I’d say automation played a decent sized part in that as well. A massive chunk of those high paying jobs were factory work. A lot of those production type tasks were automated away, and the increased number of maintenance jobs required doesn’t even come close to covering that loss of required factory workers.
Increasing automation lowered the cost to produce goods. The people who owned the machines (capital) could have lowered prices, but they didn’t. They used the lower wage cost to increase their own profits, then used those profits to buy more machines (increasing their capital).
Now we have a small number of people who own a large amount of capital, raising prices on everything to keep increasing their profits, and refusing to help the people who used to do the now automated work, or raise wages for the existing workers. The shareholders don’t care about working conditions or product quality, they only care about getting a bigger return on investment (by a bigger margin) than the previous year.
“Sustainable growth” (actually exponential growth) is literally impossible to sustain, yet almost every major company’s shareholders demand it. What happens when your economy is reliant on the impossible?
I’m not excusing the behavior of the corporate leadership here, but I think that the problem would have shown up regardless. Even cheap goods are too expensive if your income is $0.
Some form of basic income is going to be required, but good luck convincing anyone of that before the violence starts.
I’d say automation played a decent sized part in that as well. A massive chunk of those high paying jobs were factory work. A lot of those production type tasks were automated away, and the increased number of maintenance jobs required doesn’t even come close to covering that loss of required factory workers.
Increasing automation lowered the cost to produce goods. The people who owned the machines (capital) could have lowered prices, but they didn’t. They used the lower wage cost to increase their own profits, then used those profits to buy more machines (increasing their capital).
Now we have a small number of people who own a large amount of capital, raising prices on everything to keep increasing their profits, and refusing to help the people who used to do the now automated work, or raise wages for the existing workers. The shareholders don’t care about working conditions or product quality, they only care about getting a bigger return on investment (by a bigger margin) than the previous year.
“Sustainable growth” (actually exponential growth) is literally impossible to sustain, yet almost every major company’s shareholders demand it. What happens when your economy is reliant on the impossible?
I’m not excusing the behavior of the corporate leadership here, but I think that the problem would have shown up regardless. Even cheap goods are too expensive if your income is $0.
Some form of basic income is going to be required, but good luck convincing anyone of that before the violence starts.
And with AI they hope to continue or even accelerate that trend.