Regina Saphier: Recovering Plutocrats: Wake UP!

First published on Aug 22, 2014 on LinkedIn.

 

Regina Saphier: Recovering Plutocrats: Wake UP!

I used to write a live TED conference blog for years, but I stopped (partly because I started two other blogs, about MOOCs and Virtual Humanism)… partly because I started to publish via LinkedIn.
However, I watched a TED talk recently that I wanted to share with you all (this time via LinkedIn), but not because it was brilliant. I wanted you to see how billionaires are playing with ideas like raising wages or shortening the workweek to deal with the puzzling problem of the rich getting richer (despite the recent economic crisis), the middle class getting poorer, robots replacing human workers, profits going up (again, despite the recent crisis that did not yet go away), while employment is going downIt looks like new technologies are not creating new workplaces in large enough numbers.

Raising Wages?

Nick Hanauer is your average, recovering, garden variety plutocrat who says that the US middle class needs higher wages (let me translate that for you, he means: more purchasing power) and better living conditions (the ability to spend more on housing, for example). He is a capitalist who does not believe in his own privileges at the expense of american society. “Marvelous”. He warns his fellow plutocrats that the “pitchforks” are coming if things don’t change. In other words there will be consequences when too few own too much for too long.

Nick has a point, but unfortunately he still thinks that more consumption is going to fix a society that exists on Earth that has limited resources. Nick is wrong. You cannot forever increase productivity and consumption… that strategy does not lead to a sustainable society at this point. Yet it is important that he is willing to spend more of his revenues on wages instead of a new mansion or boat and that he stands up for his views publicly (let me remind you, he needs no more money, yet raising wages in general might result in more profits for him, depending on his investment portfolio). I also like that he admits that in another country with less national economic power he would sell fruit on the side of the road, because that system has only that much economic power and not everyone gets lucky… I am sorry that his warning has to do with his own fear of lower social classes, and not so much with his conscience.

What Could Be a Truly Transformative Idea for a New Era?

Plutocrats did not make america, rather the country and mostly its middle class made the 0.01% super rich, he says. I say, the super rich and governments of developed nations could easily implement the Unconditional Basic Income or UBI idea (or in other places it is called the Basic Income Guarantee or BIG).After all, Nick so clearly argues that minimum wages can be raised significantly without having to worry about negative consequences. In fact he says that spending will make the economy healthier.
So, if that is true, why not provide people with dignified optimal income (independent of work) and let them make real choices (like opting into the open source and sharing economies as consumers and/or as entrepreneurs)? This would be a truly transformative message. However, Nick is not interested in a society of true fairness and real choices, he is interested in a society that keeps people dependent and usable (keep working for money, keep spending to keep earning, to keep spending, to keep earning… so that Nick could make even more money, even if he does not need any more of that).

A Very Expressive Chart

Here is a chart that shows how corporate profits are going up while employment is in sharp decline in the US. (I regenerated the chart that I encountered in Federico Pistono’s lecture that he held at the University of Life Sciences Oslo in Norway in 2013.) If people are losing their jobs at this rate in the US, it will soon be hard to raise wages of workers… because there will be hardly any employees to benefit from a raise in a few decades. In fact Nick’s fellow plutocrats are going to be investing into technologies that make people obsolete (they are investing in this heavily already, otherwise how did profits go up to an all time high while employment plummeted to a 1984 level by now).
Every single road of this economy leads to human work becoming more and more obsolete, now even in the middle class… There will be low level jobs that cannot be done by robots (only for a while), and there will be jobs that require high level human intuition, cognition and empathy that robots cannot replace (again, for a while). The rest of the job market will be eaten alive by automation (it is already happening). Raising wages (or shortening the workweek) of nonexistent future workers is the kiss of death in a bad dream in the long run… It is happening in the US, in China, and I suspect that most of the angry people won’t grab actual “pitchforks”. To tell you the truth I rather not start to imagine what jobless masses are going to do in our foreseeable future without income. So, forget about raising wages (or shrinking the workweek) being the only way
.
.
.
Nilofer Merchant looks at her son to see the future in “Digital Life in 2025 – AI, Robotics, and the Future of Jobs” (Pew Research Center, 2014):
Let me put it this way:
my son, who is 10, doesn’t think he needs to learn to drive or do grocery shopping because he says he’ll just click something to arrive. All the fundamentals of life can and will be automated, from driving to grocery shopping. Chores effectively disappear in terms of time consumption.

Shrinking the Workweek?

Recently I watched Larry Page while he spoke to Vinod Khosla (basically, one billionaire to another) and there were a few very important ideas.
Larry Page: “I totally believe we should be living in a time of abundance, like Peter Diamandis’ book. If you really think about the things that you need to make yourself happy – housing, security, opportunities for your kids – anthropologists have been identifying these things. It’s not that hard for us to provide those things. The amount of resources we need to do that, the amount of work that actually needs to go into that is pretty small. I’m guessing less than 1-percent at the moment. So the idea that everyone needs to work frantically to meet people’s needs is just not true. I do think there’s a problem that we don’t recognize that. I think there’s also a social problem that a lot of people aren’t happy if they don’t have anything to do. So we need to give people things to do. We need to feel like you’re needed, wanted and have something productive to do.”
Larry Page goes on saying: “… reduce the workweek. And then, if you add slightly less employment, you can adjust and people will still have jobs.”
I agree that not everyone has to work to provide what people need, but reducing the workweek is only a short term solution… first you will have 20 hour work weeks… next 10 hour work weeks… Whats next? The 5 hour workweek? For how much money? Based on what performance? Coming from what source? Sustaining how many people?

Giving People the Opportunity to NOT Having to Work for a Living

In my humble opinion, providing plutocrats with endless amounts of profits cannot be a viable social goal in the age of amazing technologies. Humanity as a community cannot let this happen.
There were two key ideas I strongly agree with, added by Vinod Khosla in the video.
Vinod Khosla: “I fundamentally believe we move from an economy of labor and capital to an economy of ideas. Most economists haven’t caught on to this change…”
Vinod Khosla: “Looking 40 years out, I find it hard to imagine why we won’t need to support half the population to not work but pursue other interests that are interesting to them.”

Plutocrats Don’t Appear to Know Anything About: Unconditional Basic Income

Here is where “UBI” or “BIG” should have been mentioned during the discussion, but apparently not one of the three participants knew about it. Plus, Nick Hanauer, can you hear what Vinod Khosla, your fellow plutocrat is saying? He says, that in a few decades wage based employment won’t be a priority. He is right! What are you going to do with raised wages in an era of hyper automation? What are you going to do with shortened workweeks in the age of technology based mass unemployment?
Of course I wish all people had more income (who need it) and less meaningless work (giving people the option of self development and meaning), but raising wages or reducing the workweek are very short sighted solution in this age, based on a highly outdated market paradigm, at a never before seen level of automation that was supposed to make human life easier and more creative. How are you able to stay rich if you are so shortsighted when you believe you are a beacon? Please, wake up and look beyond your corporate bubbles, look further along the road and try connecting the actual dots.

More content regarding virtual humanism, UBI, leadership and many other topics on My Virtual Humanism Blog