From Brad DeLong:
"My friend and coauthor Larry Summers touched on this a year and a bit ago when he was here giving the Wildavski lecture. He was talking about the extraordinary decline in American labor force participation even among prime-aged males--that a surprisingly large chunk of our male population is now in the position where there is nothing that people can think of for them to do that is useful enough to cover the costs of making sure that they actually do it correctly, and don’t break the stuff and subtract value when they are supposed to be adding to it (emphasis mine - FDC).I think the DeLong isn't actually being pessimistic enough.
That is a problem that human societies have never faced before. Larry thinks it may be that we are starting to see the thin edge of the technological wedge in male labor force participation trends over the last 30 years--which I point out is not matched at all by female labor force participation trends. Women were even very briefly at a premium on the job market in the last recession--even given the extraordinary extra share of childcare and household production labor that they do.
It’s plain that the next time there is a recession, there will be more females than males working outside the home again. It's a worry. It’s a scary worry for our grandsons and great-grandsons, and perhaps for our great-great-great-granddaughers as well..."
In the short run, sure, we're worried about things like the Lesser Depression, offshoring, and income inequality. And I'm not saying that those aren't anything to worry about.
But they are, most of them, issues of political choices and our failure to restrain our oligarchy from pushing us towards a new Gilded Age.
What this DeLong rumination dredges up is my worry that we are looking at something much more fundamental and, for those of us in the industrialized world, more worrisome.
For the greater portion of human history you needed human muscle and brainpower to make things and make them work, from stone tools to combines, from atlatls to digital computers. Just having people, smart people, people who knew how to do things, was considered part of a tribe's or a nation's "wealth"; it was even called things like "human resources" when we got around to thinking of it in modern industrial terms.
But I think we're seeing not just a change in politico-economic philosophy - though the transfer of wealth to the very wealthy IS a change, and you know how I feel about that. But this isn't about relative wealth, but absolute wealth.
What I think we're seeing is a genuine shift in how human society works; we can now produce everything from foodstuffs to finished products with fewer - much fewer - humans that it took to produce those things a generation ago.
So human brain and muscle is no longer a straightforward "resource" anymore. As DeLong's friend points out; in many industries the cost of employing humans exceeds the benefit.
But...what are those people to do?
And...if they can't find anything - or, more to the point, anything that will allow them to be anything more than a menial laborer, a geriatric ass-wiper or the equivalent of a squeegee man - what the hell fo we do with them?
And lurking behind the arras is the intractable problem of what happens to a society that gets too small.
A larger one attacks and absorbs it; simply stated, in war quantity does have a quality all its own. A high birth-rate society has the capability to accept enough casualties to overwhelm a low-birth-rate society that is much higher on the technological ladder...
Mind you, the United States is in the unique position of being defended by two oceans. Much of the rest of the industrialized world doesn't have this problem, so any attempt to adjust to this imbalance by reducing the sheer number of people to match up with the actual work available puts them in danger of external threat.
So. I won't kid you; I see this as a very difficult long-term problem. Rebellions and social disasters aren't often engineered by hopeless peons and downtrodden serfs. They're fomented by people who see opportunities denied them, or, even worse, see themselves losing what hopes and possessions they once had.
The real downside of a New Gilded Age is not just that you would have new millions of match girls and breaker boys, but the combination that those boys and girls would be children of a vanished middle class...
...and that an AK-47 is ridiculously simple to operate.
I really fear that my children's century is going to be a very, very turbulent one.