Automation and the Future of Work

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* Books: Aaron Benanav. Automation and the Future of Work. Verso, 2020

URL = Verso


"Silicon Valley titans, politicians, techno-futurists, and social critics have united in arguing that we are on the cusp of an era of rapid technological automation, heralding the end of work as we know it. But does the muchdiscussed “rise of the robots” really explain the long-term decline in the demand for labor? Automation and the Future of Work uncovers the deep weaknesses of twenty-first-century capitalism and the reasons why the engine of economic growth keeps stalling. Equally important, Benanav goes on to salvage from automation discourse its utopian content: the positive vision of a world without work. What social movements, he asks, are required to propel us into post-scarcity if technological innovation alone can’t deliver it? In response to calls for a permanent universal basic income that would maintain a growing army of redundant workers, he offers a groundbreaking counterproposal."



Gary Roth:

"Benanav’s Automation and the Future of Work works best as an economic history of the last half century, when a unique combination of factors entailed a growth in government expenditures simultaneous with a hefty effort to privatize government services. This, of course, summarizes the odd confluence of circumstances known these days as neoliberalism. If Benanav’s is the most cogent of the two books, it’s because he hews closely to a singular economic interpretation.

At its center is industrial overcapacity, that is, the ability to produce goods in excess of actual demand. This tendency towards overproduction brings in its train a host of secondary phenomena—the focus of Benanav’s analysis—such as declining rates of investment, stagnant growth (secular stagnation), and inadequate profit rates, which in turn prompt intense efforts to cut costs, move production facilities to lower-wage and lesser-regulated regions of the world, and expand and streamline supply chain networks.

Most interesting are the relationships Benanav draws between rates of growth in three key economic dimensions, that of productivity, output, and employment. Through this lens, he presents a comprehensive overview of recent economic development and an analysis of the economic doldrums in which much of the world’s economy now finds itself. Benanav’s approach—through rates of growth rather than absolute numbers—offers a good means to understand highly complex relationships. Output, for instance, can only grow more rapidly than productivity when employment increases. This, he points out, was the situation that prevailed in the few brief decades following World War II, as an unprecedented prosperity produced ample profits and, at the same time, more jobs and higher wages.

Automation, on the other hand, promises to reverse these relationships, so that productivity outpaces actual production. Employment thus lags, a circumstance that creates a surplus of available employees and ample opportunities for employers to control costs by means of wage freezes, two-tiered wage systems, underemployment, fewer or no benefits, and other measures that come at the expense of the workforce. For Benanav, global overcapacity, not automation, accounts for the slowdown in growth and productivity that characterizes the recent era. Overcapacity, in this view, becomes the driver behind deindustrialization, whereby quite ferocious efforts are made to rekindle a level of economic success that has become all-too-elusive.

Benanav, though, wanders back-and-forth across the borders that distinguish economic history from economic theory. Overcapacity, while it describes the economic doldrums of the past half century, is also common to all phases of capitalist development, its periods of growth as well as periods of stagnation and outright decline. Without overcapacity and the overproduction that accompanies it, much of the rationale for both competition and commerce would be lost. The entire retail sector, to take one example, depends on overproduction as a condition of existence.

There are times, of course, when demand outruns production, but this occurs mostly because supply chains have been interrupted due to natural or political occurrences, not because of an inability to step up production. When it occurs, the pricing mechanisms applicable to supply and demand kick in, thus allowing industry time to adjust to an altered situation. One of capitalism’s genuine accomplishments over the past two centuries has been its ability to close the gap between surges in demand and the economy’s ability to scale up. The recent pandemic is an example of just this. Despite all the chaos and political bickering, and the terrible and needless suffering that ensued, the ability of industry to develop and test vaccines, and then produce them in tens of millions of doses, took place within an eighteen-month framework.

The theoretical question is why overcapacity and overproduction in some phases of capitalist evolution are spurs to further development, whereas in the recent period focused on by Benanav, they have become hindrances to be overcome. To note too is that economic growth, even sluggish growth, entails that both production and consumption take place at ever-higher levels, another of the phenomena that remain unintelligible if the focus remains fixed on overcapacity. Historically, this ramping up of the economy has been particularly noticeable following economic downturns, when both consumption and production emerge on unprecedented levels. If overcapacity is the root cause of economic sluggishness, how is it possible, then, for an ever-greater capacity to serve as a precondition for an economic resurgence?

Benanav’s politics are not always consonant with his analysis. The focus on overcapacity fits entirely within the economic analysis associated with John Maynard Keynes, in which a lack of demand, it is thought, can be counteracted with targeted government spending. Benanav has no faith in such solutions, given the largesse of governmental interventions over the past half century and the ongoing decline in business fortunes as measured by rates of output growth and productivity.

Were governments to push further in terms of an outright nationalization of industry, he notes, they would face disinvestment and capital flight. Short of a wholesale expropriation of business property ala Russia during the early twentieth century, however, business owners have historically accommodated a wide range of political systems, from democracy to fascism, with all shades of authoritarianism and social democracy in between. They may favor regimes that offer the most support and latitude in terms of contracts, subsidies, tax write-offs, minimal wages, and lax regulations, but this tends to be relative rather than absolute.

At times, the business world favors regulation because of the latter’s ability to neutralize cut-throat competition and help ensure oligopolistic operating conditions. Trade agreements are a case in point. Disinvestment, when motivated by political considerations rather than economic ones, comes at a cost, and consequently is rarely resorted to, despite the attention these sorts of occurrences receive.

Benanav’s discussion, in any event, presupposes a sharp divide separating government from business, an assumption that itself is worthy of critical attention since the same personnel tend to float between both worlds. Even when politicians hail from within popular movements, rather than from the business and legal worlds, they need to rely on these latter groups for their expertise. Policy and policy-making is common to them all."