Bring back what jobs?

Look, the jobs that are lost, are not coming back, get over it. When Trump claims he’ll bring back jobs, he either has no idea what he is talking about, or he envisions some dystopian future where Americans are more like slaves than they’ve been since, well, slaves.

China and Mexico are not the problem, automation is. Even if Trump were able to force companies to bring manufacturing back to ‘Merica, through punitive tax and trade barriers, the manufacturing won’t be the same as it was, ever.

Listen to this recent extract from NPR’s All Things Considered. Bertram de Souza of The Vindicator talks about steel mills following a recent visit of Trump to Youngstown Ohio.

The next wave of automation is coming, it’s in driverless vehicles, it will have a dramatic impact on employment. Automated delivery trucks, automated taxi’s, autonomous vehicles will make a large dent in the current employment of some 3-million in America. While many cities are salivating over the ability of self-driving, autonomous vehicles to fix their broken road and transport infrastructure, that’s missing the point.

There are many detailed, and complex reports on the impact of automation, pick your favorite organization and search their website, McKinsey and Company(2014); Stanford Business School(2015); Pew Internet(2016) and on, and on.

Equally there have been a few superficial recent reports in the news media, this one from US Today. One of the better, more recent articles is from Rex Nutting over on Marketwatch.Rex Nutting over on Marketwatch.

I’ve been horrified by the lack of actual policy discussion and examination of the context, detail and and lack of clarity even where there is policy. This is something we should have had a real debate about when, what and how we handle the future of automation.

It’s not as if the impact of automation is new. Depending on how you classify automation, it’s been going on since the invention of mills, but importantly since the computer became pervasive in business.

As far back as the late 1960’s it was a discussion topic. In the early and mid-1980’s automation had become a key issue for governments and businesses. This was a classic of it’s time.

A human teller can handle up to 200 transactions a day, works 30 hours a week, gets a salary anywhere from $8,000 to $20,000 a year plus fringe benefits, gets coffee breaks, a vacation and sick time… In contrast, an automated teller can handle 2,000 transactions a day, works 168 hours a week, costs about $22,000 a year to run, and doesn’t take coffee breaks or vacations. – Bennett, 1983

This is a well used quote from a report called “Bank Systems and Equipment” by Bennett et al 1983 and often misquoted and attributed to Nobel Prize winner, Wassily Leontief and  Faye Duchin, who used it in their seminal 1986 work “The Future Impact of Automation on Workers“.

img_20161107_125230I worked on an IBM Corporate study in 1998, following the release of Dunkerleys book, the jobless economy.  I still have the books on my home office book shelf.

Many of us were uncomfortable with what technology was capable of doing to our society, much more than our jobs. I’d seen it first hand and contributed to the loss of hundreds of jobs. When I first arrived at Chemical Bank in New York city in 1983, there were hundreds of people, mostly women, sat in large rooms, processing incoming credit card authorization phone calls. Within 3-years, they were all gone. Their positions had been eliminated. Replaced by simple automation of the repetitive tasks they did using search and a “database” lookup.

Some of the information and outlook from that IBM study found it’s way into this presentation I gave at meetings and conferences around the world at that time.

Automation was, and is unstoppable without a much bigger debate. Trump alone can’t fix it or stop it. Automation is a result of three, equally powerful trends.

One. The absolute fear and revulsion in America of Unions, their impact, power and influence. Sterns 1963 paper “Automation-End or a New Day in Unionism?” captured the potential impact of automation on Unions.

Two. Big corporations and the way the market values them, their ability to balance investment against revenue and more importantly profit. Investors and the market don’t care how business makes profit, and the tax authorities allow investments to be written off against profit. So removing expense, in the form of employees, and improving profits is always on the agenda.

Three. The continual consumer march towards ever more consumption and disposable, cheap goods. Perhaps more than the loss of jobs, if pernicious tax and trade barriers were implemented by any politician or President, we would see a revolt among the people, who more than anytime in history, want their stuff as a measure of their value.

So, we can’t stop automation, the jobs are not coming back. Where does that leave us?

I’m inclined to agree with Musk. The only way around the impact of automation is a universal basic income. That’s what we should have been debating this election cycle. Not fucking emails, walls, muslims and pussygate, let alone if somewhat left leaning Bernie Sanders proposals were socialism by the back door. Without serious discussion on these difficult topics, America will continue to into social conflict and fear.

Even if Trump gets elected today, those 5-million jobs we’ve already lost, and another 5-million are not coming back.

Author: Mark Cathcart

Formerly an Executive Director of Systems Engineering and a Senior Distinguished Engineer at Dell. Prior to that, an IBM Distinguished Engineer working for the Systems Group in NY and Austin. I’m currently “retired until further notice”.

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