An article Will a robot take your kid’s job? in a local newspaper has a subhead “A troubling new study suggests technology will mean downward mobility—especially for the young.”

The study to which it refers is Smart Machines and Long-Term Misery by Jeffrey D. Sachs and Laurence J. Kotlikoff.

The abstract of the study is

Are smarter machines our children’s friends? Or can they bring about a transfer from our relatively unskilled children to ourselves that leaves our children and, indeed, all our descendants – worse off? This, indeed, is the dire message of the model presented here in which smart machines substitute directly for young unskilled labor, but complement older skilled labor. The depression in the wages of the young then limits their ability to save and invest in their own skill acquisition and physical capital. This, in turn, means the next generation of young, initially unskilled workers, encounter an economy with less human and physical capital, which further drives down their wages. This process stabilizes through time, but potentially entails each newborn generation being worse off than its predecessor. We illustrate the potential for smart machines to engender long-term misery in a highly stylized two-period model. We also show that appropriate generational policy can be used to transform win-lose into win-win for all generations.

This downward mobility is only made worse by our new economic rules that concentrate wealth in the hands of fewer and fewer people.  This generational policy that Sachs and Kotlikoff propose is likely the very tax policy that the politics of our country is so divided over.

So, not only does Keynesian economic analysis say that there cannot be a self-sustained economic recovery with this much concentration of wealth at the top, we now have technological changes that make matters even more dire.

If more people fully understood what is at stake in this political argument, it could change a few minds.