL, what revisionist nonsense, Lenin was right, “left wing communism is an infantile disorder.”

    If you want “socialism,” then a new form of socialism must arise that once and for all gives up long ago refuted ideas and theories, it must accept the truths and facts of new scientific discoveries and it must see what is valid in all of the various economic systems of thought and then converge with them where they all agree. But this “Mormonesque” double think,” the memory hole and outright refutation of facts all done to cling to the failed religion as it is one more year is a profound error. Modern socialism needs dumbed down adherents who blindly believe, and though that may be its social strength it is in fact its ideological weakness and error. How much of this energy used to protect the and defend the faith from refutation, if channeled to rightful tasks, could help to speed evolution to the singularity?

    Bah, it’s not even worth blogging anymore, Neanderthals can’t understand complex synergistic dynamic evolutionary futuristic subjects, all they know is the club and totem fetishes that uphold static views.

    • Curt Welch Che Mort February 25, 2013 on 12:34 pm

      Your sir, are societies most dangerous criminal – a highly educated and highly literate fool.

      You have immense power to persuade with your linguistic power and war chest of pseudo facts, but your ability to understand, for care for others, is nearly non existent.

      The future is about the slap you in the face hard, after all those that buy your self serving nonsense suffer. You will feel it. Just wait for it. it’s coming.

    • Curt Welch Che Mort February 26, 2013 on 7:07 pm

      Che Mort writes: “He finally came out of the closet,”

      I’ve never been n the closet. I’ve been arguing the same line of reducing inequality in everything I write for years. All you had to do, is read what I wrote to know I’ve never been in the closet.

      “He finally came out of the closet, it is all out in the open once again, the only solution to any problem is the old tired and worn out Trojan horse repackaged for another generation. ”

      I argue for redistribution of wealth in the form of a flat rate income tax and a Basic Income distribution to everyone. Besides Alaska, where it seems to be working just fine on a small scale, it’s never been done before. So to suggest, I’m arguing something old, is to show you have no clue what I’m arguing.

      “This leads one to assume that a top down command and control of society and all production is more efficient,”

      You have a closed mind and have no idea what I’ve suggested. I’m against top down control, and I am advocating the REMOVAL of most the current top down control we have in the US. Currently, the US does massive amounts of welfare redistribution in a huge top-down control fashion. They have 1000’s of pages of tax codes, that lists endless exceptions to who has to pay, and how much, all in the name of redistribution. If you are married with a single income, you get to pay lower taxes. If you have kids, lower taxes. Interest payments for a mortgage, lower taxes. Every line of the tax code, is top down control of wealth redistribution decided by congress. Then we have all the endless social programs, that controls how gets welfare, and for how long. How gets unemployment insurance, and how long. Who gets food stamps, and who doesn’t. We have endless labor laws that decides which companies have to pay their employees more money, and which don’t (minimum wage); that decide which companies must provide health care, or retirement benefits, and to who.

      All this is millions and millions of lines of top-down control of wealth redistribution crated for us, and administered for us, by 100’s of thousands of government workers, who each, are getting a substantial “redistribution of wealth” from the tax payers, in their secure over paid government jobs.

      I advocate, to get rid of all that and replace it with a system that is far simpler. I advocate for massive welfare reform. Tax all personal income, and corporate profits, at one flat rate, and redistribute that revenue, back to the people. That reduces thousands of lines of tax codes, and welfare programs and laws, and also many labor laws, down to one top-down variable congress must set – which is to choose the value of that single flat rate tax.

      Now of course, congress will never make it that simple, they will find ways to add complexity. But we should fight to resit that.

      The point of all this is that it’s well established that helping the needy is required in order to maintain a strong and healthy society. And we can debate more of that later if you wish. But that such top down micro-management of welfare, I feel is often more destructive, than helpful. As well intended as it all is, the results are no where near as successful as I feel then can, or should be.

      For example, much of our welfare for one, creates negative incentives for work. People lose welfare income, if they choose to work more. That’s a negative reward, for working – which is obviously destructive. Likewise, we reward people for losing their job,by giving them a cash payment for months! Again, that’s exactly the wrong incentive to create.

      A basic income is constant, and never changing. It’s not a reward for losing work, or a reward for gaining work. Basic income doesn’t change, based on what one does, so it does not become a positive, or negative, reward for anything. It’s just there, like the air we breath is always there.

      Minimum wage is well intended, but it creates a social burden which the businesses that pay minimum wage workers must carry. They in effect are forced to pay welfare, where as business that hire no minimum wage workers do not have to carry. With minimum wage, the distribution of who pays for this welfare, is not fairly distributed across the entire population, it’s paid for by the people that buy the most products and services, crated by the minimum wage workers. A flat tax across the entire population, shares the burden fairly across the entire population.

      In addition, minimum wage doesn’t raise the wages of all low end jobs – it simply makes many low end jobs illegal, and the result is that business that could exist, and jobs that could otherwise exist, are removed from the economy. Minimum wage helps raise and maintain higher unemployment levels.

      I strongly advocate eliminating minimum wage laws, once a healthy BI is established.

      All welfare, though well intended, creates a culture of failure and rejection. Anyone on welfare, is made to feel by our society as someone who has “failed” and who needs “help”. To accept welfare, is to accept the idea that you are not a “full” citizen – that you are “the takers” (as we all heard Romney) talk about. This classification of society into winners and looses by the government is destructive to the very ideals of upward mobility we pretend exists in the US. With a basic income given to every person the country, whether they ask for it or not, there is no classification of anyone as a “looser”. A BI is the governments way of saying to the people, “you are all winners” and here is your reward for being a good citizen. It bonds society together, instead of acting as wedge to separate us.

      The progressive income tax we use is yet again, well intended, but it too sends a negative message to the people. When you work hard, and get a raise, and the government sends you the message, “thank you for all that hard work, I’ll take a bigger chunk of that thank you!”, it creates yet another negative message that is destructive to our goal of higher economic growth, and higher value created by our society. The flat tax I propose, has no such negative message. Everyone pays the same tax rate, on the first, and last dollar. If you make more money, you pay more of course, but you pay the same tax rate, on every dollar you make.

      Though unions are a good idea in order to give labor a fair amount of bargaining power with capital so as to force a reasonable amount of sharing of the profits of a business, it too has the negative side effect of create an adversarial relationship between workers and management. For a company to the most effective, the company must be a team, working for each other. If the industry is plagued with constant labor-capital fights, it undermines the cohesion needed to allow the business to maximise it’s productivity. Not to mention it sends a bad PR message to the customers that the business is “troubled”.

      With a healthy sized BI, unions aren’t needed. This is because the BI gives the workers all the leverage they need without the help of a union. When people have a guaranteed income that gives them enough to pay for housing, and food, then it gives them the power to say “shove it” to any employer that is not treating them fairly, and not giving them a safe, and enjoyable work place. This takes the power that capital always had over there workers away from them. Capital would threaten to fire any working that rejected lower pay, because the worker knew if he got fired, from the only big employer in town, he would have a very hard time finding work and staying afloat, and wold have a very hard time trying to relocate to another city to find work. But with a BI, the worker and his family (remembering that all members of the family are receiving their own BI), will have far greater flexibly to risk being fired, and income to help in any needed relocation or job search.

      With the government choosing what welfare we get, such as food stamps, they are doing central planing for us, by saying we can’t buy a book for our children, and that we must instead by them food. I don’t agree with that central planing. Let the people make their own decisions about what they most need. Granted, some people will have an alcohol, or drug problem, and use the BI only for that, and see their lives deteriorate into
      a drunken or drug induced stupor. But with the economic boost the BI will give to most people, and most corners of the society, I believe such problems will be less, than what we have now. In addition, with so many people supported by the BI, many will choose to turn to social aid worker (even if it’s done as volunteer work) to help those that have addiction or health problems. The BI frees society up to do what many already like to do – which is help each other, instead of fighting each other. But only a real test of a BI will show what really happens.

      I can go on, but the point is that if you think I’m advocating communist style central planing, you have NO CLUE what I’m talking about. I want the free markets to do the planing. But free markets optimize around the will of the consumers and our free marker will not optimize around the will of the people, if many have no money to spend at all, and many more have very little. With large levels of inequality like we have now, our free markets don’t optimize the distribution of resources to the people, it optimizes the distribution of resources to the 1%.

      “We have to manage the world to solve every problem!””

      I advocate removing thousands of micro-management attempts, and replacing them with one wide, sweeping, very simple, top level knob for adjusting the economy to offset the single most obvious flaw it has, without killing the golden goose of the free market which so nicely servers us.

      The problem is that free markets assigns value based on worth. The worth, is a measure of how much a single human is contributing, to the production of the things of value for our society.

      If we wanted to follow social darwinism, and create a evolution based society (which as far as I can guess from reading your post you think is correct), this would be fair. It means we just let people die if they cold not contribute to society.

      But I just wrote another long post elsewhere explaining why that’s wrong and you can hunt that down and read it if you want to understand what the rational answer to why “ignoring emotions” is wrong. Human desire and human actions are not controlled directly by evolution. It’s controlled indirectly by evolution’s best attempt to motivate us to survive. But what we actually are, are pleasure seeking machines. We act, so as to maximize our perceived sense of total future value.

      To structure society around the goal of survival, instead of around the goal of pleasure seeking, is to deny what we are, and why we choose to do anything at all. To structure our society around the goal of evolution, is to ignore the hard wired goal we are all built to seek. It forces us into a guaranteed life of sub-optimal existence.

      The arguments against socialism are based on the belief that societies “natural” goal, is survival. It is not. That’s evolution’s job, not ours. Our job, is pleasure seeking. To structure our society around the wrong goal, is exactly your augment for unregulated free trade. But in making that argument, you have proven yourself wrong, by failing to correctly identify what the goal of humans are.

      And this is why, when we look at pure capitalism, and see it causing large number of people to suffer, we get this automatic gut instant of “that’s not right”. But yet, take a hyper rational person like yourself, and find you have fallen so in love with rationality, that any rational argument feels better to you, than an emotional plea to “that’s not right” from the left. Your love for your rationality, even allows you to, ignore your own emotions, when you see a hungry child suffering as a result of capitalism.

      But you don’t have give up either. It’s rationally correct to understand that humans aren’t survivalists. We are pleasure seekers. It just so happens that the things that are most strongly wired into us as pleasure, (protecting our body, eating, having sex), are highly important for our survival – which is why evolution picked those things as pleasure for us.

      So, though we can argue the above more if you like – that is the fundamental difference in our positions – you seem to want to argue unregulated evolution, I argue for using capitalism to maximize human pleasure.

      And with that established, I’ll return to why we need this “BI Knob” to adjust our economy.

      As pleasure seekers, attempt to create a society where we each are able to maximize our own pleasure, we do not sense it fair, that great numbers of people are made to suffer, (our poor, all the people our society ended up putting into jail, the old who often had to live in poverty before SS, etc). We know that seeing these people suffer, or just knowing they are there suffering, triggers suffering in us and others (empathy), and having them suffer, we run greater risks they will try to take our happiness away from us – again causing more suffering.

      The happiness of others, is something we almost, universally appreciate. Seeing someone smile, makes us far happier, than seeing someone cry. And we are willing to pay for that by trading things of value – we give gifts all the time, for this very reason.

      Many people in society today, simply can’t contribute much to the GDP. No matter how hard they try, they have no hope of being the next Mark Zuckerberg, or Steve Jobs. We are seeing a hollowing out of the middle class, because the free market is telling us that these people just can’t contribute any more – and that’s true. Capitalism then not only measures their ability to contribution against the likes of our best, it also makes a second rather nasty decision – which is to take away resources of value from the less powerful and given them to the better. So a farmer, not doing as well as his neighbor, gets his far taken away from him, and it’s given to his neighbor. So no, the first farmer’s value to society drops as he trys to find something other than farming to contribute with.

      When humans had lots they could contribute, things worked out. But in our increasingly high tech world, being able to contribute, required advanced understanding of high complex technologies like AI robotics, and and mortgage backed derivatives, the average IQ people are falling behind – and finding less and less ways they can contribute. And the market is reflecting their lack of value with falling wages.

      But we humans, value each other more than the market does. We don’t want to see humans suffer, so we are willing to pay to reduce that suffering, and increase the number of smiles we see our world filled with. And the BI is the way, we can all make that happen. We all pay what we can, to help society as a whole rise above whatever problems each of us face. A guaranteed flow of low level income, is the best way, to give people power, give them a sense of belonging, and allow them to build for themselves the best possible fugure they can.

      In addition, our markets fail to reward lots of highly significant deeds people do for us. When a mother stays home, and spends full time caring for, and raising her children, she is doing a service for society – but yet we don’t pay her. The BI is our payment for all the stay at home parents that sacrifice their lives, to raise healthy and happy children.

      When a family takes in an older member with health problems, and cares for them, they are doing a service for all of society, because we all want to make sure people are not made to suffer. But yet, we don’t pay them. Giving a BI to both the older person with needs, and the parents how care for the elderly, are a way for us to send that signal to people to let them now we appreciate they efforts they make, to care for each other, even when they do it, out of their heart, and don’t receive other rewards for it.

      The BI frees people to do what they know is right, were as pure capitalism all too often, makes them to what they know is wrong in their heart.

      But there’s an even better way to understand what BI is doing and why it’s needed.

      We use the tool of capitalism, to create this giant, efficient machine for the production of things of value. Based on the stated goal of maximising human happiness, the correct thing to do, is take all the output of this beast, and divide it among all humans.

      But, since humans play a key role in the operation of this machine (we are still for now, important cogs in the machines ), we must be rewarded based on our contribution, so that we are motivated to seek out our position in the machines, that maximizes our skills to the society – we are motivated to chase the money, so that we provide the most benifit to society.

      But these two effects are in direct conflict with each other. We can’t share the wealth evenly because though it created maximum happiness, it kills the golden goose of productivity. But if we tweak the knob the other way, and maximise productivity, we have minimized happiness – our true goal.

      So the optimal point of maximum happiness, will be found somewhere in the middle between these two extremes. And that knob I want to give congress, that flat tax rate that feeds the BI, is the knob they use to try and find that sweet point that maximizes happiness. This is why we need the BI and that one “knob” to allow congress (and society) to try and set it to whatever produces the maximum happiness, while not killing the golden goose of productivity so much that we reduce our happiness.

      I can go on, but if you have read all this, I think you get the drift of my position.

      I think social darwinism is seriously mis-guided. It turns humans into careless selfish power seeking jerks. I think our true innate genetic goal in life is pleasure seeking, and the path to get there, is to build a society based on maximising the happiness we can create for everyone, by working as hard as we can, together to reach that goal.

      I think free market capitalism with minimal influence by our government is the correct tool to bind us together into a society working to maximize global human happiness. It turns us into one large global brain, working to create maximal happiness. But to work, it inherently, needs to have some top level macro economic regulates, to keep it operating at peak efficiency (Fed money supply regulation for example), and the flat tax driving the BI to set the optimal balance of the conflicting goals of maximum sharing, and maximum productivity.

      The goal is to create a world, full of happy, smiling, fun loving people, who every day, just love the idea of getting out of bed, and making the world a better place, than it was the day before.

      “If you want “socialism,” then a new form of socialism must arise that once and for all gives up long ago refuted ideas and theories, it must accept the truths and facts of new scientific discoveries and it must see what is valid in all of the various economic systems of thought and then converge with them where they all agree.”

      Done. Read what I wrote and understand it. Them implement it.

    • Curt Welch Che Mort February 26, 2013 on 7:58 pm

      “What happened to all of those black smiths, wheel & cart wrights that the evil automobile put out of work?”

      As it happens, blacksmithing is one of the hats I wear these days ( and my work brings happiness to many people.

      “The internet shows us what a truly free network system can do and how it allocates resources effectively and efficiently with no central controller,”

      You are preaching to the choir and you have no clue you are doing it. I fell in love with the unregulated anarchy of Usenet over 20 years ago, and for the past 15 years, one of my other hats is running my Usenet business (

      ” You can cling to a religion that always fails or adopt a scientific outlook …”

      The reason I drifted into looking at economics is because one of my other hats is as an AI engineer working on solving the most interesting puzzle of our times – the brain and Strong AI. And in that work, I’ve come to understand that our economy works the exactly the same way our brain does – it’s just a distributed optimization process maximizing a control signal (reinforcement learning process). That is the foundation of human intelligence, and human behavior. And it’s also the foundation of our larger economy. And on top of that, it’s also the foundation of evolution – all these processes are the same type of process. When people argue for intelligent design, they are actually correct. That is, there is an intelligence that is creating life. It’s not a coincidence that life looks like it was created by an act of intelligence – it was. But evolution is the intelligence. Evolution is the intelligent God they have been talking about. And it’s the exact same type of process, that is at work inside our brains, driving our own intelligence – which is why people see the obvious connection. So next time you see an evolutionists argue with a intelligent design advocate, understand that it’s just two people making the same argument, with neither understanding they are both more right than wrong.

      But in addition, the economy is also exactly the same type of process. That is, when we work together in free trade, we have actually created a real, honest to god, general intelligence super-brain that is smarter than any of the individuals that make it up. The invisible hand of Adam Smith isn’t invisible at all, it’s a super AI we built.

      These processes all share something important features in common. They must be given an optimization target to aim for. Evolution’s optimization target falls out as simple survival. Our humans are given a reward signal to optimize which is defined by our genetics – by evolution for us. We are innate behavior optimizer, with the target of maximising our reward signal – which is what we call “pleasure” or loosely translated as happiness.

      The economy is itself a different AI, with it’s own reward signal. It’s reward signal is profit, but it’s defined by the combined spending habits of all the consumers. So we tell the economy – this big super AI we have on a “leash” what we want it to do for us, by how we spend our money. In a true democracy, where everyone has an equal vote, we should all have an equal vote for controlling this monster – this global brain, we have created. That means we must give everyone an equal amount of money to spend every year. That would be the ideal situation. But, since we also operate as cogs in the machine, we can’t both reward people for their effort, and give them the same money every year. So to maximize the efficiency of this super AI we have built, we have to tweak the control signal with the flat tax, and the BI. The flat tax keeps all rewards inside the system relative – which is highly important because people are not motivated by absolute rewards, they are motivated by relative rewards. If we tax unfairly, we distort the reward signal, and create extra inefficiency in the system so it’s important to use a flat tax (which is the same for all forms of income, be it wages or capital or gains or self employment income). But the larger we allow the inequality to get, the more this AI Monster, starts to serve only the needs of the rich, instead of democratically server the needs of everyone.

      Soon, we will have fully intelligent machines which are themselves just reward optimization processes. They will replace all the humans in the “machine” so that we no longer have to work. They will not just be AIs on their own, they will be the cogs that replace us in the “super AI” we have already created using humans instead of transistors.

      The closer we get to this, the more the optimization point of the system will shift towards more sharing, and less individual rewards. Once humans are totally replaced, however long that takes, we will shift it all the way to pure sharing of the “leash” of the AI monster that serves us all.

      “it must accept the truths and facts of new scientific discoveries and it must see what is valid in all of the various economic systems of thought and then converge with them where they all agree”

      “How much of this energy used to protect the and defend the faith from refutation, if channeled to rightful tasks, could help to speed evolution to the singularity?”

      You accuse me of being a Marxist because I used the word “socialism” and you then ranted on for page after page about the failures of central control communism when in fact, I’m an AI engineer working to get us to the singularity as fast as possible, and out of my scientific work on AI, I uncovered the errors of our society and used my understanding of “complex synergistic dynamic evolutionary” to understand what we are doing wrong, and how to fix it. In fact, I know almost nothing about Marx, and only yesterday, for the first time, was learning a little about his theories (which I have quite a few problems with – like his LTV).

      You have NO CLUE who you are talking to and our knee jerk reactions to words like “socialism” do you a grave disservice. But them again, I have to admit that my first impression of you was a bit off target as well, and after actually reading your whole post, you are not the person I though you were. You have hope – as long as you can let go of you desire to believe Social Darwinism which falsely identifies survival is the human race’s “reward” signal.

      “Anderson relates in his new book Makers” – looks interesting, thanks for pointing it out. I’ve got the Kindle version on my phone now to read.

  • Robert Schreib February 24, 2013 on 5:09 pm

    It’s possible that although many jobs will be taken by robots, that the feds will require a human worker to accomodate them anyway. Like, it may be feasible to have robots driving semi-trailor delivery trucks, but they might pass federal laws requiring a human driver anyway, using the robot as a backup, since there’s so many x-factors involved in such operations, that a Human’s versitility may be essential anyway.

    • Curt Welch Robert Schreib February 25, 2013 on 12:46 pm

      Yes, it might be essential, just like checking hand bags for people boarding planes is essential today – but neither will be well paid. There are lots of potential jobs for humans in a robot future, but the majority of the wealth won’t go to these workers, it will go only to the owners of the largest robotics corporations. Technological Inequality is the real problem here, not unemployment.

      • shaker Curt Welch February 25, 2013 on 1:14 pm

        Curt, i agreed with you on basic income so its not like we are completely on different view points.

        What i do not get is why you don’t look at what happens when we have all these robots. The cost of production goes way down.

        here is the scenario and you can tell me where i am wrong

        – robots arrive and take over 50% of the workforce
        – 50% of the workforce gets fired
        – costs go down 50% (or the cost of robot vs human employee)
        – people with a job either have more money to spend (due to deflation) or more money to save
        – if they spend then jobs come back
        – if they save/invest then the old “owners” get more competition.
        – that is how it always worked. the new system will be no different.

        you cannot fire 50% of the workforce and replace them with robots and then think costs will stay the same. it doesnt work like that. if you fire 50% of the workforce and replace them with robots then your costs of all goods will drop 50%.

        • Curt Welch shaker February 25, 2013 on 5:08 pm


          To start with if 50% of the workforce gets “fired” all sorts of complex shifts in value and society happen that makes it all too complex to even consider. Certainly what will not happen, is that consumer costs will not drop by exactly 50%.

          So lets shift to a more real example. One factory, has 10 line workers welding cars, and decides to install 5 robots to replace them. The line workers, making $50K are replaced by robots that cost $500K. 9 line workers just get laid off. One line worker is kept for doing manual clean-up welding work. 1 full time robot tech being paid $80K gets hired to program and maintain the robots. The company spends a small fortune keeping the robots working each year so that the cost of running the robots is around $1 million a year instead of the $500K a year for the 10 previous humans. The net result, is that costs for the factory actually went up, not down. But it was justified because the robots produced higher quality work, worked faster, and could work for 24 hours a day non stop. That’s how 5 robots were able to replace 10 workers. The robots helped the company produce higher quality cars with less defects which raises the quality of the cars the company is producing which allowed them to sell more cars, which paid for the extra cost of the robots.

          So we see increased productivity, because the number of hours _humans_ work for the company have dropped, while sales went up. But now 8 less people have jobs in that factory.

          However, the robot factory needed workers. But not any of the 9 laid off welders, it hired a new collage engineering graduate. The welders didn’t have the skills or IQ needed to work at the robot factory.

          So with the conversion to robots, we saw an increase in the quality of products, an increase in productivity, a higher output of the factory, but no real change in prices. We saw two new high pay jobs open up, one for the robot tech at the factory and one at the robot company. 9 skilled workers, are now without a job. Since most business are replacing welders with robots at this time, these guys are just basically screwed and must go look for a new career and the many years of welding experience, is mostly just a lost investment for them at this point. They end up with less money in the pocket for the rest of their lives because they are forced to work lower wages jobs, or they have to invest so much time and money into reeducating for a new career, that they never catch up to what they would have made if their factory job was not lost. Maybe one of the laid off workers gets lucky, and finds a way to make more than he would have made if he stayed at the factory, but on average, the laid off workers do worse.

          The money in the economy what used to go to pay the welders, is still being spent by the business. Their costs didn’t drop at all. It’s going to pay off the 5 year loan on those 5 robots which cost $500K each, and to pay the new robot tech guy they had to hire, as well as to pay the electric bill for the electricity that drives the power hungry robots, and the ongoing maintenance cost of the robots.

          Some of the money goes to increased profits of the owners of the auto factory. Some goes to increased profits of the owners of the robotics company. Some goes to the engineers and mangers of the high tech robot company.

          The guys that have jobs in the new robot economy, get to buy the cars made at the factory. The 9 laid off workers, can no longer afford the cars they once helped to build.

          If the robots cost more than the humans, the humans don’t lose their job. When the price and performance of the robots drop to the point that the costs are the same, that’s when the human will lose their job to the robot. They job gets replaced, when the costs ARE THE SAME, so there is no expected drop in costs for the goods being produced.

          The net effect of this switch to more advanced technology, was an INCREASE in wealth INEQUALITY. A few people,. that had an “in” to the high tech business of robots, got nice high paying jobs – making omre money than any of the previous welders. The welders were average Joes with normal IQs in the 100 range. But the jobs that get replaced, required people with higher IQs and better education to tend to the robots, and to design and build the robots. And the welders ended up being forced to take a step down in the social spectrum and make a new life for themselves at half of what they used to get paid.

          The GDP of the economy went up – the car factory is producing and selling more cars than before. The productivity of the economy went up. But 8 guys were forced to take a step down in income, one guy stayed at the same level, while 3 guys were able to stake a step up in income. The economy grew, but so did inequality. Life got worse for 8 of the 12 guys in the story.

          That is what will keep happening over and over, until we reach your 50% job replacement. Each time we use machines to replace humans, we see the economy grow, productivity grow, and inequality grow. More people are hurt by the machines, than are helped. The benefit of the machines, are all growing to a small minority, while the larger number of people suffer.

          Thjs wasn’t so true in the past, because the economy still needed lots of “average IQ” workers. We had lots of workers doing work below their IQ level. Their intelligence was under underutilized. They might have been picking cotton in the fields all day, which only needed an IQ of 80, but they had an IQ of 110. When they lost their job to the tractor, they had to retrain for a new job in the factory, which was more complex and needed a higher IQ than working in the field – but the people had the IQ needed to be factory workers. They could learn to be welders, and riveters, and learn to operate the complex machines of the factory.

          But the more technology crept into the work place, the more complex the work became, which meant higher IQs were need to keep up. You couldn’t just master a mechanical typewriter, carbon paper, filling cabinets and staplers, you had to have the brain power to master Microsoft Windows, and Microsoft Word. You couldn’t just be a machinist anymore, you had to be a CNC programmer. You couldn’t just be a welder anymore, you had to be a robotics technician that could operate computers to program and maintain the robots.

          In the past, human society had more IQ than the job market needed because every business needed lots of man power to make it work, one smart guy, could keep 1000 people busy. The son of the guy that designed the Brooklyn Bridge (if I’m remembering this correctly), said something to the effect of how amazed he was, that the inventiveness of one person, could keep so many workers occupied for so many years. The point being that back in 1883 we needed lot of humans as simple laborers to do these projects, and far less high IQ leaders and architectures. Lots of smart people had to work well below what they were capable of.

          But as technology and advances, we keep raising the needed education, and IQ levels of the workers. We are now in an IQ squeeze where the economy needs far more high IQ people than it can provide, and far less of the low IQ people than we have. Times were simpler, the work was simpler, and most people could learn one skill, and do the same job their whole life.

          Advancing technology is opening up tons of new opportunities, but it’s making that work and those opportunities so complex that few people have the ability to to take advantage of, and the few that do, end up with a huge financial advantage over all that don’t.

          If the laid off welders in my example has the brain power to start their own robots company and compete with the company that caused them to be laid off, they would all be able to keep their jobs and make good money. But none of them had the skills, and none of them had the IQ needed to even compete with the guys running the robotics company that caused them to lose their jobs.

          The human population has run out of IQ and can’t keep up with the machine economy any more. We have already lost the race against the machines, and we are just refusing to admit it. People’s lives are going down hill, because of this, and we are pretending it’s “their’ fault for being born with an IQ of only 100.

          • shaker Curt Welch February 25, 2013 on 5:38 pm


            Here is basic math of what you outlined:

            10 workers X 50K
            – 9 Worker X 50K
            = Profit of 450K

            5 Robots X 100K
            + 1 Worker X 50K
            + Robot tech 80K
            = 630K yearly

            1Million on Electricity to run the robots

            – we have 9 unemployed welders. If these welders have no other skills other than welding then they are SOL, but i am sure if they learned how to weld they could learn to do something else, in-fact they have to.

            – you forgot to mention how the robots are created. That is where the “welders” could work.
            – you forgot to mention that the company that provides electricity for the robots now has to hire. the welders could work there.

            The economy is never “perfect”. it never hires exactly as many as it fires, nor does it hire everyone that got fired. But if you look at your scenario, and add the fact that both the factory that produced the robots, and the electric company that now needs to provide extra electricity to the robots, you have 1.5 million dollars not allocated to anyone. You have to allocate these dollars to someone – dollar allocation equal production. Somewhere along the lines, the 1.5 million is being used by someone, either to hire or invest. it is not disappearing into thin air.

            you can go through a thousand different hypothetical situations but you will always come to the same conclusion, money is either being used as profits that will be invested, or wages that will be spend.

            if a company cuts workers it saves money and invests which means new workers are hired somewhere else in the economy. 500 years ago that meant a local court jester was hired due to someone having extra capital; today it means that some XYZ ten thousand miles away is hired.

            However, the money NEVER disappears.

          • Curt Welch Curt Welch February 25, 2013 on 10:56 pm

            “- you forgot to mention how the robots are created. That is where the “welders” could work.
            – you forgot to mention that the company that provides electricity for the robots now has to hire. the welders could work there.”

            No I talked about all that. My posts just get so long you probably just got bored and failed to see it.

            “However, the money NEVER disappears.”

            Right. But you seem to be constantly forgetting what it is I argue. I argue that the problem we face is INEQUALITY. Not unemployment, or not a “loss” of money.

            When we add advanced technology to the work force, the people that own the technology gets the money, not the people that got displaced into lower pay jobs.

            Now, if everyone who got displaced had the same ability to start building robots, then all would be good. Everyone would be starting new robot companies, and everyone would own 100’s of robots, and if we owned similar amounts of robots, we would all get a similar share of the wealth. Life would be good – that’s what we would like the economy to do.

            But that’s not what is happening.

            All humans are not equal workers. And it’s not just a matter of education. They aren’t anywhere near equal workers. Most people today, don’t have enough smarts to start a robot company. They don’t have enough smarts to even get a job at a robotics company, even if they went back to school for 10 years and tried to learn how to design new robots.

            Our economy is becoming not an economy of workers, but an economy of machines. When it was an economy of human labor, the humans got wages equal to what they could contribute. And since most humans could contribute a fairly equal amount of work (if they cared to try), the distribution of wealth remained fairly balanced as long as we made sure people couldn’t exploit each other, which we did by adding various labor laws.

            But as we transform to a machine economy, the people who own the machines get the money, not the workers. Technology ownership is not equal in any sense.

            The company with the better robots, will steal market share and profits, from the companies with the weaker robots (or the ones trying to use humans). The company that “wins” will then use their profits to build themselves even better robots, and steal more market share. Because they no longer have to hire humans to expand their business, they no longer have to share their profits with the workers – owners get all the profits, instead of being forced to share profits with workers due to labor negotiations.

            If the technology they are using is “obvious” then other people could spend a bunch of money, and create a business to complete with the giant. But if the technology they are developing, is being protected in-house as trade secrets, then no one can compete with them. If they keep their robots secret, and keep them in-house, they have an advantage that shifts all the wealth to them.

            The economy will create jobs for all the displaced workers, but the jobs it creates, will be jobs like dog walkers, getting paid $1 a day, not the $400K robot engineer jobs or the $10 million a year the CEO is getting, or the $100 million a day the investor that owns the robot company is making.

            Great amounts of inequality does not on kill the economy. The economy just keeps working fine. But the people working for $1 a day, who are forced to share a two bedroom apartment, with 6 family members, and eat shit food, and drive and old broken down car, is going to get highly pissed, at the guys making $400K in the robot factory, and the guys that own the factories that are making $100 million a day and taking vacations at a resort space station in orbit around Mars.

            Long before the inequality gets that bad, the poor will revolt. The rich will send the police after them, and lock them up in jail. The poor will get more pissed, and revolt some more. Someone throws a rock and the next thing we know, they turn from protesters into terrorists. The escalation of violence only ends if the rich decide to share their wealth, or if the rich kill and imprison all the poor. But since the rich no longer need the poor to work in their factories, the rich will be happy to see a bunch of them killed, and make up some excuse to do just that.

            This is where we are headed, if we don’t force the rich to share more with the poor and reverse growing inequality to return it to something more reasonable. Either we do that, or we get the escalating violence greater levels of social unrest. That’s what technology is giving us and it’s going to keep getting worse until it’s addressed.

            The rescission shows just how close to the problems were were. Before the last recession, the problems were hidden from sight. But the recession showed how weak the economy really was and the slow recovery shows even more about the problems we are in. But it will recover, and things will calm down for a while, and some will think we are back on the path to recovery – but we won’t be and then the next big shit storm will hit, and we will see how we are worse off, and how we never did recover.

            The more of this advance technology we add and the more income and wealth inequality grows, the worse these things will get.

        • Curt Welch shaker February 25, 2013 on 9:06 pm

          “you cannot fire 50% of the workforce and replace them with robots and then think costs will stay the same.”

          Let me also attack this idea from a different direction.

          To suggest prices drop in half when HUMAN labor drops in half, you are making the suggesting that the the value of the goods is only a function of how much human labor was used in it’s production. This idea that market value is determined ONLY by human labor, is known as the Labor Theory of Value. Karl Marx’s work is based on that concept.

          Most current economists reject it now.

          The idea that makes it somewhat valid however are the two ideas that 1) only human labor can create value (aka no value is created without the help of a human), and 2) in our human society, if a human works with something else, like a field, to create corn, only the human needs to be paid – we don’t “pay” the field because the field is not an member of society. So the cost we charge for the corn, only goes to pay for the labor, not the field. So by this theory, the price of the good – such as the corn, is based only on the price of all labor needed to produce and deliver it.

          If this LTV was valid, then conceptually, what you suggest about the value of goods dropping in half when half the humans are replaced by robots is somewhat valid. We can also just assume to make your point seem valid, that the labor to produce the robot, is far far less, than all the labor the robot will replace in it’s life time, so that we can pretend the cost of the robot in man-hours is so low compared to the cost of the human it replaces, that it’s near “free”. So that would fit your suggesting the cost of good would drop (I’ll ignore the fact that half the people don’t have jobs).

          But economics it turns out is not so simple.

          In Karl Marx’s times, these ideas were a close fit to reality because in the economy, humans were by far the most valuable assets. Natural resources were in general highly plentiful; they were not scarce. There was lots of land not being farmed, that could be farmed. There was plenty of coal to be mind, and the only limiting factor was labor to get it out of the ground. There were plenty of trees to be cut down, and the limiting factor was labor to cut them down.

          Nothing of value could be crated, without the use of a human, and there was tons of work that could be done, but was not being done, because there were no extra humans to do the work.

          Though natural resources did have value, the value of the resource, was very small compared to the value of the labor, one would have to pay for to create value from it since there was for most important resources (land, trees, coal, iron ore), an excess supply and not enough humans to convert all the supply into things of value.

          So in that day, when we looked at the cost of a finished good or service, it’s value was almost entirely the cost of human labor – and the LTV was a close fit to reality.

          But today, with more advanced technology amplifying productivity, and a much larger population spread over the entire earth, the amount of labor that goes into producing a good of value, has a far smaller competent of human labor, and a far larger component of capital investments.

          These facts have exposed the errors of assuming only human labor costs are part of the price of goods. Humans are now better seen as just one of the many resources which are brought together to produce things of value. And all the non-human scarce components, such as the natural resources of land, coal, trees, oil, are assigned value based on the importance of their contribution to the production of things of value.

          We still do not pay the coal mine, for the coal it contributes to us, but we instead, pay the coal mines “agent” – aka it’s owner.

          Land now has a value of it’s own, that is controlled mostly by it’s location. (location location location). Land in a crowded urban area is a very scarce resource. So it has high value. The allocation and use of land is then controlled just as the allocation of labor is controlled by the free market. Should the land be used to build a hotel? A factory? A parking lot? A road? A factory? The value of the land now has NOTHING to do with the labor needed to “create” is. The land is not created by labor. I could use the land for the next year as a storage yard for a big down town construction project and I would need to do spend almost no labor to use it as such – so the $100K I must pay to lease the lot over the next year has nothing to do with the amount of human labor which must be invested to “create” this “thing of value”.

          So, the value of all resources used in the economy, all have value, based on supply and demand and what they are needed for, in the large picture of all the things of value these resources are collectively used to create.

          The point of the free market (assuming fair trade and competition and no monopolistic market distortions), is to make sure all the resources available for the production of things of value, are being used to produce maximal value – the highest GDP possible, given the resources available.

          That’s all good, because we humans want to have our economy producing as much value as possible. No matter how much value we have, we always want more. And this is not just “more stuff” consumerism – it’s really higher quality of life we are buying. No matter how good our life is, we always want better if there’s some way to create it.

          The free market then assigns values to all the resources, based on how important the resources are to the current production of the “good stuff”.

          Humans get paid what the humans are worth, based on supply and demand, just like a plot of land gets paid for what it’s worth. But since “land” is not a thing in our society that is given rights to own money, the land doesn’t get paid, the person that owns the land gets paid for the “value” of the land. The land is a “slave” to it’s owner.

          So, with all this in mind, lets go back to your eample.

          We have a business, using 100 humans, to produce some goods. Because we know LTV is lacking, we know that the money paid for the goods produced, is not just going to the 100 workers. It also goes to the owners of the raw materials, and it goes to the owners of the tools and capital equipment like buildings and offices.

          So we replace 50 workers with robots.

          Now to see what happens with prices, we have to substitute the value of the humans, with the value of the robots.

          This is hard to do, since we don’t know the current story behind the robots and what it took to produce them. We have no idea what they are worth in our current economy. But we do know, the humans would not have been replaced unless the robots allowed the business to create more total value, by replacing the humans with them. And we know that in theory, at the time of the replacement, the robots are approximately equal in value to the humans.

          Which all means that at the time of replacement, the costs of goods are not expected to change at all, and the cost of using the robots, are approximately equal, to the old cost of the 50 humans.

          But now we have 50 humans without work, and the economy will absorb them somewhere else. But wherever they get adsorbed, they are adding extra supply to the labor market and are driving down wages of the workers they compete with.

          But there are lots of different ways this could go depending on all the dynamics. For example, if the 50 workers let go, went off and helped the robot manufacture expand, and build more robots, then the first company could get rid of the last 50 workers and buy more robots, and then those 50 move to the robot industry. But since the labor needed to build robots is far less than the labor they save, we have productivity gain. So the first factory buys even more robots, and triples it’s output producing lots of more good “stuff” the people. And when all prices re-balance, we have the 100 people all still working, and now they can each afford to have 3 times as much “value” as before the addition of robots.

          But it doesn’t go that way. What’s happening is that the 50 people laid off, were the ones that were the easiest to replace with robots. And these guys, that were doing simple jobs like pushing stock carts around, can’t find work in the robot industry – or very few of them can, because if they can’t up their skill level, the robot industry would need them anymore than the first factory needed them.

          So to compete with the machines, our society of humans, must race against the skill levels of the machines. As the skill level of the machines creep up, the skill levels of the humans must creep up as well, and stay ahead of the machines, in order to stay well employed. When humans loose their jobs to the machines, the machines are not “free”. The machines “get paid” for the work they are doing now. But that pay, then goes to the factory owners that own the robots, and to the people that work at, and own, the business making the robots.

          When the people that got displaced, are unable to climb the skill ladder to the business that replaced them, we see inequality grow. Small difference in human skill levels, start to translate to huge differences in income when the work of one guy, that knows how to design and build the robots, ends up replacing the labor of 1000 workers. And he gets the money for that was once being spent on those 1000 workers.

          If all the displaced workers had the ability to design and build robots as well, then there would be plenty of competition, lots of robots, and all these new robot designers would be getting a fair share of the welath.

          But we are in a situation were most people just are unable to qualify for the new jobs being created, so they create a glut of low value labor at the bottom, while the wealth all goes to the minority of workers at the top, that can do that work.

          The more complex the work gets in this new high tech world, the fewer people there will be to do the work, and collect the wealth. If there are only enough “smart” people to create 10 robot companies that end up creating all the robots, that end up replacing 3 billion workers around the world, those 10 companies will “own” the wealth produced by all those robots, and the 3 billion displaced workers, will have no job and no wealth. If they manage to buy themselves one robot, they will have some wealth, but they will only have 1/3 billionth of the wealth controlled by the robot companies. And those robot companies might only employ 100 people – with everything else in the company done by their own robots, designing and building other robots.

          But let me point out another factor I’ve not talked about. The economy optimizes all assets so as to maximize the production of value – to produce as much value as possible. But the value it is maximising, is “judged” or “defined” by the consumers with the money to spend. It does what the consumers want the most.

          When 100 robot industry titans control 99.99% of all the wealth being produced by the robots, only those 100 guys get to spend the money. Which means the 3 billion robots will be working for them and the 3 billion unemployed workers will have almost not control over the economy they were rejected from. So even if this economy, can produce a Big Mac for 10 cents and feed the world, most people won’t have even have a penny to buy it with. So the economy won’t build 1000’s of McDonalds all around the world to feed them since there is no market for that. The economy instead, builds what ever the 100 super rich robot guys want to spend their money on. If they want a resort space station in orbit around Mars, so they can go vacation there, the economy will use all those robots to build that space station, insted of building McDonalds that could have turned out 10 cent Big Macs.

          The economy and all these robots, will only serve, the people who have money to spend. And that will be, the people who figured out how to make and control ownership, of all the robots, and all the natural resources.

          Though human slavery is outlawed, “robot” slavery will not be. And the biggest robot slave owners, will gain control of all the robots, and all the resources, and all the wealth produced by their slaves. And their slaves will only work for them, and not for everyone else.

          • Che Mort Curt Welch September 11, 2013 on 2:04 pm

            The LTV has always been a fallacy. Only those with limited vision adopted it. Adam Smith’s doing so set back economic theory 100 years, only human beings value. There is no mysterious force that imbues objects giving them value. Ancient humans who lived inland valued shells for their beauty. They even used them as money for their rarity. Did they have value in themselves? Did human labor imbue them with a magical force? No. Labor is an economic cost. When almost all labor was done by human and animal muscle it appeared that the labor cost and the price/value were synchronized. It was only an appearance of coincidence.

  • fireofenergy February 25, 2013 on 10:40 pm

    The socialism most people are afraid of is the kind that doesn’t allow it’s citizens to post (as in such profound and meticulously crafted RUDE rants by others here… Ok, my turn)
    China is mentioned as adopting freer markets… actually, they are taking advantage of global corporatism. They are empowering their communist idealism, using others for their own gain, even as they abuse their own people (and restrict their internet). They want order and control? You don’t do it by crushing (and abetting) spiritual beliefs.
    We must not fear for the sake of fear, but we must not be oblivious to the sufferings of the world, either, lest it backfires to us who care less (it is weird how science and spiritual beliefs form contrails in the same direction).
    Cruelty is a trait that cunningly climbs to the top of any social order, if left to its own devices. Machines and psychology are the best tools.

    Some pissed off people direct complaints towards a Basic Income Guarantee, yet our government is bloated in FAR excess, and IS socialist already, for the same reasons… trying to control fear (such as the excuse used for the genocide caused by useless oil wars). They impose themselves via their guard dogs instead of staying clear of meddling (I shall steer clear of posting the thousands of injustices imposed upon the American people by their very own governments).
    Yet, they do not restrict CO2, the emission that is altering the very air the biosphere depends on at this time and use scare tactics such as carbon taxes to ensure that most people will ignore the science (and remain pissed off)! Forced sequestration into limestone (or similar material), in stages, to enable such technology to become rapidly developed, is the obvious and REAL solution. Only then, will the technology become distributed globally, as did the internet. Wasted money on a known solar “bankruptcy to be” supports arguments by others that the fossil fuel industry has much control of the reigns of power.
    Corporatism is to be feared as much as any other “new” social structure.

    Thus, our government as it exists today, is FAR more capable of causing problems than a basic income guarantee.

    Complainers, with rude rants, should read up on what machines are going to be capable of in the near future, and into the most simplistic BIG structure as a possible best solution to wealth inequality, instead of just blowing up on the sight of the “s” word.
    More importantly, they need to understand and realize that the BIG they complain about is most probably very much LESS socialist than what we have now!

    Until I see machines actually creating more jobs, like they used to do when I was a kid, I will keep my mind open to alternative social structures, always insisting that we:
    First remove the empowered and dangerous blight within our own government.

    • shaker fireofenergy February 26, 2013 on 8:33 am


      Well at least we are getting somewhere. You went form saying we would be job less to acknowledging that we would have jobs, they just might not pay to much. but here is the thing, there are people on this planet that already have very low paying jobs. What technology is doing is it not allowing countries to “hoard” wealth. global economics is distributing poverty evenly. Over the past 70 years the west hoarded capital because we produced and sold everything. then business realized that you could use cheap labor to produce the same goods.

      We will just have to wait and see what technology does. i don’t think it is the doomsday scenario you are painting. your thinking is more along the lines of the luddite movement and it has been proven wrong time and again. it will most likely be proven wrong this time, in-fact i think it will be proven wrong.

      – free education, free communication, free transportation and a border-less world allow for more opportunity. Yes, there will be problems in the beginning. If you never went to school and then suddenly you are part of a world that requires education then you will be in trouble. The good news is that with in ten years, you can sit at home and take and class you would like – and it will be for FREE. Imagine what you could do if you allowed people to become doctors, p.h.d’s, or even get a degree for free?

      – your biggest fear/complain is you do not think humans are capable of change, that we are who we are, that someone a person was destined to be a “welder” and if that job is gone then they are doomed. I don’t agree. that welder is capable of doing an infinite number or tasks. he/she will find a task to do.

      you stated that we will have jobs like “being a dog walker”. that’s ok. in a world where your kids education is free, where housing costs have dropped 75%, where you don’t need to own a car, where energy is abundant, where food is grown in underground, solar powered systems, $1 might be all you need to live a quality life. That is what INFINITE machine production and technology brings to the table. it is not about how much money you make, its about what you can purchase with that money.

      Every year, people on this planet can purchase MORE not LESS with their money. don’t let the travails of American fool you. the world is getting better, and it doing so at a faster rate than ever before.

      • Curt Welch shaker February 26, 2013 on 11:39 am

        shake points out: “You went form saying we would be job less to acknowledging that we would have jobs,”

        Well, the truth is that once jobs pay that little, people just drop out of the economy and scrounge and barter for a living. In an otherwise very rich society like the US, it’s more productive to stand on the corner and beg for money, than to work for a dollar a day. Or to dig through dumpsters. Or, sadly for society – turn to crime. If stealing an iPhone from someone on the street pays $50 on the black market, that’s a hell of lot easier than working a real job for 3 months at $1 a day. And if you get caught, you get sent to jail where you get free housing, food, clothes, and health care, which for some people would be an improvement in their lives.

        When we don’t fix the wealth inequality problem, we force people to turn to crime, and that’s far more destructive to society than any market inefficiencies that arise from sharing some small portion of the wealth. When this happens it causes people to reject the society as unfair, and revolt against it. Turning to crime is often as much a statement of revolt against the society – as a way for someone to take back the power their society took away from them. For every person that turns to crime, there will be 10 in the same situation, that has resisted it. But those other 10 will share, and spread, the same feelings of discontent though society like a cancer. These effects tear down the very fabric of society by destroying the trust between citizens.

        The economic effects turn disastrous. Not only does it cost a fortune to house all these people we put in jail, but we must at the same time spend even more on a huge police force to keep all the discontent at bay.

        People don’t mind being poor. If all we own is a grass hut and spear, we can be extremely satisfied in life. People don’t mind hard work. If we have to get up early, and spend all day trying to chase down a deer, only to come home empty handed, we can still feel extremely satisfied with your day and content with our life.

        But when others in our “tribe” own 1000 times more than we do, and we are treated as a social failure by our society for our lack of wealth, we are not happy. It causes people to stress over not how poor they are, but how much pressure society is putting on them to not be poor.

        If you put a homeless guy naked next to the most rich man in the world, naked, and have them stand side by side, where in that picture is the “value” that justified the one man, to have 60,000,000,000 MORE power and wealth than the other? That’s the level of inequality we allow to persist in our world today. We have some men worth 60 billion, where others are worth less than a dollar.

        We don’t create happy people, by allowing that level of inequality to persist. We don’t create a strong “tribe” by allowing that to happen. And we don’t create a strong economy. Being that poor, when others in the tribe are so rich, doesn’t motivate people to “work harder”. It causes them great stress. It makes them fight with their own family members and some times kill each other. It motivates them to buy guns to get some small feeling of power, in a life where society reminds them every day how powerless and “little” they are.

      • Curt Welch shaker February 26, 2013 on 3:01 pm

        “- your biggest fear/complain is you do not think humans are capable of change”

        Well, someone with an IQ of 100 is not capable of changing and becoming someone with an IQ of 120, and that is the problem – but I think you have read that other article and get a sense of the problem we face in that way.

        “Every year, people on this planet can purchase MORE not LESS with their money.”

        Yes, that’s very true. And it’s a very good thing. There’s a book entitled “Abundance” by Dr. Peter Diamandis and Steven Kotler that talks about this very nicely. It’s a good read if you have not read it. It takes a world view and talks about what is being done to lift the fortunes of the poor people in the world and points out how small things like cell phone access or clean water can totally change the lives of people. It’s a very positive take on how much better the world is getting for people and how little it takes to do so.

        I don’t have any issues with jobs being outsourced so that the US consumerism can lift the fortunes of people around the world. If the US sees a drop in wages because we are lifting the lives of other people, that’s not a bad thing, that’s a good thing. Remember, I’m the “spread the wealth” guy. If that was the only problem, it’s not a problem, because it would mean wages would return as the standards of living rose around the world.

        But that’s not what we are seeing happening.

        The fact that advancing tech will allow people in the future to live a nice live on $1 a day does not address the far deeper problem of social inequality which is a far worse condition than poverty.

        We have a 60 billion to one inequality problem today. If we gave every poor person on the planet, $1,000 that ratio would at least drop down to 60 million to 1. But we really should, and could, get the ratio down to more like 1000 to 1 for the entire planet if people decided it was the right thing to do. But we would have to grow world wide GWP a bit more before that could happen. It should be set as a priority for the world, and instead of talking about it as “ending poverty” we should see it as ending gross inequality. But for now, I’ll settle to just try to take people in the US to cope with the problem and see if we can fix the world later.

        • shaker Curt Welch February 27, 2013 on 1:18 pm

          Well, i hope we get there. God willing. I do believe the the ever growing divide between rich and poor is a terrible things. It just leads to corruption.

          but i do also think that we will end the divide through democracy, education and when people take the political process seriously. I think technology can help bring the masses together faster than “they” can try to keep us apart. at least i hope for that.

          i don’t agree with you that all the jobs of the future will be “genius jobs”

          very few people who work for Google, Apple, Facebook and all the other tech companies are geniuses. Granted, some are. However, since Henry Ford, we have learned how to structure companies and create positions that require “the least amount” of intelligence, not vice versa.

          No company in the future can afford to hire a workforce comprised on 100%, or even 10% geniuses. If they did they would be created a product that no one could afford. Therefore, even the robots company of tomorrow, similar to Intel corporation, would have 1-2% genius (working on R&D and core product) and the remainder of their workforce would simply be the “average” worker.

          I do not see a scenario were any company could pool that much talent. That’s why there isnt a private NASA. it costs too much, nor will there ever be a private NASA unless the you can figure out how to reduce those costs.

          I don’t see future tech allowing for wealth to accumulate. I see it “liberating” wealth. more knowledge through education and communication leads to the natural distribution of wealth.

          If you can get a harvard education for $200 instead of 200K you will have a lot more doctors, CS, Hedge fund managers, etc – and they will come from every corner of the globe.

          • Curt Welch shaker February 28, 2013 on 10:17 am

            Shaker writes: “but i do also think that we will end the divide through democracy,”

            I do too. Live has for the most part gotten consistently better for man over all the years, and I think they will continue to do that. Despite my tone in many of these posts, I’m an extreme optimist for the future.

            But, our progress hits these speed bumps from time to time that set us back and require us to recognize before we can move forward again. Like the civil war where we had as a society to work through some deep rooted philosophical difference in society, before we could come out the other side and move forward. And the “working out” of those issues caused 600,000 people to be killed. So despite being highly optimistic that we will “get there” in the end, it’s still important to try and minimize the damage caused by these transitions.

            We are approaching another one of these big social paradigm shifts when everything changes. With the industrial revolutions, we transformed from farmers, to factory workers, and in the process, we have to go through events like the great depression, because people didn’t understand what was happening and didn’t know how to cope.

            But that transformation was nothing, compared to what’s coming and what’s happening today. That just meant people had to move from the farms to the cities and built a new type of society in the cities – eventually creating modern day suburbia.

            But now we are swiftly approach the point in time where the machines become more advanced than humans. The singularity. It’s only a few decades away, and more than half the population (I would guess – have not seen a good poll on this), does not believe it will happen at all – that machines can’t be more advanced than humans. They have no idea what they are about to run into or how it’s going to totally turn human society upside down.

            I’m 100% positive we will survive the transition, just like we survived the American civil war, and WWI and WWII, and come out on the other side a much better world. But there is no need for this transition to be a speed bump. The transition can be a big “nothing” like Y2K was.

            It’s all about understanding the future. If the people that fought and died in the civil war, could have been shown how the future would play out, do you think they would have bothered to fight? Of course not. No one fights a war they know for sure they can’t win.

            The machines are going to replace all humans in the work force it’s going to happen this century – probably coming to a big head around the middle of the century. And by them, the world will have flipped upside down, from what it is now.

            There is no need, for the next 35 years to be filled with human suffering and hardship. But that’s our future, if people don’t catch on to what’s happening and adapt now, instead of waiting until “after the war”.

            The entire world is going to become a highly socialistic world in which humans spend all their time “playing” instead of working. Our machines will do all the stuff humans don’t want to do. Anything we want to do, will not be work, it will be play. It will just be the stuff we choose to fill our lives with, vs what we are forced to fill our lives with. People will have the option, to lay on the couch, and stare at the ceiling all day, if that is what they choose to spend their days doing. Not many will choose that however.

            We already live in a world, that a very large number of people in the developed world are doing just that already – they are bale ot work, or not work, as they choose. They pick jobs not because they need to put food on the table, but because it gives them joy and satisfaction to do the work they have choosen.

            But only maybe 30% of the popluation has that level of freedom. The 70% are still suffering in a old world dog eat dog society working long hours, taking hour long bus commutes to work, putting up with bosses that are ass holes, just because without doing it, they wouldn’t have food on their table – or a table.

            And of course, around the world, we find billions of people in much worse conditions, starving, and dying from diseases that cost us $5 to cure, living under the threat of being killed or rapped at the whim of a local dictator.

            We allow all this to continue, because of our 40,000 year history of a “hard life”. Life has always been hard, we all die in the end, and we all have to deal with some suffering in the middle. 40,000 years of life on earth, has taught us that it’s just the way of life that some suffer, and some do good and that’s just normal.

            But we have developed so much technology at this point, that no one needs to suffer anymore. Within a time span as short as 10 years, we could transform the entire world, ending all poverty, suffering, war, and social unrest. If the world leaders came together, and told the people, that or mission for the next 10 years, was to “fix the world”, we could do it, as easily as we came to together in 10 years to put a man on the moon.

            But the reason we are not heading in that direction, is because there is a continued belief that it’s REQUIRED that some must suffer, while others prosper. It is falsely believed by society as a whole, all around the world, that if we try to help the poor, we will only make things “worse” for everyone, and that the best way to “help the poor” is actually to allow them to continue to suffer.

            In a society where humans must do all the work to climb out of poverty, that’s actually a lot of truth to that old adage.

            But in a world where the machines to all the work to pull us out of poverty, it’s not true at all. When the machines do all the work, then nobody is pulling themselves out of poverty anymore.

            When I eat a burger today, how many human hands, were used to make that burger, and how much of the work was done by machines? If you track it back, you will likely find that 95% of the work to make that burger, was done by machines. The machines planted the seed that grew into wheet and corn to feed the cattle, and make the bun. The machines fed the cattle. The machines cut the wheat and picked the corn. The machines delivered the wheat and corn to the markets. The machines killed the cow and cut it up. The machens ground the beef and formed the patties.

            In all this work, the machines are doing the work, and we humans are just standing by as “helpers” for the machines.

            If we refuse to pull others out of poverty, it’s not because we don’t have the “strength” to both save ourselves, and save others. It’s not because the 14 hours I spend in the field only feeds my own family, and to share with another would make my own familial starve.

            It’s because we simply have decided not to share our “machines” with others; that we have decided to hoard our technology, and use it to make us so amazingly rich, that would cold get our machines to feed and house the entire world, but yet we just don’t bother.

            All because, we are living under this false idea, that “suffering is required”.

            Over the next 35 years, it will become obvious that suffering is NOT required, or good anymore, and that the more we allow people to hoard, and not share, the more pissed off the suffering will become, and the more events like 9/11 we will see in the world, and the more people we will see buy guns and go ballistic killing everyone they think is the “reason” they are suffering.

            Look at what happens when a country goes to war – a real war, like WWII. The entire nation binds together to help one another to achieve amazing things. No body bickers over woman joining them in the work force, or a minor inconvenience like not having lip-stick or having to recycle, because everyone is working for the common “war effort” and they all feel great and empowered because of it.

            What if our common goal tomorrow was not “getting rich”, or “the war on drugs”, or “the war on terror”, but instead, raising the minimum standard of living, for every person on the planet as high as possible, as fast as possible? What if the goal was to raise the standard of living of every person on the planet, so that no person on the planet, had to live in a standard of living, which was less than half, the average standard of living of the world?

            I think world GDP per capital is around 10K per person. Which would mean the goal would be to elevate, the standard of living of every person on the planet, to at least a life style equal to a $5K a year of income.

            And I don’t just mean given them free fish. I mean give then the technology and tools and resources, so they can fish for themselves, and create that standard of living for themselves.

            But the goal is not to elevate the wealth of some poor nation, but to instead, elevate the poor of the entire world, so that not a single person has to live in such a low standard of living.

            How fun would it be, to make the entire world, work together on that project and get their minds off all this other crap we see in the news every day.

            This is what our machines have given us to power to make possible, but yet, instead of understanding what we have achieved with our machines, we still suffer under the belief that it’s just required, that people suffer. We need to fix that.

          • Curt Welch shaker February 28, 2013 on 12:41 pm

            ” However, since Henry Ford, we have learned how to structure companies and create positions that require “the least amount” of intelligence, not vice versa.”

            Yes, but you are missing the point. It’s not a question of whether companies can find work for people. It’s a question of what the work is worth to the company.

            The more we can automate work, the less we end up paying the worker, and the more we end up paying the machines – aka paying the people that make and support the machines.

            Making work “easy” does not fix the fact that only the “smart” IT guys get a good job, it means that the rest get low pay shit jobs – which is exactly what we see happening in society.

            Back in the 70’s in high school, I had a friend that got part time work as a cashier at a grocery store. Before he could start, he had to learn to recognize, and memorize the prices of 100’s of produce items that did not have price stickers on them. He had to be trained to punch in the prices of all the items that were marked, quickly, and without errors. He had to learn to make change quickly. He had to learn to correctly pack bags. This was a training program he had to take for like a month, before he could work as a cashier. Not everyone had the skills needed to do this job well. Only a few made it though the training and got to work. And the result was that it paid nicely – far over minimum wage. It was a job a person could live on.

            But now, everything is bar coded. Any produce that does not have a bar code, can be looked up in a color flip chart by anyone smart enough to match the item with a picture. Most items in the store are well enough packaged that it makes very little difference how you pack a bag, as long as you don’t put the bread on the bottom and a jug of milk on top of it. It’s so automated, that even a customer can check himself out, with zero training. Once you get the customer to do the work like that, the price you “pay” the cashier becomes ZERO. So the store went from having to hire and maintain a staff of 25 highly skilled cashiers, to a store that has the machines and the customers do the work, and only hire and maintain 5 cashiers, and 2 supervisors. But now the companies that design and make the automation needs workers. But those workers are all high end professions, no (or almost no) semi-skilled jobs to be found there.

            But this means that instead of lots of semi-skilled cashiers (middle class), and a store manager, we now see the same work being down by a few low-skilled workers, and a lot of highly educated manger level professions working at the company that designs and builds the automation.

            If all the people that used to get cashier jobs, were smart enough that they could get jobs designing points of sales technolgy, life would be great – everyone would still have good paying jobs. But most people that can get a cashier job, do not have the type of mind that will allow them to succeed as a point of sales engineer.

            When we add automation, we do not end up making “jobs easier”, we in fact make them harder, because we eliminate the easy jobs, and replace them with high skill, high education jobs.

            Have you read about the skills gap? Google it.


            600,000 jobs in manufacturing go unfilled, because the companies can’t find enough workers with the right levels of math and science and engineering training.

            Of course all the blame is being put on the education system. But the problem is far deeper than that. People are better educated today than they were in past generates. It’s not that education has been falling.

            It’s that the skills needed for jobs, has been constantly rising – work keeps getting harder. And it’s all due to automation.

            Now granted, the US has an education problem – the rest of the world is doing much better. But the bigger picture is that the race ultimately is hopeless. Humans can’t keep ahead of the machines for much longer.

            If the workers can’t keep up with the education requirements, they can’t find a good paying job. And worse, the more people that can’t keep up, means an excess of applicants at the low end, driving the wages of the low end jobs even lower.


            “In my state of Iowa, … The folks at the Iowa Workforce Development (IWD) office report:”

            “18 percent of Iowa jobs are low-skill positions, but 38 percent of Iowa workers have low skills.”

            “50 percent of Iowa jobs are middle-skill positions, but only 33 percent of Iowa workers fit this category, generally defined as requiring more than a high school diploma but less than a four-year college degree.

            Which if we do the math, also tells us that, 32% of the jobs are high skill, and only 29% of the workers have high skills.

            So we have a population, with 38% low skill, 33% mid-skill, and 29% high skill.

            But a job market with 18% low skill jobs, 50% mid-skill and 32% high skill.

            The low skill here are like high school or less education – basic laborers. The mid skill are associate degrees – sort of the supervisors and middle management types – and the 29% are the executives and professionals.

            So instead of days of old, where one middle management type would supervise 10 “workers”, with a 10:1 ratio we now see a need in our automated economy, for 18 works to each 50 managers, or 2:5 ratio.

            To keep well employed, most those high school or less “workers”, must now do “supervisor” level work. Which means math, reading and writing, science, and computer skills, along with strong enough analytics, to cope with complex technical issues, like why the computer is not working and figure out what must be done to work around the problem.

            This shift towards ever high job skill requirements will never end. The more automation we add, the more it shifts up. And those numbers were for Iowa. Imagine what the numbers look like in Silicon Valley. It’s probably more like: 10%, 20%, 70%.

            The classic “job pyramid” is turning upside down. Instead of lots of low skillworks at the bottom, with a few middle skill, and even fewer high skill, we are becoming a world of mostly high skill workers.

            Or at least, that’s what the economy NEEDS. But since the population can’t keep up, we see a buyers market at the bottom, with falling wages, and and a seller’s market at the top, where high skill people jump from job to job getting large salary increases with each hop.

            With too many under educated workers at the bottom, and too few highly educated high IQ workers at the top, we see soaring wages at the top, and falling wages at the bottom, driving inequality higher and higher. The more technology we add, the worse this gets.

            remember, half the population has an IQ less than 100 – that’s by definition of what a score of 100 is.

            people with an IQ of less than 100 are likely to have trouble finishing high school, or if they finish, that will be about the limits of what we can expect from them. To do well with an associates degree, we are talking people with IQ over 100. For a bachelors or masters, we are talking 125 and up.

            50% of the population falls into the under 100 range. 5% are in the over 125 range, leaving 45% in the middle. Meaning the IQ of the population is fitting a job profile of something like:
            50% 45%, 5%.

            But the population profile in Iowa is:
            38% 33% 29%

            Where as the economy wants a profile of:
            18% 50% 29%

            Do you see how much of a disconnect there is between the ability of the population, and what the economy needs? This means we have lots of low IQ people, trying to complete at skill levels, beyond their natural ability – and some succeed. People that normally won’t try to go past high school, are going for secondary school educations, and those that would normally only have tried to get an associates degree, are trying to get a batchelors. And those that once only got a bachelors, are getting masters.

            This only works to an extent. You can’t keep just expecting that if we throw more money at education, these people that would normally have been a high school drop out, are going to be able to get an MBA. No matter how much money you throw at that, it just won’t work.

            Basically, we are already past the point, were everyone can be expected to earn a _fair_ living by working, because we just don’t have the IQ talent pool to draw from to fill the jobs of our current machine economy.