Richard Bookstaber’s the ultimate Wall Street insider, with a resume that includes Morgan Stanley, Salomon Brothers, Moore Capital Management, and Ziff Brothers Investments. Then he headed to Washington, first for a post at the Securities and Exchange Commission, and then to the Treasury Department, where he serves with the Office of Financial Reseach.
Here, from his blog, is his take on the collapse of upward ability in America, and the role played by a revolutionary villain:
There is less mobility in the work force because the computers are not simply displacing jobs, they are taking out the middle. Computers are good at routine cognitive tasks in the middling white-collar range, the desk jobs, the jobs that require keeping track of things, making arithmetic calculations. They are not so good at motor tasks, the blue collar jobs that require coordination, manual dexterity and sense-of-the-world adjustments. Computers can crunch numbers but they can’t drive a truck or make up a hotel room. When it comes to computers taking on human tasks, as Steven Parker notes, the hard problems are easy and the easy problems are hard.
Because they take out the middle, it is a lot harder to pursue the American dream by working your way up the ladder. Climbing up rung by rung, you will find a machine staring down. And it won’t retire or move up the ladder to make room for you. Once in place, a retirement or promotion is not going to happen, it isn’t going to be opening up a spot.
Futurists have seen this coming for along time, sort of. As automation got started, they saw robots taking over the manufacturing tasks and our day-to-day activities (serving us our dinner and the like), leaving people to do other things – leisure activities or getting jobs making the robots. Futurists always get it wrong because they take the present and multiply it by some number to get the future, and they have the essence of the issue wrong here as well. Although there are robots in industry, the biggest effect of computer technology is in an the area no futurist imagined. It is not improving the production of industrial goods, it is supplying the increasing demand for virtual goods. So the picture is not one of producing what we have always produced, but doing it with less labor, it is that we now want things produced that have not been produced in the past, and those things by their nature require less labor. That is, we are meeting the computers halfway by increasing our demand for the very things that they do best.
