Ideology After Scarcity
An odd paradox I noticed while thinking through the “Beyond Scarcity” series I noted earlier has to do with the definition of “value”. In a deflationary environment, money is becoming more narrowly “valuable” over time – a given quantity of money buys more goods if you wait until later. At the same time, in a severe enough deflationary environment money gets less “valuable” to individuals over time – if I can get whatever I might need at any time, then I have a decreasing need for money over time and less incentive to increase my income of money. I don’t really know where I can go with this…just to remark that “value” has some odd implications that are poorly suited for a post-scarcity world. In general, capitalism seems extremely poorly suited for a world that is beyond scarcity.
It’s not particularly easy to imagine a post-scarcity world, but definitely conceivable – see Star Trek, for example. It seems pretty plausible that after industrial production becomes basically free, people would sign up en masse to explore the galaxy. After all, why not? At the same time, many would choose to use their liberty from work to chill out and enjoy whatever incredible entertainments that this future civilization could produce – for free, natch. I have not seen much Star Trek, but I have the strong sense that it does not reflect the great unwashed masses using their replicators to zap themselves up some Cheetos to chill out with the best reality TV the world has ever seen. More interesting than the dull and pleasant post-scarcity world, however, is the question of what happens before that.
Marx, naturally, had some ideas. His position on the question was that competition induces mechanization, while mechanization in turn reduces the rate of profit, and leads to periodic gluts of goods, depression, and financial crises. Over time, this will become worse and worse and will eventually lead to a final crisis that will end capitalism. Marx’s idea on this is generally considered discredited, though not disproven – the upside of millenialist theories is that you can always just say “Well, it hasn’t happened…yet.” The FT brushes it off…but does suggest that as goods become more plentiful, holders of money and assets will attempt to induce artificial shortage until “the dam bursts”. That doesn’t seem so different than Marx’s version, even if it doesn’t contain the word “revolution” even once.
This all gets back to the strange tragedy of depression. There is no war or disaster, but just people sitting idle and factories sitting idle. The classical economists and the Austrians described it as a “general glut” of goods, whereas the Keynesians and monetarists labeled it instead a shortage of money. These are actually compatible beliefs, although they generate opposite policy approaches to depression – the classicists advocated waiting until the glut is purged from the system, the Keynesians and monetarists through adding money to boost demand (primarily through fiscal and monetary policy, respectively).
In some way the debate over whether the Great Recession’s unemployment is cyclical or structural reflects a similar debate over people. The structural unemployment argument suggests that there is no way to profitably employ large portions of the current jobless – this doesn’t actually seem so different than suggesting that the US economy is suffering from a general glut of people and that the only way to proceed is to wait for the glut to subside and the market to clear. Keynesians, on the other hand, advocate the use of fiscal policy to add more money to the economy. The monetarists are rather stymied, because with the interest rate at zero their orthodox policy lever is pulled as far as it can go.
We can already foresee, and perhaps are starting to enter, a world where the returns of mechanization surpass that of labor wage arbitrage (i.e., outsourcing manufacturing) and are starting to nibble at low-productivity service jobs. While I don’t think there’s any real reason to think that the Great Recession made 8.2% of workers superfluous overnight, I think that over a long-enough timeline the structural unemployment story actually looks pretty convincing.
Which suggests to me that over the long term (20 years or so), the ideological valences of the structural-vs.-cylical debate are going to flip-flop. Elevated structural unemployment, and a superfluity of unemployable workers, strongly agitate for left-wing policies. If large masses are unemployable, then either they must be supported or left to starve, and I just don’t think Americans have it in us to let them starve. It will be more convenient for those of a right-wing persuasion to argue that elevated unemployment is cyclical, lost jobs will come back, and there’s no need for more strongly redistributive measures.
This just goes to show that ideology is more consistent than theories of economics or politics. The left will always interpret the moment in a way that justifies their instincts, and the right will always do likewise. If and when a post-scarcity moment approaches, I think the left will embrace the superfluity of labor as a justification for redistributing the increasingly abundant goods.