The Washington Post had a front page piece today warning that the spread of robots in the workplace may displace large numbers of workers. Incredibly, the piece never once mentions the implication of the displacement story for the demographic nightmare stories that endlessly fill its news and opinion pages.
Remember, the demographic nightmare story is that because of lower birth rates and longer life expectancies we are going to see a fall in the ratio of workers to retirees, from 3 to 1 today, to just 2 to 1 in 20 years. So, this is a story where we are suffering from a severe labor shortage. All of us aging baby boomers will be laying in our own waste because there is no one to change our bedpans.
Okay, now we have the story of sophisticated robots that will be able to replace human laborers in a wide variety of activities. The Post tells us that we should be worried about unemployment. Not really, because anyone who has read an intro econ textbook in the last 70 years knows that creating demand in an economy is very simple. Governments can run deficits. And if we need lots of demand, then we can run large deficits.
These deficits will give us the money we need to buy the output generated by sophisticated robots. And, when it is necessary, we will have the sophisticated robots changing our bedpans.
Of course there is a political problem. Folks like Peter Peterson and Washington Post don't want us to run deficits. They would rather see workers be unemployed. But hey, this is not the fault of the robots.
Advanced robots are simply another form of the productivity growth that we should all know and love. It increases the potential wealth of society. It is certainly possible that the rich and powerful will use their control over the political process to deny the bulk of the population the benefits of productivity growth, as they have largely done for the last 30 years, but the blame should be focused on the rich and powerful, not the robots. You might as well lash out at the wheel.
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