Wages, Workers, and Machines

Today the “Zero to Hero” assignment was to write a blog post that builds upon yesterday’s assignment, to comment on some blogs. I did’t do yesterday’s assignment because it was Sunday and that means a 40 mile bike ride along the beach, lunch at The Spot in Hermosa, on orgy in the living room, and curling up to cheesy horror movies. So, instead I will be elaborating on the comment section of a Facebook conversation that is currently going on.

I shared an article that discussed the further mechanization of low-paying jobs, in this case it is a machine that can make burgers without any human help. I’m sure your big-chain grocery store has “U-Scans” so that anyone who can scan their own purchases can do it themselves and get out of the store more quickly and there are some fast-food restaurants that allow you to order via touchscreen computer and pay without talking to a person… it was only a matter of time before other jobs are replaced by machines. Now, I don’t think this is a bad thing in the long run but I do recognize that it will hurt people in the short run.

One of the main forces encouraging businesses to turn to machines is labor cost, particularly pushes for minimum-wage increases. When the government enforces a minimum wage it forces businesses to either increase their prices or decrease labor (by firing or reducing hours). Large corporations can usually bear this a little bit but small, local chains rarely make large profits and suffer the most. A large chunk of the US economy is small businesses and when people lobby for an increase in minimum wage they are harming small businesses. In addition to that, increased labor costs means increased prices of goods… so everyone is now paying a higher price even if they didn’t get a raise. If the minimum wage goes from $7.50/hr to $8.00/hr the price of goods will go up, even for the person who made $8.00/hr the whole time. And of course, as the article points out, if labor costs go up then businesses will look for a way to replace labor with machines.

So, in the long run, is this a good thing? I think so, yes. Humans are not here on the planet to work at shitty low-wage jobs. I look forward to a Star Trek world where machines do everything while the rest of us spend our time pursuing our passions and just hanging out. Work is a means to an end, not an end itself. Work is a tool to earn money to exchange for goods. We are entering a new era where the economy is based on service, information, and entertainment. We must take steps though to not punish or discourage innovation and entrepreneurship. Raising the minimum wage is a band-aid that makes things worse in the long run. What we need to be doing is breaking down the barriers of entry into different fields. Why do most cities and states regulate hair stylists and other trades, and require accreditation through certain expensive schools? Why does it costs so much to get approved to start your own business? Why is the government wasting time and money shutting down lemonade stands and raiding barbers? If this world is going to advance we need to let people use their gifts, talents, and passions without a bureaucrat stepping in, demanding money, and threatening to send men with guns to their doors if they don’t comply.

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