By Michael Olenick, a research fellow at INSEAD who writes regularly at Olen on Economics and Innowiki. Originally published at Innowiki
Part I, “Automation Armageddon: a Legitimate Worry?” reviewed the history of automation, focused on projections of gloom-and-doom.
“It smells like death,” is how a friend of mine described a nearby chain grocery store. He tends to exaggerate and visiting France admittedly brings about strong feelings of passion. Anyway, the only reason we go there is for things like foil or plastic bags that aren’t available at any of the smaller stores.
Before getting to why that matters – and, yes, it does matter – first a tasty digression.
I live in a French village. To the French, high-quality food is a vital component to good life.
My daughter counts eight independent bakeries on the short drive between home and school. Most are owned by a couple of people. Counting high-quality bakeries embedded in grocery stores would add a few more. Going out of our way more than a minute or two would more than double that number.
Despite so many, the bakeries seem to do well. In the half-decade I’ve been here, three new ones opened and none of the old ones closed. They all seem to be busy.
Bakeries are normally owner operated. The busiest might employ a few people but many are mom-and-pop operations with him baking and her selling.
To remain economically viable, they rely on a dance of people and robots.
Flour arrives in sacks with high-quality grains milled by machines.
People measure ingredients, with each bakery using slightly different recipes.
A human-fed robot mixes and kneads the ingredients into the dough.
Some kind of machine churns the lumps of dough into baguettes.
I have no real disagreement with a lot of automation. But how it is done is another matter altogether. Using the main example in this article, Australia is probably like a lot of countries with bread in that most of the loaves that you get in a supermarket are typically bland and come in plastic bags but which are cheap. You only really know what you grow up with.
When I first went to Germany I stepped into a Bakerie and it was a revelation. There were dozens of different sorts and types of bread on display with flavours that I had never experienced. I didn’t know whether to order a loaf or to go for my camera instead. And that is the point. Too much automation is really all about narrowing the choices in your life and making it cheaper instead of enabling a richer lifestyle. We are all familiar with crapification and I contend that it is automation that enables this to become a thing.
“I contend that it is automation that enables this to become a thing.”
As does electricity. And math. Automation doesn’t necessarily narrow choices; economies of scale and the profit motive do. What I find annoying (as in pollyannish) is the avoidance of the issue of those that cannot operate the machinery, those that cannot open their own store, etc.
I gave a guest lecture to a roomful of young roboticists (largely undergrad, some first year grad engineering students) a decade ago. After discussing the economics/finance of creating and selling a burgerbot, asked about those that would be unemployed by the contraption. One student immediately snorted out, “Not my problem!” Another replied, “But what if they cannot do anything else?”. Again, “Not my problem!”. And that is San Josie in a nutshell.
A capitalist market that fails to account for the cost of a product’s negative externalities is underpricing (and incentivizing more of the same).
It’s cheating (or sanctioned cheating due to ignorance and corruption).
It is not capitalism (unless that is the only reasonable outcome of capitalism).
The author’s vision of “appropriate tech” local enterprise supported by relatively simple automation is also my answer to the vexing question of “how do I cope with automation?”
In a recent posting here at NC, I said the way to cope with automation of your job(s) is to get good at automation. My remark caused a howl of outrage: “most people can’t do automation! Your solution is unrealistic for the masses. Dismissed with prejudice!”.
Thank you for that outrage, as it provides a wonder foil for this article. The article shows a small business which learned to re-design business processes, acquire machines that reduce costs. It’s a good example of someone that “got good at automation”.
Instead of being the victim of automation, these people adapted. They bought automation, took control of it, and operated it for their own benefit.
Key point: this entrepreneur is now harvesting the benefits of automation, rather than being systematically marginalized by it.
Another noteworthy aspect of this article is that local-scale “appropriate” automation serves to reduce the scale advantages of the big players.
The availability of small-scale machines that enable efficiencies comparable to the big guys is a huge problem. Most of the machines made for small-scale operators like this are manufactured in China, or India or Iran or Russia, Italy…where industrial consolidation (scale) hasn’t squashed the little players yet.
Suppose you’re a grain farmer, but only have 50 acres (not 100s or 1000s like the big guys). You need a combine – that’s a big machine that cuts grain stalk and separate grain from stalk (threshing). This cut/thresh function is terribly labor intensive, the combine is a must-have.
Right now, there is no small-size ($50K or less) combine manufactured in the U.S., to my knowledge. They cost upwards of $200K, and sometimes a great deal more. The 50-acre farmer can’t afford $200K (plus maint costs), and therefore can’t farm at that scale, and has to sell out.
So, the design, production, and sales of these sort of small-scale, high-productivity machines is what is needed to re-distribute production (organically, not by revolution, thanks) back into the hands of the middle class.
If we make possible for the middle class to capture the benefits of automation, and you solve 1) the social dilemmas of concentration of wealth, 2) the declining std of living of the mid- and lower-class, and 3) have a chance to re-design an economy (business processes and collaborating suppliers to deliver end-user product/service) that actually fixes the planet as we make our living, instead of degrading it at every ka-ching of the cash register.
Point 3 is the most important, and this isn’t the time or place to expand on that, but I hope others might consider it a bit.
Regarding the combine, I have seen them operating on small-sized lands for the last 50 years. Without exception, you have one guy (sometimes a farmer, often not) who has this kind of harvester, works 24h a day for a week or something, harvesting for all farmers in the neighborhood, and then moves to the next crop (eg corn). Wintertime is used for maintenance.
So that one person/farm/company specializes in these services, and everybody gets along well.
Marcel – great solution to the problem. Choosing the right supplier (using combine service instead of buying a dedicated combine) is a great skill to develop.
On the flip side, the fellow that provides that combine service probably makes a decent side-income from it. Choosing the right service to provide is another good skill to develop.
One counter-argument might be that while hoping for the best it might be prudent to prepare for the worst. Currently, and for a couple of decades, the efficiency gains have been left to the market to allocate. Some might argue that for the common good then the government might need to be more active.
What would happen if efficiency gains continued to be distributed according to the market? According to the relative bargaining power of the market participants where one side, the public good as represented by government, is asking for and therefore getting almost nothing?
As is, I do believe that people who are concerned do have reason to be concerned.
“Too much automation is really all about narrowing the choices in your life and making it cheaper instead of enabling a richer lifestyle.”
Many times the only way to automate the creation of a product is to change it to fit the machine.
Some people make a living saying these sorts of things about automation.
The quality of French bread is simply not what it used to be (at least harder to find) though that is a complicated subject having to do with flour and wheat as well as human preparation and many other things and the cost (in terms of purchasing power), in my opinion, has gone up, not down since the 70’s.
As some might say, “It’s complicated,” but automation does (not sure about “has to”) come with trade offs in quality while price remains closer to what an ever more sophisticated set of algorithms say can be “gotten away with.”
This may be totally different for cars or other things, but the author chose French bread and the only overall improvement, or even non change, in quality there has come, if at all, from the dark art of marketing magicians.
/…from the dark art of marketing magicians, AND people’s innate ability to accept/be unaware of decreases in quality/quantity if they are implemented over time in small enough steps.
You’ve gotta’ get out of Paris: great French bread remains awesome. I live here. I’ve lived here for over half a decade and know many elderly French. The bread, from the right bakeries, remains great. But you’re unlikely to find it where tourists might wander: the rent is too high. As a general rule, if the bakers have a large staff or speak English you’re probably in the wrong bakery. Except for one of my favorites where she learned her English watching every episode of Friends multiple times and likes to practice with me, though that’s more of a fluke.
It’s a difficult subject to argue. I suspect that comparatively speaking, French bread remains good and there are still bakers who make high quality bread (given what they have to work with). My experience when talking to family in France (not Paris) is that indeed, they are in general quite happy with the quality of bread and each seems to know a bakery where they can still get that “je ne sais quoi” that makes it so special.
I, on the other hand, who have only been there once every few years since the 70’s, kind of like once every so many frames of the movie, see a lowering of quality in general in France and of flour and bread in particular though I’ll grant it’s quite gradual.
The French love food and were among the best farmers in the world in the 1930s and have made a point of resisting radical change at any given point in time when it comes to the things they love (wine, cheese, bread, etc.) , so they have a long way to fall, and are doing so slowly; but gradually, it’s happening.
I agree with others here who distinguish between labor saving automation and laborer eliminating automation, but I don’t think the former per se is the problem as much as the gradual shift toward the mentality and “rightness” of mass production and globalization.
I was exposed to that conflict, in a small way, because my father was an investment manager. He told me they were considering investing in a smallish Swiss pasta (IIRC) factory. He was frustrated with the negotiations; the owners just weren’t interested in getting a lot bigger – which would be the point of the investment, from the investors’ POV.
I thought, but I don’t think I said very articulately, that of course, they thought of themselves as craftspeople – making people’s food, after all. It was a fundamental culture clash. All that was 50 years ago; looks like the European attitude has been receding.
Incidentally, this is a possible approach to a better, more sustainable economy: substitute craft for capital and resources, on as large a scale as possible. More value with less consumption. But how we get there from here is another question.
I have been touring around by car and was surprised to see that all Oregon gas stations are full serve with no self serve allowed (I vaguely remember Oregon Charles talking about this). It applies to every station including the ones with a couple of dozen pumps like we see back east. I have since been told that this system has been in place for years.
It’s hard to see how this is more efficient and in fact just the opposite as there are fewer attendants than waiting customers and at a couple of stations the action seemed chaotic. Gas is also more expensive although nothing could be more expensive than California gas (over $5/gal occasionally spotted). It’s also unclear how this system was preserved–perhaps out of fire safety concerns–but it seems unlikely that any other state will want to imitate just as those bakeries aren’t going to bring back their wood fired ovens.
I think NJ is still required to do all full-serve gas stations. Most in MA have only self-serve, but there’s a few towns that have by-laws requiring full-serve.
I’m not sure just how much I should be jumping up and down about our ability to get more gasoline into our cars quicker. But convenient for sure.
In the 1980s when self-serve gas started being implemented, NIOSH scientists said oh no, now ‘everyone’ will be increasingly exposed to benzene while filling up. Benzene is close to various radioactive elements in causing damage and cancer.
It was preserved by a series of referenda; turns out it’s a 3rd rail here, like the sales tax. The motive was explicitly to preserve entry-level jobs while allowing drivers to keep the gas off their hands. And we like the more personal quality.
Also, we go to states that allow self-serve and observe that the gas isn’t any cheaper. It’s mainly the tax that sets the price, and location.
There are several bakeries in this area with wood-fired ovens. They charge a premium, of course. One we love is way out in the country, in Falls City. It’s a reason to go there.
Unless I misunderstood, the author of this article seems to equate mechanization/automation of nearly any type with robotics.
“Is the cash register really a robot? James Ritty, who invented it, didn’t think so;” – Nor do I.
To me, “robot” implies a machine with a high degree of autonomy. Would the author consider an old fashioned manual typewriter or adding machine (remember those?) to be robotic? How about when those machines became electrified?
I think the author uses the term “robot” over broadly.
Agree. Those are just electrified extensions of the lever or sand timer.
It’s the “thinking” that is A.I.
Refuse to allow A.I.to destroy jobs and cheapen our standard of living.
Never interact with a robo call, just hang up.
Never log into a website when there is a human alternative.
Refuse to do business with companies that have no human alternative.
Never join a medical “portal” of any kind, demand to talk to medical personnel.
Sabotage A.I. whenever possible.
The Ten Commandments do not apply to corporations.
I don’t use self checkouts but sometimes I will allow a cashier to use one for me while I am supposedly learning how to work the machine.
During a Chicago hotel stay my wife ordered an extra bath towel from the front desk. About 5 minutes later, a mini version of R2D2 rolled up to her door with towel in tow. It was really cute and interacted with her in a human-like way. Cute but really scary in the way that you indicate in your comment. It seems many low wage activities would be in immediate risk of replacement. But sabotage? I would never encourage sabotage; in fact, when it comes to true robots like this one, I would highly discourage any of the following: yanking its recharge cord in the middle of the night, zapping it with a car battery, lift its payload and replace with something else, give it a hip high-five to help it calibrate its balance, and of course, the good old kick’m in the bolts.
Here’s a clip of that robot, Leo, bringing bottled water and a bath towel to my wife.
Stop and Shop supermarket chain now has robots in the store. According to Stop and Shop they are oh so innocent! and friendly! why don’t you just go up and say hello?
All the robots do, they say, go around scanning the shelves looking for: shelf price tags that don’t match the current price, merchandise in the wrong place (that cereal box you picked up in the breakfast aisle and decided, in the laundry aisle, that you didn’t want and put the box on a shelf with detergent.) All the robots do is notify management of wrong prices and misplaced merchandise.
The damn robot is cute, perky lit up eyes and a smile – so why does it remind me of the Stepford Wives.
S&S is the closest supermarket near me, so I go there when I need something in a hurry, but the bulk of my shopping is now done elsewhere. Thank goodness there are some stores that are not doing this: The area Shoprites and FoodTown’s don’t – and they are all run by family businesses. Shoprite succeeds by have a large assortment brands in every grocery category and keeping prices really competitive. FoodTown operates at a higher price and quality level with real butcher and seafood counters as well as prepackaged assortments in open cases and a cooked food counter of the most excellent quality with the store’s cooks behind the counter to serve you and answer questions. You never have to come home from work tired and hungry and know that you just don’t want to cook and settle for a power bar.
OK, so how do you sabotage the cute SS robot? I suggest a laser pointer to blind its sensors. Or, maybe smear some peanut butter on them. What happens when it runs over your foot that just happens to get in its way? Contingency tort lawsuit?
The more automation you see in a business that you still patronize, the bigger the discount you should ask for. The Ten Commandments do not apply to corporations or job destroyers.
My husband recently retired from teaching. I’ll have to see if he still has his laser pointer or if he had to give it back :-)
Those early cash registers were perhaps an early form of analog computer. But Wiki reminds that the origin of the term is a work of fiction.
The adding machine – yes, definitely.
The typewriter – maybe. Before the typewriter printed type had to be typeset by hand, a laborious and expensive process.
The French call food processors “robots.” Industrial robots have no autonomy, much less a high degree. They repeatedly perform a task they’re programmed to do but they’re robots.
The idea that a robot has some type of autonomy, that it thinks, makes for good science fiction. But by that definition robots don’t exist because there are no thinking machines with a high level of autonomy outside the sci-fi genre. Except that they do exist and they’re everywhere.
“The typewriter – maybe. Before the typewriter printed type had to be typeset by hand, a laborious and expensive process.”
This is really not the appropriate comparison.
The typewriter replaced pen and ink.
Hand assembly of type, a character at a time, was replaced by linotype machines in the late 1800s, which were in turn replaced by phototypesetting in the second half of the 20th century, in turn replaced by computerized typesetting.
Where you go, and if you go, after that, depends on use cases – laser printers, e-books, web pages, videos and probably a few other methods of delivering information.
Perhaps I didn’t qualify “autonomous” properly. I didn’t mean to imply a ‘Rosie the Robot’ level of autonomy but the ability of a machine to perform its programmed task without human intervention (other than switching on/off or maintenance & adjustments).
If viewed this way, an adding machine or typewriter are not robots because they require constant manual input in order to function – if you don’t push the keys, nothing happens. A computer printer might be considered robotic because it can be programmed to function somewhat autonomously (as in print ‘x’ number of copies of this document).
“Robotics” is a subset of mechanized/automated functions.
Adding machines are robots under your definition. You input what you want them to calculate but the actual calculations are done by the machine (which is the point of having the machine in the first place). You’re touching the machine a lot more because it needs you to input more to do its thing but the calculation part is automatic. Typewriters, now that I think about it, really aren’t: they don’t automate anything.
The difference is a machine that extends human abilities with no automation (ex: a shovel) vs a machine that mimics human abilities (ex: a calculator or bread mixing machine).
The next level would be an autonomous machine but, depending on the definition of autonomy, I think those are a long way off. For example, a self-driving car – once perfected – can handle all sorts of different conditions but still can’t really think. It comes down to the definition of autonomy, or maybe it’s more accurate to say the degree of autonomy.
I think the author confuses automation -in its most general sense- with progress in a down home, folksy, “let’s be real” sort of way. The two are not always one and the same for all people and certainly not so for all other forms of life on the planet. At the end, he does at least make a passing gesture to automation in its more sinister form than that of helping artisans avoid drugery.
When I first got out of grad school I worked at United Technologies Research Center where I worked in the robotics lab. In general, at least in those days, we made a distinction between robotics and hard automation. A robot is programmable to do multiple tasks and hard automation is limited to a single task unless retooled. The machines the author is talking about are hard automation. We had ASEA robots that could be programmed to do various things. One of ours drilled, riveted and sealed the skin on the horizontal stabilators (the wing on the tail of a helicopter that controls pitch) of a Sikorsky Sea Hawk. The same robot with just a change of the fixture on the end could be programmed to paint a car or weld a seam on equipment. The drilling and riveting robot was capable of modifying where the rivets were placed (in the robot’s frame of reference) based on the location of precisely milled blocks build into the fixture that held the stabilator. There was always some variation and it was important to precisely place the rivets because the spars were very narrow (weight at the tail is bad because of the lever arm). It was considered state of the art back in the day but now auto companies have far more sophisticated robotics.
By that definition aren’t mixers still robots? You can put in a whisk and they’ll mix one way. Put in a bread hook, set the right setting, and it will knead dough – just like the helicopter building robots. Same with cash registers: press one button and they add money, another and they calculate change, a third and they’ll do a return, a fourth and they’ll print a total. Though, despite multiple functions, you can’t reprogram the old mechanical ones (of course, the newer ones are computers running a program). A baguette making machine seems like what you’re describing as hard automation: it has one and only function.
The Oregon gas attendant rule is a job-creation scheme. It works well, and very rarely is there an annoying wait.
Gas in Oregon is considerably cheaper than in California.
A few years ago my wife told me I had to go out and get a real job. I realized I was only qualified to do two things: teach, or pump gas.
Thank you Oregon for giving me a choice!
And considerably more expensive than in low tax South Carolina (2.19/gal a recent example).
But what happens when the bread machine is connected to the internet,can’t function without an active internet connection, and requires an annual subscription to use?
That is the issue to me: however we define the tools, who will own them?
You know, that is quite a good point that. It is not so much the automation that is the threat as the rent-seeking that anything connected to the internet allows to be implemented.
Until 100 petaflops costs less than a typical human worker total automation isn’t going to happen. Developments in AI software can’t overcome basic hardware limits.
The story about automation not worsening the quality of bread is not exactly true. Bakers had to develop and incorporate a new method called autolyze (https://www.kingarthurflour.com/blog/2017/09/29/using-the-autolyse-method) in the mid-20th-century to bring back some of the flavor lost with modern baking. There is also a trend of a new generation of bakeries that use natural yeast, hand shaping and kneading to get better flavors and quality bread. But it is certainly true that much of the automation gives almost as good quality for much lower labor costs.
On the subject of the machine-robot continuum…
When I started doing robotics, I developed a working definition of a robot as:
a. Senses its environment
b. Has goals and goal-seeking logic
c. Has means to affect environment in order to get goal and reality (the environment) to converge
Under that definition, Amazon’s Alexa and your household air conditioning and heating system both qualify as “robot”.
How you implement a, b, and c above can have more or less sophistication, depending upon the complexity, variability, etc. of the environment, or the solutions, or the means used to affect the environment.
A machine, like a typewriter, or a lawn-mower engine has the logic expressed in metal; it’s static.
The addition of a computer (with a program, or even downloadable-on-the-fly programs) to a static machine, e.g. today’s computer-controlled-manufacturing machines (lathes, milling, welding, plasma cutters, etc.) makes a massive change in utility. It’s almost the same physically, but ever so much more flexible, useful, and more profitable to own/operate.
And if you add massive databases, internet connectivity, the latest machine-learning, language and image processing and some nefarious intent….then you get into trouble.
Sometimes automation is necessary to eliminate the risks of manual processes. There are parenteral (injectable) drugs that cannot be sterilized except by filtration. Most of the work of filling, post filling processing, and sealing is done using automation in areas that make surgical suites seem filthy and people are kept from these operations. Manual operations are only undertaken to correct issues with the automation and the procedures are tested to ensure that they do not introduce contamination, microbial or otherwise. Because even one non-sterile unit is a failure and testing is destructive process, of course any full lot of product cannot be tested to state that all units are sterile. Periodic testing of the automated process and manual intervention is done periodically and it is expensive and time consuming to test to a level of confidence that there is far less than a one in a million chance of any unit in a lot being non sterile.
In that respect, automation and the skills necessary to interface with it are fundamental to the safety of drugs frequently used on already compromised patients.
Agree. Good example. Digital technology and miniaturization seem particularly well suited to many aspect of the medical world. But doubt they will eliminate the doctor or the nurse very soon. Insurance companies on the other hand…
Bill Burr has some thoughts on self checkouts and the potential bonanza for shoppers –
“There would be no improvement in quality mixing and kneading the dough by hand. There would, however, be an enormous increase in cost.” WRONG! If you had an unlimited supply of 50-cents-an-hour disposable labor, mixing and kneading the dough by hand would be cheaper. It is only because labor is expensive in France that the machine saves money.
In Japan there is a lot of automation, and wages and living standards are high. In Bangladesh there is very little automation, and wages and livings standards are very low.
Are we done with the ‘automation is destroying jobs’ meme yet? Excessive population growth is the problem, not robots. And the root cause of excessive population growth is the corporate-sponsored virtual taboo of talking about it seriously.