Crushed by the wheels of industry: critics increasingly see new tech as one of the free market's most dangerous tools of oppression. Image: Ikon Images
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The new Luddites: why former digital prophets are turning against tech

Neo-Luddism began to emerge in the postwar period. First after the emergence of nuclear weapons, and secondly when it became apparent new computer technologies had the power to change our lives completely.

Very few of us can be sure that our jobs will not, in the near future, be done by machines. We know about cars built by robots, cashpoints replacing bank tellers, ticket dispensers replacing train staff, self-service checkouts replacing supermarket staff, tele­phone operators replaced by “call trees”, and so on. But this is small stuff compared with what might happen next.

Nursing may be done by robots, delivery men replaced by drones, GPs replaced by artificially “intelligent” diagnosers and health-sensing skin patches, back-room grunt work in law offices done by clerical automatons and remote teaching conducted by computers. In fact, it is quite hard to think of a job that cannot be partly or fully automated. And technology is a classless wrecking ball – the old blue-collar jobs have been disappearing for years; now they are being followed by white-collar ones.

Ah, you may say, but human beings will always be better. This misses the point. It does not matter whether the new machines never achieve full human-like consciousness, or even real intelligence, they can almost certainly achieve just enough to do your job – not as well as you, perhaps, but much, much more cheaply. To modernise John Ruskin, “There is hardly anything in the world that some robot cannot make a little worse and sell a little cheaper, and the people who consider price only are this robot’s lawful prey.”

Inevitably, there will be social and political friction. The onset has been signalled by skirmishes such as the London Underground strikes over ticket-office staff redundancies caused by machine-readable Oyster cards, and by the rage of licensed taxi drivers at the arrival of online unlicensed car booking services such as Uber, Lyft and Sidecar.

This resentment is intensified by rising social inequality. Everybody now knows that neoliberalism did not deliver the promised “trickle-down” effect; rather, it delivered trickle-up, because, even since the recession began, almost all the fruits of growth have gone to the rich. Working- and middle-class incomes have flatlined or fallen. Now, it seems, the wealthy cyber-elites are creating machines to put the rest of us out of work entirely.

The effect of this is to undermine the central argument of those who hype the benefits of job replacement by machines. They say that new and better jobs will be created. They say this was always true in the past, so it will be true now. (This is the precise correlative of the neoliberals’ “rising tide floats all boats” argument.) But people now doubt the “new and better jobs” line trotted out – or barked – by the prophets of robotisation. The new jobs, if there are any, will more probably be serf-like attenders to the needs of the machine, burger-flippers to the robot classes.

Nevertheless, this future, too, is being sold in neoliberal terms. “I am sure,” wrote Mitch Free (sic) in a commentary for Forbes on 11 June, “it is really hard [to] see when your pay check is being directly impacted but the reality to any market disruption is that the market wants the new technology or business model more than they want what you offer, otherwise it would not get off the ground. The market always wins, you cannot stop it.”

Free was writing in response to what probably seemed to him a completely absurd development, a nightmarish impossibility – the return of Luddism. “Luddite” has, in the past few decades, been such a routine term of abuse for anybody questioning the march of the machines (I get it all the time) that most people assume that, like “fool”, “idiot” or “prat”, it can only ever be abusive. But, in truth, Luddism has always been proudly embraced by the few and, thanks to the present climate of machine mania and stagnating incomes, it is beginning to make a new kind of sense. From the angry Parisian taxi drivers who vandalised a car belonging to an Uber driver to a Luddite-sympathetic column by the Nobel laureate Paul Krugman in the New York Times, Luddism in practice and in theory is back on the streets.

Luddism derives its name from Ned Ludd, who is said to have smashed two “stocking frames” – knitting machines – in a fit of rage in 1779, but who may have been a fictional character. It became a movement, with Ludd as its Robin Hood, between 1811 and 1817 when English textile workers were threatened with unemployment by new technology, which the Luddites defined as “machinery hurtful to Commonality”. Mills were burned, machinery was smashed and the army was mobilised. At one time, according to Eric Hobsbawm, there were more soldiers fighting the Luddites than were fighting Napoleon in Spain. Parliament passed a bill making machine-smashing a capital offence, a move opposed by Byron, who wrote a song so seditious that it was not published until after his death: “. . . we/Will die fighting, or live free,/And down with all kings but King Ludd!”

Once the Luddites had been suppressed, the Industrial Revolution resumed its course and, over the ensuing two centuries, proved the most effective wealth-creating force ever devised by man. So it is easy to say the authorities were on the right side of history and the Luddites on the wrong one. But note that this is based on the assumption that individual sacrifice in the present – in the form of lost jobs and crafts – is necessary for the mechanised future. Even if this were true, there is a dangerous whiff of totalitarianism in the assumption.

Neo-Luddism began to emerge in the postwar period. First, the power of nuclear weapons made it clear to everybody that our machines could now put everybody out of work for ever by the simple expedient of killing them and, second, in the 1980s and 1990s it became apparent that new computer technologies had the power to change our lives completely.

Thomas Pynchon, in a brilliant essay for the New York Times in 1984 – he noted the resonance of the year – responded to the first new threat and, through literature, revitalised the idea of the machine as enemy. “So, in the science fiction of the Atomic Age and the cold war, we see the Luddite impulse to deny the machine taking a different direction. The hardware angle got de-emphasised in favour of more humanistic concerns – exotic cultural evolutions and social scenarios, paradoxes and games with space/time, wild philosophical questions – most of it sharing, as the critical literature has amply discussed, a definition of ‘human’ as particularly distinguished from ‘machine’.”

In 1992, Neil Postman, in his book Technopoly, rehabilitated the Luddites in response to the threat from computers: “The term ‘Luddite’ has come to mean an almost childish and certainly naive opposition to technology. But the historical Luddites were neither childish nor naive. They were people trying desperately to preserve whatever rights, privileges, laws and customs had given them justice in the older world-view.”

Underpinning such thoughts was the fear that there was a malign convergence – perhaps even a conspiracy – at work. In 1961, even President Eisenhower warned of the anti-democratic power of the “military-industrial complex”. In 1967 Lewis Mumford spoke presciently of the possibility of a “mega-machine” that would result from “the convergence of science, technics and political power”. Pynchon picked up the theme: “If our world survives, the next great challenge to watch out for will come – you heard it here first – when the curves of research and development in artificial intelligence, molecular biology and robotics all converge. Oboy.”

The possibility is with us still in Silicon Valley’s earnest faith in the Singularity – the moment, possibly to come in 2045, when we build our last machine, a super-intelligent computer that will solve all our problems and enslave or kill or save us. Such things are true only to the extent to which they are believed – and, in the Valley, this is believed, widely.

Environmentalists were obvious allies of neo-Luddism – adding global warming as a third threat to the list – and globalism, with its tendency to destroy distinctively local and cherished ways of life, was an obvious enemy. In recent decades, writers such as Chellis Glendinning, Langdon Winner and Jerry Mander have elevated the entire package into a comprehensive rhetoric of dissent from the direction in which the world is going. Winner wrote of Luddism as an “epistemological technology”. He added: “The method of carefully and deliberately dismantling technologies, epistemological Luddism, if you will, is one way of recovering the buried substance upon which our civilisation rests. Once unearthed, that substance could again be scrutinised, criticised, and judged.”

It was all very exciting, but then another academic rained on all their parades. His name was Ted Kaczynski, although he is more widely known as the Unabomber. In the name of his own brand of neo-Luddism, Kaczynski’s bombs killed three people and injured many more in a campaign that ran from 1978-95. His 1995 manifesto, “Industrial Society and Its Future”, said: “The Industrial Revolution and its consequences have been a disaster for the human race,” and called for a global revolution against the conformity imposed by technology.

The lesson of the Unabomber was that radical dissent can become a form of psychosis and, in doing so, undermine the dissenters’ legitimate arguments. It is an old lesson and it is seldom learned. The British Dark Mountain Project (dark-mountain.net), for instance, is “a network of writers, artists and thinkers who have stopped believing the stories our civilisation tells itself”. They advocate “uncivilisation” in writing and art – an attempt “to stand outside the human bubble and see us as we are: highly evolved apes with an array of talents and abilities which we are unleashing without sufficient thought, control, compassion or intelligence”. This may be true, but uncivilising ourselves to express this truth threatens to create many more corpses than ever dreamed of by even the Unabomber.1

Obviously, if neo-Luddism is conceived of in psychotic or apocalyptic terms, it is of no use to anybody and could prove very dangerous. But if it is conceived of as a critical engagement with technology, it could be useful and essential. So far, this critical engagement has been limited for two reasons. First, there is the belief – it is actually a superstition – in progress as an inevitable and benign outcome of free-market economics. Second, there is the extraordinary power of the technology companies to hypnotise us with their gadgets. Since 1997 the first belief has found justification in a management theory that bizarrely, upon closer examination, turns out to be the mirror image of Luddism. That was the year in which Clayton Christensen published The Innovator’s Dilemma, judged by the Economist to be one of the most important business books ever written. Christensen launched the craze for “disruption”. Many other books followed and many management courses were infected. Jill Lepore reported in the New Yorker in June that “this fall, the University of Southern California is opening a new program: ‘The degree is in disruption,’ the university announced.” And back at Forbes it is announced with glee that we have gone beyond disruptive innovation into a new phase of “devastating innovation”.

It is all, as Lepore shows in her article, nonsense. Christensen’s idea was simply that innovation by established companies to satisfy customers would be undermined by the disruptive innovation of market newcomers. It was a new version of Henry Ford and Steve Jobs’s view that it was pointless asking customers what they want; the point was to show them what they wanted. It was nonsense because, Lepore says, it was only true for a few, carefully chosen case histories over very short time frames. The point was made even better by Christensen himself when, in 2007, he made the confident prediction that Apple’s new iPhone would fail.

Nevertheless, disruption still grips the business imagination, perhaps because it sounds so exciting. In Luddism you smash the employer’s machines; in disruption theory you smash the competitor’s. The extremity of disruptive theory provides an accidental justification for extreme Luddism. Yet still, technocratic propaganda routinely uses the vocabulary of disruption theory.

Meanwhile in the New York Times, Paul Krugman wrote a very neo-Luddite column that questioned the consoling belief that education would somehow solve the probem of the destruction of jobs by technology. “Today, however, a much darker picture of the effects of technology on labour is emerging. In this picture, highly educated workers are as likely as less educated workers to find themselves displaced and devalued, and pushing for more education may create as many problems as it solves.”

In other words – against all the education boosters from Tony Blair onwards – you can’t learn yourself into the future, because it is already owned by others, primarily the technocracy. But it is expert dissidents from within the technocracy who are more useful for moderate neo-Luddites. In 2000, Bill Joy, a co-founder of Sun Microsystems and a huge figure in computing history, broke ranks with an article for Wired entitled “Why the future doesn’t need us”. He saw that many of the dreams of Silicon Valley would either lead to, or deliberately include, termination of the human species. They still do – believers in the Singularity look forward to it as a moment when we will transcend our biological condition.

“Given the incredible power of these new technologies,” Joy wrote, “shouldn’t we be asking how we can best coexist with them? And if our own extinction is a likely, or even possible, outcome of our technological development, shouldn’t we proceed with great caution?”

Finally, there is Jaron Lanier, one of the creators of virtual reality, who lost faith in the direction technology was taking when his beloved music industry was eviscerated by the destruction of jobs that followed the arrival of downloading. Why, he repeatedly asks in books such as You Are Not a Gadget, should we design machines that lower the quality of things? This wasn’t what the internet was supposed to do.

Moderate neo-Luddism involves critical scepticism about the claims by the makers of the new machines and even more critical scepticism about the societies – primarily Silicon Valley – from which these anti-human ideas spring. At least now there is a TV satirical comedy about the place – HBO’s Silicon Valley – which will spread the news that the technocracy consists of very strange people who are, indeed, capable of building “machinery hurtful to Commonality”. The running joke in the first episode was about the way the technocrats always claim to be working to make a better world. As if.

Luddite laughter is a start. But there’s a long way to go before the technology beast is tamed. For the moment, you still may lose your job to a machine; but at least you can go down feeling and thinking – computers can’t do either. 

@bryanappleyard

Update 11 September 11am:


1The New Statesman has published the following letter in response to this article:

Bryan Appleyard’s article on “the new Luddites” (above) gave a rather misleading picture of the Dark Mountain Project, which apparently represents “a form of psychosis” likely to “create more corpses than ever dreamed of by even the Unabomber”. In reality, we are a network of writers, artists and thinkers, centred on the Dark Mountain journal. We publish two books of new work every year, much of it involving exactly the kind of “critical engagement” with technology for which Appleyard calls.

According to the New York Times, a publication not noted for its homicidal or psychotic tendencies, Dark Mountain is “changing the environmental debate in Britain and the rest of Europe”. We won’t speculate about Appleyard’s mental health or criminal intentions, but we do hope that the editors of the NS require a higher standard of research from him in future.

Dougald Hine, Paul Kingsnorth
Directors
Dark Mountain Project

 

This article first appeared in the 20 August 2014 issue of the New Statesman, What the Beatles did for Britain

MILES COLE
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The new Brexit economics

George Osborne’s austerity plan – now abandoned by the Tories – was the most costly macroeconomic policy mistake since the 1930s.

George Osborne is no longer chancellor, sacked by the post-Brexit Prime Minister, Theresa May. Philip Hammond, the new Chancellor, has yet to announce detailed plans but he has indicated that the real economy rather than the deficit is his priority. The senior Conservatives Sajid Javid and Stephen Crabb have advocated substantial increases in public-sector infrastructure investment, noting how cheap it is for the government to borrow. The argument that Osborne and the Conservatives had been making since 2010 – that the priority for macroeconomic policy had to be to reduce the government’s budget deficit – seems to have been brushed aside.

Is there a good economic reason why Brexit in particular should require abandoning austerity economics? I would argue that the Tory obsession with the budget deficit has had very little to do with economics for the past four or five years. Instead, it has been a political ruse with two intentions: to help win elections and to reduce the size of the state. That Britain’s macroeconomic policy was dictated by politics rather than economics was a precursor for the Brexit vote. However, austerity had already begun to reach its political sell-by date, and Brexit marks its end.

To understand why austerity today is opposed by nearly all economists, and to grasp the partial nature of any Conservative rethink, it is important to know why it began and how it evolved. By 2010 the biggest recession since the Second World War had led to rapid increases in government budget deficits around the world. It is inevitable that deficits (the difference between government spending and tax receipts) increase in a recession, because taxes fall as incomes fall, but government spending rises further because benefit payments increase with rising unemployment. We experienced record deficits in 2010 simply because the recession was unusually severe.

In 2009 governments had raised spending and cut taxes in an effort to moderate the recession. This was done because the macroeconomic stabilisation tool of choice, nominal short-term interest rates, had become impotent once these rates hit their lower bound near zero. Keynes described the same situation in the 1930s as a liquidity trap, but most economists today use a more straightforward description: the problem of the zero lower bound (ZLB). Cutting rates below this lower bound might not stimulate demand because people could avoid them by holding cash. The textbook response to the problem is to use fiscal policy to stimulate the economy, which involves raising spending and cutting taxes. Most studies suggest that the recession would have been even worse without this expansionary fiscal policy in 2009.

Fiscal stimulus changed to fiscal contraction, more popularly known as austerity, in most of the major economies in 2010, but the reasons for this change varied from country to country. George Osborne used three different arguments to justify substantial spending cuts and tax increases before and after the coalition government was formed. The first was that unconventional monetary policy (quantitative easing, or QE) could replace the role of lower interest rates in stimulating the economy. As QE was completely untested, this was wishful thinking: the Bank of England was bound to act cautiously, because it had no idea what impact QE would have. The second was that a fiscal policy contraction would in fact expand the economy because it would inspire consumer and business confidence. This idea, disputed by most economists at the time, has now lost all credibility.

***

The third reason for trying to cut the deficit was that the financial markets would not buy government debt without it. At first, this rationale seemed to be confirmed by events as the eurozone crisis developed, and so it became the main justification for the policy. However, by 2012 it was becoming clear to many economists that the debt crisis in Ireland, Portugal and Spain was peculiar to the eurozone, and in particular to the failure of the European Central Bank (ECB) to act as a lender of last resort, buying government debt when the market failed to.

In September 2012 the ECB changed its policy and the eurozone crisis beyond Greece came to an end. This was the main reason why renewed problems in Greece last year did not lead to any contagion in the markets. Yet it is not something that the ECB will admit, because it places responsibility for the crisis at its door.

By 2012 two other things had also become clear to economists. First, governments outside the eurozone were having no problems selling their debt, as interest rates on this reached record lows. There was an obvious reason why this should be so: with central banks buying large quantities of government debt as a result of QE, there was absolutely no chance that governments would default. Nor have I ever seen any evidence that there was any likelihood of a UK debt funding crisis in 2010, beyond the irrelevant warnings of those “close to the markets”. Second, the austerity policy had done considerable harm. In macroeconomic terms the recovery from recession had been derailed. With the help of analysis from the Office for Budget Responsibility, I calculated that the GDP lost as a result of austerity implied an average cost for each UK household of at least £4,000.

Following these events, the number of academic economists who supported austerity became very small (they had always been a minority). How much of the UK deficit was cyclical or structural was irrelevant: at the ZLB, fiscal policy should stimulate, and the deficit should be dealt with once the recession was over.

Yet you would not know this from the public debate. Osborne continued to insist that deficit reduction be a priority, and his belief seemed to have become hard-wired into nearly all media discussion. So perverse was this for standard macroeconomics that I christened it “mediamacro”: the reduction of macroeconomics to the logic of household finance. Even parts of the Labour Party seemed to be succumbing to a mediamacro view, until the fiscal credibility rule introduced in March by the shadow chancellor, John McDonnell. (This included an explicit knockout from the deficit target if interest rates hit the ZLB, allowing fiscal policy to focus on recovering from recession.)

It is obvious why a focus on the deficit was politically attractive for Osborne. After 2010 the coalition government adopted the mantra that the deficit had been caused by the previous Labour government’s profligacy, even though it was almost entirely a consequence of the recession. The Tories were “clearing up the mess Labour left”, and so austerity could be blamed on their predecessors. Labour foolishly decided not to challenge this myth, and so it became what could be termed a “politicised truth”. It allowed the media to say that Osborne was more competent at running the economy than his predecessors. Much of the public, hearing only mediamacro, agreed.

An obsession with cutting the deficit was attractive to the Tories, as it helped them to appear competent. It also enabled them to achieve their ideological goal of shrinking the state. I have described this elsewhere as “deficit deceit”: using manufactured fear about the deficit to achieve otherwise unpopular reductions in public spending.

The UK recovery from the 2008/2009 recession was the weakest on record. Although employment showed strong growth from 2013, this may have owed much to an unprecedented decline in real wages and stagnant productivity growth. By the main metrics by which economists judge the success of an economy, the period of the coalition government looked very poor. Many economists tried to point this out during the 2015 election but they were largely ignored. When a survey of macroeconomists showed that most thought austerity had been harmful, the broadcast media found letters from business leaders supporting the Conservative position more newsworthy.

***

In my view, mediamacro and its focus on the deficit played an important role in winning the Conservatives the 2015 general election. I believe Osborne thought so, too, and so he ­decided to try to repeat his success. Although the level of government debt was close to being stabilised, he decided to embark on a further period of fiscal consolidation so that he could achieve a budget surplus.

Osborne’s austerity plans after 2015 were different from what happened in 2010 for a number of reasons. First, while 2010 austerity also occurred in the US and the eurozone, 2015 austerity was largely a UK affair. Second, by 2015 the Bank of England had decided that interest rates could go lower than their current level if need be. We are therefore no longer at the ZLB and, in theory, the impact of fiscal consolidation on demand could be offset by reducing interest rates, as long as no adverse shocks hit the economy. The argument against fiscal consolidation was rather that it increased the vulnerability of the economy if a negative shock occurred. As we have seen, Brexit is just this kind of shock.

In this respect, abandoning Osborne’s surplus target makes sense. However, there were many other strong arguments against going for surplus. The strongest of these was the case for additional public-sector investment at a time when interest rates were extremely low. Osborne loved appearing in the media wearing a hard hat and talked the talk on investment, but in reality his fiscal plans involved a steadily decreasing share of public investment in GDP. Labour’s fiscal rules, like those of the coalition government, have targeted the deficit excluding public investment, precisely so that investment could increase when the circumstances were right. In 2015 the circumstances were as right as they can be. The Organisation for Economic Co-operation and Development, the International Monetary Fund and pretty well every economist agreed.

Brexit only reinforces this argument. Yet Brexit will also almost certainly worsen the deficit. This is why the recent acceptance by the Tories that public-sector investment should rise is significant. They may have ­decided that they have got all they could hope to achieve from deficit deceit, and that now is the time to focus on the real needs of the economy, given the short- and medium-term drag on growth caused by Brexit.

It is also worth noting that although the Conservatives have, in effect, disowned Osborne’s 2015 austerity, they still insist their 2010 policy was correct. This partial change of heart is little comfort to those of us who have been arguing against austerity for the past six years. In 2015 the Conservatives persuaded voters that electing Ed Miliband as prime minister and Ed Balls as chancellor was taking a big risk with the economy. What it would have meant, in fact, is that we would already be getting the public investment the Conservatives are now calling for, and we would have avoided both the uncertainty before the EU referendum and Brexit itself.

Many economists before the 2015 election said the same thing, but they made no impact on mediamacro. The number of economists who supported Osborne’s new fiscal charter was vanishingly small but it seemed to matter not one bit. This suggests that if a leading political party wants to ignore mainstream economics and academic economists in favour of simplistic ideas, it can get away with doing so.

As I wrote in March, the failure of debate made me very concerned about the outcome of the EU referendum. Economists were as united as they ever are that Brexit would involve significant economic costs, and the scale of these costs is probably greater than the average loss due to austerity, simply because they are repeated year after year. Yet our warnings were easily deflected with the slogan “Project Fear”, borrowed from the SNP’s nickname for the No campaign in the 2014 Scottish referendum.

It remains unclear whether economists’ warnings were ignored because they were never heard fully or because they were not trusted, but in either case economics as a profession needs to think seriously about what it can do to make itself more relevant. We do not want economics in the UK to change from being called the dismal science to becoming the “I told you so” science.

Some things will not change following the Brexit vote. Mediamacro will go on obsessing about the deficit, and the Conservatives will go on wanting to cut many parts of government expenditure so that they can cut taxes. But the signs are that deficit deceit, creating an imperative that budget deficits must be cut as a pretext for reducing the size of the state, has come to an end in the UK. It will go down in history as probably the most costly macroeconomic policy mistake since the 1930s, causing a great deal of misery to many people’s lives.

Simon Wren-Lewis is a professor of economic policy at the Blavatnik School of Government, University of Oxford. He blogs at: mainlymacro.blogspot.com

 Simon Wren-Lewis is is Professor of Economic Policy in the Blavatnik School of Government at Oxford University, and a fellow of Merton College. He blogs at mainlymacro.

This article first appeared in the 21 July 2016 issue of the New Statesman, The English Revolt