March 3, 2016

This post focuses on one significant upcoming additive advance to inequality. There are many other advances also moving in the same direction. It takes time and hard work to reach agreement on fair solutions and to implement them.  We are way behind. The dangers are rising.

The near certain example is in transportation.

Experts estimate that we will have abundant self driving cars within 20 years, you’ll see some of it on your streets much sooner–like right now on Highway 280 between here and Google in Silicon Valley. Self driving cars will be made available via an app on your phone. The car will drive itself from a nearby lot to your home, take you to your destination, and then take another passenger or wait on the outskirts of downtown until end of the workday. You won’t need a particular car–you’ll probably use a service where a small fleet of cars serves a population X times the number of drivers.

There will certainly be some initial distrust, reluctance to go to a self driven car. Some will will be attached to the enjoyment of the driving experience–at least when (rarely) not in traffic. But, considering the comfort and convenience cars that drive themselves will bring, it’s likely a lot of us will be won over. Brookings says 90% of Americans drive to work.

If that’s not enough motivation, consider the savings. The cost of a membership in shared self driving cars will be a fraction of what it costs now for everyone to have 1, 2, or more cars. Your garage, if you have one, can be turned into whatever you want, maybe air bnb. Drivers will have the opportunity for big savings–the car, the maintenance, the garaging, the gas, and the insurance. Consumer reports estimates that the annual median cost of car ownership is $9,100. Half of the cost is depreciation, which for those who go to self driven cars can be spread among many users, as is maintenance, insurance, etc.

Ancillary societal benefits are major. Experts estimate that 30% of real estate in many large cities is dedicated to parking. Most of this won’t be needed in the future.   Then there are gas stations, repair shops, auto parts distributorships, car washes, etc., which can relocate to the edges of the cities. All the freed space can be recycled into housing, shops, parks, etc. The growing complaints in many major cities around traffic will be significantly resolved because a high percentage of traffic congestion in downtowns is due to drivers looking for parking. Cars will unload their passenger at the door of their office building and zip off to the suburbs to wait until needed again.

There will be parallel change in all other vehicles currently driven by people.Trucks and busses will be self driving as well. A few facts:  There are 3.5 million truck drivers in the US. There are 234,000 taxi drivers and chauffeurs. There are 665,000 bus drivers in the US. There are 162,000 Uber drivers. There are millions of support jobs partially at risk as well. For example, in addition to the 3.5 million truck drivers, there is another 3.5 million who do work in support of trucking. Some of those will also be at risk as a result of automation advancing. Amazon and Google are considering delivering our packages in self driving cars or with drones. Add in farming vehicles and forklifts.

The preponderance of these hard working drivers are only high school educated, and highly at risk to this rapidly approaching advancement in technology. With electricity expected to be the bulk of future vehicle power, displaced drivers will be increased by displaced gas station operators, and likely reduced manpower needs in human resource departments of trucking companies and bus and taxi companies, reduced need for manpower in vehicle insurance sales and service, and many other affiliated work areas associated with transportation.

There are technological issues yet to be resolved. There are risks to self driven vehicles having to do with weather, reliability of technology, rescue in event of emergency, and cyber crime. But there is little doubt that this future will arrive–the only question being when and how rapidly and widely it advances. All auto manufacturers are aggressively preparing for it, as is Uber and Google, among others. Some say we’ll have 10 million self driving cars within 10 years.

This post has focused on drivers. There are many other jobs at risk to technology. The Huffington Post reports from a study finding that 47% of all the jobs in the US are at risk to computerization within the next 20 years.

Inequality is at record levels in the US and other countries now. It’s going to get worse if we don’t start now to face it and prepare to moderate it. Globalization and technology are driving it. Conservative economics, in force since Reagan, prevent any government intervention to moderate it.

John Maynard Keynes, the famous economist, said in 1930, that within 100 years we would all be working only 15 hours per week, due to forecasted technological advances. Those advances have come. Keynes did not consider to whom the benefits of technological advance would go. They have gone to the inventors and capitalists who created and funded them. That would be OK, the essence of the American dream, if it were not for the fact that the advancement of technology is steadily removing the need for human workers, while we are doing nothing to compensate for that.

Thee are so many things we could do.  We could invest in modernizing our rusting and failing infrastructure. This would provide replacement jobs to many and would be good for all Americans, increasing the income and wealth of the 1% also. We could  find ways to assure equal education to all. Better educated workers would benefit the 1% also. We could create training programs for apprenticeships in plumbing, electrical and all manner of personal services which are not rapidly being replaced by technology. We could help displaced workers re-locate to where employment is available. And, we can and should strengthen our social support programs. See my previous post regarding prescriptions. All of this costs money, but all of it will save us money in the long run.

The alternative is not appealing, a growing danger for my children and grandchildren. And the threat of a revolution is growing. In my view, the response of Americans to both Trump and Sanders evidences the seeds of revolution unless something is done.