Paul Krugman makes a cogent argument today in the New York Times with respect to technology which few who regularly read this blog will be surprised to know I wholeheartedly agree. But I’m not sure he needs to bring Luddism, with all its anti-technology baggage, into the argument.
As you may or may not know, Luddism has its roots in the destruction of textile machinery by European factory workers in the early 19th century, who were concerned as to the effects that this new technology was having on their ability to retain their livelihoods. Over the decades, however, Luddism has become more generally associated with expressions of anti-technology and other gruntish behavior, and, while it has undergone some recent reinvention by the Neo-Luddite movement, it is still commonly utilized as a derogatory term to categorize and marginalize those who question the purposes to which technology is being applied as those who just “hate technology.” However, in terms of the original idea, I do think it is just as relevant today as it was 200 years ago. To wit (from Krugman):
Until recently, the conventional wisdom about the effects of technology on workers was, in a way, comforting. Clearly, many workers weren’t sharing fully — or, in many cases, at all — in the benefits of rising productivity; instead, the bulk of the gains were going to a minority of the work force. But this, the story went, was because modern technology was raising the demand for highly educated workers while reducing the demand for less educated workers. And the solution was more education.
Now, there were always problems with this story. Notably, while it could account for a rising gap in wages between those with college degrees and those without, it couldn’t explain why a small group — the famous “one percent” — was experiencing much bigger gains than highly educated workers in general. Still, there may have been something to this story a decade ago.
Today, however, a much darker picture of the effects of technology on labor is emerging. In this picture, highly educated workers are as likely as less educated workers to find themselves displaced and devalued, and pushing for more education may create as many problems as it solves.
I have long felt that the increasing trend of requiring a college education to enter the middle class was a dangerous concept for a functioning democracy. Indeed, while it is a laudable goal, and highly desirable, to have an educated population, the backbone of the middle class should always primarily be those who can find reasonable work without an advanced degree. More Krugman:
So should workers simply be prepared to acquire new skills? The woolworkers of 18th-century Leeds addressed this issue back in 1786: “Who will maintain our families, whilst we undertake the arduous task” of learning a new trade? Also, they asked, what will happen if the new trade, in turn, gets devalued by further technological advance?
And the modern counterparts of those woolworkers might well ask further, what will happen to us if, like so many students, we go deep into debt to acquire the skills we’re told we need, only to learn that the economy no longer wants those skills?
Education, then, is no longer the answer to rising inequality, if it ever was (which I doubt).
So what is the answer? If the picture I’ve drawn is at all right, the only way we could have anything resembling a middle-class society — a society in which ordinary citizens have a reasonable assurance of maintaining a decent life as long as they work hard and play by the rules — would be by having a strong social safety net, one that guarantees not just health care but a minimum income, too. And with an ever-rising share of income going to capital rather than labor, that safety net would have to be paid for to an important extent via taxes on profits and/or investment income.
The fundamental problems with the way technology (and globalization) has been implemented have always been about the way that displaced workers have been treated, and how the fruits of increased productivity have been shared. While the general case can always be made that “consumers” benefit from increased productivity, it becomes harder to justify when large percentages of this consumer group are forced to fend for themselves when they become “redundant.” After all, it is rather hard to reap those “consumer benefits” when you have no job, or prospects of easily acquiring a new one.
Thus while Krugman proposes some solutions for maintaining the middle class , I think a better strategy would be to focus on investing in industries that increase the number of adequately paying jobs that can reasonably be performed with a high school education (not these), investing in producing high school graduates that can enter these jobs without requiring additional initial training (and perhaps adding publicly funded trade schools for focused industries), and to help workers learn transferable skills that can be leveraged for alternative occupations. Without this focus, all you will ultimately have is a lot of disgruntled, unemployed/underemployed college graduates, and an even larger group of disgruntled , disenfranchised people for whom attaining a middle class livelihood – and, consequently, a reason to be engaged in self-government – is a far-off dream last learned through aging and irrelevant textbooks.