An Economy Based on Machines Not Humans?
In the early 1960s, a coalition of academics, journalists, technologists, including Nobel Prize Winners Linus Pauling in chemistry and Gunnar Myrdal in economic sciences, submitted a report to President Lyndon Johnson that described a “triple revolution.” “Two of the revolutionary forces identified in the report — nuclear weapons and the civil rights movements — are indelibly woven into the historical narrative of the 1960s,” writes Martin Ford in Rise of the Robots. “The third revolution, which comprised the bulk of the document’s text, has largely been forgotten.” In their report to Johnson, the authors warned of an economy based on machines, not humans, with the result being, Ford writes, “massive unemployment, soaring inequality and, ultimately, falling demand for goods and services as consumers increasingly lacked the purchasing power necessary to continue driving economic growth.”
The central thesis of Rise of the Robots: Technology and the Threat of a Jobless Future, is that the world can no longer afford to ignore this third revolution. It is here, now. In his detailed, wide-ranging book, Ford, a software entrepreneur and writer, points to the economic markers that bolster his pessimistic vision of the future. For example, starting in the 1970s and contrary to all that had happened before, increase in productivity stopped translating into increased wages — just one of seven deadly economic trends that Martin attributes to advances in information technology.
Creative destruction may be a comforting hypothesis, writes Ford — yes, the horse-and-buggy industries disappeared, but they were replaced by the massive automobile industries. The new companies of the digital industry, however, are no General Motors. When, two years after its founding, YouTube was sold for $1.65 billion, it had a total of 65 employees. And he is unmoved by those who argue that technology may lower wages, but it also lowers prices, so it all comes out okay in the end. If you have no income, lower prices don’t matter.
Technology’s Negative Impact
Technology isn’t creating jobs, Martin argues. It’s taking them away. The evidence that Martin marshals to make his case for the negative impact of automation and artificial intelligence on the economy is impressive. It’s no longer just factory jobs that are being automated. Computers can now write newspaper articles, grade not just multiple-choice tests but also essays, compose music and beat the best players of Jeopardy! — a feat which requires a sophisticated understanding of the nuances of language that baffle traditional algorithms (Martin notes that a Google search of the Jeopardy clue “Sink it and you scratch” is going to lead you to countless links related to scratches in sinks — and not to the game of pool to which the clue refers). Both blue- and white-collar jobs can be taken over by machines.
Information technology, from big data to automation to artificial intelligence, is indeed exploding the economy, with the results that parallel the warnings of the triple revolution report: income inequality, sinking wages and evaporating purchasing power. Martin’s solution — a guaranteed income for all — is unlikely to find many adherents. At the very least, however, let’s hope that Rise of the Robots is a boulder in the pond of the self-satisfied techno-optimists and self-serving economists and policymakers who cling to the answers provided in their political doctrines.
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