Against the Looming Economic Impacts of Automation, Politicians Can’t Continue on Cruise Control

In response to much of the political debate about jobs being lost to China and Mexico—and other global punching bags—a meek, oft-ignored retort posits: “But… automation.” Indeed, automation has played as much if not a bigger role in job loss as wage disparities and protectionist (a.k.a., tariff-based) policies. Tinkering with market equality and retaliatory measures may not yield positive results because the market hates such tinkering, and because market equality may constitute a diminishing driver for job loss in key sectors.

But where automation is offered as a preeminent job-killer, nothing but platitudes about job retraining and new job creation accompanies the platitudes, often offered in a passing political debate. Debates concluded and elections settled, said platitudes are soon forgotten. No clear sign exists that politicians are hard at work devising strategies or policies to address the growing crisis—as many Americans see it—that looms ahead.

“Don’t worry,” is the most typical assurance. “We’ve been here before (remember the Industrial Revolution?), and we made it through just fine.”

Such talk reminds me of a time I came home during my first year in college. During the drive home, I told Dad about an Adam Smith essay I had read for my Economics 101 class on the topic of trade imbalances. I marveled aloud at Smith’s insight that such disparities gave way to equilibrium, in part through offsetting currency valuations.

I vividly recall my dad’s gentle grin. An Econ major himself, he said, “The problem is time: equilibrium takes time, and in the meantime, people suffer.” In a few minutes I learned how transitions to equilibrium hit the poorest and least educated among us the hardest.

That lesson reverberates today as I ponder our present era of transition where the means of production and services become increasingly automated. An added challenge applies this time: the accelerating pace of technological innovation gives no reprieve or recovery between times of transition. One follows another, each more disruptive than the last. Stability plateaus to reap the benefits of upheaval run shorter if not altogether non-existent.

Automation (ATM machines, computer stock trading, robotic factories) has been with us for a while. So far, we may suffer a little, for a time, but we haven’t collapsed. Bank tellers didn’t suffer much with the advent of ATMs; more branches opened, and some tellers became loan officers. But for every successful transition, there was a time of stress (it takes time to open a new credit union branch, and to retrain tellers to let out home mortgages). Other communities have endured more severe consequences. For many in coal and steel, once vibrant communities turned in tattered ghost towns.

Coal and steel industry decline, in particular, should have served as the proverbial canaries in the mine. Yet, as painful as these transitions have proved, no major action or preparation for future displacements has taken place. Why? The hits have taken placed in isolated locations — Apalachia, Pittsburg, rural Kentucky — while the rest of us enjoy relative (if at times stalled) prosperity. The market does adjust, productivity and prosperity improves, and as a whole, we move on. Equilibrium returns, even if converging on a different point, and never mind that some are still stuck in transition.

As is the bane of our existence, we may not react until the crisis affects us personally. What sort of automation will promote a call to action? When will politicians click out of cruise control?

The answer may lie right under our noses: self-driving cars and trucks.

Several pilot programs around the country currently aim to perfect and vet self-driving technology. While much of the discussion around these programs raises concerns about safety and liability, the jobs self-driving vehicles displace will cause a wider ranging transition impact.

Think about all those truckers on all those highways. Think about the logistics companies that hire them. Estimates place the totals a 3.5 million truckers nationwide, with 8.7 million overall employed in the trucking industry, or roughly one out of fifteen 15 workers. Even an elementary student will appreciate those are “high numbers.”

Think also of Uber (“millions” of drivers according to its CEO), Lyft, plus other like services, and of all those traditional taxi companies (over a quarter million jobs). The impact will be national. It will stress rural areas, small towns, and large urban centers. No longer will politicians from Kentucky cry foul, while their California and New York colleagues shrug and whimper something or other about “inevitable progress.”

Unlike more esoteric artificial intelligence (AI) and robotic technologies affecting more out of view fields, self-driving vehicles are something the public can easily understand and appreciate — as easily as “yesterday you could drive for a living, and today… so sorry.” And where will these displaced drivers find new jobs? If you think in the service industry, in particular sectors that could use workers with improved education and training, think again.

Already the legal sector is undergoing a transformation wherein AI is replacing administrative and paralegal work. If you envision truck drivers joining a law firm with minimal training, dream anew. Even Supreme Court clerks might soon look over their shoulders — can’t a computer program research legal libraries on a given topic faster and more accurately? And really, can most of an attorney’s work escape from AI advancements? If AI code can write a news story, can a legal brief be far behind?

Explore other technically-linked sectors, medical fields included, and you will find similar trends. And they are all happening concurrently. Displaced truck and taxi drivers may not have alternative professions in other sectors because they are all automating away — at once.

“This time it’s different,” many say about automation and AI driven disruptions. And it is. Because it is moving faster. Because it is transforming everything. And because a lot of new professions need inventing to replace jobs supplanted by automation, without any clear sense of where new sources of economic value lie in wait, ready to support said professions.

One paradoxical observation rumbles under this ongoing transition: if the point of automation is to increase productivity for goods and services to be sold at ever more competitive prices, what good will it do if the potential buying public is by enlarge unemployed and destitute of wealth with which to buy said goods and services?

I don’t have a complete answer. But those in power, those vested with responsibility to address not only our current crises, but to foresee and plan for future ones, should at least be posing the question in a way that leads to solutions.

Some of these solutions may endanger innovation and advancement by placing restrictions on what jobs automation can displace. Others, in exacting taxes from automated sectors to finance subsistence among the unemployed, such as through universal basic income (UBI) schemes, may create an on-steroids Welfare State. And, yes, there’s hope that new professions — likely to require more education and skill — will arise to exalt humans from mundane, repetitive work toward more transcendent endeavors. With regards to this latter scenario, we have yet to settle whether the average Joe and Jane will rise to satisfy the rigors necessary for higher intellectual and artistic achievement.

Rather than face off against these complexities, however, politicians more than likely will play delay of game. Or they will pretend to. They will punt while they fixate on the current scandal or the power struggle du jour.

Will they finally wake up when angry truckers and taxi drivers march down streets everywhere?

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