All I can say is that I am glad that I was born in 1935 and not 2005 because the future does not look very rosy as we head into the next depression.
There is no God to save us either.

David

All the labour saving changes we have become used to will be steadily lost when we drop off the other side of the energy cliff. http://gailtheactuary.files.wordpress.com/2014/01/tverberg-estimate-of-future-energy-production.png

The underlying reason we can't come to grips with population growth is because we are a species, like any other species, which expands due to certain conditions, in this case population growth has mirrored the growth of cheap fossil fuels. There is a shadowing effect which translates to a delay - http://www.globalchange.umich.edu/globalchange1/current/lectures/predation/tmp26.gif

Individuals may clearly see that there is a problem with overpopulation but collectively, we haven't been able to get our act together.

We are to some extent in collusion with politicians to maintain our way of life as long as possible.

It's all a question of timing. I expect the process to be quite drawn out with occasional peaks and troughs. But economically the overall direction will be downward.

Our world without cheap fossil fuels will not be able to support about the same populations it supported prior to their discovery. It is a very different world now than then however, with failing infrastructure, Climate Change, species loss, tapped out soils, pollution and environmental destruction to cope with.

So who knows how long automation will last. Obviously, we are using up the earth's resources at a steady and unrelenting rate - http://www.footprintnetwork.org/en/index.php/GFN/page/earth_overshoot_day/

with all the frothing at the mouth from the tax payer funded abc you can see why youth unemployment is only going to continue. Overpaid public servants who somehow manage to convince the gullible that they are the ones who care and yet are really just about self interest. Yep the unions will continue to force Labour to increase wages for already overpaid and often lazy Government workers and people will be dumb enough to question the reason their are no jobs for kids. Well just like Greece selfishness is the obvious answer. Does anyone but the abc luvies really believe Tony Jones is worth $300,000 plus to sprout his propaganda.

This very article could have been written a couple of hundred years ago by a Luddite, seeing all their handwork being sacrificed to new technology!
Even so, it was this very technological change that dragged billions out of endless endemic generational poverty.

Computers are useful tools/slaves not original thinkers! And we will always need those!
Yes we are heading for another Great Depression, and not because our jobs are being replaced by machines that work day and night.
These machines have a flaw, they all need cheaper energy and lots of it; and can do absolutely nothing without it!

Things we can and should do!
Stop growing the population as are only ACCEPTED method of growing the economy, but instead concentrate on ending poverty in all its forms and guises, wherever we find it.
Even if that means unemployment benefits/pensions at least 80% of an average male wage; and or, people paid to just consume!
One of the very obvious flaws in the author's thinking is the absolute link between work,(wages)and consumption.

During the last Great Depression people made do, tied it up with wire to keep it going.
During the next one people will need to be paid to consume, but only if we would keep this highly automated system alive and running!

And we will need to bring the cost of energy way down, rather than make it ever increasingly expensive, just so some mindless profit graph can just keep growing!
Or automated factories that roll day and night without more than half a dozen technicians employed to keep the whole thing running, making products only the techs can afford!

With many following the metals industries and steam to their own (too few customers, the life blood of all private enterprise) ultimate end!

By which time people, (survivors) will have to learn all over again how to make things and hand produce their own sustenance, cooperate for the common good; build their own mud brick huts and hand made tools/weapons!
Rhrosty.

"One thing the IT industry does well is to enable efficiency. I have on my mantle piece a 400 Megabyte drive that cost me $2,800. That was $7.00 per megabyte in 1991. Last week, at Officeworks you could get 4 terabytes (that's 4,000 megabytes) for $199.00. That's $0.05 cents per megabyte. Now, that's efficiency."

No, it's miscalculation!

4000 megabytes is 4 gigabytes.
4 terabytes is 4000 000 megabytes.

Your hard drive cost $0.00004975 per megabyte, or about 0.005 cents.
Or to put it another way... each cent buys 201 megabytes, or just over half your 1991 purchase.

But this efficiency increase is enabling people to do a lot more. The age of BIG DATA has already begun, even if you haven't noticed it yet.

You dismiss growth because the world is finite, but you've failed to comprehend that the world is enormous. And anyway, growth in economic value doesn't equate to growth in resource use. Compare those hard drives: which do you think took more resources to make? Which one would use more electricity to run?

Your key point that "Australians are too expensive to employ and be globally competitive" fails to take into account that many Australians are highly educated and skilled, and we are globally competitive because of that. Plus our primary industries are very productive.

As long as employers (including the government) are willing to spend money, there will be jobs. All these efficiency gains enable the money supply to be increased without a corresponding increase in inflation, so there should not be a problem providing enough jobs. The problem at the moment is that politicians are obsessed with trying to run a surplus instead of doing what's really needed.

Joske, your claim that "All the labour saving changes we have become used to will be steadily lost when we drop off the other side of the energy cliff" assumes there will be an energy cliff.

There won't. It's hard to believe that anyone could take a prediction like http://gailtheactuary.files.wordpress.com/2014/01/tverberg-estimate-of-future-energy-production.png seriously; in reality renewables are rapidly expanding, yet Tverberg forecasts a decline in their use. He also forecasts a decline in nuclear power production concurrent with a sharp decline in fossil fuel production.

I found his explanation in the comments at http://ourfiniteworld.com/2014/01/29/a-forecast-of-our-energy-future-why-common-solutions-dont-work/#more-38772 : he thinks governments of countries producing the nuclear fuel will collapse. He also vastly overestimates the difficulty of wind turbine maintenance, and he doesn't seem to realise most solar cells are made of silicon rather than expensive exotic materials.

If we are to import all our durable goods and processed food, how are we to pay for it? With I.O.U's, written on toilet paper?

We have brought the cost of building houses way down; but have more pro rata homelessness, now than at any other time in our brief history!
Why?
Well Greed coupled to political incompetence or self interest? Same diff!
And more of the same aspirational endevour, will simply compound the problem!

I am not my brothers keeper! Yes I am, if I depend on his consumption for the very life of mine or any enterprise?

The alternative? No go ghettos where only lawlessness and crime flourish! And an endlessly shrinking better off element that live in prisons of their own making!

So what's the answer?
Simply put, cooperative capitalism comrade, and lots of it; with the drones, robber barons and professional parasites made to roll their sleeves up and finally get their hands dirty, literally!
That has to mean quite massive tax reform and vast simplification; that also acts to end all avoidance!

And a return to Keynesian economics, that dragged us out of the last great depression and into a period of unprecedented prosperity.
Along with a return to cost only, Government supplied essential service and energy provision that undeniably supported/underpinned it!

Some people bereft of a single scaric of future vision; will reject some of these answers out of hand and unexamined, all while supporting a vastly more expensive farm bill, millionaire medicine, family trusts, negative gearing, preferential treatment of super super, (welfare for the rich) and massive government subsidies for things like vastly overproduced mountainous sugar; and an endlessly declining (discretionary spending) middle class!?

And just what you'd expect when dogma and ideology (the inmates have taken over and are running the asylum) totally replace logic and reason; or just plain old fashioned common sense, or even the wisdom of, [we've seen it all before,] the still mentally agile aged!
Rhrosty.

Well said, Aidan.

While ever people have wants that can be satisfied by human effort, there will be nor shortage of jobs.

The idea that machines are going to cause mass unemployment has always been wrong for that reason.

The Luddites smashed machine looms, because they reasoned that it was going to put all the hand-loom weavers out of work.

I remember in the 1980s people moaning and fretting about how computers were going to put everyone out of work.

We have to distinguish between unemployment that is caused by market forces, and unemployment that is caused by government.

Unemployment caused by market forces is like when cars replaced horse-buggies, or biros replaced fountain pens, or CD players replaced record players. This social disruption is caused by the fact that society doesn't want what the workers formerly supplied. The best way to deal with it, is to leave people free to move from one area of work to another. They do not have a right to policies forcing everyone else to pay them to supply what is no longer wanted.

Unemployment caused by government includes that caused by taxation killing employment, manipulating the credit supply causing recessions killing employment, occupational licensing killing competition, treating employing people as an intrinsically anti-social and unfair behaviour thus killing employment, taxing payrolls killing employment, shafting the costs of social welfarist schemes such as superannuation (retirement) onto businesses thus killing employment, treating employers as a class enemy thus killing employment, and so on.

This kind of anti-social destructionism provides no corresponding net benefit to society as a whole, and is eminently avoidable. It is just parasitic behaviour and should be abolished. It's made even more nauseating when government then appears concerned about unemployment and masquerading as the saviour of society with more of the snake-oil redistribution schemes that caused the avoidable problem in the first place.

JKJ, has hit the nail on the head. Every new technological break through has had those wailing that it will put everyone out of work, with pretty much the opposite happening. What it does is enable the same number of people to produce more, thus which increases productivity, and the net income of everyone.

Hi Guys

Now with such high youth unemployment building a generation of no hope, Wouldn't we be better off retiring some older people to free up some jobs or at least do an apprenticeship type training rather then raising the retirement age and FORCING both parents to working just to survive, And building another generation of no hope no job no future

The new jobs are service based, washing each others dogs, personal trainers, serving coffee etc

And bureaucrats, we seem to need an endless supply of them.

Her's an interesting article,

http://www.salon.com/2014/06/01/help_us_thomas_piketty_the_1s_sick_and_twisted_new_scheme/

Geoff do you really think there would still be a functioning society as unemployment went past 25%.

Yes OK, if we add all the useless bureaucrats the unemployed & the aged pensioners together we are probably close to that level now, & our society is not making it. Our head is about to go under at this load of freeloaders, & the future does not look pretty. It will not take much further increase in welfare recipients for total failure to occur.

We will collapse long before we could get to 30%, even if half of them were sacked bludging bureaucrats, university staff, & other useless flotsam.

So sorry mate, we will never get used to 30% unemployed, as there is no way we could survive to get there.

Aidan,"The problem at the moment is that politicians are obsessed with trying to run a surplus instead of doing what's really needed."

So what is needed Aidan ? More debt ? Total debt of Australia is $5 trillion which is $ 217,000.00 for every person in this country.

The solution is going back to Govt banks that can create new money debt free. You cannot be this stupid and be able to write sentences.

Even 100 years ago, economists were warning that unless the working week was reduced in line with technology-driven improvements to productivity, widespread unemployment would become long-term, irreversible and intractable.

Of course, the warnings went unheeded and, when the totally predictable unemployment rot started to seriously set in throughout the West during the late 70s, all the usual suspects got the blame, except the real culprit - the length of the working week.

Unfortunately, it costs business less to employ one person on a $100,000 salary than two people on $50,000 salaries - so higher wages for fewer people, rather than a reduced working week, became the entrenched paradigm. On that, both trade unionism and big business were in total agreement.

Had common sense prevailed by reducing the working week but leaving wages the same, the average Westerner would now be working an average 20 hour week, there would be full employment and the relocation of First World industries offshore to Third World sweatshops may never have happened.

aussieboy

'Wouldn't we be better off retiring some older people to free up some jobs or at least do an apprenticeship type training rather then raising the retirement age and FORCING both parents to working just to survive'

Nah ... it would never work, mate. Far too sensible.

This argument has been put forward since at least the 19th century, notably by Karl Marx. Yet human society has continued to innovate with major industries that would have not have been comprehended 30 years ago. Service industries have become the major employment sector and has employed those displaced from manufacturing and agricultural industries. Finance, health, IT, communications are all examples of sectors that have grown significantly in recent decades.
The writer also doesn't acknowledge the impact of the ageing of our society will have on our employment market over the next few decades. There will be a much larger part of our population who won't be part of the labor market but will still be consumers of goods and services. There will be large part of our job market who will be meeting the needs of the retired

Yes, people have been (wrongly) predicting for years that technology will kill jobs. But there is a fundamental difference now.

All jobs created have relied on humans being better or cheaper than the equivalent machine. Historically machines have been extremely limited in what they have been able to do. Initially they have been great only where they can replace repetitive, predictable, manual labour. More recently they have been also been used for doing straightforward, predictable mental calculations.

But what's changing is that computer technology is becoming more and more autonomous - using neural techniques to learn tasks as they go rather than having to be programmed. And to add to that, robotic technology is providing much greater dexterity and mobility. We now have driverless cars (something seen inconceivable only a few years ago). In Japan robots are being used to provide care for the elderly. And they've even invented a machine for burger flipping.

As soon as you start paying attention to the massive and rapid increases in technological knowhow (at an unprecedented rate that makes previous improvements seem laughable), you realise we are entering a completely different paradigm.

So the only opening for human employment will be in those areas that machines can't (yet) do well (e.g. creativity), or where they'd be too expensive.

Geoff is absolutely right to highlight the problem.

If we, as a society, continue to bury our heads in the sand and fail to adapt our economic system to a world where unemployment will be getting to 30%, it won't be pretty.

James Rickards ,the author of the death of money says, get ready for a 25yr Depression.$1 of debt used to create $2.40 of growth in the 1960's.Today $1 of debt creates 3 cents of growth and soon it will be negative growth of each $1 of debt.Japan has been QE as debt, money printing, call it what you will for over 20 yrs and their economy continues to get worse as they up the levels of QE as debt.
http://www.youtube.com/watch?v=KYW5OGWfqJc

"So what is needed Aidan ? More debt ? Total debt of Australia is $5 trillion which is $ 217,000.00 for every person in this country."
Or $69375 for every sheep in this country. Which is far less misleading, as it avoids the misleading impression that the sheep somehow have to pay it off.

But most of the money is money that Australians owe to other Australians. It's not a problem at all.

"The solution is going back to Govt banks that can create new money debt free."
Whether or not debt is always created makes very little difference.

"James Rickards ,the author of the death of money says, get ready for a 25yr Depression"
Of course he does; it helps to sell his book!

"$1 of debt used to create $2.40 of growth in the 1960's.Today $1 of debt creates 3 cents of growth"
Debt was in much shorter supply in the 1960s than it now is.

"and soon it will be negative growth of each $1 of debt"
Baseless claim.

"Japan has been QE as debt, money printing, call it what you will for over 20 yrs and their economy continues to get worse as they up the levels of QE as debt."
Japan's growth is being held back by its sales tax and by high electricity costs (due to the nuclear shutdown).

To all who have commented. Thank you.

A special thanks to Aidan Yes my calculations were wrong. You are right. Storage is now .005 cents per MB. Slight brain fade there.

I love the comments and the discussion.

A couple of points.

I am not a Luddite. I have more technology in my home than most. Use computers for watching TV, streaming music, creating music. video conferencing, security cameras etc. Hell I even sms my kids in their bedrooms to tell them dinner is ready.

But what I do see is a convergence of efficiency to live and the growth of the population as reaching a point where something has to change.

When the loom was created in 1875 here were only 1.3 million people on the planet. Now there's 7 billion.

As to dragging people out of poverty. Ok then lets ignore the 3 billion now living in poverty. https://www.dosomething.org/facts/11-facts-about-global-poverty

As to we will never run out of resources. We use 1.5 planets worth of resources a year. http://www.footprintnetwork.org/en/index.php/GFN/page/world_footprint/

And Rhrosty I do agree the inmates have taken over the asylum.

The whole point of the essay was to get comments and feedback and to get people thinking and talking. Also thanks to all those who have posted links to other information.

I do not have the answers. Matter of fact. The older I get. The more I am told I know nothing by everyone else.

Long live the debate. Better over a glass of wine though.

Cheers

Geoff