How “Use of Machinery” Promotes Inequality and Social Upheaval

Yves here. Look at how obvious the impact of capital (“machinery” is now often “robots” or the all-encompasing “technology”) on communities and the status of was roughly 175 years ago:

By Sandwichman. Originally published at EconoSpeak

More Feargus O’Connor (1844) on labour’s objections to machinery:

And now, sir, let me state my principal objections to the unrestricted use of machinery. First, it places man in an artificial state, over which the best workman, the wisest man and most moral person, has no control. Secondly, while it leads to the almost certain fortune of those who have capital in sufficient amount to command those profits, made up, as you admit, by the reduction of wages; upon the other hand, it leads to uncertainty in the condition of the employed, against which he is incapable of contending. Thirdly, it disarranges all the social machinery of which formerly individuals were necessary items, families formed branches, and small rural districts important sections of the one great whole. Fourthly, the present fluctuations give rise, in good trade, to an augmentation of artificial classes, if I may so call them, who have no natural position in society, but are merely called into existence by present appearances, trade upon nothings, traffic in fiction, and, like your order, speculate upon what they may retire upon when trade begins to flag. Hence we find each fluctuation in trade followed by a new race of shopkeepers, who are grasping in prosperity, compound when appearances change, and retire when adversity comes, leaving a vacuum to be filled up by the next alternation from panic to speculation….

And now, as the thread of our dialogue has been somewhat broken, I beg to submit a summary of my objections to machinery. Firstly, the application of inanimate power to the production of the staple commodities of a country must inevitably depreciate the value of manual labour; and every depreciation of the value of man’s labour in an equal degree lowers the working-man in the scale of society, as well as in his own esteem: thus making him a mere passive instrument, subservient to any laws that the money classes may choose to inflict, to any rules the owners may impose, and satisfied with a comparative state of existence. I object to machinery, because, without reference to the great questions of demand and supply, the masters can play with unconscious labour as they please, and always deal themselves the trumps. I object to machinery, because it may be multiplied to an extent whereby manual labour may be rendered altogether valueless: I object to machinery, because under its existing operation you admit the necessity of emigration, better ventilation, education, improved morality, manners, habits, and customs of the working classes, thereby showing that a slate of recklessness, ignorance, want, and depravity exists; which, as I before said, you admit to be consequences of the present system.

While the inevitability of each of O’Connor’s objections is subject to debate, the crucial issues at stake for him are the sociological and psychological effects of the unrestricted use of machinery on communities and individuals, under its existing operation. The specter of the “job-killing robot” plays a minor and only contingent role: “it may be multiplied to an extent whereby manual labour may be rendered valueless.” Even that objection can readily be interpreted as more significantly about a loss of social status and psychological esteem rather than a wholesale elimination of jobs.

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  1. mark

    This might be a common opinion but even in the 19th century it was exposed as misconception. Let’s turn to that well known promoter of the bourgeoisie Karl Marx who wrote in the first volume of the Capital (I’m translating and paraphrasing):
    All wealth is based upon productivity or the amount of productive human labour needed to produce a given product. Given the inherent assumption of competition in everything he wrote about Capitalism it follows that an individual Capitalist will only introduce machinery if the amount of productive labour needed to produce the machinery (its value) and the amount of labour needed to produce a product with it will be less than the previous amount of labour needed to produce the same product without the machinery. For example a thousand pair of shoes represent the total expenditure of a hundred hours of productive labour while using machinery compared to two hundred hours without it. Thus by introducing machinery productivity increases as does overall wealth. Or in other words society has more products to consume.
    The problem is not the machinery but the allocation of the gains made by it. In case all gains made by increasing the overall productivity are left to reside with the capitalist-class it is obviously bad for everyone else. On the other hand when some or all of the gains are redistributed to other parts of society it is going to increase the (material) well being and should be welcomed. This is as true with steam powered looms as it is with robots.

    1. MoiAussie

      In case all gains made by increasing the overall productivity are left to reside with the capitalist-class it is obviously bad for everyone else.

      You were going well up to this point. Imagine the machinery company, that not only supplies the machinery but extracts an ongoing share of the gains from its use by supplying expert labourers to service it, fix it when it breaks, upgrade it as technology is refined or scale of use extended. Said company also employs draftsman and designers and craftsmen to create and improve the machinery, salesmen to spruik it, accountants to keep the books, etc. Introducing machinery may also require a company to buy new inputs, such as oil, coal, electricity, etc., and thus gains are distributed out.

      IOW, there is a cost of doing business with machinery that goes well beyond the initial cost of purchasing a machine, and this part of the gains flow not just to the owner of the machinery company but all those involved in that enterprise, and possibly others. If, as in the modern world, the machinery company itself relies on others to supply it with parts or machines or experts, the distribution goes even further.

      1. mark

        If the TCO of a machine are not lower or at least equal than the labour cost it replaces the Capitalist employing it would worsen its competitive standing and loose out in the long-term. Thus even considering all newly created jobs, they must be equal or less than what is replaced. This holds true from a theoretical standpoint as long as one assumes (close to) perfect competition, which Marx does in his work.
        As said before this is not my opinion but a paraphrasing of his work hence the vocabulary.

        1. HBE

          If the TCO of a machine are not lower or at least equal than the labour cost it replaces the Capitalist employing it would worsen its competitive standing and loose out in the long-term.

          The issues are, you are assuming rational actors, that what we live under now is capitalism (it isnt), as well as competition.

          Capital is more often than not going to collude rather than compete when push comes to shove in a struggle between it and labor. Competition is rare and temporary, collusion is not.

          We do not live under capitalism, what currently exists is more akin to corporate socialism. Which further ecxacerbates the issue of irrational actors, why take a rational approach to the markets when risk is socialized or you can hire a very tiny cohort of lobbyists to guarantee you income (think ACA, which amounts to an extracted subsidy for insurers.).

          Machines (robots) are not purely about improved efficiency (the rational pure capitalist), they are about power. The power to go without labor altogether, and cow it utterly. Bezos workhouses do just fine paying almost nothing to humans, but they are bad PR and labor tends to organize eventually and struggle for that power, robots not so much.

          Your analysis assumes rational actors and capital, and leaves out the human dynamic of power. Our current oligarch class is assuredly not rational. The NC analysis of Uber is a recent example, a company doomed to fail when looked at rationally, but valued as if it’s certain to succeed, that is not rational.

          Humans (even oligarchs) are often not rational, and often desire complete power over “competitive standing”. Bezos doesn’t want robots to improve “competitive standing” or because they are more efficient, he wants them because of the additional power over everyone they provide.

          Quit assuming rational actors.

          1. Carolinian

            Yes like almost everything else in the end it is all about power. I’ve always thought the dirty secret of most of those capitalists who criticize government and “lazy” bureaucrats is that they themselves aspire to be like government–a monopoly institution with a guaranteed revenue stream.

            1. MoiAussie

              they themselves aspire to be like government

              like government but without any obligations to citizens, other nations, or the natural world.

          2. Left in Wisconsin

            We do not live under capitalism, what currently exists is more akin to corporate socialism.

            I think you have this exactly backwards. All that “rational actor” crap is what has nothing to do with capitalism. (Indeed, the word ‘capitalism’ does not exist in neoclassical economics.) Capitalism is exactly about a capitalist class exercising its power over working people to twist society in ways that benefit it as a class. Which is precisely what we have.

    2. Moneta

      The root of our problem is the definition of wealth. Our definition does not account for externalities.

      When we build a house, we see it as wealth creation but in reality we most probably sacrificed an arable piece of land and depleted resources. This structure will depreciate over time and will need future resources for maintenance. But all activity around this depreciation is seen as wealth because it enters GDP.

      Since every unit of GDP needs loads of resources and energy we are increasingly impoverishing future generations because of depletion and degradation.

      We can keep on using a bad definition of wealth as long as we can exploit our planet’s resources. But the question is for how much longer? Millions are convinced technology will save us.

      It’s true that technology advances in leaps and bounds but in my lifetime, I have not seen our planet get healthier. Looking at a map of roads in NA is an eye opener… the network of paved roads needing maintenance and limiting the movement of animals is shocking. Not to mention that a lot of our dirty productuon just moved to emerging markets making it look like we are environmentalists.

    3. Sandwichman

      “The problem is not the machinery but the allocation of the gains made by it. ”

      That is actually what O’Connor is saying, in part. But the key issue is that capitalists control the allocation of those gains and they introduce machinery to enhance their control over allocation. “The masters always deal themselves the trumps.”

      This was the second in a pair of postings, the first of which, Crowding Out and the Social Overhead Costs of Labor, gave more context and analysis.

      1. Left in Wisconsin

        they introduce machinery to enhance their control over allocation

        This may be true but this is not the only reason why corporations introduce machinery. I have been recently perusing Barnett’s (1926) “Chapters on Machinery and Labor.” The Owens automatic bottling machine cut labor costs for a gross of beer bottles from $1.47 (for hand-blown) to 10 cents in 1906. And within the following decade, the machines had tripled their productivity, completely doing away with hand blowing. Likewise, the linotype machine quadrupled productivity over hand setting type (4-5000 ems per hour vs 1000), although to achieve this required using an experienced (hand) typesetter, not an unskilled worker.

        Because there are some cases where the productivity gains make new machinery a no-brainer (i.e. ATM’s), it is hard to determine when the objectives of introducing new machinery are less valid. This is why I think Marx was right to focus on the allocation of the gains. (Plus, we need time to “hunt in the morning, fish in the afternoon, …) If the gains must be shared beyond the owners of capital, the equation changes.

        1. Sandwichman

          “this is not the only reason why corporations introduce machinery”

          Of course not. Did I say it was the only reason? But it is a strategically important reason and I might even say the decisive reason.

          1. Left in Wisconsin

            To be clear, I love your posts and don’t take major issue with them. Just trying to think things through. Whether we like it or not, IMO we are clearly in an era when two things are true:
            1. We are in the midst of (another) great technological leap, which is fundamentally changing lots of ways of doing things.
            2. There are very few situations in which businesses need to fear labor that is too expensive or uppity. (Silicon Valley is perhaps one place.)

            So I don’t view corporate fear of a worker-ist threat to allocation of the spoils (at least at the level of the firm) as particularly motivating in this era. Though I suppose ever-vigilant …

            For example, I think one possibility in our current period, if we presume a thoughtful and foresighted capitalist class, is that there is a desire to move working people out of production of conventional goods into caring work (caring for the 1%). It would seem to me the 1% have a strong incentive to keep this work low-paid even though demand is, and will indefinitely continue to be, exploding. Thus, the need to continue the assault on working people in the traditional, goods-based economy, both through low-wages and automation (which is other periods have been seen to be alternatives, not complements).

            1. Sandwichman

              My sense is that a lot of the dysfunction has been institutionalized to such an extent that “a thoughtful and farsighted capitalist class” is an oxymoron.

              A thoughtful and farsighted capitalist class would commit suicide. ;-)

    4. digi_owl

      How Marx dealt with machinery in his thinking was perhaps his one great flaw.

      For some reason he assumed that the value extracted from a machine was the same as was put in by workers when they made it.

      But a machine is, imo, more a value amplifier/multiplier than a value container.

      By this i mean that a machine will increase the value output of the worker operating it (in a increasingly vague sense as machines becomes more sophisticated) multiple times over, compared to one just working with hand tools. And the total value thus produced will be much more than what was originally put into the machine’s construction.

      1. Moneta

        Not sure. We’re not accounting for all externalities when constructing our machines.

  2. SA

    He was a Chartist, who wanted to break up the Irish landed estates and distribute land to poor wage-earners. So he was like Jefferson — small farms would save America from the scourge of cities and raise up the masses to responsible citizenship. And in fact, in the U.S., the expanding frontier was carved up into small farmsteads. But the cities still grew, and automation grew, too; meanwhile, Marx wanted to turn the machinery over to the workers, while Lenin famously became a convert to Taylorism after vilifying it before the revolution.

    Anyway, we have a problem that is fundamentally different from the sociological and psychological effects of factory work, because no one has come up with a plan for workers being displaced by automation and globalization.

    1. hemeantwell

      Lenin famously became a convert to Taylorism after vilifying it before the revolution.

      Lenin became oriented to maximizing production because the Soviet Union needed to rebuild after the devastation of WWI and the Civil War in an international environment that was hostile. Taylorization in the US reflected the struggle of capitalists to maximize profits to enhance competitive power. Taylorization in the Soviet Union reflected a hostile political context. Domestically, I think it would also be necessary to consider that in the Soviet case the broad idea of “raising living standards” by increasing production efficiency also meant being able to provide industrial goods to serve as incentives for the peasantry. The “Scissors crisis” c. 1923 reflected this problem, which Stalin eventually “solved” with forced collectivization.

      1. Mike

        A major portion of Lenin’s writings regarding socialism were, in effect, his case for industrialism. But it must be held in mind that his plans for Russia could not be fulfilled unless further revolutions, especially in the “advanced capitalist” nations, occurred so that those advanced nations could aid the nascent Soviet nation (enter Trotsky & “permanent revolution”) without gouging it through profit-making and political intrigue to undermine the regime.

        Point is, this “Taylorist” period was to be short and certainly not permanent, but the failure of Western & European Communist Parties to win anything made Stalinist forced industrialism not only possible, but almost inevitable. However, there once appeared a quote from Trotsky where he said something to the effect that if the revolution in the West did not occur, the Soviet experiment would need to resume capitalist forms to survive. Not sure if Trotsky meant that as to be under Soviet government auspices, or because counter-revolution would take over. Nonetheless, perspicacious if said (many “quotes” attributed to CP leaders are on the order of Putin statements today – mistranslated and meant to be misunderstood).

        1. hemeantwell

          My understanding of Lenin has changed substantially through my reading of Lars Lih’s work, especially “Lenin Reconsidered,” (endorsed by none other than Robert Tucker, one of the most influential mainstream writers on the Soviet Union). Lih combed through the arguments within Russian social democracy in the 1890s and establishes Lenin’s strong orientation to the “Erfurt model” promoted by the German movement. That model stressed not only propagandizing among workers but also recruiting workers into the party to involve them in its deliberations and to infuse the party, through their influence, with their culture. He had in mind a dialectic of superseding the initial preponderance of intellectuals with a more heterogenous culture, inspired by what Lih emphasizes was Lenin’s belief in the “good news” of the socialist alternative.

          That was one reason why Lenin fought so intensely against “workerist” tendencies that dismissed the development of a democratic political life. A more open society was essential for enlightenment. To appreciate the context for that belief, read Franco Venturi’s “Roots of Revolution”, a history of Russian populism and socialism in the 19th century. Full of mini-bios of brave people dying in prisons or rotating through labor in Siberia as punishment for trying to “go to the people.” Impressive, and pretty damn sad as well.

          As a replication of the one-sided instrumentalization of labor as seen in the American context, Russian Taylorism would have been antithetical to Lenin’s most fundamental understanding of of the development of the revolution. The misreading of “What is to be Done?” as a kind of manifesto putting intellectuals in the driver’s seat is core to this misconception, pretty much a willful one as Lih demonstrates.

      2. digi_owl

        Bingo. The context is often left out when people look at how the various communist states turned out as they did.

        Hell, before WW2, the Nazis were considered the lesser evil in much of the west.

        Keep in mind that Germany smuggled Lenin into Russia to destabilize their WW1 foe. But they never expected the revolution to succeed to the degree it did. And Thus UK and other nations actually sent troops into Russia to help the Tsarist side.

        This is the kind of experience that likely colored both Lenin’s and Stalin’s approach to the outside world.

  3. Livius Drusus

    Yes, job loss through automation is probably the least problematic part of technological development. So far we have not faced a job apocalypse due to automation although maybe it will be different in the future. The elimination of some jobs (first agricultural, now in manufacturing and some services) led to the growth of new jobs in other sectors as productivity growth expanded the economy. The issue was (and still is) how to help ordinary working people benefit from that productivity growth so that it doesn’t all go to the owners of capital (machines). This is a political problem and can be remedied with political solutions like support for social insurance, unions or public employment/the job guarantee. However, I don’t support a basic income guarantee because I don’t think it can give people the purpose, sense of worth and psychological esteem that a decent job gives people.

    All that being said, the real problem with technology is that humans will eventually be so dominated by technique, not just computers and other machines but also by management techniques, psychological and medical techniques, etc., that they will no longer really be free in any real sense. That is why I am more worried about things like the push for a cashless society, surveillance by both governments and employers, chipping, the attempt to push everyone onto social media which is a kind of voluntary surveillance system, etc. That is not even getting into the more informal problems like having all relationships increasingly mediated through tech, social isolation and mental and physical illness caused by too much screen time, and the plague of invidious comparison caused by social media bragging where everyone now feels worthless because everyone they know seems to have the perfect marriage, the perfect job, the perfect body, etc.

    Job loss through automation is nothing new and can perhaps be dealt with through the right policies but the developments I mentioned above are rather novel and can lead to a kind of total surveillance/panopticon society where there will be no escape from the power of large organizations like the government and corporations. I also think that some of the new tech developments have damaged relationships, culture and mental and physical health in ways that are relatively new, although television probably started the march toward social isolation decades before the personal computer and smartphones.

    I am very much in favor of restricting technology in some cases but I realize that this position is very unpopular, especially in the United States where people practically worship technology. It seems like many Americans believe that tech will solve all of their problems and some even think that tech will make them immortal. Both political parties, the media and the business community promote that tech-as-cure-all ideology as well.

    1. Moneta

      I think of my grandmother, now in her 90s, who in her youth, had to unstitch her dresses and sew them on the reverse side when the material would get worn out…

      Then of my father’s recent conversation with a neighbor thinking that my father understood the desire for pit fires in the backyard because he came from the country… my father’s reply: “No, we did not waste resources that would serve us in the winter nor did we want to inconvenience our neighbours with smoke.”

      For some reason, millions of us do not see the unproductivity or waste in hopping into a car, driving 5-10km to pick up a carton of milk.

      Not so long ago, no one in their right mind would have done this!

      All this expended energy to get a few calories. For how many more decades can humanity do this?

      This type of inefficiency can only lead to a bad distribution of wealth.

      1. Moneta

        Because energy has been subsidized for so long, we are completely disconnected from how much energy any of our daily activities consume.

        We go from the car to the escalator to the elevator to sit at our desk all day. And when we get home, we hop into our car to go to a gym to run on a treadmill because we don’t move enough during the day. We are so productive… Lol!

        1. MoiAussie

          Those of us who pay energy bills and ponder how to reduce them are not quite completely disconnected. Ditto water. But I think your point holds in general for the consumerist west. The majority are too busy thinking about something else (celebrities? fashion? followers? food?) to have any real idea how much they consume (except in vague $ terms) or how much they waste. Not to mention the inherent waste in buying a house that’s oversized, or a monstrous overweight overpowered SUV for transport.

          The majority of the developing world are still very much in touch with these things.

          1. Moneta

            With today’s policies, if you conserve, you only make energy cheaper for the profligate.

      2. JTMcPhee

        “Eat it up, wear it out. Make it do, do without.” Advice from the Great Depression, courtesy of my grandmother…

    2. JTMcPhee

      Not to worry. I’d bet that “innovation” in genetic tinkering, autonomous war machines and other “artificial intelligence,” the massive vulnerability of the computer systems we’ve turned over so much of our necessary-for-life functions to, the possibly baked-in wrecking of the biosphere by climate change, and of course the “oops” use of nuclear and other weapons of mass destruction poised so delicately on the pointy pinheads of our ruling fools,, will make all this other angst and speculation and distress very, very moot…

  4. Disturbed Voter

    In the future, George Jetson just has to punch a red button at Spacely Sprockets. What if only one George Jetson is required? That will clear up the traffic among the flying cars then ;-)

    Marxist or Capitalist equations don’t take into account energy supply and energy quality. Both depend on unlimited cheap new energy so that entropy is avoided. This isn’t true of course. Both theories are false in the long run. This is like the physiocrat thinking that there is unlimited new colonial land to exile the excess population to. Well we can all go to Mars and be Elon Musk’s butler or maid. We also suffer from the idiocy of mercantilism, that all countries can productively export something other than financial services and fiat dollars/euros/yuans/pounds.

    1. Outis Philalithopoulos

      What is your source on “physiocrat thinking that there is unlimited new colonial land to exile the excess population to”? I haven’t come across this while reading Quesnay, Mirabeau, or le Mercier de la Rivière, although the last of these certainly thought a great deal about the French colonies, see this article by Florence Gauthier for a good overview.

      1. Moneta

        The progressive and neoliberal views that we in developed countries can accept all immigrants from devastated countries…

        If technology can save us, we can integrate all immigrants, no problem.

        If there are physical limits, developed countries accepting all immigrants so they can exponentially increase their energy and resource consumption will accelerate the devastation of our planet.

        1. Disturbed Voter

          The idea that with current technology, everyone on the planet can live at the resource load typical of Angelinos (Los Angeles) is of course, delusional.

          Actual immigration into the former First World … can be managed intelligently. Unfortunately the intelligent people don’t seem to be in charge. Per the 2000 UN report on the lack of population replacement in the then First World … massive influx of non-Europeans are necessary from the Urals to Ireland. We don’t have that problem in the New World.

          Otherwise, some Europeans will have to be downwardly mobile to fill the positions at the bottom of the social hierarchy, now being filled by the immigrants (since the 1950s).

      2. Disturbed Voter

        Colonialism presupposes that the resources taken from the natives, will last as long as necessary to fund the diplomacy and warfare of the crown. See Spain, France and GB in particular. The default form of farming in the English colonies basically led to soil exhaustion, and continual need to move West into virgin lands (sexual innuendo I think was deliberate).

        But thanks for the article reference. I am sure to enjoy it. In the case of New France, they mostly did fur trapping, which would have much lower impact on the soil and other resources, than in the other colonies.

        1. Outis Philalithopoulos

          You didn’t say “colonialism,” you said “physiocrats.” The physiocrats were a specific group of French economists, active in the years before the French Revolution – the most important single figure was Quesnay, the royal physician (le Divin Docteur, as his friends called him). They are a source for some ideas and reasoning patterns still seen among modern economists, including neoclassicals in particular.

          I was a bit surprised by your comment because the idea that the physiocrats saw extracting resources from the periphery as essential for the health of the center doesn’t jibe well with their emphasis on the economy as a self-sustaining, naturally just unit. They advocated making France a sort of free-trade paradise, and claimed that if the country followed their economic policy, it would be prosperous no matter what outside countries did.

          If you just misspoke, that’s okay. But if you know of an instance where a physiocrat had the view you indicated, I would find it interesting.

          1. Moneta

            If the population grows, there are too many farmers for the land and they did not like cities…

  5. EoH

    Some people in the US worship unrestrained capital; technology is an aspect of it.

    O’Connor’s observation about the unrestrained speculative capitalist is important. He is outside of society. It’s not just that she is is a new social figure outside of current norms of nobility, landed gentry, merchant, artisan, farmer, peasant, industrial worker. This unrestrained actor owes nothing to anyone and would happily disrupt any part of society in order to pocket his profits. Not as innovation, except socially, but as rent extraction. Hence the need to describe destruction as “creative”, obscuring its intentionality and deriding its costs to others as merely collateral.

    This is cannibalism, rightly resisted. Except, that is, where it is lauded as the highest form of economic achievement, a perspective with which every well-paid courtier, think tank expert, and full cannibal would agree.

    1. Disturbed Voter

      Just a matter of colonialism and the exponential function. As soon as exploration was complete, and traditional colonization was complete, the imperialists reached a crisis (WW I and WW II). With neocolonialism after WW II an attempt was made at continued extraction and disadvantage (with the exception of Japan and S Korea) … but this pretty well broke down by 1970. With the move to the Petro-Dollar … we have second generation neocolonialism … rent extraction thru the advantages of issuing dollars, euros and pounds. But given exponential needs .. it is necessary for the 1% to extend neocolonialism to their home populations, as they have since 1980. With multinational companies and elites, the global village has taken on the characteristics of a company town during the coal extraction era of 100 years ago. Ludlow massacres are necessary to keep the sheep in line.

  6. justanotherprogressive

    It isn’t the machines – it is who controls the machines. When the people who use the machines aren’t the ones controlling the machines, you get workers having to use their bodies for someone else’s gain. In China, they called these people “coolies”……others might call it something a little less nice……

    I think of Mennonites who aren’t opposed to using the latest technology but only as it benefits them – not some “owner”, so they make decisions on what technology they will have and the gains from that technology go to all members of the group, not just a few…

    I’m sorry that I am not so well read that I can immediately pull up some philosopher or essayist who might have written about the same ideas that I have as “justification” for my thoughts – sorry, they are just my own ideas. And isn’t it time this century started having its own ideas instead of just repeating what other people in the past have said? Where are the creative thinkers and writers of today or are our “elite” thinkers relegated to just repeating and arguing over the ruminations past writers who they think have “said it all”?

    1. Sandwichman

      “It isn’t the machines – it is who controls the machines.”

      Yes, indeed. But there is also a feedback mechanism in which who controls the machines determines what kind of machines and in what order. Under an entirely different system we would have entirely different machines. See The Bleeding Edge: Why technology turns toxic in an unequal world by Bob Hughes:

      Capitalism likes us to believe in the steady, inevitable march of progress, from the abacus to the iPad. But the historical record tells of innumerable roads not taken, all of which could have led to better worlds, and still can.

  7. WorkerPleb

    Fourthly, the present fluctuations give rise, in good trade, to an augmentation of artificial classes, if I may so call them, who have no natural position in society, but are merely called into existence by present appearances, trade upon nothings, traffic in fiction, and, like your order, speculate upon what they may retire upon when trade begins to flag. Hence we find each fluctuation in trade followed by a new race of shopkeepers, who are grasping in prosperity, compound when appearances change, and retire when adversity comes, leaving a vacuum to be filled up by the next alternation from panic to speculation….

    This man was an economic Nostrodamus.

  8. Sandwichman

    This was the second of two post, the first of which, Crowding Out and the Social Overhead Costs of Labor gives more context and analysis. Here are the first and last paragraphs of that earlier post:

    Another strange twist in the convoluted lump-of-labor saga. Chartist leader Feargus O’Connor refuted the “Treasury View” — aka “crowding out” — in 1844. O’Connor’s tract is long-winded and sentimentalized an idyllic past but it also contains some cogent analysis of why workers were (and should still be) wary of the exploitative use of technology by capitalist firms.

    Ignoring or neglecting the profitable aspect of cost-shifting invites policy responses that perversely subsidize and thus promote environmental and social harm — a moral hazard. Under such a policy regime, predatory and parasitical cost-shifting advances by crowding out investment in socially beneficial and environmentally sustainable innovation.

    1. Left in Wisconsin

      What is insane is that we have allowed capital/capitalists/big business to graft a completely individualist conception (the owner reaps all the gains) onto completely collective processes (production, invention, innovation, etc.). This goes hand-in-hand with the slight of hand that changed productivity (growth) from a collective process (division of labor, factory reorganization, etc.) to an individual one (human capital, skill development, etc.) It’s all simply justification for stealing all the benefits.

      1. Disturbed Voter

        The Social Contract has always been a cruel fiction. We are born into some society we didn’t create, we are raised by parents trapped in the system, who in turn, with the assistance of public education, make indentured servants of their children, just like themselves. And the constant desire for status quo maintenance, keeps it all going at all levels.


    Automation and machinery efficiency are merely two varieties of a larger contradiction in aggregate demand in capitalist economies. It is in the interest of the economy at large for the average resident to have access to a decent enough income as to spur consumer spending. But it’s in the interest of each individual employer as to reduce all business costs, including labor, as to maximize profits. It may be at an accelerated clip these days, with the combination of automation, computerized production inefficiencies, and cheap, fast shipping and telecommunications, but it’s an essential problem, not a modern development.

  10. Rosario

    Added to the psychological and sociological effects are ecological effects. This was what was largely missing from Malthus’ thinking as well along with most economic thinkers. People are not so much the problem as the tools they use in conjunction with their bodies. That is largely the cause of over-consumption, environmental degradation, etc. We should take some inspiration from the Amish, use technology with intent and purpose rather than as a duty demanded by culture.

  11. washunate

    I don’t follow the sensationalism in the headline. This article doesn’t describe how usage of machinery promotes inequality and social upheaval.

    Furthermore, this demonstrates one of the really bad diagnoses being made in contemporary leftist thought. The problem is not that “capital” is being rewarded at the expense of “labor”. The problem is that some labor is being rewarded at a much higher rate than other labor.

    And wage inequality is precisely what today’s affluent intellectuals, technocrats, and bureaucrats don’t want to touch with a ten foot pole.

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