Economists Pin More Blame on Tech for Rising Inequality – Recent research underlines the central role that automation has played in widening disparities.

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>But Mr. Acemoglu insists that a hands-off, free-market approach is a recipe for widening inequality, with all its attendant social ills. One important policy step, he recommends, is fair tax treatment for human labor. The tax rate on labor, including payroll and federal income tax, is 25 percent. After a series of tax breaks, the current rate on the costs of equipment and software is near zero. What he’s not including and what’s very important is healthcare cost. Health insurance is essentially another tax employers have to pay to hire someone. Healthcare is the United States is insanely expensive compared any other country, and but no one talks about its effect on employment, which is massive. This makes outsourcing and automation more attractive. This also gives advantages to large firms such as walmart or amazon, that can get lower healthcare premiums via large pool negotiations , versus small businesses. Rent seeking by the US healthcare industry is the biggest problem this country faces in term of domestic policy. If we spent as much as next country in terms of percent of GDP, the saving would account to hundreds of billions.

NigroqueSimillima

the purpose of technology is to reduce or ideally eliminate the need for human labor. when people envision the future, they don’t think “hopefully i will still have to weed my lawn with my bare hands” or “hopefully i will still be screwing around with excel macros trying to get these reports to line up.” we don’t even think “hopefully i will be debugging robot heuristic algorithms using my 11 PhDs for 65 hours a week while my kids grow up wondering who the fuck i am.” *the goal of technology is for nobody to be doing any of this shit.* so tech is not to blame for eliminating the need for labor and therefore jobs – that’s why we’re doing it. the problem is that the “trade your labor for your survival” contract no longer holds – and it shouldn’t. this is a dumb arrangement in the first place.

dust4ngel

This has been known for many several years now. It’s not so much that the middle class is disappearing as it is being split into two – upper middle class and lower middle class. The problem is that demand for repetitive and easily automated work such as bookkeeping, cashiers etc is being eroded due to technology. This is forcing jobs that were previously lower middle class/working class into low class/poverty level jobs as the number of job seekers in those fields outstrips demand. On the other hand people that would have been middle class can with some education jump to upper middle by helping create these technologies. These automations are of course making more millionaires and billionaires as well.

IHaveaDegreeInEcon

This is a very small part of the conversation. Real growth comes from “savings out of income.” With the majority of household debt being more than 60% of their income in conjunction with government debt being way more than 60% of gdp, real growth cannot occur. Marginal revenue product of debt PROVES this to be fact and not a mere concept within economic theory. When the fed lowers rates, they create a disincentive to save which reduces the opportunity cost of money to be invested in real growth. Instead, the opportunity cost to invest in financial assets increases.

BambiDangles14

Uh yeah, I pretty much can’t do anything better than a machine designed only to do one job. What will we do when we automate all the work away? Will we all be unemployed?

scruffywarhorse