In Praise of Technological Progress and Automation

by Pejman Yousefzadeh on June 15, 2011

As Don Boudreaux notes, it’s more than a little risible that President Obama should be blaming unemployment–even a little–on automation. It’s also more than a little risible that he doesn’t mention that automation has brought about a great many more benefits than it has brought about drawbacks.

If this kind of excuse-mongering continues, it will be quite difficult for me to continue to claim that notwithstanding my political differences with him, this President ought to be taken seriously.

IMMEDIATE UPDATE: It is worth noting the way in which Andrew Coulson rightfully piles on:

[The President's] words could only be uttered by someone who knows very little about economics or the history of human progress. In fact, they could only be uttered by someone who has never reflected on this question before in his  life. Because if you reflect for one moment, you come up with this glaringly obvious counterfactual: we use a lot more  labor-saving technology today than in previous generations, and yet we also employ far more people. Therefore, increased automation does not lead to decreased national employment.

If you do more than just think for a second — if you read an economic history book, for instance — you discover that increased automation doesn’t even necessarily lead to decreased employment in the industry being automated! The classic example is the 19th century British textile industry. The so-called “Luddites” smashed automated looms fearing that they would lead to rampant unemployment in their industry. But, as the new technology proliferated, textile industry employment rose. Among other reasons, increased efficiency drastically lowered the prices of textile goods, that shot demand through the roof, and to meet the new demand new workers were required to operate and maintain the new machinery.

There are other examples, of course, and the president will save the American people a great deal of hardship, and himself further embarrassment,  if he familiarizes himself with them. Here’s a good brief introduction from the British Secretary of State… under Margaret Thatcher.

  • Anonymous

    The other thing that strikes me is that Obama is apparently contending that automation has soared so much in the last two and a half years that it has caused the problems he is having.  Were there no ATMs when unemployment was half what it is now?  Would restricting automation enhance employment and productivity?  How?  He’s been so coddled all his life he thinks whatever he says is smart. This dumbest of Presidents has done it again. 

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