transportation

by

Will Robots Drive Us To Socialism?

robots-out-to-get-me

I read recently that Rio Tinto has already replaced 30% of their mining machinery operators and drivers with robots.

The future of work in an age of increasing automation is a topic that a lot of economic thinkers have considered. Frances Coppola ponders the question of how the future may look in a world in which automation is driving people out of the labour market:

Automation only happens when machines are cheaper to run than people, and it is probably fair to say that in the last few decades automation has not happened quite as fast as one might have anticipated because companies have discovered that labour in emerging markets is cheaper than the cost of investing in machinery. But as the standard of living rises in emerging markets, and the cost of technology falls, that will not remain the case. Hazlitt, writing in 1952, pointed out that it was automation of production that enabled families to survive without children’s labour, because the price of goods produced with the new machinery was so much lower than those produced in a more labour-intensive way. In the short term automation caused hardship, as people whose livelihoods depended on the old way of doing things lost their jobs: but in the longer term there was benefit to society in the reduced cost of goods that enabled many people to work less, and in the development of new industries to employ those people no longer needed in the old ones. The change we are seeing today is every bit as great, and the short-term consequences are the same – high unemployment, particularly among those with poor or irrelevant skills.

Automation should both require fewer people to work AND enable people to work less, since the whole point of automation is to reduce the cost of production, which in a competitive system would result in falling prices. Unfortunately this isn’t always the case: the owners of automated industry may use reduced production cost as an opportunity to take more profit, and they may use political influence to create barriers to entry and trade tariffs to prevent competition driving down prices. But assuming that governments don’t use subsidies and protections to keep inefficient companies alive and prices artificially high, where does that leave us in terms of employment and incomes in the future?

Where it leaves us is with increasing inequality, which of course is something that we have seen in recent years, alongside increased unemployment, which is another thing we have seen. And in a world where a minority, historically known as the capitalists own the physical means of production like factories, robots and patents this will result in greater inequality as labour becomes less and less important as an economic factor. The owners of capital will be able to produce to satisfy market demand with little labour input. This will result in more former labourers leaving that field and either becoming entrepreneurs themselves, or becoming dependent on welfare. I think this transformational phenomenon is already well under way in the West — and I only expect it to become more pronounced globally as automation becomes ubiquitous.

In theory, physical labour may become totally obsolete. If every house has a decentralised energy source like solar panels and reliable energy storage, as well as an advanced 3-D printer or molecular assembler that can produce almost physical object imaginable from a few basic recyclable chemicals then human poverty will essentially have been abolished. We can just spend the vast majority of our time doing things that we enjoy, while spending only a few minutes or at most hours a day programming our machines to fulfil our material desires.

That is the more optimistic vision. In a less optimistic vision, only a small minority of people will have access to such technologies as while the technology may exist, the costs of mass distribution remain too high (at least for a time). The vast masses, will be stuck in impoverished material conditions — dependent on welfare, and charity — without any real prospect being able to climb the ladder through selling their labour. Only a lucky few — who have an inimitably good idea, or a creative skill that cannot be replicated by a robot — will have a prospect of joining the capital-owning upper class. And for the others who are left out in the cold, political action may look attractive. Simply have the government take a larger chunk of the capital-owning class’s income or wealth, and redistribute it to the poor. Ideally, this would be done with the intent of abolishing poverty through making cheap electricity, internet access and molecular assemblers available to all. Less ideally, rather than giving the poor the means to fish (so to speak), it might instead take the shape of a giant welfare net, keeping the means of production in limited hands and simply confiscating and redistributing some wealth. These issues unresolved could create a lot of tension between the two classes. In a worst-case scenario, that could lead to social breakdown or even revolution.

Fortunately, I think that this can be avoided through voluntary charity. The billionaire class today is split between those on one hand determined to give it all away with the intent of improving the material conditions of the very poor — Bill Gates, Warren Buffett — and those on the other determined to create new futuristic technologies and systems — Elon Musk — that can improve the material conditions of the masses. As we proceed through the 21st Century and as the technologies of superabundance — solar energy, nuclear energy, wind energy, cybernetics, genomics, the internet, 3-D printing, molecular manufacturing, desalination, etc — create more and more wealth and more and more billionaires, this trend may accelerate. Simply, the wealthy may have so much wealth that eliminating material poverty through voluntary charity may in the long run be an obvious and inevitable move.

As Brian Caplan notes:

At first glance, I admit, a vision of a superabundant world where people who own only their labor eke out a meager existence seems frightening.  But put your fears aside.  In an ultra-productive world, a relatively tiny amount of non-labor resources would make your rich by current standards.  Labor + zero non-labor assets = poverty; labor + token non-labor assets = riches.  In any case, a slight charitable impulse in the better-off is all you need to ensure fabulous riches for every human on earth.

Once you’ve got a world this wonderful, the last thing you’d want to do is start down a potentially slippery slope with a high tech Russian Civil War at the bottom.  Indeed, a more sensible reaction would be abolish the welfare state as obsolete.  If half of us were billionaires, mopping up any residual human poverty with voluntary charity would be child’s play.

Ironically, this kind of world could be strangely like the decentralised and classless society that Marx originally envisaged. The route to which we appear to be travelling toward it on, though, is totally and completely different to the one Marx envisaged. Instead of violent revolution, the road to superabundance may be paved by technological progress made by the capital-owners.

by

Competing For State Contracts is Not Competition

Here in Britain, we hear the word competition a lot. Since Margaret Thatcher, there has been a general trend — in the name of competition — toward the selling-off of utilities such as water, railway, electricity and telecoms providers. More recently, there has been a trend toward government services being provided by private companies, such as the bungled Olympic security arrangements contracted out to multinational security giant G4S, as well as work capability assessments contracted out to French IT consultancy ATOS, and the contracting-out of some medical services.

The way this works is that the government provides the funding for services, which private sector companies then bid to undertake. This is also the way in which defence contractors have historically competed for defence contracts, a sector which is renowned worldwide for its profligacy, waste and inefficiency.

This is a bizarre arrangement. Competing for government contracts is nothing like the free market. In a true market environment businesses compete for the custom of individuals based on their ability to provide the best products and services. Individuals spend their money to satisfy their needs. New businesses can generally enter the marketplace at any time, and take business away from existing competitors. Competition is beautiful, because it allows economies to quickly adjust capital, labour and resource allocation to the preferences of society based on which goods and services people choose to purchase.

Under a model where private contractors compete for government cash, this is impossible because contractors are essentially bidding for a state-backed monopoly. State bureaucrats determining which contractor will get the money is not competition; there is no market mechanism, there are no consumer preferences. Contractors are just bidding for handouts from the taxpayers’ purse based on the preferences of economic planners. Consumers cannot take their custom elsewhere, because the custom is involuntarily coming out of their taxation.

This has also been the reality of privatisation. Although I am no fan of government-controlled industry, the reality of privatisation in the UK has been the transfer of state monopolies into private hands.

One very clear example of this is telecoms infrastructure. BT Openreach, an arm of the privatised BT, has a complete state-enforced monopoly on telephone exchanges. Other telecoms providers have to lease their infrastructure in order to operate.

And the same for railways; rail lines are sold off as monopolies for ten-year periods. For travellers who want to travel by rail from one destination to another, there is no competition; there is only a state-backed monopoly operating for private profit. No competition, only endless fare hikes, delays and a complete lack of market accountability as contractors take the government cash and do whatever they want.

Ultimately, the state-backed-monopoly model seems to manifest the worst of all worlds. Costs for taxpayers remain high, budget deficits continue to grow, and utilities remain inefficient and messy. The only difference appears to be that taxpayers’ money is now being funnelled off into corporate pockets.

A free society cannot be based on economic planners allocating resources based on a bidding process. A free society is based on the state letting society allocate resources based on the market for goods and services that people want and need.

by

Precrime in America

The U.S. Department of Homeland security is working on a project called FAST, the Future Attribute Screening Technology. FAST will remotely monitor physiological and behavioural signals like elevated heart rate, eye movement, body temperature, facial patterns, and body language, and analyse these signals algorithmically for statistical aberrance in an attempt to identify people with criminal or terroristic intentions.

It’s useful to briefly talk about a few of the practical problems that such a system would face.

Firstly, the level of accuracy in remote monitoring. Is it possible to engineer a system that can remotely tell you the heart-rate of a hundred passengers  passing through a TSA checkpoint? Yes. Is it possible to do so accurately? That is much, much harder. The obvious conclusion is that such a system, were it to be deployed in the wilds of airports (and presumably, other locations where our ever-benevolent technocratic overlords determine “terrorists” or “criminals” may be operating) would — given a large enough number of scans — produce a lot of false positives stemming from erroneous data.

But let’s assume that such a system can be calibrated to produce a relatively accurate data set. Now we are faced with the problem of defining “suspicious” behaviour. Surely a passenger with the flu or a cold — who might have an elevated body temperature and a faster heart rate — would set alarm bells ringing. So too would someone suffering from pre-flight anxiety, people taking certain medications, the elderly and so on. Given that TSA screening protocols have prevented precisely zero terrorist attacks on American soil since 9/11 (even in spite of the fact that 630 million passengers fly each year ) this merely suggests that vulnerable people will end up getting hassled by the TSA to an even greater extent than they already would be today. This is no laughing matter — a nervous but otherwise perfectly innocent passenger might end up getting tasered and die — something which of course has  happened multiple times already. Or —  under the NDAA (2011) — false-positives might end up being indefinitely detained on totally erroneous grounds.

Of course, the next problem is distinguishing the guilty from the innocent. Simply, this system would seem to produce nothing other than circumstantial evidence. Given that no crime would have yet been committed, how would it be possible to prove nefarious intent? Perhaps one day a terrorist or drug smuggler (got to keep fighting the war on drugs…) will be foolish enough to try to carry a gun or a knife through a TSA checkpoint and onto an aeroplane, but given that a metal detector could have detected that anyway, what is the point of this new technology? Surely it is to pinpoint potential terrorists who would otherwise not be picked out by the body scanners? In that case, would the end result just be that people — with no real evidence against them other than a fast heart rate and some perspiration — end up being thrown off their flight? Would people who are subject to a false positive and as a result miss a flight try to sue the TSA for wasting their time and money?

Next, just as a committed and composed liar can fool a polygraph, surely terrorists and drug smugglers out in the wild would adapt their behaviour to avoid detection. There are of course prescription drugs that can be taken to reduce the physiological symptoms of anxiety, and thus fool the detector.

Then there are the problems in testing. Subjects in the laboratory trials (taxpayer-funded, of course) have been told to go through the system with the intent to cause a disruptive act. The system has been fine-tuned to detect subjects in a controlled laboratory environment. Simply, there is no data on the effectiveness of this system against terrorists in the wild. The wild is a totally different environment, and the mindset and physiological cues of a real terrorist may well be entirely different to those of a laboratory subject who is pretending (we just don’t know until we try it on a large enough sample of real terrorists). The notion that it can catch terrorists seems wholly pseudo-scientific, and based on the false premise that terrorism has an identifiable set of physiological cues.  The entire operation is based on the (possibly flawed) premise that a terrorist will be nervous, and that therefore we should cast an extremely wide dragnet to further interrogate and intimidate nervous people. That is guesswork, not science.

As Alexander Furnas writing in the Atlantic states:

We should ask, in a world where we are already pass through full-body scanners, take off our shoes, belts, coats and only carry 3.5 oz containers of liquid, is more stringent screening really what we need and will it make us any safer? Or will it merely brand hundreds of innocent people as potential terrorists and provide the justification of pseudo-scientific algorithmic behavioral screening to greater invasions of their privacy?

It is ridiculous — and totally contrary to the Fourth Amendment — that the courts have franked the notion that air travellers can be subject to invasive pat-downs and body scans without probably cause. But they did. In U.S. vs Davis, 482 F.2d 893, 908 the judge ruled that “airport screenings are considered to be administrative searches because they are conducted as part of a general regulatory scheme, where the essential administrative purpose is to prevent the carrying of weapons or explosives aboard aircraft” and that “an administrative search is allowed if no more intrusive or intensive than necessary, in light of current technology, to detect weapons or explosives, confined in good faith to that purpose, and passengers may avoid the search by electing not to fly.”

But to effectively conduct a medical scan on passengers? Surely this goes well beyond being “no more intrusive or intensive than necessary“? How many successful terrorist attacks occurred after 9/11, even before the more invasive pat-downs and body scans were brought in? None. So why would deepening the security regime be necessary?

And now that the TSA has expanded its regime beyond airports and out onto the roads of America we must ask ourselves what the endgame of all of this is? Could it be to deploy these technologies on a widespread basis throughout American cities, malls, sports stadiums and using it to scout out potential troublemakers? Would that be deemed an “administrative search” too (and thus not subject to the Fourth Amendment)?

This logic — of giving incontrovertible and unchallengeable power to our benevolent administrative overlords and then hoping for the best — takes us to a dark and nasty place. It requires us to assume they have our best interests at heart, and it requires us to assume that they will not abuse their power. The power to monitor these kinds of cues is a power that could easily be abused. A corrupt TSA agent might call a person they find attractive — even a child — out of the queue for a secondary search so that he or she can molest them with an enhanced pat-down. These new tools just enhance that power, providing a cloak of pseudo-scientific justification to the reality of citizens bowing down at the feet of their government and kissing the ring of power. Unquestioning obedience to power is a recipe for social catastrophe.

As Jefferson put it:

When governments fear the people, there is liberty. When the people fear the government, there is tyranny.

Would I be picked out of the queue at the airport? Sure. I already am for my Arabic name. But I am nervous. And the things that make me nervous? Encroaching Orwellianism. The potential for the abuse of power. The potential for tyranny. The demand of unquestioning obedience. The money spent and debt accrued to develop these technologies. The fact that our governments are obsessed with terrorism to the extent that they will put tighter and tighter controls in place at airports, even though more people are crushed to death by furniture or televisions every year than are killed in terrorist attacks, while ignoring real threats to our society like excessive systemic risk in the global financial system.

That all scares the shit out of me.