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Old 01-10-2012, 12:29 AM
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Lemur866 is offline
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Join Date: Jul 2000
Location: The Middle of Puget Sound
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So the "ultra-rich" are the capitalist owners of robot factories, yes? And these robot factories churn out every product imaginable, yes? And the ultra-rich are rich because they provide these products? And everyone else become welfare bums? Except, who are the ultra-rich selling products to? Each other? There are no consumers in this scenario. Therefore, how does owning a robot factory make you rich?

A guy with his factory churing out every product imaginable isn't rich. Sure, he can make anything he wants. So what? What does he do with those piles of stuff? He can't sell them, can he? What would he sell them FOR? What would he exchange his worthless piles of junk for, that he wants?

When the marginal cost of producing a product is essentially zero, then you can't get rich manufacturing that product. It becomes free. It doesn't matter if the product is diamond necklaces or digital watches or luxury cars or plastic toys or soybeans. In fact, the example of agricultural products is entirely analgous.

Back in the feudal era, what was the basis of wealth? Land. And why? Because serfs worked the land to produce agricultural products that everyone needed to live. Wheat, grapes, olives, wool, and so on were the basis of every aristocrat's wealth. And the surplus food supported a small class of artisans and priests and so on. But the vast majority of workers were agricultural workers.

So suppose there is an agricultural revolution, and agricultural products can be grown at a fraction of the cost using a fraciton of the labor. What now? The feudal aristocrats become fantastically rich, and the former serfs now become beggars dependent on the scraps from the lord's table? Is that what happened? No, what happened is that the amount of wealth you could generate from agriculture plummeted relative to the amount of wealth you could generate by manufacturing. We produced much more food than ever before and the food was worth less and less. The Earth has 7 billion people today, and never in human history has each person been so well fed.

So consider the poor capitalist factory owner. When the marginal cost of production drops and drops and drops, do the products of his factory retain their value? Of course not. The flood of manufactured products means that manufactured products become cheaper and cheaper, and eventually so cheap that you can barely give them away.

And we're already beginning this process. Do the thousands of new factories in China make the factory owners fantastically rich? No. Oh, they make money, especially compared to the starving communist peasantry of a few decades ago. But ownership of a factory that makes goods for dirt cheap doesn't make you rich, any more than ownership of a farm that produces a flood of cheap corn and wheat makes you rich.

But won't the industrialists use the political process to keep the workers/former-workers-now-beggars enslaved? But to what end? The agricultural aristocrats tried to hang onto their privileges too, but when mass production knocked the floor out of the value of agriculture, how could they? Those who control valuable goods and services control society, not those who control formerly valuable goods and services. Yes, the people of the future will need manufactured goods, and there will be a flood of manufactured goods. But the people who control the factories that produce those goods won't be rich any more than modern farmers are rich.

Go to any city in America, and if you stand in the right line, someone will hand you a free meal. People used to literally starve to death when they couldn't find jobs and didn't have land to work. Nobody starves nowadays, because the cost of food is so low that we just hand it out. Yes, we have so much food nowadays that the poor are fat and the rich are thin.

And so in the future, the guy whose giant house is stuffed with gadgets and gizmos and diamond necklaces and clothes and cars and fountains will be considered poor and crazy, just like the rich today don't have giant pantries bulging with packaged snack cakes. The meaning and value of these things will be different.

And as for the value of information, well, the marginal cost of making another digital copy of information is already zero. The cost of making the information in the first place isn't zero, but once we've already created it then copying it over and over costs nothing. And so basing a fortune on control of information seems pretty unlikely as well. You have to continually create new information to stay in the same place, because very soon the information is worth nothing, because the marginal cost of copying it is nothing.