This was originally published on January 25, 2020 on Medium.com. I think it may have been the first blog I wrote! It’s still pretty relevant.
Ned Ludlam had enough of the criticisms from his father. “Square the needles” was the latest complaint. He took a hammer to the knitting machine and “beat them into a heap.”
A few decades later, in the 1810s, Ned was a wanted man. The English Government suspected him of orchestrating a series of machine-breaking crimes. Ludd was his moniker by then. Ned himself never admitted to the deeds, but the quip “Ned Ludd did it” was common. Captain or King Ludd was the taunting title for the police. Several times the authorities thought they had their man, only to see him pop up somewhere else. The rumor was he lived in Sherwood Forest, home of Robin Hood several centuries earlier.
They never did find Ned, and we’re still talking about him today. Ned was either complete fiction or was distinct from the legend. His followers, the Luddites, were a clear threat to public order. It became a capital offense to destroy a textile machine.
These days Luddite refers to technophobes as well as saboteurs. The ones who couldn’t work the VCR in the 1990s, the DVR in the 2000s, or the smartphone settings now. Luddites are afraid of technology and what it will bring. They’re especially worried about technology taking people’s jobs.
Don’t think the machine sabotage has ended either. In the late ’80s, I had a part-time job maintaining a security robot in a large corporate warehouse. One service call was especially memorable. The robot’s R2D2-style head was decapitated. It was no accident! (And no Mensa candidate either; the robot head was a camera!) Many current cyber-threats re also aimed at destruction, payback, or protest.
The original Luddites didn’t especially hate technology. They hated poverty and some business owners. Britain’s economy was struggling after the Napoleonic wars. Unemployment and hunger were common, and it hit the artisan class hard. Their skills had given them immunity to prior downturns.
The textile machines weren’t new. They had been around for decades, and the artisans knew how to use them. The Luddites attacked the businesses that were using cheaper, inept labor. The craftsmen were losing their jobs. Plus, they felt the textile quality was suffering. Taking out the machines was metaphorical. Something like ‘hey, let’s see if these dodos you hired can figure out how to make cloth without machines!’
The Limits of the Luddite Fallacy
Most economists argue against the “Luddite Fallacy.” That’s the notion that disruptive technology costs jobs. They say that technology improves production efficiency and increases consumption by lowering prices. Voila — more job creation! New industries arise because of technology. ‘Don’t worry about it’ is the vibe the economists give, and they have a lot of previous examples to back it up.
The Luddite reaction remains a natural one — even sensible. More jobs emerge than disappear from technology, but new jobs don’t necessarily go to the people who lost theirs. The jobs created tend to require more skill. The reeducation can be daunting, especially for someone late in their career. Disruption creates an imbalance between system pieces. The economy can take decades to equilibrate, waiting for the next generation of workers.
People still worry about technology, but they’re not sticks in the mud — a Luddite. They’re hoping they and their children can have the relevant skills for the future workplace.
Many economists say the Luddite Fallacy is still valid. People worry about Artificial Intelligence (AI) or biotechnology, for example. But more jobs will emerge than disappear, they say. They could be right — again. Or maybe we’ll go beyond the limits of the theory. It’s a signal to revisit the assumptions when a rule of thumb becomes gospel.
I don’t know if the Luddites or the economists are right about Artificial Intelligence (AI). Will AI take all the work so we can sip Mai Tai’s by the pool? Perhaps someday, but there is a lot of improvement in the technology needed between now and then. And we stink at predicting the timing of inventions. Plus, we’ll need major societal adjustments to ensure the wealth is available to all. Machines may become smarter than us at everything, and we should invest in preventing disastrous outcomes. However, I’d be surprised if it happens in the next thirty years.
By definition, there won’t be enough jobs for everyone if world-dominating machines emerge. Then the Luddites will be right. That means economists should be less confident between now and then.
What does the Luddite Fallacy assume?
The jobs created could be fewer than jobs lost, at least for an extended period, for several reasons, such as:
There are market restrictions on price or wage movements;
Labor can’t access employers with open jobs;
The new jobs take a while to form;
People take a long time to retrain;
Too many of the new jobs also go to machines;
Not enough people are ever capable of doing the new work.
The first four reasons are transient conditions that the Government could mitigate. No economist is saying the transition will be painless.
What about reason 5? If machines can do 100% of what we can do, as well as we can, at a fraction of the cost, then, of course, there won’t be jobs for people. Production without labor.
What about half of the work? Would it create more jobs than it takes away? That number isn’t random. More than one estimate has half of all work tasks automating in the next few decades, even if tech stops advancing.
And yet, reason number 6 is my biggest worry.
We may be fine as long as we churn out enough capable people. But that won’t be easy. New jobs will be harder than the old ones, on average. Plus, the way they’ll be harder — more abstract thinking — isn’t what most schools create. And the latest AI feats make the problem a crisis.
The Luddites could still be wrong, but only if us humans become more capable. I’m worried about that one. It’ll take an educational revolution.
©2020 Dasey Consulting LLC