|By Kevin Benedict||
|January 12, 2017 12:45 PM EST||
Adam Smith wrote about rational self-interest, which posits we work together for the greater good when it benefits ourselves. Does this concept translate to robots, automation and employment? I think it does.
I believe most of us would agree that replacing large numbers of humans with machines that result in wide scale unemployment and suffering is not in our rational self-interest. Having massive numbers of jobs terminated by the Terminator does not result in a safer, healthier civilization or vibrant economy; therefore, it is not in our best interest.
Just because something is possible, does not mean it is good. A powerful king that takes all the food, property and means of production away from his people resulting in their suffering, quickly becomes a target of their wrath, and on a quick path to obsolescence.
Businesses that replace human workers with machines and software, out of self-interest, will over time find it increasingly difficult to sell their products to their unemployed or underemployed consumer base. At what point do businesses seek to expand employment opportunities out of a rational self-interest rather than decrease them through automation? And, is it even realistic for profit maximizing businesses to seek the greater good? We must ponder these issues as a society and economy.
In the short-term, factories hope to benefit from automation faster than their competition in order to gain advantages - while there are still sufficient numbers of consumers employed elsewhere to provide a market for their goods. In the mid-term, entire industries will automate and terminate large numbers of jobs, but hope other, slower-to-automate industries will employ their consumer base. In the long-term, however, when digital transformation has swept through all industries, who is left to employ the consumers and provide them living wages, and who is left with capital to buy goods?
As jobs that require little training or education diminish in numbers, we have two choices, 1) Increase education levels to equip our population for the digital future, or 2) subsidize the unemployed and underemployed with a sufficient income to survive and maintain their dignity. If there are still not enough jobs for those who work hard to increase their level of education, then we are reduced to one choice.
There are plenty of problems left on this planet to be solved, and solving these problems could employ many. Today, however, not all of these problems have economic values assigned to them. Fresh water sources, clean air, forestation, peace, better health, better education, etc., all of these have the potential to generate enormous economic benefits, but they need society to place a value on them and reward innovations and employment in these areas.
A vibrant economy, and a safe and secure society, depends on healthy employment numbers, adequate wages, property ownership, human and property rights, hope, peace and purpose. Digital transformation must foster these goals, or risks accelerating a break down in our society and economy - two things that can dampen a New Year's celebration.
Follow Kevin Benedict on Twitter @krbenedict
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