View 662 February 14 - 20, 2011 (original) (raw)
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Thursday, February 17, 2011
Progress
For 25,000 years the material quality of life for the average person changed but little. It could be summed up in the single word poverty. For all the glitter of Bath and Brighton Beach, the average English citizen in the early 19th Century had a quality of life hardly superior to that of the average lake or marsh or forest dweller in Europe or Mesopotamia in 4000 BC. There was glamour in those Regency times. The pelisse of the hussar, the splendid uniforms of Napoleon's Grenadiers, the country houses so well described by Jane Austen; but beneath that layer of glitter was uniform poverty. If you doubt it, read A Farewell to Alms (kindle link) and see the evidence marshaled by Gregory Clark. If you think he has made too extreme a case, factor in your own interpretation of his data; but be aware of the data. If you think the life of the average Englishman of 1810 to be that much better than that of the average Roman in Etruria in the year in which Caesar Augustus decreed that all the world should be taxed, look at the numbers and make your adjustments; but do understand that his point is well made. For the average human, there was not a lot of progress through all of history.
For most of history, for most of humanity, life was hard, and seldom got better. Clark ascribes this to the Malthusian Trap: when conditions get better, people breed up a new population that lowers the average to subsistence level again. Add the observations that Possony and I made in our study of the strategy of progress: that human societies convert more and more of their output to structure, so that bureaucracy absorbs all surpluses, all creativity and progress ceases except for short periods when output grows so rapidly that the structure can't keep up. Examples would be the Discovery of the New World, gunpowder, and all three Industrial Revolutions, and the Silicon Valley revolution. For a while human ingenuity outstrips the ability of government to control it; but inevitably the regulators return. Note also that the bureaucracy inevitably assumes a patron status to its clients, so that the apparatus always takes a high place in the distribution of the society's assets. There is always a nomenklatura, which does not live spectacularly well, but has comfortable conditions. It makes nothing but it is needed so that all will be tranquil. It provides security, regulation, order. And it eats better than those it regulates.
Of course there will always be those at the very top, with wealth beyond the dreams of avarice; how they acquire that status varies with the society, and varies greatly even within that society -- contrast Bill Gates, Al Gore, John Kerry, Bill Clinton, in this era as opposed to Rockefeller, Jay Gould, Andrew Carnegie, Vanderbilt and Mellon of the past -- but that niche is always filled.
With that as background, read "Is Your Job an Endangered Species" by Andy Kessler in today's Wall Street Journal (link). If you think his job classification list is whimsical, substitute your own. Then read "When Computers Beat Humans on Jeopardy" by Roy Kurzweil, also in today's Wall Street Journal (link), and fold that back into your job classification scheme.
Kurzweil believes that the ratio of computer performance to price doubles in less than a year now. Moore's Law is accelerating. We are on an S curve and the rate of change is itself accelerating. Whether that's true or not, it's pretty clear that Moore's Law at least prevails. Performance/price rises exponentially. We each have on our desks more computing power than existed in all the world when I acquired my first computer, and computers now do jobs that were once thought absolutely secure.
Now contemplate the financial situation: neither the Federal nor the State governments have any money; indeed all have unpayable debts, and are almost at the limit of their borrowing, to the point that they are now contemplating selling capital assets like state office buildings in order to stave off collapse for another year or so. Bullying the politicians will continue, but the largesse they have to dispense is much shrunk and shrinking still. You will now be ready to take stock of your situation.
From Kessler's article:
You can't blame the fact that 26 million Americans are unemployed or underemployed on lost housing jobs or globalization�those excuses are played out. To understand what's going on, you have to look behind the headlines. That 36,000 is a net number. The Bureau of Labor Statistics shows that in December some 4,184,000 workers (seasonally adjusted) were hired, and 4,162,000 were "separated" (i.e., laid off or quit). This turnover tells the story of our economy�especially if you focus on jobs lost as a clue to future job growth.
With a heavy regulatory burden, payroll taxes and health-care costs, employing people is very expensive. In January, the Golden Gate Bridge announced that it will have zero toll takers next year: They've been replaced by wireless FastTrak payments and license-plate snapshots.
Technology is eating jobs�and not just toll takers.
Tellers, phone operators, stock brokers, stock traders: These jobs are nearly extinct. Since 2007, the New York Stock Exchange has eliminated 1,000 jobs. And when was the last time you spoke to a travel agent? Nearly all of them have been displaced by technology and the Web. Librarians can't find 36,000 results in 0.14 seconds, as Google can. And a snappily dressed postal worker can't instantly deliver a 140-character tweet from a plane at 36,000 feet.
So which jobs will be destroyed next? Figure that out and you'll solve the puzzle of where new jobs will appear.
Now read Kurzweil's estimate (link) that every one of you will have a Watson on his desk by 2020. Watson is the IBM computer that just beat the previous champions of the very human talented intellectual game "Jeopardy". Kurzweil's customary optimism about technological progress may be an exaggeration, but then again it may not be: we are well up on the steeply rising part of the S curve of computer technological progress. Now an iPad app can do some clerical jobs. The biggest bookseller in the world doesn't have any pleasant clerks to welcome you to the store. And for those whose jobs are safe only because there are government requirements for licenses, contemplate Kessler:
Sponges are those who earned their jobs by passing a test meant to limit supply. According to this newspaper, 23% of U.S. workers now need a state license. The Series 7 exam is required for stock brokers. Cosmetologists, real estate brokers, doctors and lawyers all need government certification. All this does is legally bar others from doing the same job, so existing workers can charge more and sponge off the rest of us.
But eDiscovery is the hottest thing right now in corporate legal departments. The software scans documents and looks for important keywords and phrases, displacing lawyers and paralegals who charge hundreds of dollars per hour to read the often millions of litigation documents. Lawyers, understandably, hate eDiscovery.
Doctors are under fire as well, from computer imaging that looks inside of us and from Computer Aided Diagnosis, which looks for patterns in X-rays to identify breast cancer and other diseases more cheaply and effectively than radiologists do. Other than barbers, no sponges are safe.
Such job restrictions are enforced by unions. Private sector unions are vanishing, in part because they drove their industries out of the state, or out of the country, Public sector unions are growing; but their power rests on political ability to extract money from the public institutions, and the public institutions are flat broke. That won't stop the bureaucracies, which will eventually devour their own.
Now add in the recent dramatic rises in commodity futures: food, fuel, it's all going up. In the old days that was known as inflation. In Carter's time unemployment plus inflation was known as stagflation, and added up to a misery index. No one thinks in those terms now.
In Wisconsin they have taken to the streets, and the Democrats are boycotting the Senate. The police are now trying to round up Senators to require them to attend the legislature to form a quorum. There are crowds in the streets, How that plays out is uncertain. Perhaps the Wisconsin governor will be driven out of the state to exile in some right to work state?
Humor aside, we live in interesting times, and unrest in the Middle East drive up oil prices, which will drive up the price of energy, which translates into increased food prices. We will continue to mandate adding alcohol to gasoline. Burn food to save the planet.
And technology marches on. Whether or not a computer passes the Turing Test next year or next decade, we can be sure that more and more service jobs can become apps on the pocket computers we will all carry in 2015. Meanwhile, various agencies, boards, commissions, inspectors will make it more and more expensive to hire a human to do that job. And the public service unions will continue to insist on their rights to pensions and benefits. And the teachers will insist on their right to pensions, and benefits, and academic freedom while more and more of their students drop out. And the students will insist on more and more money to be paid to their professors who will teach them that they deserve low tuition and cheap room and board while studying womyn's studies, ethnic studies, social science, or whatever they choose to study at someone else's expense.
Where this all goes is not at all clear. The governments are out of money. There is probably another round of tax increases to be endured before it all collapses. "And they never catch wise." But of course everyone catches wise eventually. And meanwhile there is no more money. We can run the printing presses for a while longer, but those with goods to sell will demand higher and higher prices, and without money to invest, perhaps the technological revolution will be slowed, at least in the United States.
The Industrial Revolution beginning in about 1850 produced the world we know, in which every generation could look forward to more: longer life, more to eat, better housing, and all that and more for their children. Progress, not just for the officer class, but for everyone; a time when everyone would be a lady or gentleman, not a peasant or a servant; when hard work could create a better life for everyone. The world changed, progress outran the Iron Law. But that was in another country.
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