Our displays of techno-freedom are turning more and more of us into dependents:
Apart from specific job categories, technological advances in products and services, along with greater outsourcing opportunities and free trade with other technologically advanced nations, increase returns to IQ and educational achievement relative to other worker qualifications such as strength, quick reflexes, and physical fortitude. The design, production, and control of robots require intellectual qualities that are not required in factory workers. Though there is evidence that IQs have increased over the last century and may continue doing so, and though some day it will be possible to increase IQ by altering brains, technological advances may continue for some time to increase the wage premiums for high-IQ workers and reduce wages of average- or low-IQ workers, thus increasing the rate at which inequality of incomes is growing. Not that the jobs of high-IQ workers are immune from the effects of technological progress; I gave the example of lawyers. Any job category involving a high degree of specialization is vulnerable. Think of the impact of photography on portrait painters, or of computers on typesetters.
These trends bear on the current debates over the size of government. Technological advances are increasing longevity, and with it an increase in the dependent population. By reducing demand for workers, and therefore employment and wages, in many labor markets, the same technological advances may be creating a second dependent population, consisting of people of working age and their children who cannot support themselves without public assistance that will either replace or augment wages. Republicans may therefore be tilting against windmills in thinking that the size of government can be reduced.
Indulge me while I separate out the big points, each of which suggests that economic recoveries might typically be jobless for the forseesble future:
1. Easy outsourcing to other countries through free trade.
2. Mental labor—and so IQ—becomes almost the only key to productivity. And so being smart and intellectually skilled becomes worth more, and physical labor worth less (as Marx predicted).
3. The first two points suggests it will be tougher and tougher for ordinary Americans—those without highly marketable and flexible skills and without big brains—to earn a decent and reliable living. So, despite their "traditional values," they will fall victim to the pathologies connected with broken families and the general fecklessness of chronic unemployment. They will be become more dependent on government as they find it tougher and then impossible to rely on themselves.
4. The jobs of those with high IQs will be less vulnerable to the vicissitudes of the market and rapid technological progress. Those who are performing specialized tasks designed by others will be easily "disrupted" by change beyond their comprehension and control. So training in specialized skills—at vo-tech schools—might be a lot less helpful than it first seems, because the need for this or that skill turns out to be more and more temporary.
5. As a result of various forms of technological progress, people are living longer. Their post-employment period of dependency is expanding, and we can add that rapid techno-change is undermining the traditional social safety nets that are the extended family, the small town, the church, and even enduring friendship. When voluntary caregiving recedes, it hard to see how government doesn't have to fill in. You really can't expect old people to remain productive in a techno-society full of preferential options for the young. A good part of increased longevity is an extended period of frailty.
6. So government will have to get bigger just to take of the growing number of dependents--the not-so-smart or inappropriately skilled young and those who have been blessed by the routinization of longevity. It might be more and more implausible to BLAME people in each category for their lack of productivity or "personal responsibility." So the Republican plans for "downsizing" government might be "tilting at windmills."
7. But I still can't see how the new birth of big government could possibly be affordable. Fewer and fewer productive people—partly because of the birth dearth—will have to "care" for more and more unproductive people.
Well, I always enjoy libertarian pessimism, although I think it's exaggerated. And history and Posner suggest it is too.
Here's the moral challenge for libertarians. John Locke taught that "capitalism"—or the unlimited acquisition of property—could only be justified if the average guy is better off. "Trickle down" has to be more than a theory. But what if he's not better off? Liberty has to deliver the goods for it to be a democratic principle.