#geopolitical fridays: Geopolitical consequences of the jobless revolution

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Cover Picture from the World Bank Development Report 2016 –
“Digital Dividends”, which, given its content should be perhaps be named
“Digital Destruction”

“The opening up of new markets,
foreign or domestic, and the organizational development from the
craft shop to such concerns as U.S. Steel illustrate the same process
of industrial mutation – if I may use that biological term – that
incessantly revolutionizes the economic structure from within,
incessantly destroying the old one, incessantly creating a new one.
This process of Creative Destruction is the essential fact about
capitalism.“

Joseph Schumpeter, Capitalism, Socialism, and Democracy
(1942)

This week on my blog dealt with
technology and power, pouring over our love affair with smart phones,
visualising surveillance technology and assessing the Blockchain
revolution. #Geopolitical fridays has a look at the geopolitical
consequences of the (so far?) not very creative destruction of
technology, namely of ICT, automation and robotics.

Technology’s
disruptive effects make themselves felt both in the developed and in
the developing countries. In both geographical spheres, societal
consequences of job losses due to replacement of manual labour by
machines promise to be dire. But given the differences in economic
development level already reached, existing social safety nets, and
standards of education, it is safe to assume that social and political
reverberations stand a somewhat better chance to be absorbed in the
developed world, but risk provoking chaos in developing countries.

Wendell
Wallach, consultant, ethicist, and scholar at the
Yale University Interdisciplinary Center for Bioethics posits that we
have reason to be worried regarding technology and the changes it
heralds. He points out for example that not only has the tech
revolution, rather than prior technological revolutions destroyed more
jobs it has created, thereby proving Schumpeter wrong. It is also on
track to concentrate wealth in ever-fewer hands – in the future, 70% of
stock ownership are expected to be held by
5% of the population.

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According to a recent World Bank Report, Digital
Dividends
, the digital revolution holds both promises
(growth, jobs, and service delivery) and risks (concentration,
inequality, and control) for developing countries. But there is very
little time to prepare – expected job losses in developing countries
due to technology are bound to be staggering (see graph above, or
click
here
for an article detailing job losses as expected by the World
Bank).

Automation and 3D printing will bring
manufacturing closer to developed countries, which translates into
something euphemistically called ‘premature de-industrialisation’.
What it really means is that developing countries will not be able to
reach economic prosperity, as their growth model to date – rely on cheap(er)
labour than the OECD countries – will be obliterated in due course.

And while we have at least started to prepare for a post-manual
labour world, notably through our discussions on and experiments with
a Basic Minimal Income, developing countries tend to lack social
institutions that could mediate the impending crises, such as for
example functioning, affordable, pro-active education systems.

The consequences of this latest technological revolution promise
to be far from benign. They hold the seeds of massive social unrest.
And they will rearrange the geopolitical cards on the table.

Further reading:

Wendell Wallach, A
Dangerous Master: How to Keep Technology from Slipping Beyond Our
Control

World
Bank Development Report 2016, Digital Dividends

Johanna M

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