How the Paradise of Increased Productivity Was Lost.
The Luddites. To begin to answer that question we can go back even further to the beginning of the nineteenth century and a group of people known as the Luddites. The Luddites were the first victims of the new capitalist order to fight back. They are also relentlessly maligned.
It is true that they fought back foolishly; they smashed machines when they should have smashed the system. But all they knew was the machines, machines that were taking their jobs; they had not the remotest concept or understanding of the system that was their true enemy.
The Luddite Fallacy. Most people think of Luddites as fogey-brained fools who are irrationally opposed to all new technology. That is how far they have become maligned. They were in fact textile workers whose livelihoods and lives were being destroyed by new power looms and other machinery that produced goods far faster and more economically than they could. Economists and historians know this but malign them more subtly by accusing them of something called the Luddite Fallacy. The Luddite Fallacy, briefly, is the idea that technological innovation that produces more with less labor leads to overall unemployment. This is a foolish notion, we are gravely and condescendingly assured, because when jobs are lost due to automation, new jobs are inevitably created. The money saved on the old products is freed to be spent on new or different ones.
The Radical Bleeding Heart, you may have noticed, does not attempt to hide his disdain for conventional theory-bound economists, but the Luddite Fallacy provokes him, not just to satire and sarcasm, but to simple, white-hot fury.
The Fallacy of the Fallacy. These pompous profs tell us that “economic theory” guarantees that new jobs will replace the old. This, to put it as politely as the circumstances will allow, is utter balderdash. Other “economic theories”—to say nothing of economic history—make it clear that the job market is subject to any number of forces; there is never any automatic guarantee that there will be adequate jobs for all.
It is certainly true that human beings are adaptable and will attempt to find new ways to make a living when the old ways fail, and that people with the power to do so may deign to take advantage of their desperation, particularly if they become really, really, desperate. But sometimes the whole system falls apart. Have these people never heard of the Great Depression?
This “economic theory” dismissing the so-called Luddite Fallacy is nothing more than a means to trivialize the plight of the unemployed. It is otherwise meaningless. A strawman, actually, since no one ever claims that jobs lost to automation are never made up.
It is particularly galling when they imply that it is quite stupid of workers not to appreciate the benefits of labor saving machinery. Why should they when the benefits all go to someone else and they see only costs?
But must the benefits go only to the owners?