Tuesday, August 2, 2011

Creating Jobs for Commie Robots

Yesterday, in perusing the business news, one little tidbit stuck out for me as I sought relief from the endless coverage of the debt-ceiling hoo-hah.

That tidbit had to do with the manufacture of the Apple products that seem to pervade my home.  The iPods and iPhones and MacBooks and even the iMac upon which this is currently being typed are all designed by folks on the West Coast, but are assembled by FoxConn in China.

That's where all the jobs created by our vaunted  "job creators" go these days.  Well, there or Mexico, or Vietnam, or Burma.  

But yesterday, Foxconn announced that it is going to be letting go hundreds of thousands of workers over the next three years.  It appears that with the growth of their economy, the Chinese who have so diligently performed for next to nothing on the assembly lines are now starting to expect better pay and some protections in the workplace.  Even though they're making a small fraction of what American workers used to make, it's still too much.  It's biting into profit margins.

So in the name of efficiency and improving profitability, Foxconn has announced that it will replace those line workers with around 300,000 robots.  Remaining workers will be "higher up the value chain."   Profits will be retained.  Your iPhone 5 will be a marvelous, magical wonderment, assembled with the help of our Chinese robot friends.

Here's what I just don't get about this.  Within the context of our global economy, we appear to have reached the point where even the most marginally compensated human labor is an impediment to profitability.  Providing wages to line workers is, even in the context of the Chinese economy, now a greater drain on capital than the purchase, energy, and maintenance costs for robotic production.   When you add in the outrageous demands that Chinese workers make...for four hours of fitful sleep a night, a few morsels of kung pao rodent, and a chance to urinate more than once a day without their pay being docked...it's clear that where Foxconn goes, so ultimately goes most production.

But here, the pursuit of profit ultimately is a spiral into economic oblivion.  If workers are no longer necessary in factories, and robot harvesters and combines are the future of profitable agriculture, the question becomes...how does capitalism survive its own governing ethos?  If there are no workers to buy the products that are produced by the robots, then the pursuit of profit margins will have poisoned the economic ecology.  You'll have lots of product, cheaply made, but no global base of salaried workers to consume that product.

Capitalism becomes the serpent consuming its own tail, a system doomed to fail as it devours itself.

Such odd creatures, we humans are.