The Second Machine Age: Work, Progress, and Prosperity in a Time of Brilliant Technologies

4. Labor Force Remedies
Individuals.“Our most fundamental recommendations to students and their parents: study hard, using technology and all other available resources to ‘fill up your toolkit’ and acquire skills and abilities that will be needed in the second machine age” (p.199). Learn to race with machines. A college degree remains a vital stepping stone to most careers. Most professions still require the skills of ideation, large-frame pattern recognition, and complex communication. “As the labor market polarizes more and the middle class continues to hollow out, people who were previously doing mid-skill knowledge work start going after jobs lower on the skill and wage ladder…this puts downward pressure on wages” (p.202). More surprises are in store, and “it’s becoming harder and harder to have confidence that any given task will be indefinitely resistant to automation” (p.203).

National Policies. The best way to tackle labor force challenges is to grow the economy. To do so, we should teach children well, put digital technology to work (e.g. MOOCs enable low-cost replication of the best teachers, content, and methods), “flip the classroom” by having students listen to lectures at home and do traditional homework at school, raise teacher salaries, lengthen school hours and the school year, champion the innovation engine of entrepreneurship (the best way to create jobs and opportunity), improve matches between jobs and people, support basic research, institute prizes for innovation, upgrade US infrastructure to acceptable levels (one of the best investments the country can make), reform counterproductive immigration policy (of benefit not only to immigrants but to the economy), tax wisely (most economists advocate “Pigovian” taxes on pollution and other negative externalities; also, a value-added tax and higher taxes on high earners).

Long-Term Policies.Reward employment instead of taxing it; some form of basic income guarantee can help, but better still is a negative income tax that provides an incentive to work. Also, we will need some radical “out-of-the-box” ideas, e.g.:

  • A national mutual fund distributing ownership of capital widely;
  • Directing technical change toward machines that augment human ability rather than substitute for it;
  • Paying people to do socially beneficial tasks;
  • Nurturing special categories of work to be done by humans only (e.g. caring for the young and old);
  • Awarding credits to companies that employ humans, similar to carbon offsets that can be purchased;
  • Providing vouchers for basic necessities like food, clothing, and housing;
  • Ramping up government programs like the depression-era Civilian Conservation Corps to clean up the environment and build infrastructure.

[NOTE: Not mentioned but well worth adding to this list are job-sharing programs that match the over-worked with the under-worked, promoting quality part-time work with better benefits (another form of job-sharing), and perhaps encouraging semi-self-sufficiency, e.g. with urban agriculture programs and homesteading. See Work Sharing During the Great Recession;International Labor Office, May 2013.]

Technology is not destiny. We shape our destiny.

– Erik Brynjolfsson & Andrew McAfee

5. Other Long-term Prospects and Problems
The final chapter emphasizes that the new technologies are exponential and combinatorial, with most of the gains still ahead. Growing even faster than Moore’s Law, “in the next 24 months, the planet will add more computer power than it did in all previous history; over the next 24 years, the increase will likely be over a thousand-fold” (p.251). Our gener­ation will likely experience “two of the most amazing events in history: the creation of true machine intelligence and the connection of all humans via a common digital network, transforming the planet’s economics.” But not all the news is good, because, “while the bounty brought by technology is increasing, so is the spread.” And this is not the only possible negative consequence.

As we move deeper into the second machine age, “perils from both accident and malice will become greater, while material wants and needs are likely to be relatively less important.” We will be increasingly concerned with questions about catastrophic events, genuine existential risks, freedom vs. tyranny, etc. The sheer density and complexity of our digital world bring risks and weaknesses: 1) the digital world is subject to minor initial flaws that cascade via an unpredictable sequence into something much larger and more damaging; 2) tightly-coupled complex systems make tempting targets for spies, criminals, and terror­ists (“until recently, our species did not have the ability to destroy itself; today it does”); 3) there are myriad other ways that technology can have unexpected side effects, e.g. addictive gambling, digital distractions, cyber-balkanization of interest groups, social isolation, and environmental degradation; 4) development of fully conscious machines may bring a dystopian “terminator” future, or a utopian singularity; “we honestly don’t know; as with all things digital, it’s wise never to say never, but we still have a long way to go.” (p.255)

“In the second machine age, we need to think much more deeply about what it is we really want and what we value, both as individuals and as a society… Technology is not destiny. We shape our destiny” (Final paragraph, p.257).


The Second Machine Agehas much in common with several other recent “techno-ecstatic” books on the new digital technology, notably The New Digital Age by Eric Schmidt and Jared Cohen, Big Data: A Revolution That Will Transform How We Live, Work, and Thinkby Viktor Mayer-Schonberger and Kenneth Cukier, and Abundance: The Future Is Better Than You Thinkby Peter Diamandis and Steven Kotler (GFB Book of the Month, Aug 2012). All four books promise a better world ahead. Diamandis and Kotler make no qualifications at all, but simply enthuse that, within a generation “abundance for all is actually within our grasp,” with no mention of how it will be distributed. The promise of “big data” is hyped in the book’s sub-title, with no downsides of infoglut considered. “Googlers” Schmidt and Cohen state that everyone will benefit in the new digital age, but not equally— which is a slight improvement in sobriety.

The importance of Brynjolfsson and McAfee is that they forthrightly venture into the economics of the new digital era, linking the new technologies to the widely-appreciated fact of growing inequality. Although they state that the transformations ahead will be “profoundly beneficial,” they also grapple with the “thorny challenges” of technological unemployment and uneven “spread” of the “bounty,” with two chapters of suggestions on how to tackle labor force challenges. The authors state that we can face up to these challenges, even as the spread accelerates—which they deem likely. But, seriously, folks, how likely is it that Americans and other developed nations will do so to any meaningful degree? Similarly, the Worldwatch Institute says that sustainability is still possible if we do everything right starting now (Is Sustainability Still Possible?GFB Book of the Month, Oct 2013), but how likely is that?

The authors mention only in passing that the biggest effect of technological displacement of jobs will be on the developing nations (p.184), which parallels the unfortunate megatrend that the biggest negative impacts of climate change, largely caused by the rich nations, will also impact the poorest nations. And they don’t consider the declining quality of many jobs as a result of economic restructuring (e.g., see David Weil, The Fissured Workplace: Why Work Becomes So Bad For So Many), or the impact of the new technologies on politics. The New Digital Agedoes consider politics, noting more “revolutions” ahead for better or worse by newly enlightened and connected citizens—especially angry young people who are unemployed or underemployed as a result of the new technologies. We can already see roiling civic discontent in a dozen or so countries worldwide, which does not necessarily lead to better leadership, policies, or jobs (e.g., see Global Employment Trends for Youth: A Generation at Risk;International Labor Office, Aug 2013).

Brynjolfsson and McAfee conclude that “we need to think much more deeply about what it is we really want and really value.” We also need to think more deeply, widely, and rigor­ously about current social, economic, and environmental trends and possible developments, as well as the “brilliant technologies” that are driving them. How much and what kind of bounty are we really getting, and at what cost to whom, all things considered? We need nutritious food, potable water, safe and affordable energy, decent housing, adequate infrastructure, and security in many dimensions. But will the Second Machine Age provide more than marginal help in these essential areas? These basic needs are not addressed by Brynjolfsson and McAfee, who focus instead on the wonders of self-driving cars (perhaps important to those traveling to Silicon Valley on California’s congested highway 101) and on the flood of information now available worldwide (but not necessarily utilized, or beneficial, and too often a distraction).

The authors make a strong case that “a very big deal” is unfolding—that “we’re at an inflection point” where the curve starts to bend a lot. This may be overstated to some degree, but should not be ignored. Similarly, environmental scientists have been warning of various “tipping points” and “abrupt climate changes” ahead (e.g., Abrupt Impacts of Climate Change;GFB Book of the Month, Jan 2014). The difference in presentation is that the scientists are restrained in their assessments, often erring on the side of caution and trying not to express undue pessimism. In contrast, those who write about technological change are too often exuberant and overly optimistic. To its credit, The Second Machine Agedoes devote an entire chapter (“Beyond GDP,” pp 107-124) to discussing the deficiencies of the obsolete GDP measure of production and progress. It just doesn’t go far enough. “True growth is greater than the standard data suggest.” (p.119) But if the negatives are subtracted, overall net growth may be much less.

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