Blaming Automation: A Leftist Playbook Retread
Economist Henry Hazlitt (1884-1993), in his book Economics In One Lesson (1946), wrote:
"Among the most viable of all economic delusions is the belief that machines on net balance create unemployment. Destroyed a thousand times, it has risen a thousand times out of its own ashes as hardy and vigorous as ever."
"The belief that machines cause unemployment ... leads to preposterous conclusions."
President Lyndon Baines Johnson (LBJ), in January 1964, speaking about how automation reduces the number of jobs (thus causing poverty), said, "We must ... establish a high-level commission on automation. If we have the brain power to invent these machines, we have the brain power to make certain that they are a boon and not a bane to humanity."
I guess that Dear Leader Barack Hussein Obama is more familiar with LBJ than with Hazlitt. Obama, in June 2011, in an effort to explain why his policies have not produced the 7 million jobs he promised in 2008, said (emphasis mine):
There are some structural issues with our economy where a lot of businesses have learned to become much more efficient with a lot fewer workers. You see it when you go to a bank and you use an ATM, you don't go to a bank teller, or you go to the airport and you're using a kiosk instead of checking in at the gate.
Obama actually said that. So I guess that his answer to unemployment is to prohibit improvements in automation, in technology, in efficiency -- to become a "Luddite," one who dislikes technology, especially technological devices that threaten existing jobs.
Heck, I can solve Obama's unemployment problem right now -- just prohibit the use of any automation and return to the 17th- or 18th-century way of doing things. Efficiency would suffer, as would the standard of living and life expectancy. And many conveniences that we take for granted, such as cars, airplanes, televisions, appliances, and electricity, will have to be given up. But we would have many more people employed.
New technology improves efficiency, profits, and the overall standard of living. Otherwise, there would be no economic incentive to invent new technology. But automation produces short-term unemployment; of that there is no argument. So Obama may be correct -- in the short term (defined as his term as president; he cannot be re-elected so he doesn't care beyond that time).
But there a fallacy to Obama's (and low-information voters') thinking and long-term view. As "The Luddite Fallacy" states, new technology, in the long run, does not lead to higher overall unemployment in the economy. New technology doesn't destroy jobs -- it only changes the nature of jobs in the economy. The only way to address this situation is to embrace (and get trained for) automation, new technology.
The question, then, is, "Why doesn't Obama (and the Progressives/Liberals/Democrats, the 'low-information' voters, Obama's economists, the [now disbanded] jobs council, and the MSM) see the fallacy?" The answer is simple: they do! But the next election is a short-term time period away. Short-term thinking (by politicians of both parties) wins elections.
But wait! There is a "Luddite Fallacy Fallacy" theory, which maintains that there are limits to human capabilities. It says, "Increasingly, only those at the right end of the bell curve [referring to smart people] are able to claim a decent (or any) share of the American pie. As the American economy is constituted (in its global context), diligence and hard work are not sufficient to give you that claim."
I can only assume that Obama, progressives, liberals, and Democrats have this view of "the unwashed masses" who cannot find their own way in this world, who must be protected from evil capitalists (smart people) who want only to take advantage of them, who must have their standard of living maintained.
K.E. Campbell closes his excellent June 2011, article with, "In short, the 'real result of the machine is to increase production, to raise the standard of living, and to increase economic welfare' by lowering prices or raising wages or both. But this president does not get it. So much for 'progressives' being for 'progress'."
Where was the MSM while all of this "retread" was going on? Certainly not informing the low-information voters, thus enabling Obama to continue his "machines take jobs" myth. Where is the MSM today? They continue to report the Q3 "official" unemployment rate, while totally ignoring the much more realistic Q6 unemployment rate. As Tyler Durden says, "... fudging the labor force participation rate is how the Obama administration has managed to maintain the myth the economy has grown under his leadership for the past 4+ years." And the MSM fails to make an issue of the shrinking labor force participation rate and its effect on unemployment.
So, try as the MSM may to prop up Obama by fudging unemployment numbers, by propagating the "technology causes unemployment" fallacy, and by enabling the Democrats' retreaded argument, economic reality will eventually win out.
And where is Obama today? Still spreading his "technology causes unemployment" myth, still spouting the Democrats' retreaded argument, still trying to promote his economic policies that did not work during his first term, still mired in "real" unemployment, still trying to hinder efficiency through regulations that hurt new technology innovation. I hope only that when Obama and his enablers (the MSM and progressives/liberals/Democrats) are forced to face economic reality, there is still a country in which my children and grandchildren can grow up.
Dr. Warren Beatty (not the liberal actor) earned a Ph.D. in quantitative management and statistics from Florida State University. He was a (very conservative) professor of quantitative management specializing in using statistics to assist/support decision-making. He has been a consultant to many small businesses and is now retired. Dr. Beatty is a veteran who served in the U.S. Army for 22 years. He blogs at rwno.limewebs.com.