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Real Nice Economy You Got Here. Be A Shame If Someone Broke It
This clip of Harold Daggett is popping up all over twitter. The immediate aesthetics are comical; the accent, the glasses, the jewelry. If it looks like a mobster and sounds like a mobster....
There's enough discussion on the Presidential Race in the VP debate threads. The CW angle here is how the image of the "American Union Man" has always been 99% hagiography. They have been lionized in Bruce Springsteen songs and other pop culture kitsch since the 1990s at least, but the hard economics stopped working in the 1970s. Unions are a tax on everything downstream of them. Functionally, it's racketeering and extortion. They owe their bewildering continued existence to the fact that they function as a bedrock reliable voting bloc with lockstep leadership control .... until now?
We had the teamsters refuse to back any candidate earlier. Your modal longshoreman is almost certainly a Trump voter. But Trump despises Unions. So ... what's happening?
US ports are actually some of the least efficient in the world because of this point-blank refusal to adopt automation, IIRC they were next to Tanzania on the leaderboard. China and Japan are far ahead.
However, we do need to consider a balance between automation and human labour renumeration and leverage. I doubt any of us have worked in a port. Few of us are professional artists or actors, I suspect. I imagine many here would be much more sympathetic to extremely highly-paid software engineering or finance jobs getting axed and replaced by AI.
It may well be that a reasonable balance for ports vs port workers involves this thug and his hangers-on being sent off to prison for economic wrecking, mass sackings and prompt automation. But similarly reasonable balances may be imposed on unruly, arrogant tech-bros by the rest of society. Some level of working-class unity (interpreted broadly to mean all who derive most of their earning from their wage) may be appropriate here. What happens when we automated the dock workers, automated the factory workers, automate the retail workers... who will be left to go on strike when they automate us? And then where is our leverage to negotiate anything in the future?
There was a Liu Cixin short story about an Ancap civilization enforced by AI NAP killbots where one capitalist ended up owning all the parks, all the water and air after winning a completely fair free-market competition. Everyone else was confined to desolate hive cities, rasping away in filthy reprocessed air until their machines failed, unable to step a few metres away and enjoy the beautiful landscape. It is all private property. I am a NVIDIA shareholder and feel somewhat insulated by all of this... but many are not. Who is to say that someone or something won't decide 'oh these little people who bought shares pre-singularity didn't really contribute, off to penury with them! Print out another billion clones of us!'? We need leverage to negotiate and getting into a habit of discarding leverage may not be helpful, despite obvious good reasons to do so.
Good.
Good.
Productivity is the source of wealth. Holding productivity back in pursuit of rents is how you get extended (ie. century long) periods of economic stagnation.
What does happen when they automate all the farm work? Where will we go?
-- Farm laborer, 1860, when 70% of the population worked in agriculture.
Productivity is the source of wealth. What happens when we, individual human beings without exceptional skills (and eventually them too), are no longer productive in any job? It's going to happen sooner or later, likely sooner.
When we are no longer productive, all we have are legal/moral claims to wealth that is fundamentally controlled by others. That's a precarious position to be in!
Competing states are absolutely advantaged by higher productivity but you and I aren't states or economies or large firms.
It has yet to happen anywhere, any time. There's always something else for people to do.
No, but we are advantaged by higher productivity, too. The 'golden age' of the post-war boom was possible because of higher than usual productivity growth from the 1920s through the 1970s.
People benefit from being wealthier. Higher productivity makes us wealthier. It's pretty straightforward.
I agree that it is bad for ports to be grossly inefficient. These dock workers probably do need to lose their sinecures. But we need a more sophisticated position than 'put it off till tomorrow' or 'make them humiliate themselves providing pointless services (Ubereats and 20 different fast food outlets) to the shrinking middle-class' or 'have them fill out some paperwork and pretend to be disabled'.
Higher productivity doesn't make everyone wealthier automatically, it just produces wealth. That wealth need not be distributed, it might just get turned into another 24/hour automated port, a factory with a few engineers overseeing the machinery, dividends, raising house prices another 20%. No law says that wages must keep pace with productivity.
There absolutely is such a law. Even in high theory, the situations where wages != Marginal labor product are situations of monopoly/monopsony, which are fought by breaking up the monopoly/monopsony. What do you think the proper word for a union with a chokehold on a service with an inelastic supply is? If you guessed monopoly, you'd be correct.
And it's funny you would bring up housing costs, which is an industry where construction productivity has been stagnant for most of a century and where severe supply restrictions are the underlying cause of price increases. This is another situation where the entrenched, rent-seeking interests need to be broken and the market allowed to function again, just like with the ports.
Breaking this union would be an unmitigated good for the country.
I don't see a law saying that wages must keep pace with productivity:
"2. This means that highly productive workers are highly paid, and less productive workers are less highly paid."
There is a distinction between what I said (where productivity might have nothing to do with the workers personally) and what the statement in your link says. In a world of high automation, one could easily argue that all workers are less productive and deserve much lower wages. Or we could imagine two countries. One where workers get 50% higher wages from productivity rising 100% and one where 20%, that could fulfill what I said and what 2. says. We have observed a general trend in the last 50 years where productivity rises much faster than wages rise: https://www.epi.org/productivity-pay-gap/
Housing is indeed restricted by vested interests but it's just one example of an asset that could be bid up by increasing wealth. They could do it to shares or land as well. Pure market competition is not desirable in a situation where power and production is wildly, massively unequal. I am not going to be able to compete with a 200 IQ robot working 24/7 at $0.10 per hour. We have a mixed market economy to balance these competing interests. Now I don't want some govt planning board controlling automation and getting snookered by vested interests but I do want some kind of power/capital redistribution that preserves incentives for innovation without immiserating 90%+ of the population.
And I think the best chance we have of that is by not totally and unflinchingly embracing automation (even when it makes a lot of sense). We should establish a precedent where the gains of capital and automation are distributed even to wildly unsympathetic people.
Right there:
That's not the way productivity measurement works.
https://www.bls.gov/k12/productivity-101/content/how-is-productivity-measured/calculating-productivity.htm
Automation makes individual workers more productive.
EPI is a bullshit factory think tank funded by labor unions to produce propaganda. Their """researchers""" are paid to sit around all to figure out how to twist economic statistics to push their ideological agenda.
If we're going to go for low quality sources, here's a reddit thread on that bullshit graph:
https://old.reddit.com/r/badeconomics/comments/6rtoh4/productivity_pay_gap_in_epi_we_trust/
The EPI graph is an embarrassment designed to draw in ignorant young people on the internet to believing something that isn't true because it's not like they can check it. Pretty much everything you've absorbed about the economy from the internet is bullshit lefty propaganda.
And I think we should let consumer preferences drive the evolution of the economy.
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