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Will Automation Lead to Economic Collapse?

Most of the agriculture and industrial jobs are already phased out by machines. Over 70% of jobs and labor is currently to find in the service sector, but also this sector is being phased out and replaced by automation which means decreased purchasing power of the general public. Just take a look at this: http://www.thefiscaltimes.com/Articles/2012/08/20/Will-Robots-Cause-Mass-Unemployment-in-China.aspx#page1

Let's make an example as well. What exactly happens when people get automated by machines? They loose their jobs and need welfare to support themselves until they get a new job, if they ever do. But, where does welfare come from? It comes from tax payers. And do people on welfare pay taxes? They don't. So, what happens when everybody is on welfare due to automation and nobody pays taxes? This example is the reality in Michigan and the government there have been on the brink of shutting down due this exact issue. And we are beginning to see this never-ending spiral go out of control in the rest of the world. The trends are definitely there, but where's the solutions?

Is an economic collapse, in fact, an imminent event and a mathematical certainty, looking at the trends in Michigan and China? And is there a way out of this, looking at it in an economical perspective?


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  • Sep 16 2012: I'd like to add to your question - will automation justify social darwinism since unskilled workers will be less in demand?
    • Sep 16 2012: No, of course not: if you cut the poorest people out of your society every generation you go extinct because no society of 100% doctors and lawyers can function. Also very important, automation doesn't have to lead to unemployment: if you reduce working hours everyone can stay employed. That you thought of social darwinism before you thought of reducing working hours seems very disturbing to me.
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      Sep 20 2012: Skilled labor will always be in demand to satisfy our need for trinkets, pictures, toys. What we won't need is white collar workers. Computers can do most of their work today. The only thing that makes white coller workers valuable is money. They can't grow food, they can't make cloths, they just keep track of numbers (a computers job) and other record keeping chores, all done by computer today, just not implemented yet because no one want's to deal with a bunch of angry people in the streets.

      The machines to make a no money, no worry world is already here. What we need is less people.

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