A new generation of industrial robots has arrived. They are very fast, very accurate, can operate without pause indefinitely, are very expensive, and very profitable to their owners. Let us guess that, on average, each robot will replace 100 workers, thousands of workers in every factory. What will happen to those workers?
These new robots will bring a far greater disruption of the work world than we have ever seen, resulting in the loss of large segments of the manufacturing work force, on top of the job losses, already at critical level, from computerization in all fields. If the profit from these changes is not to create a new society of the very rich and the very poor, with no one in between, there must be ways for ordinary people to earn enough income that makes use of this new reality.
New robots will bring a far greater disruption
of the work world than we have ever seen.
Could a variation of worker-ownership be one way?
In a typical worker-owned company, it is the work that forms the substance of the arrangement. No one can invest in the company without working there. There is no rich capitalist owner who takes all the profit and pays the workers a wage. Worker-owners split profit equitably. It works very well.
But imagine a new type of manufacturing company in which there basically are no workers, other than hired management and robots. In essence, the human resources consist of a large number of “junior capitalists” and the management they hire.
Share ownership must be limited so no one has controlling interest, lest it become just another capitalist company, and perhaps further limited to those displaced by technology. The difference between this and a traditional company is that there are no major capitalist shareholders who own and control the company and take all the profit. It is “worker-owned” without workers.
There must be new ways to assist displaced people to obtain a share of ownership in the company. Another catch is that a new robotic company will probably take several years to begin generating profit, and the displaced who have no income do not have the luxury of delayed gratification. Here’s what it might look like.
Could a variation of worker-ownership be the way?
Hired professional management would be responsible for building and operating the company. All would be salaried; none would be owners. All would serve at the discretion of the board of directors, which in turn was elected from the worker-owners at large (could we call them “nonworker-owners?), and not based on the number of shares owned.
Ultimate control of the company would fall to this board of directors elected from the “nonworker-owners”, who would be responsible for the overall focus of the company as well as salaries for management.
But how could we arrive at this stage without the company becoming yet another company controlled and owned by rich people?
Obviously, the rub comes from how the “nonworker-owners” will find the money for investment, since there is no company work to be done other than by the management group, which cannot invest. Those who invest could only afford to do so if they already had a reasonably comfortable income. If so, it would not be affordable for the very ones the arrangement should protect, namely those who have been displaced.
Government could assist. Perhaps this assistance might best be in the form of a loan automatically repaid with part of the profit, which could make it possible for such a person to live on limited other income. This strategy would also quickly remove government from undesirable ownership. There would be a maximum income limit to qualify for this loan, perhaps something like 125% of the poverty level. And that is the goal, to keep displaced workers from falling into poverty while all profit went to the already wealthy.
Government might also “spawn” a new company by hiring a management team to establish the company and build a manufacturing plan, then making auto-repaying loans to a large number of qualifying persons all at once.
A company could be chartered as a “benefit corporation”, which obtains favorable treatment from government in return for being a responsible citizen (which is not necessarily true of most corporations, regardless of their contrary claims).
The company would consist of a large number of investors, and it would be possible for it to accept additional capitalization in the form of regular small automated investments, which are inexpensive to process. Young people who work at low income jobs could afford to invest in an established company, as could any person without family or other heavy financial responsibilities.
The problem from which this proposal came—the loss of large numbers of jobs, particularly manufacturing jobs—to the new generation of industrial robots requires new ways for the country to keep such people out of poverty. Other ideas are also needed. Traditional capitalism can only exacerbate the ever growing inequality we already have.