Saturday, December 31, 2016

Trump Ain’t Bringing Any Jobs Back— Quite The Opposite


Trump has always made a big deal about how brilliant he is— high IQ, great college education, “all the best words,” etc— but in reality, he has a very average IQ, higher than his supporters, of course, but probably the lowest of any legitimate American president. As for his education… he flunked out of Fordham, which isn’t a top school to begin with, and his daddy then bought him a spot in a "special" real estate program at Wharton, where he failed to make any kind of impression on anyone for the months he was there. And, it isn’t likely he learned much at Wharton or in the greater University of Pennsylvania environment it is part of. For a final post of the wretched 2016, I want to reference the current work of Wharton’s Art Bilger, a venture capitalist and board member at the business school. He sees massive disappearances of jobs over the next couple of decades. Massive.
The Trump campaign ran on bringing jobs back to American shores, although mechanization has been the biggest reason for manufacturing jobs’ disappearance. Similar losses have led to populist movements in several other countries. But instead of a pro-job growth future, economists across the board predict further losses as AI, robotics, and other technologies continue to be ushered in. What is up for debate is how quickly this is likely to occur.

Now, an expert at the Wharton School of Business at the University of Pennsylvania is ringing the alarm bells. According to Art Bilger, venture capitalist and board member at the business school, all the developed nations on earth will see job loss rates of up to 47% within the next 25 years, a statistic from a recent Oxford University study. “No government is prepared,” The Economist reports. These include blue and white collar jobs. So far, the loss has been restricted to the blue collar variety, particularly in manufacturing.

To combat “structural unemployment” and the terrible blow it is bound to deal the American people, Bilger has formed a nonprofit called Working Nation, whose mission it is to warn the public and to help make plans to safeguard them from this worrisome trend. Not only is the entire concept of employment about to change in a dramatic fashion, the trend is irreversible. The venture capitalist called on corporations, academia, government, and nonprofits to cooperate in modernizing our workforce.

To be clear, mechanization has always cost us jobs. The mechanical loom for instance put weavers out of business. But it’s also created jobs. Mechanics had to keep the machines going, machinists had to make parts for them, and workers had to attend to them, and so on. A lot of times those in one profession could pivot to another. At the beginning of the 20th century for instance, automobiles were putting blacksmiths out of business. Who needed horse shoes anymore? But they soon became mechanics. And who was better suited?

Not so with this new trend. Unemployment today is significant in most developed nations and it’s only going to get worse. By 2034, just a few decades, midlevel jobs will be by and large obsolete. So far the benefits have only gone to the ultra-wealthy, the top 1%. This coming technological revolution is set to wipe out what looks to be the entire middle class. Not only will computers be able to perform tasks more cheaply than people, they’ll be more efficient too.

Accountants, doctors, lawyers, teachers, bureaucrats, and financial analysts beware: your jobs are not safe. According to The Economist, computers will be able to analyze and compare reams of data to make financial decisions or medical ones. There will be less of a chance of fraud or misdiagnosis, and the process will be more efficient. Not only are these folks in trouble, such a trend is likely to freeze salaries for those who remain employed, while income gaps only increase in size. You can imagine what this will do to politics and social stability.

Mechanization and computerization cannot cease. You can’t put the genie back in the bottle. And everyone must have it, eventually. The mindset is this: other countries would use such technology to gain a competitive advantage and therefore we must adopt it. Eventually, new tech startups and other business might absorb those who have been displaced. But the pace is sure to move far too slowly to avoid a major catastrophe.

According to Bilger, the problem has been going on for a long time. Take into account the longevity we are enjoying nowadays and the US’s broken education system and the problem is compounded. One proposed solution is a universal basic income doled out by the government, a sort of baseline one would receive for survival. After that, re-education programs could help people find new pursuits. Others would want to start businesses or take part in creative enterprises. It could even be a time of the flowering of humanity, when instead of chasing the almighty dollar, people would able to pursue their true passions.

On a recent radio program, Bilger talked about retooling the education system in its entirety, including adding classes that are sure to transfer into the skills workers need for the jobs that will be there. He also discussed the need to retrain middle-aged workers so that they can participate in the economy, rather than be left behind. Bilger said that “projects are being developed for that.” Though he admits that many middle-aged workers are resistant to reentering the classroom, Bilger says it’s necessary. What’s more, they are looking at ways of making the classroom experience more dynamic, such as using augmented reality for retraining purposes, as well as to reinvent K-12 education. But such plans are in the seminal stages.

Widespread internships and apprenticeships are also on the agenda. Today, the problem, as some contend, is not that there aren’t enough jobs, but that there aren’t enough skilled workers to fill the positions that are available. Bilger seems to think that this problem will only grow more substantial.

But would those who drive for a living, say long haul truckers and cab drivers, really find a place in the new economy with retraining, once self-driving vehicles become pervasive? No one really knows. Like any major shift in society, there are likely to be winners and losers. This pivot point contains the seeds for a pragmatic utopia, or complete social upheaval, but is likely to fall somewhere between.

Bilger ended the interview saying, “What would our society be like with 25%, 30% or 35% unemployment? … I don’t know how you afford that, but even if you could afford it, there’s still the question of, what do people do with themselves? Having a purpose in life is, I think, an important piece of the stability of a society.”
Tough times ahead-- just when we desperately need extraordinary leaders... instead of the exact opposite. Trump's economic team is the worst I've ever seen in my lifetime. They will be incapable of doing anything but making everything that comes down the pike manifestly worse. And the quality of the opposition-- think about the reptilian Chuck Schumer and a tired and confused Nancy Pelosi isn't any better (even if, at times, arguably better-intentioned). Happy New Year!

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At 4:55 AM, Anonymous Hone said...

Gee how uplifting - another horrific disaster down the pike. As if there's not enough to worry about in the upcoming year! Lack of effort for population control is another big problem that will exacerbate all said.

At 6:23 AM, Anonymous Anonymous said...

Excellent point, Hone. Populution is the biggest reason that climate change cannot be fixed... ever. But I digress...

This is a topic that gets zero notice but is just as important as any other today. And it also points out just how miserable our media is and how ignorant and stupid our populace is.

“What would our society be like with 25%, 30% or 35% unemployment?..."
The key question. It presumes all else will be static except for the U3 measure (since Reagan we use U3 instead of U4, U5 or U6 -- the one we should use).

What that implies is that "society" will remain indifferent to the plight of those structurally un/underemployed and will continue to squeeze the hapless until they "do" something. The answer to the question is readily apparent. Look at history (of course maleducated americans are ignorant of it) of France, Russia, China and everywhere else where that high a percentage are hungry and powerless and society does dick about it.

Looking to our government, which means arguably looking in the mirror, we see no help either for the hapless chattel being extruded out of useful society nor for any sort of actual recognition that there really *IS* a problem here.
Our government, being of, by and for the capitalists, are totally engaged in self-enrichment (by definition in capitalism, at the expense of the haplessly extruded) and are openly hostile to helping anyone that doesn't offer them any further enrichment. But again I stress we need to look in the mirror since WE elect these sociopaths.

And a comment about scummer and Pelosi... I will argue that their history of deeds, the ONLY useful measure of people, proves that they are NOT, actually, "better-intentioned". In taking the measure of someone, one needs to be deaf to their words (and blind to their expressions). One should only measure that which they do. And in the case of the Democraps since the early '80s, that which they do is no less misanthropic and sociopathic than the Rs. They DO move a tick slower in oppressing the haplessly extruded... but they still plod along that same vector.

“What would our society be like with 25%, 30% or 35% unemployment?..."
Using the mirror of the 2016 election, it is apparent that "our society" while doing nothing about the U3, will also deny those haplessly their basic needs for life (food stamps, medicare, Medicaid, SSI are all going to be cut or eliminated by April). So "society" wants them dead?

On our current vector, will the next big gummint contract be for large camps with many ovens?

Don't look to Democraps. They take millions from all the corporations who would stand to profit from building camps and constructing all the ovens. And THEY were the ones offering to start the cutting during the obamanation admins.

Mirrors are a bitch sometimes.

At 3:31 PM, Anonymous Robert Dagg Murphy said...

High unemployment is a sign of success. We can automate and sit on the porch knowing that we have unlimited energy coming from our Star Sun and wealth is without practical limit. Happy new year and may humanity learn the above mentioned truths to design better economic, social and political system. Less politics and more science.

At 10:09 PM, Anonymous Anonymous said...

Robert, when did humanity learn anything useful about capitalism? Oh, yeah, Karl Marx. How did that wisdom turn out?

Boeing alone more than makes up for that which drumpf is fraudulently taking credit (several hundred at Carrier and 5000 jobs not moving at... ??? forgot where). B cut over 8K jobs in 2016 and announced a continuation of layoffs in 2017, though not a target number.

Their stock jumped over 1% on the announcement.

B isn't alone. My old company just put several hundred through the chipper at EOY and will keep chipping in 2017 also. For every layoff here, they hire 4 or 5 in India. The 'street' loves that shit.

Capitalism at work.


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