No work, No pay

Brad DeLong points us to an article by Robert Reich in which he predicts an ever widening gap between the rich and the poor due to the rise in productivity and the consequent loss of manufacturing and other routinized jobs. Those occupying the few analytical jobs that remain will get richer and richer, while those who are no longer needed in the workforce will get poorer and poorer.

Meanwhile, the ranks of production workers have fallen... between 1995 and 2002 more than 22 million factory jobs vanished. The United States wasn't even the biggest loser. America lost about 11 percent of its manufacturing jobs, while Japan lost 16 percent and Brazil lost 20 percent. The biggest surprise: China, which is fast becoming the manufacturing capital of the world, lost 15 percent of its manufacturing jobs.

What's going on? In two words: higher productivity. Factories are becoming more efficient, with new equipment and technology, and in nations like China, market reforms are replacing old state-run plans with modern ones. As a result, even as China produces more manufactured goods than ever before, millions of its factory workers have been laid off.

Routine office jobs are disappearing almost as fast as routine factory jobs. Almost any office task—claims adjusting, mortgage processing—can be done more cheaply and accurately these days by specialized software. Jobs that can't be turned into software are heading to low-wage countries as fast as telecom systems can reach them....

This seems to suggest that we may be about to enter a world in which all the production required to satisfy the needs of the populace will be undertaken by a small minority of the people. It seems to me this raises the question of what we do with the all the people who are not needed for work. Reich seems to suggest we need to devote more resources to education in order to make sure that our people don't get left behind, but then what happens to those in other places with less education who do? After all, if Reich is correct, the more we educate people, the faster we will develop productivity improvements that force others out of work.

The problem here seems to be that work and pay are inextricably tied together in the paradigm of our capitalist society. Those who work get paid. Those who don't don't. But, if we really are moving into a world where only a few workers will be needed, I don't see how that paradigm can survive. Inevitably, the fruits of the high productivity of some will have to be shared with the rest of the population in some way or revolution is inevitable. You just can't have ninety percent of the population unemployed!

In other words, if Reich's world comes to pass, the conservatives' ideal of an “ownership society” where everyone is incentivized to work for his wage will be impossible. So where does that leave us? What kind of paradigm can replace our capitalist market society paradigm? I frankly don't know. I'm still a victim of the current paradigm.