Robots, Outsourcing, & The 2016 Election


2016 Elections

Future generations will look back with disbelief on the 2016 Presidential elections. It is historic not only because the Democrats have a woman as their candidate, but also because the Republicans have the Trump as their candidate. Love him or hate him, Trump has made this the most closely covered election of all time. Daily reporting is filled with political mistakes, gaffs, non-sequiturs and nearly unprintable accusations. Yet, there are real political issues on the table. What is truly surprising, is that in between the sniping, big labor issues are on the top of the list of issues for both parties.

For years, if not decades, labor has been on the backburner in American politics. Since NAFTA was passed in 1992, globalization… expanding global markets by bringing down tariffs and barriers to international trade… has bee the expected sure for all labor ills. The theory was that poorly paying jobs would migrate to low paying countries, while high-income countries would replace these positions with new high-paying jobs. The theory is simple, just not very accurate.

Overall, world income has improved. Beyond that, there is little agreement as to what Globalization is doing to America and to the world. Globalization has brought new profits and money into the US, but reduced taxes on the wealthy and greater use of offshore tax shelters has kept new wealth concentrated in a relatively few hands. Globalization achieved the goal of expanding the economy, but the combination of automation and offshore workers (and a collapse of the global economy) greatly reduced the bargaining power of workers, undercutting the mechanisms that previously “spread the wealth” in America. As a nation, America has prospered, but the gap between the very wealthiest and the least educated, lowest paid American’s has widened. In both parties, this gap is a core driver of the most dedicated segments of the electorate.

Globalization achieved the goal of expanding the economy, but the combination of automation and offshore workers (and a collapse of the global economy) greatly reduced the bargaining power of workers. The mechanisms of capitalism that previously “spread the wealth” in America, were undercut, if not simply eliminated. As a nation, America has prospered, but the gap between the very wealthiest and the least educated, lowest paid American’s has widened. In both parties, this gap (real or percieved) is the core driver for the most vocal parts of the electorate.

There have always been, and always will be, a degree of inequity in the economy o even the most egalitarian nation. The current movement can be traced back to the “Occupy Wall Street” movement in 2011, the “One Percent” movement that continued growing in the following years, the rise of Bernie Sanders in 2015 and finally the adoption of One Percent rhetoric in Hillary Clinton’s Presidential Platform. Trump has different supporters, with different issues, but the underlying demand to solve the new inequality is pretty much the same.

Clinton and Trump use different language when they talk about most issues. Certainly, they have different experiences with labor policy. Yet, both sides have at least partially abandoned their party’s positions and have developed startlingly similar views on labor and outsourcing issues. For the first time in a very long time, both the Republican and Democratic candidates are largely in agreement about what we will see in 2017.  

Globalization: Clinton and Trump both say that mistakes were made with the NAFTA agreement in 1992. They also agree that the 21st-century equivalent… the TPP… is flawed and should not be approved. Clinton might change rather than outright reject TPP, but Trump supports reject the agreement in full. That’s a very, very difficult pill for Republicans to swallow. Globalization has been their economic cornerstone for the last 30 years.   

Minimum Wage: Clinton and Trump both agree that wages are too low. Clinton originally supported an increase to $10 per hour, and more recently moved to adopt Bernie Sander’s $15 per hour position. Trump originally rejected a Federal minimum wage increase, but later moved to $10 per hour, with the provision that the state (rather than the Feds) should enact that change. Before the election, Trump’s position may evolve further and merge with Clinton’s proposal. Clearly, supporters on both sides are pushing their candidates to improve working conditions for America’s lowest paid workers.

However, we are at an inflection point in labor. Outsourcing and new automation technologies are ready to replace domestic workers. Many entry level positions… such as fast food workers and cashier operators… are teetering on the edge of automation today. Many employers say that a higher minimum wage would immediately force them to replace workers with automated kiosks. Of course, still more employers and experts say that these jobs will eventually be automated regardless of the minimum wage.   

Outsourcing: Trump has gone as far as to say that he will stop all outsourcing, which is a 180-degree turnaround from his party’s former position. However, he hasn’t laid out how this would be accomplished. Clinton, seems generally opposed to outsourcing, but has been far less vocal and in the past has stated that the US has benefited from outsourcing.  

A.I.s & & Robots: Neither candidate seems to be aware of the looming disruption from the latest automation technologies. This disruption will impact the U.S. economy during the next Presidential term, and continue through at least the following term. Experts tell us that these technologies will impact the America’s workforce harder than all previous outsourcing. On the positive side, these technologies might take work that was previously offshored and return it to domestic shores. However, when work returns to America, it will return to a “lights-out” factories with few employees.

Self-driving trucks, lights-out factories, and robots replacing humans in the most dangerous jobs in America will be a massively important issue for Trump’s supporters, even if they don’t know it yet. Still, barely a word has been said by either candidate on their plans to deal with this issue. Both parties may avoid developing a position for this election, but the next President of the United States will be faced with the impact of new technology as soon as 2017.  At least, that’s my Niccolls worth for today!

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3 Responses to Robots, Outsourcing, & The 2016 Election

  1. The politicians (Governments) need not stop the outsourcing of the jobs, it will mostly come to an halt by itself when the employment sectors start to employ more and more AI robot automation. as It will make the outsourcing costlier.

    Nevertheless, there will be no respite from the jobless problems it will rather skyrocket. To deal with this issue, what we need is a Scientific Approach and the historical perspective of this situation. “Think Out Of The Box”. Read the following theoretical article in two parts in http://bit.ly/2apUuVB http://bit.ly/2b2Vejs

    The gist of the theory is; there must be A Gradual Reduction in Working Hours, which In the present situation, ENACTMENT of A THREE-DAY/24/HOUR WORK WEEK.

    Before which, the principle behind my theory is; the fruits of the societies technological progress should not be appropriated only by a few elite but it is their historical responsibility to see to it that the benefit should be equally shared among all members of the society.

    • I think you’re quite correct. In fact, I’m in the middle of writing a blog along this very theme! We’re theoretically in an age of the “40 hour” work week, but the reality is that email and other technologies follow us where ever we go, adding hours of additional work every day, while making us all “on call” 24×7. Just scaling back to a true 40 hour week would provide quite a few new jobs. But, equilibrium with the robotic revolution would probably push us to somewhere near a 20 hour week.

      This all makes mathematical and even economic sense, after all we eventually accepted the idea of a “radical” 40 hour work week, a century ago. I would, however, expect that Europe would adopt this sort of position decades before it was seriously discussed in the US. Then again, the similarity in Republican and Democratic rhetoric about good jobs in America, may be a once in a generation opportunity! I don’t think the issue will be solved, or even acknowledged in 2016, but… minimum wage & minimum hours could be the battle cry of 2020!

  2. Thank you for your quite positive reply;
    By the way, I would like to publish the revised version the theory mentioned in the article. However, I will not be able to accomplish it unless I get help from the concerned academic professional writers in this field. Herby, I welcome all those interested in co-authoring this book. and my special invitation to you in this regard. Write to me, Valerian Texeira: E-mail texeiravalerian@gmail.com

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