My latest column for The CEO Magazine looks at how the automation deal is breaking down. Normally the deal in modern economies is that we accept that technological change and automation will screw up a bunch of people’s lives, but in exchange we end up with a richer society overall. At the moment we seem to be getting the screwing-up without much of the “richer society”. Specifically, productivity is growing extremely slowly. Economists mostly trust, based on past history, that this is temporary. (You might call this the Mokyr Doctrine, as its leading proponent is the brilliant historian of technology Joel Mokyr.) Let’s hope they’re right.
Only after writing this did I realise that the automation deal is another example of how different political stances treat different trade-offs.
Most people on the political right currently seem much more willing to accept the automation deal (Donald Trump seems an interesting exception). However, many on the right express outrage at a similar deal which says “limiting CO2 emissions will screw up some people’s lives now, but we’ll all end up with a better environment in the future.”
For people on the left, it’s the other way around.
Each political stripe believes in at least one sort of progress trade-off, but they evaluate different trade-offs differently.
Another sort of trade-off is the one between unemployment and inflation that is assumed in most versions of Keynesian economic management.
Can anyone think of other such trade-off examples?