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    • I have not fully absorbed this discussion paper (link below) yet, and in part, this is just a bookmark to remind me to get back to it.

      At this point, I think the high-level takeaways are that, in the course of "making stuff":

      1] we're spending a lot more money on Tech and proprietary advancements (IPP) because these obsolete themselves so quickly.

      2] the "superstar" effect aggregrates and centralizes production, limiting options/alternatives/competition

      3] boom and bust cycles have an effect; presumably by moving the goalposts quicker than people can adapt. (need to revisit this)

      4] Globalization and the hollowing out of unions contribute to the situation, but don't seem to be quite as important as once thought.

      Furthermore, tech can either complement or replace humans. My sense of this is that humans are hired for their brains, their ability to adapt to the unplanned-for, their ability to naturally do things that tech can't yet do. Anything which is completely routine from start to finish, having a limited number of well defined predetermined choices, whether physical or mental, is a good candidate for delegating to some form of tech (robot, app, AI, etc.) Tasks which are a mix of creative and routine are best served by a human adept at using tech. Likewise, tech can be used to "protect the brain" when the task requires a human's ability to problem solve/adapt, but is intrinsically hazardous (bomb robot). Success in this economy requires that one aspire to be more than a robot or algorithm made from meat.

    • This is very fascinating to me but I can't stop wondering whether there is something more human and emotional going on than the globalization, automation, productivity factors we mathematically analyze.

      There seem to be big cultural things like not begrudging the idea that basketball players can get $100 million contracts but begrudging the people who teach our children wanting $2,000/year more salary and money for books.

      My understanding is the economy and businesses do better when the masses have enough money to buy cars, homes, clothes, cheeseburgers, health care, etc., but there seems to be this feeling they don't deserve it. They're just teachers and Uber drivers.

      When Uber went public, the CEO, who was fired, made $10 billion. The drivers may net out $9/hour after expenses. I mean, maybe that's globalization, automation, productivity, but couldn't some of it be our values?

    • Another thing they write about is capital. While running tonight I listened to this podcast with Mark Cuban and Steve Case:

      The part that stopped me in my tracks is Cuban and Case's insistence that everyone in the company be part of the stock plan, meaning capital. They pointed out that working by the hour never gets you there in today's hourly workforce.

    • I may be stating the obvious here. Just thinking into the forum...

      From several quarters, I've seen the observation that the gap between the top earners and regular joes has been widening throughout the late 1900s and early 2000s. This fact has been blamed for populism, at least; and is widely recognized as a problem. I haven't seen a solid, well accepted explanation as to why, although the correlation with the decline of unions is frequently noted. As I understand this article, the authors hypothesize that part of the reason is that labor plays less of a role in producing the stuff that is sold. Also, labor is typically expected to achieve continual productivity gains via measures directly related to output. Management and executives? Not sure what the productivity expectations are there. Perhaps it is the freedom to define your own productivity measure which makes certain people appear more valuable on paper. In addition, compensation with wages is a different animal than compensation with stocks.

      The whole notion of trade is to exchange something you have/can do (which someone else needs) for something that someone else has/can do (which you need). If you do that directly, it's bartering. Mostly, the exchange involves a 3rd or 4th party (employers who regularly exchange time-served for money.) Trades for necessities tend to happen when someone else can accomplish the task/produce the thing better than you. For instance, even if I converted my entire yard to a garden, I would in no way be capable of subsistence; hence I buy food. However, back to the time is money equivalency, if I took the time I would have spent growing the food and figured how much I earn in that time; the food I buy has to cost less than that. Hence, I expect producers to be more efficient than I.

      But even if they're not more efficient, the price for food still needs to be low enough that my wages can also cover mortgage, utilities, taxes, vehicle maintenance, etc. There are actually two ways to lower a price: increase productivity or value the time of the producers less. That second option means that someone else's time is less valuable than mine. And in the other direction, my time is less valuable than quite a lot of other people's time. Migrant workers and Chinese sweat shops are not collections of employees whose time is highly valued, but they produce such bargains that the poor, underpaid Americans at the bottom of the pile exploit them gleefully. Everyone's looking for someone to oppress via a weaponized bargain. This fact tempers sympathy somewhat.

      I do not think this valuation is ever set by "begrudging". Teachers may get shafted because their customers have produced what may fairly be described as a living money pit. Or two. Keeping the kids fed, clothed, and healthy competes with the money available to pay for education. Because teachers are funded with taxes, they benefit from leveraging the funds of those who have not produced any money pits, or their money pits have had money pits of their own (people are compelled to support them while receiving no direct benefit). However, taxes being what they are, the level of support per person still needs to be capped at what the least common denominator can afford. Being funded by the least common denominator, and worse, associated with taxes, is not the way to get rich; even if that amount is levied from the entire populace instead of just your direct customers. :)

      Sports stars generate revenue, and receive some fraction of that revenue. People pay exhorbitant sums to watch them. Try selling tickets to a classroom. Or trading cards with teacher's faces on them. Selling advertising in the classroom generates outrage.

      The valuation is not done by faceless conglomerates, it's done by spectators, taxpayers, and by an inconveniently costly notion that its not ethical to let corporations inundate captive children with advertising. It will never voluntarily change. Perhaps taxing ticket sales and earmarking those funds for education would be the way to go. Wouldn't help my area much if the taxes were local, but a national solution could make an impact, I suppose.

      In a single organization, raising the valuation of people's time needs to be countered by some other factor (fewer people, reducing executive salaries) to prevent raising the price of products. If this happens across the board, it's called inflation and nothing really has changed. It's important to frame this as a "robbing Peter to pay Paul" problem. When the objective is to rebalance wages from unrelated organizations, that gets tricky. Americans vote with their dollars--it's downright un-American to rig an election by redirecting votes.

      I'm not sure this went anywhere. Maybe it's best to just avoid posts that start with "I'm just thinking into the forum..."

    • Chris, I think part of it is the fact that the "teachers and Uber drivers", ie. the majority of people, are incapable of mounting an opposition. We can moan over a beer that footballers are paid more per week than the average house price in the UK but, really, what else can we do? We have no obvious way to galvanise large groups of people effectively, even with the miracle of social media. Even if we could, how do we then mould this group into a shape that could take action, and even govern? Both have difficulties, and precedents are not kind. Often, when large groups dissent, this may hasten the demise of a regime. However, it is generally some smaller, agile and opportunistic group that moves to fill the power vacuum, without necessarily sharing the masses' grievances. See Russia and Romania in the last century.

      Forget the ballot box; governments do not address this problem for fear of losing financial support from the privileged.

      Its a complex problem that needs more involvement from the ranks of economists and politicians. As I have ventured before, income disparities are possibly one of the biggest global challenges, every bit as vital to solve as climate change. I do not see a civilised society being possible with the massive disparities we are seeing at the moment.

      In other news, the sun is shining in my part of the UK, so that nice.