Hyper Canteloupe

Twice in two days some quite sane business colleagues have hypothesised to me something that I already know.

Each pointed out to me that the degree of automation in all aspects of production of goods and in the delivery of services is accelerating so quickly that employment levels are soon going to start dropping off precipitously.

Also, both of my colleagues noted that this isn’t good for the global economy because we need all those people to have incomes in order to consume.

What they are sensing is the start of the end of Capitalism, as we know it.

Born out of the Industrial revolution we have had a golden era of Capitalism with ever-increasing productivity for over three hundred years.

For most of this period, humans were necessary units of labour AND consumption, and our economic management has had this assumption implicitly built into it.

But now, with real demand for labour dropping off and potentially taking consumption with it, the central banks are running out of ideas on how to stimulate their economies.

Their levers don’t work if people are unemployed and never will be employed.

Ideally there would be an adjustment period while some new economic model emerges; most likely based on an extension of the existing model of employing people in artificially generated services jobs through the implementation of government legislation.

Financing this model past a smallish percentage of the overall workplace, however, will require some imaginative re-thinking of corporation structures and taxation, as well as income taxation.

[Here I have extracted some imaginative model that I came up with for this. I had troubles re-reading it, so imagine the trauma for others?]

The thing that worries me the most is that such any such re-jigged system relies on ever increasing productivity and an infinite supply of resources.

Unfortunately, climate change combined with our rapidly diminishing resources may mean that we may be better off letting consumption decline.

Maybe the best way to achieve all this is to leave things just as they are but to substantially increase income on salaries so that the hordes of unemployed or artificially employed can be kept alive by government programs.

If this went on for long enough and a large fraction of people were in artificially created jobs, ironically we’d up in a situation of pseudo-communism.