Technology is root of all evil, says IMF
Proposals for tax on engineers, compulsory arts degrees
The International Monetary Fund (IMF) has this month brought out its World Economic Outlook for 2007, and the various heavyweights of financial news have all had their bash at reporting on it. Normally, no vulture would stir on his/her perch over this type of thing - unless, perhaps, Paris Hilton had been implicated in some kind of major economic upthrust - but in this case, the economists make some rather startling pronouncements about technology.
In essence, according to the IMF, technological innovation is what causes economic inequality among the human race. Yes, you read that right: technology - and not just the machinery, but people with tech skills - are to blame for the fact that some people are dirt poor and others disgustingly rich.
"Technological progress alone explains almost all of the increase in inequality from the early 1980s," according (pdf - page 2) to the IMF.
The authors admit that globalisation has also been a factor in the way the poor are now so much further behind the rich, but technology is the true villain.
"Increased financial globalisation - and foreign direct investment in particular - has also played a role in increasing inequality, but contrary to popular belief, increased trade globalisation is associated with a decline in inequality," say the IMF writers.
"Technological advances have contributed the most to the recent rise in inequality."
This is held to be because higher tech "increases the premium on skills and substitutes for relatively low-skill inputs".
In other words, overpaid scumbag IT people with their systems, networks etc are stealing bread from the mouths of poor but honest file clerks, printers, semaphore operators, call-centre people, recording execs and so on. IT, powered machinery, cheap tools, new drugs - it's all evil and divisive, promoting war, rebellion and strife. Big global business trading in old-fashioned stuff like commodities - you know, mining, agribusiness - these people are your friends.
Most of the mainstream financial press have chosen to ignore this dazzling suggestion from the world globalisation bureau that globalisation is great and if something has gone wrong it must be someone else's fault. But noted economics pundit Clive Crook, writing for the Financial Times, has fallen on it with glee.
"I want to be constructive," writes the Oxford-trained economics egghead.
"Let us agree that reducing inequality is the overriding goal – more important than lifting people out of poverty (which globalisation is doing), more important than raising living standards in the aggregate (which globalisation is doing). Let us also agree that efforts to improve education are useless palliatives, not worth discussing... It is surely time to name the real enemy... the world needs critics of technological progress. If we can only stop or slow that, we can have more equal societies."
Crook even makes the mistake - surely fatal to this kind of thinking - of going back into history.
"Ned Ludd was right," he says. "The world has put up with progress and its consequences too long."
It's always possible that the man is merely being comical in some leaden economist fashion. If not, well, he must have a very narrow idea of what technological progress actually is and when it began. Perhaps you might contend that Stone Age society was more equal than today's, though the Inca nobility seem to have been a hell of a lot better off than their peasantry even then. It seems reasonable to suggest that the technically sophisticated but still mainly agrarian society which produced the Luddites was more equal than that of ancient Egypt, or Rome, or the Middle Ages; and that today's arrangements - even worldwide - are overall fairer than that.
The idea that societies in which most people can't read and make their living shovelling shit have fairer distribution of wealth than high-tech millieux seems frankly insane, in fact.
Sure, Bill Gates' personal wealth is five or six orders of magnitude greater than that of ordinary Americans. But Georgian labourers sometimes didn't have any personal wealth at all, or measured it in farthings. A great noble of those days' annual income was sometimes a million or ten million times as much, representing immense capital holdings and disparity a hundred times worse. And there just wasn't that much of a middle class back then; poor folk literally were common. The old-time French toffs were worse, and those everywhere else often worse still. In America back then a lot of labourers were still slaves - tax-averse American capitalists having broken with Blighty to create the land of the free - and by definition were wealth rather than owning any.
How to get back to those glorious, free and equal days? Not to worry, Crook has the answer.
"An impossible dream?" he writes.
"By no means. Here are some practical first steps. Punitive taxation is a no-brainer. Include a surtax on scientists and engineers. Restrict postgraduate education to the arts, humanities and the law. In fact, make postgraduate study in those fields compulsory."
Before you head over to Crook's place with the hot tar and feathers to give him a proper taste of the old days, though, be aware that he does plan one move which could be popular with (some) techies.
"Dismantle all the legal protections of intellectual property," he says.
Also remember that in this case it might actually be the IMF and its mindset that are the problem, rather than a plague of Oxford economics graduates, even if it doesn't seem like that in normal daily life. ®
The IMF is just channeling Greenspan
I mean, seriously - banker types pretending to be interested in equality? isn't that, like, communism or something? Crook's sarcasm has got it exactly right - their idea of equality is cutting everyone down to the level of the unskilled. The reason, obviously, being that envy of the skilled leads to inflationary wage pressures. The former Chairman actually put it in black and white in his recent memoir "The Age of Turbulence". I quote - "...by opening our borders to large numbers of highly skilled immigrant workers, we would both enhance the skill level of the overall workforce and provide a new source of competition for higher-earning employees, THUS DRIVING DOWN THEIR WAGES". (my caps)
I'm really surprised this has been overlooked by the US technical community. I'd have thought it would provoke a torch-wielding mob marching on the Federal Reserve.
Shakespeare was on the right track
First we shoot the economists, then the lawyers.
And looking at the wonderful load of contaminated food we are receiving in the states, I am of a mind to increase our farmer's subsidies...
Captain Obvious time: You get paid for what's in demand
Hello!!! Isn't it obvious that you get paid more when your skill are in demand? Isn't that obvious?
The actual IMF report isn't all that eye-opening. Yes, there is inequality in incomes. Yes, the rich have grown richer, and the report also says that the poor have also grown richer! And the rich, by and large, got rich through shrewd actions, instead of wasting their money. I remember there was an article in the paper about a homeless guy who became a millionaire. How? While he was homeless, he went into the library and started reading the financial investment books. Then he took his beggings and invested it! Lo and behold, a number of years down the road his investments rose to over a million dollars.
There is nothing in the IMF report about everybody becoming a ditch-digger to even things out. Looking at the last paragraph, they say that there needs to be more education and more exports. Well, duh, dudes! My dad was a librarian, and I'm a software engineer. Guess who gets paid more? I hope that other countries take education seriously, and build up a cadre of people with respectable skills. It will do the whole world good.