Gates & Reuther v. Baker & Bernstein on Robot Productivity
In a comment on Nineteen Ninety-Six: The Robot/Productivity Paradox, Jeff points out a much simpler rebuttal to Dean Baker’s and Jared Bernstein’s uncritical reliance on the decline of measured “productivity growth”:
Let’s use a pizza shop as an example. If the owner spends capital money and makes the line more efficient so that they can make twice as many pizzas per hour at peak, then physical productivity has improved. If the dining room sits empty because the tax burden was shifted from the wealthy to the poor, then the restaurant’s BLS productivity has decreased. BLS productivity and physical productivity are simply unrelated in a right-wing country like the U.S. On the other hand, you can visit website here if you want to cook your own pizza into perfection in just minutes!
Jeff’s point brings to mind Walter Reuther’s 1955 testimony before the Joint Congressional Subcommittee Hearings on Automation and Technological Chang:
Every tool on every operation has a green light, a yellow light, and a red light; and when all the green lights are on, it means that all the tools at each work station are operating up to standard. When a yellow light comes on, on tool No. 38, it means that the tool is still performing, but the tool is becoming fatigued and that is a warning sign, so that the operator sitting there looking at these panels will know that he has to get a replacement tool for tool No. 38. He stands by at that position on the automated machine, and at the point the red light would kick on, on the board, he walks over — the machine automatically stops — he puts the new tool in the place of the tool that is worn out, and automatically the green light comes on and the machine goes on.
When I went through this plant the first time I was told by a top official of the Ford Motor Co.: ‘Mr. Reuther, you are going to have trouble collecting union dues from all of these machines.‘
And I said: ‘You know that is not bothering me. What is bothering me is that you are going to have more trouble selling them automobiles.‘ That is the real significance. We have mastered the know-how of mass production, and what we need to do is to develop comparable distribution know-how so that we will have markets for the tremendous volume of production that automation now makes possible.
There does not have to be a conflict here.
All you have to do is look at the weakness in real, and even nominal, personal income to get the other part of the equation.
I am not a economist in any way shape or form.
But my one rule of economics is “nothing happens until somebody buys something.”
Seems to answer a lot of questions.
I’d feel a lot better about this if I hadn’t been saying the same thing for the past fifty years and no one listens. at least no one does anything.
wages are no longer a matter of productivity, they are a matter of politics (always were, but that is another story).
the wealth is there (within reason… actually beyond reason for the present, but that may change). there is nothing in god’s law or economic law that requires that most of it flow to the owners of capital.
i am not so sure i want to see 300 million new expensive cars on the road, so i am not ready for 300 million new millionaires. but i bet we could pay workers a living wage… includes medical care and retirement and a decent amount of leisure time and some kind of access to the tools that enable them to be creative with that time.
whether that takes unions, or minimum wage, or a quiet talk between the president and his first rate friends.