JOBS IN THE UNITED STATES WILL NOT BE CREATED WITH NEW RULES FOR THE LABOR MARKET

The article Automation v. Immigrants (Jobs Fake-Out) of Opes published on March 16, 2017 questions that the loss of jobs for the citizens of the United States is not a result of automation and immigration. According to Opes, entrepreneurs want to plant this idea of ​​automation and immigrants as causes of job loss in the United States in the minds of people like the elitist and intellectuals. Opes defends the thesis that perhaps the cause of the unemployment problem does not result primarily from automation or immigration, but from the wave of regulations and rules of wages and hours of work over the years that almost wiped out manufacturers and factories in the United States. He asks how to grow jobs in the private sector and restore the spirit of American know-how?

 

Opes suggests that jobs for all skill levels in the United States should be the top priority that means: 1) Jobs for all levels of education; 2) jobs for all capacities (including people with disabilities); 3) Jobs for all abilities; 4) No-Tech Works; 5) Low-tech jobs; 6) White-collar work; 7) Blue collar jobs. Opes says the premise is that automation will continue to shift jobs to an increasing number of people in the United States in a variety of employment sectors. But is this really the problem? The solution for this problem is to at least temporarily suspend labor regulations and salary rules. In addition, if jobs are the number 1 priority should be relaxed taxes on wages as well.

 

There is no doubt that the problem of unemployment in the United States results, on the one hand, from the automation of the productive activities of the country and, on the other, from the transfer of Americans factories to countries with low labor costs like China, India and Mexico , among others. The solution proposed by Opes would not be able to cope with the advance of automation and prevent large US companies from failing to invest in other countries in the world where they would earn greater profits. The World Economic Forum (WEF) in Davos reports that "automation will encompass both intelligent machines and the computerization of complex tasks in organizations. Its adhesion by the companies will bring advantages due to the incapacity of the human workers in some tasks, as well as reduction of costs and labor rights (the machine does not receive salary).

 

For human workers it will be necessary to create new forms of work to avoid a humanitarian catastrophe of enormous proportions. The scale is massive: almost half (47%) of all jobs in the United States and 35% in Britain will be susceptible to automation by technology over the next two decades according to The Economist and researchers at Oxford University". McKinsey Consulting reported that 140 million workers could be replaced by automated by technology by 2025. The factory of the future features a full robot installation and a high degree of automation, as well as being properly organized around the technology, the computer, which integrates, through specially developed software, practically all activities.

 

It is possible to imagine that factories of the future will count less and less with the presence of human beings in the production line. Automated and robotized factories mean industries with fewer and fewer people. In three decades, 6 million industrial jobs in the United States were eliminated, making factory employment reach the 1940s level. Jobs involving repetitive jobs will disappear rapidly in the coming years. In rich countries, it is estimated that 25% of all functions in industry are to be replaced by automation technologies by 2025. Worldwide, an estimated 60 million factory jobs will be eliminated. The big challenge for economic growth in the coming years is how to develop new jobs for a larger population than we have today, and especially not a large decline in the middle class, since with a weak middle class, the general consumption decreases, and the economy collapses as it does in the United States. It is hard to believe that the projections of Davos, Oxford and McKinsey are completely wrong.

 

Technological progress will inevitably have three consequences: 1) the decline in consumption or general demand for goods and services due to the increase in unemployment and the reduction of the purchasing power of the working population; (2) the decline of the middle class with major political implications since it acts as an ally of the bourgeoisie; And (3) the weakening of the struggle of the unions for the benefit of the workers and of the class struggle between the bourgeoisie and the proletariat. The political consequences of the end of employment thanks to technological advances are quite serious because the population needs to work to survive. This situation may pave the way for a social revolution with unpredictable consequences, unless a new model of society inspired by Scandinavian social democracy (Sweden, Denmark, Norway, Finland and Iceland) is implanted in the United States and in worldwide as an alternative to neoliberalism which is ruining most countries in the world.

 

The Nordic or Scandinavian model of social democracy could best be described as a kind of middle ground between capitalism and socialism. It is neither wholly capitalist nor wholly socialist, being the attempt to fuse the most desirable elements of both into a "hybrid" system. In 2013, The Economist magazine stated that the Nordic countries are probably the most well-governed in the world. The UN World Happiness Report 2013 shows that the happiest nations are concentrated in Northern Europe, with Denmark at the top of the list. The Nordics have the highest ranking in real GDP per capita, the highest healthy life expectancy, the greater freedom to make choices in life and the greatest generosity. Without changing the model of society prevailing today in the United States, the neoliberalism, the problems of unemployment will not be overcome.

 

* Fernando Alcoforado, member of the Bahia Academy of Education, engineer and doctor of Territorial Planning and Regional Development from the University of Barcelona, ​​a university professor and consultant in strategic planning, business planning, regional planning and planning of energy systems.

Comments

Thomas Sutrina Added Mar 19, 2017 - 6:26pm
Fernando A., The law of economics apply if cost go up sales go down and that applies to necessities. Opes is correct that the cost government adds to problem leads to less American products being made when others make them at a lower cost.

Fernando A. considering that humans have since the stone age created new forms of work to improve their lives and on occasions to avoid catastrophe. Obvious. The industrial revolution caused an even greater change.  Humans adapt, government do not, which is also a simple and obvious fact that has been repeated multiple times.
 
You have given us only one side of the equation of humans adapting. Only government will prevent this equation from balancing. They see there power growing as they provide more welfare.  So they have not reason to help the transition.  We need to tell them to get out of the way.
 
I am not sure that there is a hybrid between as the Declaration of Independence and Marx that used socialism and communism interchangeably.
 
Please tell me how a government of 'master minds', jettisons judo-christian morals and principles, and have laws that can be change to serve special interest compares to the principles of the Declaration of Independence, "assume among the powers of the earth, ... the Laws of Nature and of Nature's God entitle them, a decent respect to the opinions of mankind ... We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit o Happiness."
 
Government and man often fail but the Ten Commandments for example do not change.  Man are distinguishable from other plants, animals, and minerals.  By that measure we are created equal and as all creatures with the capacity to choose have natural standard as part of their biology.  Master minds and government will never alter this.  That is what that declaration says.
Opes Added Mar 20, 2017 - 7:41pm
Fernando, A lot of what you have referenced here is quite fascinating reading.  I am indeed familiar with the conclusions brought forward by the World Economic Forum (WEF) in Davos  as you mentioned.
 
Your hypothesis is interesting that the USA (and others) could follow the Scandinavian social-democracy model of Sweden, Denmark, Norway, Finland and Iceland towards avoiding the future calamity of automation that would causing too many people to be out of work with idle hands and in poverty.  The dynamics of that solution at first blush seem too impracticable due to a variety of regional differences.  Plus the shear magnitude of the population differences mixed with the USA multicultural, urban/suburban texture makes for some very delicate balancing to be required.  
 
When an American visits Denmark for the first time, they might be surprised by the enormous amount of bicycles that people use there for mobility.
 
Has technology out paced us as a human species in being able to manage socially our socio-economic environment?  Our civilizations have fallen behind emotionally to adapt to automation ever since we invented better methods of mobility.
 
The technology of mobility is an example of how Homo Sapiens became too effective and efficient in travel, much before we could emotionally handle the culture-shock.  Mobility is in some cases the war generator of imperialism.
 
Fernando Alcoforado Added Mar 20, 2017 - 9:19pm
Thomas Sutrina, you say that Opes is correct because it´s necessary to make the cost of American products lower. To lower the cost of American products is necessary that the measures proposed by Opes be adopted in all States of the United States. A consequence of the adoption of the Opes measures would be the reduction of public revenues, which would result in an increase in the deficit and US public debt. Raising US public debt would not be good for the United States because it would mean making the country more dependent on China that is its main lender. Another important issue is that US multinational corporations will continue to operate globally outside the United States where they earn more profits. I disagree with your positioning by repelling government action as a strategy to change the current reality of the United States. The important thing is to get the government to adopt a policy that matches the interests of the majority of the nation.
Fernando Alcoforado Added Mar 20, 2017 - 9:41pm
Dear Opes, I consider your article very important because it enabled our debate. It is clear in its proposal that the United States can increase its competitiveness by lowering the cost of its labor as it does in China, India and Mexico, among other countries. I did not agree with your proposal because it would be the reduction of public revenues, which would result in an increase in the deficit and US public debt. Raising US public debt would not be good for the United States because it would mean making the country more dependent on China that is its main lender. Another important issue is that US multinational corporations will continue to operate globally outside the United States where they earn more profits.

Although you agree with my proposal to adopt the Scandinavian model of social democracy as in Sweden, Denmark, Norway, Finland and Iceland to avoid the future calamity of automation that would cause too many people without working with idle hands, and in poverty, you believe that this dynamic at first glance seems very impractical due to a variety of regional differences, plus the magnitude of population differences mixed with the multicultural, urban / suburban texture of the USA. I believe that if there is political will of the people and the governors, the existing obstacles could be overcome.

I agree with you that technology has not enabled us as a human species to be able to socially manage our socio-economic environment and that our civilizations have been left behind emotionally to adapt to automation since we invented better methods of mobility. I disagree, however, that mobility is in some cases the generator of war and imperialism because both are generated by the economic struggles between big business and big powers.
Thomas Sutrina Added Mar 21, 2017 - 9:01am
Fernando, you again chose the non-dynamic conclusion that lowering taxes will lower income.  That did not occur in the past during Reagan, Kennedy,  or Coolidge administrations from what I remember.  The law of economics  that says lower prices  that includes taxes will increase sales.  Since sales pays salaries more people are employed.  Less welfare or cost to the government.  The tax maybe lower but volume of sales increase to so the sum being taxed is higher.

Trump said he want the global companies to have a reason to bring money back into America.  Lower taxes is one reason.  Most countries I believe do not charge to bring money into their countries.  Or they charge a tax when the income is not taxed by the country where the money was made.  We charge a tax independent of other taxes paid elsewhere.

Congress agrees with you Fernando so we will have a border adjustment tax like other countries.
 
Hybrid socialism and Capitalism in practice is socialism that realize that master mind driven economics fail.  So they let some capitalism occur.  This is not a hybrid at all.  Since the master minds are in control.  China is an example.
Opes Added Mar 21, 2017 - 3:53pm
Fernando, I agree with Thomas.  I can refute your claim - "I disagree, however, that mobility is in some cases the generator of war and imperialism because both are generated by the economic struggles between big business and big powers."  In ancient times there were no big businesses, but the wars were still there due to mobility.
Fernando Alcoforado Added Mar 21, 2017 - 7:17pm
Thomas Sutrina, I agree that the tax applied may be lower and that the volume of sales would increase so that the sum being taxed is higher. You're right when you say that lower prices that include taxes will help increase sales and, consequently, more people will be employed. For this equation to work, it would be necessary to reduce wages and taxes substantially in order to compete favorably with, for example, China, India, and countries in Asia that have very low taxes and very low labor costs. I did not say that lowering taxes would reduce income. I argued that there would be a reduction in government tax collection, resulting in an increase in the public deficit and, consequently, in public debt as happened during the Reagan and Bush administrations. These governments were the ones that most reduced taxes and did not prevent the transfer of industries from the United States to abroad, besides contributing to raise the public deficit and the public debt of the country that is the largest in the world.
China, without a doubt, is a dictatorial system. But, the Scandinavian countries are democratic countries in contrast to their evaluation. It is not by chance that the Scandinavian countries are the happiest in the world according to the recent UN ranking
Fernando Alcoforado Added Mar 21, 2017 - 7:22pm
Opes, war is an armed struggle between nations, for territorial, economic, ideological or religious reasons. It is also an armed conflict for political control among different groups within the same nation, the so-called civil war. There are many reasons behind a war, such as power struggles, economic motivations, the imposition of ideas or culture, the confrontation between social causes and religious or ethnic motives. My claim that wars are generated by the economic struggles between big business and big powers are about wars over the past 500 years.
Tamara Wilhite Added Mar 21, 2017 - 7:47pm
We have seen higher unemployment and depressed wages for the poorest fifth of Americans (without high school diploma or just that diploma) due to competition with illegal and legal immigrants who are overwhelmingly unskilled. Their suffering is worse than the competition with H1B visas that have kept STEM wages flat despite the hype and pushing out engineers at their wage peak in their 40s-50s. In that regard, unemployment for Americans at both extremes IS driven by immigration, legal and illegal.
Automation pretty much only affects low skill work, which means we can either have higher wages for the unskilled or more unskilled through immigration but not both.
The solution for the serious unemployment and deepening poverty for the lower class is closing the borders for a generation until our economy adjusts.
 
Tamara Wilhite Added Mar 21, 2017 - 7:47pm

The Great Shift Toward Automation and the Future of Employment
https://hubpages.com/business/The-Great-Shift-and-the-Future-of-Employment
Thomas Sutrina Added Mar 21, 2017 - 8:56pm
Fernando, sum being taxed is higher and the amount of taxes may also be higher or lower depending on the dynamics of the economy. Reagan and coolidge also decreased regulations that further reduced costs and increased sales and also reduced the cost of doing government. Both administrations had booming economies and the net income of the government increased. I do not know if the Democratic congress that Kennedy had also reduced regulations. I believe that his administration also received more money in taxes.
I also talked with a Chinese engineer that said the companies provide many amenities. He did not consider this as adding to the cost of a product and that a tax that paided for the same amenities that is done in socialist companies is the same thing. When he said salaries were low does not concider the cost paid directly by the manufacture they work for. This is the same in socialist countries including the USA. So we do have a problem in determine the real costs of a product due to these hidden costs.
Fernando Alcoforado Added Mar 22, 2017 - 1:06pm
Dear Tamara Wilhite, I agree in part with you when you say that unemployment for Americans on both extremes is driven by immigration, legal and illegal. Unemployment in the United States has three causes: 1) immigration; 2) the transfer of factories from the United States to abroad; And, 3) the technological advance. I agree with you that closing the frontiers for a generation until the US economy fits is part of the solution to severe unemployment and deeper poverty for the lower class. You're wrong to say that automation virtually affects only low skill work. Automation is also affecting the middle-class skilled worker
Fernando Alcoforado Added Mar 22, 2017 - 1:27pm
Thomas Sutrina, I agree with you that the amount of taxes may be higher or lower depending on the dynamics of the economy. I agree that the Reagan and Coolidge administrations had booming economies with increased government revenue, but the public deficit and public debt increased. It is clear that the Chinese government offers various facilities to attract foreign investors, in addition to the low labor cost.
 
Thomas Sutrina Added Mar 22, 2017 - 1:30pm
Tamara, Fernando being a liberal wants to forget that job are lost because of higher cost.  And that the tax and regulation policy of the government effects the cost of products that come into the country and go out.  It also effects the return of wealth, earnings for US companies.  
America was the China economically in the late 1800s and early 1900s because of a low tax and regulation burden.  Since then many costs added to labor have resulted in the loss of low skilled workers for jobs that can be done outside a community.  Health insurance, unemployment insurance. social security, medicare part of social security, retirement saving, life insurance, and EPA requirements for the factory floor.  Many of these cost do not show up on your pay slip but the employer assigns the cost to your wage for companies that have international competitors and are also international.   
Opes Added Mar 22, 2017 - 5:42pm
The war data is that in over 3,705 years there have been approximately 3,020 wars started worldwide.  Most were in Europe with over 1,675+ approximately.  The next highest is Asia, followed by The Americas, and then Africa.  Could all that fighting happen if the wheel or ships weren't invented for travel or with the use of horses, etc.?
Doug Plumb Added Mar 23, 2017 - 8:22am
We have our clothes, electronics and soon to be cars being made for 25 cents an hour by Chinese political prisoners (Christians and Falun Gong practitioners). People here cannot compete with that.
Dino Manalis Added Mar 23, 2017 - 8:33am
We need pro-growth policies, including lower business taxes and a territorial tax to bring trillions from abroad for investments; jobs; higher employee salaries; and more tax revenues.  Trade is pro-growth and creates jobs, but we have to be ready for competition with low corporate taxes; constant research and development of better goods and services; and worker retraining.
George N Romey Added Mar 23, 2017 - 10:14am
The even scarier scenario and less talked about is that artificial intelligence is taking away higher level jobs.  Education won't solve that issue.  What we need is a total restructuring of work so that we work far fewer hours but have full employment.  This issue is not going away.
Doug Plumb Added Mar 24, 2017 - 4:45am
I'm big on a shorter work week too George. Under the English Empire when the queen taxed the sunlight it was about 30 hours.
Fernando Alcoforado Added Mar 24, 2017 - 7:16am
Thomas Sutrina, I dispute your claim that I forgot that work is lost because of the high cost. Throughout this debate, I have made it clear that the United States has lost its businesses and hence its jobs because peripheral countries, such as China and India, have lower internal costs (labor, taxes, etc.). I have always pointed out that this is why US multinationals prefer to invest outside. It is clear that reversing this situation would require the United States to have lower labor costs and lower taxes than peripheral countries. Lowering the cost of labor with a reduction in the incidence of taxes on labor income and lowering taxes in general would contribute to raising the public deficit and, consequently, of public debt. It must be remembered that raising public debt means making the US economy even more vulnerable and making it even more dependent on China as its main creditor.
Fernando Alcoforado Added Mar 24, 2017 - 7:31am
Opes, It is obvious that increased troop mobility at all times in history have contributed to the success of the countries that won the war. Opes, It is obvious that increased troop mobility at all times in history have contributed to the success of the countries that won the war. But not just mobility. It is evident that technological advances have always been used by countries at war in each era. We all know, for example, that the advent of aviation was crucial for civilian populations to be directly affected by wars during World War I and II.It is evident that technological advances have always been used by countries at war in each era. We all know, for example, that the advent of aviation was crucial for civilian populations to be directly affected by wars during World War I and II.
Fernando Alcoforado Added Mar 24, 2017 - 7:36am
You are quite right, Doug Plumb, when you say that the United States will have immense difficulty competing with peripheral countries that produce at very low costs, like China.
Fernando Alcoforado Added Mar 24, 2017 - 7:45am
You are quite right, Dino Manalis, in stating that the United States must have "pro-growth policies, including lower taxes for businesses and a territorial tax to bring trillions of dollars from foreign into investment; Jobs; Higher salaries of employees; And more tax revenues". I also agree that “trade is pro-growth and creates jobs, but the United States must be ready for competition with low corporate taxes; Constant research and development of better goods and services; And retraining of workers”. Let's wait for the implementation of the Trump government's economic policy to see if they will agree with this proposition.
Fernando Alcoforado Added Mar 24, 2017 - 7:53am
I entirely agree with your view, George Romey, that artificial intelligence is destroying jobs at a higher level, and that education alone will solve this problem. Your thesis that the United States needs a total restructuring of work by reducing working hours to full employment is absolutely correct.
Opes Added Mar 24, 2017 - 11:56am
Fernando, Simply it seems clear as day to me that when one group of people are separated from another group by lack of mobility, there cannot be war.
 
Mobility bring with it the chances for proximity between groups of people that have differing cultures, of which are aggressive towards others.
 
Yes the advances in weaponry have assisted in determining winners, but the cause of the conflict is that these groups have found each other in the first place by way of mobility.  
Fernando Alcoforado Added Mar 25, 2017 - 5:14pm
Dear Opes, I agree with you that when one group of people is separated from another group for lack of mobility, there can be no war and mobility brings with it the chances of closeness between groups of people who have different cultures, of which they are aggressive to others. Your thesis is true in prehistory when communities living on the collection of nature, hunting, and fishing products faced the problem of scarcity that forced them to move to other areas where other communities already existed when wars occurred between them by resources in the area of conflict. Of course, what would have caused these wars was the struggle for scarce resources. Mobility would be a consequence of this fact and not cause of wars.
Fernando Alcoforado Added Mar 25, 2017 - 5:32pm
You Are Right The Other Side, because Moore's law that came into being in 1965 through a concept established by Gordon Earl Moore said that the processing power of computers would double every 18 months. It's been 50 years since Moore created his "law" and even half a century later it remains strong and strong. It's an impressive brand, especially when it comes to hardware evolution.