Quam quisque novit artem, in hac se exerceat. / Let a man practise the profession which he best knows.” - Cicero

The intensity with which companies invest in automation and reduction in employees is quite impressive. In my short life as a financial analyst, I noticed how companies were implementing ‘cost-cutting measures’, regardless of the actual need for them, as an answer to any shareholder disappointment with quarterly results. The crapification of a number of services is directly traced to these cuts in headcount, such as you waiting dozen of minutes on the phone to reach an actual operator (before being re-directed to another one, if not cut outright). Automation and big data are the new fashion, regardless of their actual costs. Amazon Go’s cashier less convenience store is just another example of a misplaced focus that ends up doing less good than bad.

At the same time, not nearly as much time and money is spent to either re-train (if it is ever possible to re-train a former worker into a Python developer) or accommodate the growing mass of un/under-employed. Countries that managed to keep their unemployment rate down are actually very good at exporting it (Germany exported it to Southern Europe), meaning that in the end the pain of not having work doesn’t disappear, it just moves around.

If we remain focused on the bigger economic picture, unemployment is costly for states: it results in lost government revenues through taxes, both direct and indirect (ie: via the consumption of the productive unit) along with losses in wealth creation, experience and general well being. Do these costs match the savings realized by companies? Most probably not, though companies are following the well established and mis-guided mantra that they must maximize profits. If companies cannot be trusted to provide full employment, then the state should step in.

Not with expensive and business friendly policies that create jobs at the margins, but with work programs that can guarantee an occupation and a minimum wage that can bring back the unemployed into societies. Employed people have a better vision of themselves and their social status, which can probably translate into a higher trust for their governments, especially if the latter introduced the programs that now employs them. At the time when democracies are in crisis, this could provide a much needed buffer against the authoritarian and populist wave sweeping the world.

Should we wait for another economic crisis to implement innovative answers to a common ill? The ultra-liberal model has shown its obvious limits and is directly endangering our democracies by increasing inequalities and resentment. The reasonable course of action is thus to learn from this experience and introduce a social model and economic policy that isn’t based on boosting economic growth at all costs but to produce growth that will benefit all citizens. The results from this policy could produce higher growth thanks to the redistribution effect, something that would revive hopes of a better future in the somber times we live in.

‘Doomsday Clock’ ticked forward 30 seconds to 2 minutes to midnight – Tic Tac Tic Tac. The problem with this clock is that you will never hear it ring.

The U.S. Is About to Get Real Cold Again. Blame It on Global Warming – A warmer Earth results in extreme climate events in both directions (hot and cold). The powerful wind currents (jet streams) will be more prone to ‘snaps’ , leading to cold ‘bubbles’ detaching from their usual path and freezing everything on their way.

Vulnerable industrial controls directly connected to Internet? Why not? – Industrial machines are connected ‘naked’ to the internet, as companies save costs by allowing remote access and data gathering to their employees, though they apparently aren’t (yet?) being attacked -even if utilities have been blackmailed since at least 2006.

Amazon’s Pointless Obsession With Cashiers – The new cashier less Amazon Go convenience store (CVS) does… nothing to improve the CVS experience: it only cuts the shopping time by 1 minute (less purchases, no significant advantage to shoppers) and there will still be human staff (stocking shelves, monitoring, managing). Meanwhile, the truly innovative Amazon Fresh is being neglected or even cut back.

Is There Anything That Working Less Does Not Solve? – Working less could be a remedy to many ills, though the author focuses on working hours (necessary) instead of work conditions. An interesting counterpoint here.

Et si l’Etat créait lui-même les emplois pour combattre le chômage? – Question qui doit se poser au moment où les différentes politiques économiques n’ont fait que bénéficié les grandes entreprises sans créer d’emplois de façon conséquente. Puisque le consensus de Washington a démontré ses limites, il est temps de trouver des solutions innovantes pour régler le problème du chômage.

NSA Deletes “Honesty” and “Openness” From Core Values – The NSA changed its core values during a ‘website update’, throwing out key values and replacing them with inward looking statements.

Picture of the week: Cirque de Gavarnie, Pyrenee

About Carlito Riego

"Great perfection may appear imperfect, but its usefulness is inexhaustible. Great abundance may appear empty, but its usefulness cannot be exhausted. Great correctness may appear twisted, great skills appear crude, great eloquence appear awkward. Activity conquers cold; inactivity conquers heat. Clear serenity governs the world." - Lao Zi