It’s not like we weren’t warned. In the 1940s, the father of ‘cybernetics,’ Norbert Wiener, worried about what thinking machines meant for the human employees who would have to compete with them. Wiener realised that if we didn’t change the underlying operating system of our economy, our technologies may not serve our economic prosperity as positively as we might hope. Before we embed the values of our industrial economy into the fabric of the digital one, we need to re-evaluate our fundamental assumptions about employment and compensation.
Looked at in terms of human value creation, the industrial economy appears to have been programmed to remove human beings from the value chain. Before the Industrial Age, the former peasants of feudalism were enjoying a terrific economic expansion. Crusaders had returned having established trade routes through which the goods of many lands could travel. They also returned with new technologies for agriculture and trade, including the bazaar – a marketplace for the exchange of crafts, crops, grain and meat, which used new financial instruments such as grain receipts and market money. But as the peasants got wealthy exchanging goods and services, the aristocracy got relatively poorer. So they re-established control over the economy by outlawing market moneys and chartering monopolies with dominion over particular industries. Now, instead of making shoes himself, the local cobbler had to get a job at the officially chartered monopoly company. Thus what we think of as ‘employment’ was born – less an opportunity than a restriction on creating value.
“Unlike the one-size-fits-all solutions of the Industrial Age, distributed prosperity in a digital age won’t scale infinitely”
Instead of selling his shoes, the cobbler sold his hours. Worse, his skills were not valued. The owners of proto-factories saw in industrial processes a way to hire cheaper workers. Why hire a skilled craftsman when you can break down the shoe-making into tiny steps, each capable of being taught to a day labourer in 15 minutes? Automation reduced the economy’s dependence on the labouring classes. The only business priority these companies understood was growth. Their own solvency was based on paying interest to nobles chartering and later to the banks financing them. But today, growth has become an end in itself – the engine of the economy – and humans have come to be understood as impediments to its functioning. If only people and our idiosyncratic demands could be eliminated, businesses would be free to reduce costs, increase consumption, extract more value, and grow. This is one of the primary legacies of the Industrial Age, when the miraculous efficiency of machines appeared to offer us a path to infinite growth. Applying this ethos in a digital age means replacing the receptionist with a computer, the factory worker with a robot, and the manager with an algorithm. When digital companies disrupt an existing industry, they offer just one new job for every ten they render obsolete. If we want a digital economy that gets people back to work, we have to program it for something very different.
Where the corporations of the past depended on government regulation to maintain their monopolies, today’s digital companies do it through the monopoly of the platforms themselves. They’re not factories but networks whose embedded programming controls the landscape on which interactions take place. Thankfully, the remedies are varied. Unlike the one-size-fits-all solutions of the Industrial Age, distributed prosperity in a digital age won’t scale infinitely. Rather, the solutions gain their traction and power by reconnecting people and rewriting business plans from the perspective of serving human stakeholders rather than abstracted share values.
“Once we’re no longer conflating ‘work’ with ‘employment’, we are free to create value in ways unrecognised by the current growth-based market economy”
Yes, on the surface most of them sound idealistic or even socialist, but they are being tried by companies and communities around the world, and with documented success. Many are retrieving the Papal concepts of ‘distributism’ and ‘subsidiarity,’ through which workers are required to own the means of production, and companies grow only as large as they need to in order to fulfil their purpose. Growth for growth’s sake is discouraged. Many are implementing worker-owned ‘platform cooperatives’ to replace platform monopolies, allowing those contributing land or labour to an enterprise to earn an ownership share equal to those contributing just capital.
Once we’re no longer conflating ‘work’ with ‘employment’, we are free to create value in ways unrecognised by the current growth-based market economy. We can teach, farm, care for and entertain one another. The work challenge is not a problem of scarcity but a spoil of riches. It’s time we learn to deal with it that way.
This article was published in the February 2016 edition of Geographical magazine.