> Nearly 1 billion people have been taken out of extreme poverty in 20 years
But it has been done without generating the sort of full-time blue collar employment that is implied behind all sorts of economic policies around the globe. China has gone from feudalism to post-industrial robotization in one generation, skipping most the wealth-building industrialization phase Western Europe and North America went through in the last century.
The global creed is "you're not worth something without work", yet we are, for all purposes, running out of work. The computer revolution is optimizing away all its menial jobs already – just how much have trends like virtualization, clouds, infrastructure orchestration and so on reduced the demand for warm bodies to throw at hardware issues in the last few years? – while education systems still haven't finished ramping up the creation of more and more menial labourers. The earlier industrial revolutions have, quite soon, created more jobs than they destroyed, but this does not seem to happen any more.
We've reached the point where we have, globally, more people of working age than we can possibly need to satisfy all global needs, and this trend is not going to reverse.
And the problem is: We have no idea what to do about it. The left is blabbing "muh robots" and "muh basic income", but nobody has a consistent, practicable theory of what a post-full-employment society (which is something entirely different from a post-employment-at-all society) could look like. We're still going to need menial labour, blue collar work, white collar… but not enough. What do we do with all the excess population?
Model 1) There's a finite amount of work out there. Computers will replace mental jobs just like robots killed physical jobs. We're all heading towards unemployment.
Model 2) Employment is determined by the value of an employee. Technology makes employees more valuable, not less. Employees will get more bargaining power as technology improves, not less.
The economic consensus is with #2, because feedback systems appear to drive down high unemployment over time (though bad governance can definitely interfere). One feedback system might be: idle people will eventually conspire to discover and meet the wants of others.
That's abstract though, it might be helpful to look closer to home.
Consider the fear that software will take over everyone's work. It's easy to forget that programmers know exactly how this goes. They have already cannibalized a lot of their work with software. The last fifty years of programming language (IDE, engine, ...) development has been a steady progress of finding ways to get software to write software, to do all the annoying grunt work of the job.
As programmers became more efficient, and crank out more and more complex tools over time, has the demand for code steadily decreased? Have we now solved all the world's problems that can be solved through code? Or has the problem space expanded to meet our capacity? Has the demand for programmers increased because their time is now much more valuable than it was in the era of punch cards?
Note more broadly, jobs are picking up right now as part of the recovery, despite continual technological improvement.
I think the economic consensus is with #2 because so much of the available data so consistently points that way, so it's easy to dismiss the other model as just natural human pessimism about the future. Maybe the pessimistic model is right and we just don't know it yet, but I think it currently has the weaker case.
Imagining this future doesn't seem too outre.
Just speculation but isn't that already the case? I don't have the numbers but I wonder what percentage of the human population is in the working force or, better yet, what percentage of our collective "waking hours" is spend working, with or without monetary compensation.
We're still going to have a lot of jobs in the mid-term, probably even long-term. 70%, 60% of the working populace in the mid-term maybe, and not too few of those in menial/blue collar jobs. We still need to fill these jobs, and a generous basic income would make these jobs highly unpopular. So we can either set a basic income that is not high enough to solve the problem it was trying to solve, or we create a situation like in Saudi Arabia – where all the undesirable jobs are taken by foreign jobbers (from nations without basic income, or war zones, or…), while the natives grow fat and lazy.
Not exactly an economic policy I'd have expected from the Left.
Or we could just let the wage for those undesirable jobs rise to a level that someone will take them, even though they're getting the basic income.
Why shouldn't someone get paid a lot of money for (e.g.) trimming my toenails? Someone else would have to pay me a lot of money to do that.
To avoid that would take substantial further reductions in birth rates beyond that which is baked in based on current trends.
EDIT: Let me adjust this a bit. UNs World Population Prospects 2015 [1] says "Continued population growth until 2050 is almost inevitable, even if the decline of fertility accelerates." and their middle and top estimates shows continued growth until 2100, though rapidly shrinking growth. The low end estimate shows a reduction in the latter half of the century. Almost all of this growth is expected to be in developing countries, however.
[1] http://esa.un.org/unpd/wpp/Publications/Files/Key_Findings_W...
Awesome!
Seriously, which is it? Either capitalism is going to fail because there aren't enough workers, or it's going to fail because robots are taking all the jobs. Can't have both!
Because, of course, having both would be fine... no catastrophe, life continues as normal as it has in the face of every prediction of imminent disaster. We have less workers due to demographic changes, but that's cool because we need less workers. We sort out the political problem of how to stop all the money going to to <1% of the population, we're all good.
I wouldn't call the circumstances in Europe 1815-1945, when the last massive societal upheavals happened, "life as normal".
And even if capitalism did deserve much of the credit, that doesn't mean it shouldn't be criticized or that we should stop looking for better. Feudalism may have lifted more humans out of poverty than any other system that came before it by leaps and bounds. It's a good thing we didn't decide to stop there.
Communism, oligarchy and dictatorships (the first really being a special case of the latter two) are supremely harmful and stupid. I wish people would stop using them as straw men to prove that capitalism is great.
Looking at it this way, you're quite right that The Enlightenment, science, egalitarianism and democracy deserve the credit because they are choices we make. They are motivating and organisational forces we have control over and so can be credited with achievements. When an Engineer builds a bridge we celebrate the skill of the engineer and the educational and organizational forces that made the project possible, not the laws of physics.
In this way of thinking, there is no such thing as an end to capitalism. Anyone talking about the future in that way is simply asking the wrong questions. They can't see the wood for the trees.
But if capitalism isn't private property and business ownership, what is it? That's certainly what Marxists* mean by it. If anti-capitalism isn't about abolishing those things, what do it's proponents advocate? A political or economic agenda characterised purely in terms of being anti-something with no proposed alternative is just nihilism. What are anti-capitalists for? What do they propose? What is their actual agenda? I've yet to see that coherently laid out. I can understand anti-corporatism for example because that still allows for alternatives. But other than actual honest to goodness communism, what is the alternative to capitalism that it's critics want to replace it with? Some pointers on that would be greatly appreciated.
*Of course it would help if Marx had actually given an account of how he thought a communist economy would function. Other than vague pronouncements that production would be regulated by 'society' and that individuals would have complete freedom as to what pursuits they engaged in from day to day, he never to my knowledge actually gave an account of how it would function either. But at least he gave a very clear and specific account of what he was against.
Marxists (and more specifically, Marx) certainly meant more than the mere existence of private property and business ownership, he meant the system organized around a particular model of private property rights. (Both private property and privately owned business existed in the pre-capitalist feudal economy from which capitalism emerged, but under a very different model of property rights and very different economic relations between participants in the economy.) [0]
> If anti-capitalism isn't about abolishing those things, what do it's proponents advocate?
Mostly, altering the conception of property rights and economic arrangements to de-emphasize the role of profit to be captured by capital in some significant (but not always all, or even most) economic interactions, increase social control of some of the rights associated with ownership in the capitalist system (though not necessarily to the exclusion of private ownership rights) of productive capital.
Anti-capitalists are a fairly diverse lots, so the differences will be fairly stark without a lot of commonality. Opposition to capitalism doesn't mean supporting the same alternatives to it. (Strictly speaking, supporters of the modern mixed economy are a kind of "anti-capitalists" who support a particular -- and currently dominant -- replacement of capitalism.)
[0] This provides a basic rundown, though its perhaps less clear which of these elements are consequences and which defining features, https://en.wikipedia.org/wiki/Capitalist_mode_of_production_...
tl;dr: the freer the market the better capitalism works. Just have a look at the top freer economies here, they're also the wealthiest http://www.heritage.org/index/ranking
Yes. Mining and drilling have obliterated the natural resources of hundreds of millions of people around the world. That's why oil spillage in Nigeria is called an environmental disaster.
> Essentially, isn't this capitalism with all its fault lines? One way or another it can be got to work for everyone's advantage.
Not when capital is turned into a commodity that has necessarily less value, which are then still traded on the market as securities with no regulation. Then you end up with scenarios in which political intervention is the only method for preventing the entire global economy from collapsing. That's already happened once, which is evidence that this article's fairly milque-toast thesis is correct.
Indeed, there are present day countries serving as examples. Unless I've misunderstood your point?
Capital has always and will always be a traded good. Nothing about that can ever change. Unless you plan to return humanity to the most basic of existence, living day to day, scrounging, trying not to starve without reserves.
No regulation? Please point me to the industrial economy without financial regulations on any major specific thing.
What happened with the global financial meltdown was very obviously not due to lack of regulation. It was caused by the Fed encouraging reckless behavior by intentionally inflating asset bubbles as an attempt to accelerate recovery from the 2000/2001 recessionary economy. Hint: they're doing the exact same thing all over again right now, they're doing it on purpose and have been for over half a decade, and they're openly admitting it.
Capitalism generates capital. Yay for us, we now have lots of capital. But once you've generated all the capital, and maximised all the profits to the point of driving surplus value to 0. What then?
* Also a major nitpick, most of that billion were brought out of poverty in China in the 1950s at the peak of Maoism/Communism... so you're point is kind ironic, no? The majority of the remainder were also in China during DengXiao ping driven state run capitalism or "Socialism with Chinese Characteristics"... So even if you weren't missing the point, the point you are making is still very moot.
If you're talking about the "Great Leap Forward" years (late 50s-early 60s), somewhere between 18 and 45 million Chinese people died, most of them by starving to death. The Chinese economy did not grow during that period. It shrank.
That's an odd definition of "brought out of poverty".
You're assuming you will be able to keep this capital forever. History demonstrates that most of even the richest families don't stay such after 3 or 4 generations.
Ask any Family Office managing finances for HNW investors and they'll give you examples.
* Decreasing marginal utility of wealth.
* Difficulty investing as wealth increases. Capital accumulation lowers rates, incentivizing individuals to spend (h/t Reisman)
* Empathy and philanthropy (one can't just ignore this, it's human action all the same).
* The calculation problem builds in inefficiencies as organizations grow (h/t Peter Klein).
Intergenerational differences in ability and goals and the squandering of inheritances.
Entrepreneurship and innovation. Punctuated equilibrium (h/t Schumpeter).
The fact that we'll probably squander that too, or it will decrease in value, only strengthens the questions... so what do we do after that?
Wealth creation through creativity, like we do every time, that's what we do next.
This article was wasted time
Catchy one liners "Wealth creation through creativity" might help you sleep at night, but seriously, our creative endeavours have never produced anywhere near the amount of capital the resource sector has... What happens when we either get so efficient at resources that they cost nothing, or we run out of the resource?
There is no ultimate conclusion to Capitalism, the system continues to create more prosperity, and capital continues to seek higher forms of productivity and profit, which perpetually raises the standard of living for any nation that deploys Capitalism with its well understood requirements (which include a strong judicial system, property rights, et al). New innovations and breakthroughs perpetually lead to new industry and expansion, creating perpetually greater numbers of jobs (which is why America doesn't only have 500,000 jobs available today; and America isn't even a properly functioning Capitalist nation, it's a poorly functioning highly regulated mixed economy).
More generally, Malthus had much more historical support for his thesis (that population would quickly grow to consume all the food available). But the rules changed.
http://www.forbes.com/global2000/
Only four of the top 20 could reasonably be described as "resource" companies (oil companies, in every case).
It certainly isn't a natural resource like oil or iron ore.
What would you call it?
Harnessing the energy of people across the planet by letting them trade with each other has so clearly been a disaster for everyone, has it? Essentially, isn't this capitalism with all its fault lines? One way or another it can be got to work for everyone's advantage.