Answering the question of whether such automation could lead to prolonged pain for workers means taking a close look at past experience, theory and technological trends. The picture suggested by this evidence is a complex one. It is also more worrying than many economists and politicians have been prepared to admit.
Be sure to read the rest of the foregoing article in the latest issue of The Economist, an edited version of the beginning of which article you've just read.
As Robert Reich recently pointed out, the oligarchic concentration of power at the top -- which flows largely from the concentration of income and wealth there -- has prevented Washington from dealing much with the problems of the poor and the middle class. To the contrary, as wealth has accumulated at the top, Washington has: a) reduced taxes on the wealthy, b) expanded tax loopholes that disproportionately benefit the rich, c) deregulated Wall Street, and d) provided ever larger subsidies, bailouts, and tax breaks for large corporations -- all at the expense of the poor and our shrinking middle class! The only things that have trickled down to the middle class and the poor, besides ever fewer good jobs and smaller paychecks, are public services that are increasingly inadequate because of being starved for money.
Unequal political power is the most noxious and nefarious consequence of widening inequality, . . and is also the most fundamental threat to our democracy. With Citizens United, big money has now all but engulfed Washington and many state capitals -- drowning out the voices of average Americans, filling the campaign chests of the candidates who will (of course) do the bidding of their "providers,' as those providers finance attacks on organized labor, and bankroll a vast empire of right-wing think-tanks and publicists who, along with bought-off university professors and high paid "journalists,' fill the airwaves and lecture halls with the lies, half-truths and distortions that maintain the interests of their "providers.' Problem is, our Republican friends "don't see or acknowledge any of this, which is a sign of how far the right has moved, away from the increasingly frustrating and even painful reality that many if not most Americans live in every day.
When almost all the gains from growth go to the top, as they have for the last 30 years (as the new oligarchy has taken control), the middle class no longer has the purchasing power necessary for the economy's buoyant growth. Therefore, not enough jobs can be created to provide adequately paid work for anywhere near the number who need it. Three people now look for every job that pays above minimum wage.
Once the middle class exhausted all its coping mechanisms -- e.g. wives and mothers surging into paid work (as they did in the 1970s and 1980s), longer working hours (which characterized the 1990s), and deep indebtedness (2002 to 2008) -- the inevitable result of that exhaustion was fewer jobs and slower growth, just as we have continued to experience. Then, when the middle class became stressed, it became harder for them to be generous to those most in need. The "interrelated social problems" of the poor require money to solve, but the fiscal cupboard is bare. And because the middle class is so financially insecure, it doesn't want to (nor does it feel it can afford to) pay more in taxes, as would be required.
America's shrinking middle class also hobbles upward mobility, which now trails that of crusty old Great Britain. Not only is there ever less money for good schools, job training, and social services, in the USA, but "the poor" (which now includes a huge number of former members of the middle class) now face an ever more difficult challenge moving upward because the income ladder is far more extended than it used to be, and, as Reich also points out, its middle rungs have disappeared. Meanwhile, legions of young black males are branded with felonies for either possessing or selling small amounts of a drug that should long ago have been decriminalized, as it recently has been in Colorado. And as further punishment for their 'crimes,' these young black males will never be allowed to work at any job above the most menial -- the dire social consequences of which stupidity are incalculable.
Once oligarchy takes over, the possibilities for economic democracy and/or free markets are dead