Innovation Used to Benefit Workers. Can It Again?

Bob Lord

Bob Lord Tax lawyer, Phoenix, Az.

A few weeks ago, I cringed when I saw this headline at a popular progressive website: “See How Well the GOP Tax Scam Is Creating Jobs? Walmart Announces Plans for 360 Robot Janitors.”

It’s the same way I’ve cringed when conservative scolds taunt fast food workers that they’ll regret demanding a living wage, because it will cause their jobs to be mechanized out of existence.

On both the left and the right, Americans see innovation mainly as a threat to workers. The unfortunate thing is: They may not be wrong.

It didn’t used to be this way.

Replacing human labor with a machine used to mean fewer work hours per worker, with little or no loss in pay. It meant workers being freed up to do other, more rewarding work.

Until about 1980, technological advances benefited American workers and American society. Technological advances improved productivity, and workers shared in the benefits proportionately. Wages rose at the same rate as productivity.

Not only were American workers paid more, they enjoyed progressively shorter work weeks. As workers’ pay increased, they could buy more, which created more work, and more demand for workers.

Then, things changed. Technology continued its relentless march forward, but productivity increases stopped translating into higher wages. Instead, policy choices made by America’s political leaders caused the increased wealth and income from those productivity improvements to flow almost exclusively to those at the top.

Over the course of just four decades, America went from historically low levels of economic inequality to its highest level of economic inequality ever, surpassing even the inequality that reigned during the country’s gilded age. While the wealthiest American families own 60 times the wealth they owned in the early 1980s, the wealth of the median American family has decreased.

Those trends have now been at work for so long that the American view of technological advance has been turned on its head.

Today, it’s taken as a given that technology that replaces human labor will enrich only the developers of the technology — and the wealthy shareholders and executives of the corporations that employ it to eliminate jobs. We assume, not incorrectly, that the workers whose jobs are eliminated will suffer, while no other workers benefit.

It doesn’t have to be this way.

How crazy is it that we see the elimination of backbreaking labor as a bad thing? Nearly 50 years ago, science fiction writer Arthur C. Clarke proclaimed: “The goal of the future is full unemployment, so we can play. That’s why we have to destroy the present politico-economic system.”

In those words, Clarke captured the true value of technological advance: Technology should drive us ever closer to a society free of mundane human tasks. Instead, thanks to that “present politico-economic system,” it’s now employed in service of creating obscene wealth for a tiny fraction of our population.

That group, about 125,000 households in all, lives in absurd opulence. They own multiple mega-mansions. They fly in their own airplanes. Some own their own islands. Some earn more in a day than workers earn in a year. “Wealth beyond the dreams of avarice,” to quote a phrase most frequently attributed to English dramatist Edward Moore.

It doesn’t have to be this way. We may never achieve Clarke’s utopian vision, but we could be one heck of a lot closer to it. Stronger unions, a federal jobs guarantee, a universal living wage, and single-payer health insurance could all help restore the balance between labor and technology.

Those idea will have strong proponents in the next Congress. So now we can get to work destroying that “politico-economic system.”

 

This piece was originally published on Otherwords.org

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Reposted from Inequality.org

Posted In: Allied Approaches

Union Matters

Federal Minimum Wage Reaches Disappointing Milestone

By Kathleen Mackey
USW Intern

A disgraceful milestone occurred last Sunday, June 16.

That date officially marked the longest period that the United States has gone without increasing federal the minimum wage.

That means Congress has denied raises for a decade to 1.8 million American workers, that is, those workers who earn $7.25 an hour or less. These 1.8 million Americans have watched in frustration as Congress not only denied them wages increases, but used their tax dollars to raise Congressional pay. They continued to watch in disappointment as the Trump administration failed to keep its promise that the 2017 tax cut law would increase every worker’s pay by $4,000 per year.

More than 12 years ago, in May 2007, Congress passed legislation to raise the minimum wage to $7.25 per hour. It took effect two years later. Congress has failed to act since then, so it has, in effect, now imposed a decade-long wage freeze on the nation’s lowest income workers.

To combat this unjust situation, minimum wage workers could rally and call their lawmakers to demand action, but they’re typically working more than one job just to get by, so few have the energy or patience.

The Economic Policy Institute points out in a recent report on the federal minimum wage that as the cost of living rose over the past 10 years, Congress’ inaction cut the take-home pay of working families.  

At the current dismal rate, full-time workers receiving minimum wage earn $15,080 a year. It was virtually impossible to scrape by on $15,080 a decade ago, let alone support a family. But with the cost of living having risen 18% over that time, the situation now is far worse for the working poor. The current federal minimum wage is not a living wage. And no full-time worker should live in poverty.

While ignoring the needs of low-income workers, members of Congress, who taxpayers pay at least $174,000 a year, are scheduled to receive an automatic $4,500 cost-of-living raise this year. Congress increased its own pay from $169,300 to $174,000 in 2009, in the middle of the Great Recession when low income people across the country were out of work and losing their homes. While Congress has frozen its own pay since then, that’s little consolation to minimum wage workers who take home less than a tenth of Congressional salaries.

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