In American, in the last thirty years or so, the purchasing power of the middle class has not increased; it has not actually even kept up with inflation. At the same time, the gap between the wealthiest in our society – the famous 1% – and everybody else has widened considerably.
I read an article today by the economist Paul Krugman that makes me fear that we have not begun to see the worst. He points out that today jobs are returning to developed countries like the United States from the under-developed countries where they had migrated. This is because wages in Asian countries have increased substantially, greatly reducing the cost savings, especially when you add in the difficulties of transportation, government regulations, and likelihood of lower energy costs in the homeland.
But there’s another big reason. It is that jobs done by workers are increasingly going to be done by robots.
That might not sound like a bad idea – it will reduce production costs even more, and might eliminate a lot of boring jobs.
But it’s going to eliminate a lot of jobs period. By the hundreds of thousands. Even a college education isn’t going to be that helpful.
Krugman points out that the implications of this development for the entire capitalist system are profound. The people who will make money are the people who already have assets to develop in factories and their robots. The “work hard and save for a better life” opportunities will continue to decrease for the vast majority.
Krugman doesn’t elaborate on the implications of these changes beyond pointing out that they could fundamentally change the way capitalism works, making the few even richer, and the many even poorer.
But as Henry Ford realized, if nobody can afford to buy the cars he was making, he wasn’t going to make a lot of money producing them.
Isn’t that what will happen if we continue to disenfranchise the middle class in our society?
Or will we have to develop a whole new economic system going beyond feudalism, beyond slavery, beyond Marxism, beyond capitalism?
I guess worry is an ongoing process.
But then, so is problem-solving.
I doubt I will be around to see the future, but it sure is going to be interesting. Assuming, of course, that Homo sapiens survives at all.