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Home Publications Blogs Beat the Press The Scary Robot Story Stems from Confusion by the Story Tellers

The Scary Robot Story Stems from Confusion by the Story Tellers

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Saturday, 15 February 2014 06:42

Joe Nocera uses his column today to discuss the scary robot story. This is the story that none of us will have jobs because we will all be displaced by robots. (Incredibly, this story exists side by side with its direct opposite, the view that we won't have any workers because so many people are retiring and living forever.) Anyhow, the deal is that the owners of the robots are very rich and the rest of us are left begging for pennies.

The reason this story makes no sense is that the ability to get rich from owning robots will not depend on physically owning a robot. Robots will be cheap to produce; they will be made by other robots. If robots are expensive it will be because we give strong and long patent monopolies.

Without strong patent protection we will all be able to buy robots for a few dollars that will cook our food, clean our homes, install cheap solar panels and insulation, provide us medical care, grow our vegetables, and teach our children. How could we be poor in this world?

In short, the scary story is a story of patent policy designed to redistribute income upward. It has nothing to do with technology.

Comments (10)Add Comment
factotum
written by xteeth, February 15, 2014 7:30
This seems shallow to me as explanations go. If those at the bottom lack the "few dollars" robots cost because they are paid only "a few dollars," it is the same problem as if robots are extraordinarily expensive and workers have a small number of dollars. Isn't that they way we are going at this point? It seems to the rest of us that the amount desirable stuff costs depends mostly on the number of dollars or credit we haven't yet spent, not on some measure of what it costs to produce something.
...
written by LSTB, February 15, 2014 10:25
I have to disagree. If robots substitute for labor then landowners are the ones who benefit with increased land rents thanks to robots working on their land. Human workers would be pushed onto marginal lands or just become homeless trespassers altogether. Land titles have the same effect that patents do, except everyone needs land but not everyone needs patent-protected technology.

Henry George was right. Two-factor neoclassical analysis rationalizes poverty.
Technology, Robots and Innovation Depend on Commoditized Efficiency - Not the Other Way Around
written by Last Mover, February 15, 2014 10:35

Americans have been brainwashed into believing that "innovation" from differentiated products (including robots) trumps huge efficiencies available from scale economies of key commoditized goods and services. Much of this comes from the false corollary belief that property right protection in the form of patents is necessary to incentivize said innovations with huge amounts of excess profit not necessary to result in their creation.

Compare this, which amounts to standard sock puppet propaganda designed to crush rather than support true innovation through patent power combined with other forms of market power ...
In some ways, “The Second Machine Age” is an odd book. For the most part, its tone is one of sunny optimism about all the wonderful things technology will soon bring us, from driverless cars to more powerful forms of artificial intelligence. “Innovation,” they write, is the “most important force that makes our society wealthier.” The authors believe that we are at a moment when technological innovation is about to accelerate, and make the world much wealthier, just as the Industrial Revolution did 250 years ago.


... to this:
Not everybody buys the technology-is-going-to-change-everything mantra espoused by Brynjolfsson and McAfee. Robert J. Gordon, a macroeconomist at Northwestern University, calls them “techno-optimists.” In his view, the next 40 years of innovation is not going to look much different from the past 40 years, which he believes haven’t been nearly as transformative or wealth-creating as the discovery of electricity and the invention of the light bulb.


Kilo-watt hours of electricity are an undifferentiated commodity at given levels of reliability, just as lumens of light or mega-bit seconds of computer data. This homogeneous nature allows clear understanding of what volumes of production result in the lowest cost per unit of output.

Most if not all "robot innovation" depends on access to commoditized electricity and computer data which has not changed from its base form when discovered, i.e., smoke signals sent and received from fires, followed by Morse Code over telegraph wires, were early forms of zeros and ones that ended up as digitized computer data.

When one technology replaces another in "creative destruction" fashion, it accomplishes this by wiping out the commoditized base essentials of the defunct technology. It does not accomplish this by "endless innovation" around the "leading edges" of the old technology constantly peddled by "sock puppets for innovation" as earth shaking events like robots that will replace labor forever ... absent complementary changes in the underlying commoditized technology as well.

For example, when the CEO of Verizon repeatedly brags what Verizon has brought to America in terms of "innovation" after systematically shutting down the expansion of FIOS to the curb in its service territory, he is categorically lying about what would have occurred in the obvious counterfactual.

True innovation from full coverage by FIOS would swamp the trivia paraded around as "innovation" under trailing edge technology forced on Verizon customers in terms of economic impact, and that includes widespread emergence of robots.

This is "creative destruction" stopped in its tracks by Verizon as the massive private market failure it is - because Verizon has commandeered commoditized computer data to block and prevent it from attaining its scale efficiency potential as the one and only essential infrastructure platform on which true hi-tech innovation can thrive.

Just because commoditized anything is boring and bland because it's not differentiated and branded with innovation overkill, doesn't mean it is not absolutely essential to achieving maximum economic growth.

Just keep it out of the hands of economic predators, because they have no intention of using commoditized efficiency for innovation. They have strong incentives to suppress it instead.

The predators will continue to get away with it as long as the public brainwashing succeeds in passing off "innovation" for economic efficiency gains that can only arise from the underlying huge scale of commoditized infrastructure base on which true innovation always depends.
Bingo
written by Anna Lee, February 15, 2014 10:36
DB, Perhaps, in order for people to get your point though, you should start with your last statement and go from there: "In short, the scary story is a story of patent policy designed to redistribute income upward. It has nothing to do with technology."

I agree with this statement but my take on distribution is not one of how purchases are made but rather how utility and productivity are distributed.
Are patents the "hammer" or the "nail"?
written by Sandwichman, February 15, 2014 1:59
"If the only tool you have is a hammer, every problem looks like a nail..."

I'm beginning to worry that Dean is overstating the role of patents as THE explanation for the inequitable outcomes from automation. Patent protection is, after all, a strategy and if exploitation wasn't enforced through patent protection there are other means available. A longer historical view of the displacement of workers through the introduction of machinery would suggest that patents don't explain everything. Patents don't explain master/servant laws, anti-combination acts or the granting of injunctions against strikes and boycotts.

The problem with using patents to explain everything is that patent reform then looms as the panacea. Would better patent laws really solve all the problems relating to robots?
The scary robot/tech, deficit, entitlements, takers, etc., are, duh, different tall tales
written by jaaaaayceeeee, February 15, 2014 3:31

One destructive way to redistribute income upwards, is the corrupt enforcement of corrupted intellectual property laws to stifle innovation, competition, and free trade, with news and pols rushing to convince us that up is down, protectionism is free trade, regulation is inherently cronyism, and so on.

Sandwichman, you have to assume that this blog, addressing news media stories that misinform, is trying to be the answer to life, the universe, and everything, if you want to wildly claim that Baker makes IP protectionism The Answer to everything.

You should read his most recent book, available as a free download or paperback at cost, "Getting Back to Full Employment: A Better Bargain for Working People," or any of his other works.
More or less
written by Lord, February 15, 2014 3:32
It is more that robots displace workers, but price rigidity, whether due to patents or debt, prevent them from becoming affordable. Enough are produced to displace many workers but never enough to give them one.
"you have to assume that this blog, addressing news media stories that misinform, is trying to be the answer to life, the universe, and everything"
written by Sandwichman, February 15, 2014 4:13
Well, no, jc, I don't have to assume that. I'm well aware of Dean's other writing but I'm also wary of the number of times recently (4?, 5?) Dean has deployed his patent answer to the robot menace. I've done quite a bit of research on the robot mythology myself and would welcome a more nuanced and variegated consideration. The "robot menace" is not just "patents all the way down."
...
written by watermelonpunch, February 15, 2014 7:52
Are patents the "hammer" or the "nail"?
written by Sandwichman, February 15, 2014 1:59
"If the only tool you have is a hammer, every problem looks like a nail..."

I'm beginning to worry that Dean is overstating the role of patents as THE explanation for the inequitable outcomes from automation. Patent protection is, after all, a strategy and if exploitation wasn't enforced through patent protection there are other means available. A longer historical view of the displacement of workers through the introduction of machinery would suggest that patents don't explain everything. Patents don't explain master/servant laws, anti-combination acts or the granting of injunctions against strikes and boycotts.

The problem with using patents to explain everything is that patent reform then looms as the panacea.


I'm too tired to go look... but I've seen Dean Baker has a rebuttal to the patent reform idea...

IIRC, he's proposed throwing out the hammer AND the nail, and switching to a bucket to mix concrete.
why are you so much better at dunking G Mankiw ?
written by ezra abrams, February 16, 2014 6:03
In theory, theory and practice are the same
In practice, they ain't

Yeah, I'm sure you can come up with some theory explaining why robots are not job killers, whilst simultaneously not be embarrased by the track record of economics (cf, 1930, 2008)

The trouble is, this has nothing to do with economics - it has to do with raw naked political power.
Since this doesn't fit with your professional math logic driven training, you disregard this fact.

sad

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About Beat the Press

Dean Baker is co-director of the Center for Economic and Policy Research in Washington, D.C. He is the author of several books, his latest being The End of Loser Liberalism: Making Markets Progressive. Read more about Dean.

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