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Should anybody have to work at McDonald’s?

October 31, 2016

The short answer is no, at-least in the long term. To be clear, in giving this answer (and the longer answer bellow), I am not talking about anybody’s individual situation (either a perspective employee or a specific company like McDonald’s). I’m addressing more general issues of unskilled labor. I will also be talking about what the future will be like and, the same as anyone who does so, my predictions will certainly be completely wrong.

A few years ago, when observing a discussion on minimum wage, it was remarked that if the minimum wage was raised to $15 an hour then companies like McDonald’s would just replace their workers with computers. (There is a lot to comment on in that letter that I will forego talking about). This was stated as a negative consequence of giving McDonald’s employees $15 per hour. This strikes me as odd. Isn’t being able to do more work with less labor good for the entire economy and can’t we figure out how to make something good for the entire economy good for everyone?

Producing more real goods and services with less labor should be objectively a good thing for everybody. The problem is that, in current US society, people lose out when such things happen. We live in a society in which work is required to live a comfortable life. The amount that Americans have to work has declined from what it once was but as things exist at present, McDonals cutting someone’s job in favor of an automated kiosk, out does mean that someone is worse off.

It’s not hard to imagine a world in which machines are capable of doing all the productive work of society leaving humans to live, not just a life of comfort (which is possible even without robots), but for every last one of us to live a life of leisure (for the humans who chose to live a life of leisure). There are plans to open a burger joint in San Fransisco in which the cooking will all be done by machines. Food ordering kiosks are already in existence (around where I live places called Sheetz and Wawa mart offer fast food type food that are ordered solely through kiosks). With advances in chat-bots it’s even easier to imagine that someone of my age (early 30s) will live to see a society in which it is uncommon to see anyone actually working in a fast food joint.

Such a thing should be better for everybody. If a customer is in a bad mood, computers not programed with the same emotions of people will better be able to manage it. An employee who is in a bad mood won’t make everybody’s life worse. Food will be prepared more consistently and more accurately. Since there is less (human) labor going into it, the food will be cheaper. (I should note that I’m only talking about fast food as there will still likely be people willing to pay a premium for a more traditional dining experience and that I’m talking about when these technologies mature). Also, people won’t have to work the degrading jobs that are commonplace in working fast food.

First, the idea that we are talking about raising the minimum wage or raising the wage of people who work at McDonalds, is recognition that there are people (for whatever reason) trying to support themselves (much less families) working at places like McDonalds and that they are unable to do so at the wages that they can secure. Furthermore, work such as this is often degrading. (Disclaimer: I have never worked at McDonalds and cannot comment on working at that specific restaurant but I have worked in fast food and it has impacts that are dehumanizing though I sometimes find this aspect exaggerated. This could either be because it is or because I can cope better being dehumanized then the median person.). If there is inherent value in work, there is no additional inherent value in working fast food (or many other specific types jobs for that matter).

The heart of the manner is that, according to neo-classical economics, there is economic value in accomplishing the same amount of work for lower cost but how that benefit should be distributed is a question I would say the current answer is unsatisfactory. Increasing the automation of McDonald’s provides this value to the company and/or the franchise owners not to its front line employees and/or perspective front line employees. It’s still a net benefit in aggregate (in the manner in which economists generally measure the aggregate) but it produces winners and losers. There is an issue both, in that counting individual people, there are more losers then winners and that the losers tend to be in a more difficult economic situation then the winners tend to be.

The questions is in how to make something that is an aggregate benefit (the total value of how much the winners win is greater then the total value in how much the losers lose), an universal benefit (everybody in society is made somehow better off). It’s not a simple mater. If adding in ordering kiosks is a total economic benefit, McDonald’s, franchise owners, and its current employees simply coming to a profit sharing agreement is insufficient. Some people use unskilled labor at McDonalds as a stepping stone to better employment and some people have their careers as unskilled laborers, but this profit sharing agreement excludes people who would take either of these paths who do not yet work for McDonalds and with McDonalds hiring fewer employees, their career paths are harder.

Productivity has been growing in the American economy: more goods and services can be produced with less labor. There are effects that this can have: people can have access to more goods and services (this is happening), owners and investors can reap more profits (this appears not to have happened), or people can work less (while working hours have been constant for several decades, the labor participation rate (the page I want to link to doesn’t have a valid hyper link, click the first link and then change the date to 1948 through 2016) shows a more complicated relationship). Even poor people have more access to good and services then they used to: in the United States someone in poverty today is better off (at-least materially speaking) then they were 50 years ago.

It appears that productivity growth (of which automation of unskilled labor is merely part) mainly goes towards more goods and services though these don’t necessarily go towards those directly negatively affected by automation. People who need to work unskilled jobs (because they cannot obtain a skilled position either because they cannot perform such or because of contingent factors) are being squeezed out of work because of automation and, in a society in which work is a near necessity, this is a problem if one accepts one of the founding principles of the United States: that all people have inherently equal value as human beings.

The problem with automation isn’t limited to unskilled labor. Right now, depending on circumstances and personal preference, ordering kiosks may give better or worse service then a person. Given that robotics and artificial intelligence are (and have been for some time) advancing faster than human evolution, at some point (assuming this trend continues) ordering kiosks will be better than a human in any situation. We will also reach a point where automated skilled labor becomes cheaper and better than using people.

If one has the philosophy that anyone that is unable to find work (or other circumstances and for any reason) to support themselves should not find that support then there isn’t a problem. Robots will replace humanity not through warfare but through economics. If one has the philosophy that people should be able to live a comfortable life regardless of inherent ability and contingent factors, then how a society deals with automation maters.  I find myself unable to speak to people with other philosophies with a general statement.

There are two ways which US society could change which would be useful in preventing the economic replacement of humans with robots: spreading out the benefits of increased productivity to all in society as a matter of course and developing a culture (over time) in which it is okay for a person not to work. If the benefits of increased productivity are not spread out then more and more humans will be left out of the benefiting group until there are no more humans left in it. If it remains an economic necessity for a person to work then more and more people will be left out of work. The ways of meting these two goals aren’t necessarily different.

Securing public assistance in the United States is an arduous process at present. No institution is perfectly efficient, not even governments. No government (or anyone or anything else) can perfectly determine who is eligible for a particular program. One extreme is to ensure that anyone who is eligible is determined to be eligible (and thus also determine as eligible a lot of people who aren’t) and the other extreme is to ensure the no one who is not eligible is determined to be (and thus also determine a lot of eligible people as not eligible). Public assistance programs in the US (for the most part) are closer to the second extreme then the first and the culture is geared towards moving it in that direction. Every time someone advocates for “cutting waste, fraud, and abuse,” they are, likely unintentionally and unknowingly, also advocating for cutting the benefits of government from those who are supposed to (by the purpose of whatever program is being talked about) benefit. A cultural change here will help in the above goals.

Another thing is to reduce the hours people find themselves working. This is for all workers: skilled, unskilled, labor, management, physical workers, conceptual workers, et cetera. This can be done through unions, through law, through some combination, or through some other means but it would probably involve a culture where working long hours is looked down upon (whereas doing so is lauded in current American culture). The fewer hours individuals and families have to work to earn a comfortable life (or even a luxurious life), the better off society will be and the more likely the above goals will be met.

The last suggestion I have is to implement a minimum guaranteed income (in that form or some other). It can start small and grow over time as people need to work less and less to achieve the same material production. (There doesn’t need to be a one or the other choice, the amount of human work that needs to be done can decrease as production increased: the benefits of productivity can be divided between both more goods and services as well as less labor). In order to help the above goals, it should eventually be enough that someone should be able to live a comfortable life without having to work. This would require people in US society becoming okay with someone living a comfortable life without working. This could also replace many of the support programs (government or non-government) currently in place with complicated eligibility requirements, tension between treating everybody equally and adapting to individual circumstances, and administrative overhead as well as some regulations on economic activity (such as the minimum wage).

In the end, if the goal of making work unnecessary to live a comfortable life is achieved, this won’t mean an end to work. There can still be social and even material benefits to work and individuals can make their own decisions about what they prioritize. If there is utility to work, then work can still be done (I do think this is the case and I also think that any four year post-secondary degree should require two years of work in unskilled labor because that education is valuable). Artificial Intelligence will almost certainly not (all) have the same psychology as humans. If a person wants to be a janitor, or scientist, or advertising company executive, there should be no problem with a robot for such a job letting the person do this work.

It is possible that society will figure out how to deal with this problem once automation noticeably impacts the ability for skilled workers to find work. That would be a shame, not only because it would be discriminatory between unskilled and skilled workers leading to comparatively more harm to unskilled workers, but also because of the years in which solutions to this problem aren’t being seriously looked for. It is also possible in which solutions to this problem aren’t found, and robots end up replacing humans as a result of economics.

The sooner US culture (I do not endeavor here to speak about cultures elsewhere) starts to change to accept that work should not be required to live a comfortable life and nobody should have to work at McDonald’s, the better things will be.  It is also clear that these issues are already impacting peoples lives.  The increased automation of unskilled work should be a good thing but there are people for which the automation that is already going on is making it harder to find work.  There is little in current American culture that serves these people.

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