by Nathan Greppi

In his 1939 novel The Grapes of Wrath, American writer John Steinbeck recounted how the United States, during the Great Depression, was facing problems very similar to those that have emerged with globalization in recent decades. The introduction of tractors in agriculture frightened those farmers who were accustomed to a connection with the land not mediated by machines and, when a piece of land was confiscated by banks, it was not clear to whom to complain; for a Midwesterner it was impossible to confront a bank whose headquarters was on the other side of the country.

The fact is that, while at the time of Steinbeck, President Roosevelt reacted with a strong state intervention in favor of the poorer classes through the New Deal, the last American presidents have done little or nothing to reduce inequality and help those who cannot keep up with technological and social changes, triggered first by the offshoring of factories and then by the advent of Big Tech. Another problem is that if, until the 1950s-60s, the growing mechanization of production processes was accompanied, in the long term, by the creation of new and more remunerative jobs, since the 1980s American productivity has continued to decline. The result is that, in the face of increasing investment in robotics and artificial intelligence, less educated workers have become increasingly impoverished.

The report of economist Acemoglu

As a recent analysis by the "Financial Times" explained, after Bill Clinton favored unregulated free trade in the 1990s and Obama later uncritically praised the work of the Silicon Valley giants, today among Washington politicians there is gradually growing awareness of the need for a change in perspective. In particular, in November 2021 the Turkish-American economist Daron Acemoglu presented before a House of Representatives committee the results of his research on how wages have changed in America and the effects of automation.

According to the data, all groups of workers between the ages of 18 and 64, regardless of educational attainment, saw their earnings rise from 1963 through the early 1970s, and then remain vaguely stable until the early 1980s. Since that time, those who had completed college saw their earnings grow exponentially (or less so if they only had a bachelor's degree). In contrast, those without a college degree were impoverished until the mid-1990s, slowly climbed back up in the early 2000s, and recently, after collapsing due to the 2008 crisis, have slowly started to climb back up. However, even in the climb back up, there has been a huge gap between rich and poor, particularly on the basis of educational attainment.

According to Acemoglu, between 50 and 70 percent of the economic disparities created between 1980 and 2016 can be traced back to having machines and algorithms perform tasks that were previously done by flesh-and-blood humans. In his view, "Big Tech has a particular approach to business and technology, centred on the use of algorithms for replacing humans. It is no coincidence that companies such as Google are employing less than one-tenth the number of workers that large businesses such as General Motors used to do in the past".

Another problem highlighted by his testimony lies in the gap in taxes paid. Between 1981 and 2018, the percentage of taxes that had to be paid for labor remained virtually unchanged, while the percentage for the use of software and other devices increased until 1999 and then gradually declined. This threatens to incentivize companies to replace human workers with machines, in part for tax benefits.

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Political reactions

It's not just in parliament that concerns are being raised. In January, during a virtual meeting organized by the World Economic Forum, Treasury Secretary Janet Yellen said that while the increase in remote work that occurred with the pandemic should increase productivity in the U.S. by 2.7 percent, this increase will mostly favor workers who were already earning more than average.

Already in the 2020 presidential election, Democratic primary candidate Andrew Yang had repeatedly pointed his finger at automation, which he said was destroying millions of jobs in the US. His plan was to tax more the companies that would benefit from automation, and then use the money raised to guarantee a basic income for all American citizens. To advance this belief, in October 2021 Yang left the Democratic Party to found the Forward Party, which aims to enact radical changes in economic and innovation policies.

Right-wing proposals

Unfortunately, so far the American Right has been more reluctant to address the topic, and this despite the fact that, according to a 2019 research by the Brookings Institution, of the 50 districts where there is the greatest risk of job loss due to automation as many as 46 are Republican. That same year, Tim Chapman, then executive director of the conservative organization Heritage Action, wrote an editorial in the "USA Today" newspaper calling on Republicans to find a solution to the problem, in part to not let the Left alone have the floor on the issue.

In the article, the author explained that, according to a poll conducted by his organization, 82 percent of Americans feared that many jobs would disappear in the next 10 years, and 90 percent called for greater policy emphasis on training programs to make it easier to enter the workforce. Given the traditionally anti-statist nature of American conservatives, Chapman did not think public programs were a good option and instead proposed various tax and bureaucratic breaks for training courses organized by companies or other private entities. He cited as an example the decision by Mike Lee, a Republican senator from Utah, to propose a bill known as the Higher Education Reform and Opportunity (HERO) Act, which aimed to reduce the cost of higher education and provide more opportunities to develop the skills required by the labor market.

Chapman's advice should also be followed by the Italian Right, since sooner or later the problem of automation and its impact on employment will become felt here as well.

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A freelance journalist, he has written for the newspapers Mosaico , Cultweek and Il Giornale Off . Member of the Council of the UGEI (Union of Young Jews of Italy). He was editor-in-chief of HaTikwa and communications officer of the US-Italy Global Affairs Forum .