In 1928, famed British economist
John Maynard Keynes predicted that technology would advance so far in a
hundred years – by 2028 – that it will replace all work, and no one will need
to worry about making money.
“For the first time since his
creation man will be faced with his real, his permanent problem – how to use
his freedom from pressing economic cares, how to occupy the leisure, which
science and compound interest will have won for him, to live wisely and
agreeably and well.”
We still have thirteen years to go
before we reach Keynes’ prophetic year, but we’re not exactly on the way to it. Americans
are working harder than ever.
Keynes may be proven right about
technological progress. We’re on the verge of 3-D printing, driverless cars,
delivery drones, and robots that can serve us coffee in the morning and make
But he overlooked one big question:
How to redistribute the profits from these marvelous labor-saving inventions,
so we’ll have the money to buy the free time they provide?
Without such a mechanism, most of
us are condemned to work ever harder in order to compensate for lost earnings
due to the labor-replacing technologies.
Such technologies are even replacing
knowledge workers – a big reason why college degrees no longer deliver
steadily higher wages and larger shares of the economic pie.
Since 2000, the vast majority of
college graduates have seen little or no income gains.
The economic model that
predominated through most of the twentieth century was mass production by many,
for mass consumption by many.
But the model we’re rushing toward is unlimited production by a handful, for consumption by the few able
to afford it.
The ratio of employees to customers
is already dropping to mind-boggling lows.
When Facebook purchased the
messaging company WhatsApp for $19 billion last year, WhatsApp
Originally appeared at: http://robertreich.org/post/128058937635