Wednesday, April 27, 2011

Universal Food Benefit instead of Citizen's Dividend

Interesting graph from the USA on the rise in food stamps.  From 26 million on the program at the start of 2007 to 44 million at the start of 2011. 

I know the idea of a citizen's dividend is unpopular in many circles.  The idea of giving everyone free money just doesn't sit well with the protestant work ethic, foundation of our society.  But people may be far more willing to entertain the idea of a universal food benefit.  Which would have the same effect since we all have to eat and money is obviousy fungible.

Sort of like how universal health care is a popular idea, even though technically we could say we are giving people something for nothing and discouraging work.

For example if everyone in Britain got £100 a month food benefit.  A family of 4 would get £400 a month tax free from that and that would make quite a difference in their lives.  The total cost of the program would be £74 billion a year.

In the US the food stamps are coming on electronic cards that get updated on the first of each month.  Its cheaper to administer that way and there is less stigma associated with using the cards, which appear as ordinary debit cards.

Tuesday, April 19, 2011

Growing empty office space

A prediction I made some years ago was that in time many office buildings would become empty.  People thought I was crazy, and that it was a sure thing investment. 

My thinking was information technology is step by step taking over the management of information in the organization.  You've got to remember in the 1970's large corporations needed office towers each floor full of rows of cubicles, each cubicle having an office drone.  And each drone was updating part of the information of the corporation.  Such as forms in triplicate, and each being dutifully filed.  With ledgers being updated.

Today most of the information is handled by servers, or even server farms.  Each server can do into the billions of operations a second.  So we don't need so many office drones anymore.  Naturally in the government and banks they still have just as many, actually more drones.  But in the competitive parts of the economy, they have been forced to gradually eliminate the drones. 

For example say an area of the company needed 500 drones managing the information.  Well they also then need building maintenance, management, HR, secretaries, etc..  Now say they need 25 drones to handle it.  And a couple manager.  Well somewhere in the country the corporation would have rented a large space to house all the cubicle drones. 

Sunday, April 3, 2011

Luddite fallacy

I definately agree the Luddite fallacy was indeed a fallacy up until recently.  The limitation on economic growth in the past was labour supply.  We wanted say more factory workers in an area, but we couldn't spare labour from the farming fields.  As agricultural productivity soared, all of a sudden we could fulfill our desire for more factory workers.

And indeed the very technology that was causing the automation of jobs, like the farm combine in agriculture, opened up vast new industries.  Like the auto industry.  Which employed millions.. and we could now afford autos, because of course we had the surplus labour who could build them.

However I believe a phase change has happened.  The new technologies clearly appear to be getting rid of good jobs faster than they open up new ones.  When you think about it logically this is completely natural that this point would be reached eventually.