The Most Economically Mistaken Essay Ever

By Don Bodreaux:

Here’s a letter to the editor of Alternet:

In what is a prime candidate for the most economically mistaken essay ever penned, Robert Reich calls a future in which technology makes ever-more high-quality goods and services widely available at virtually zero cost “horrifying” (“In Our Horrifying Future, Very Few People Will Have Work or Make Money,” March 17).

Where to start?  Perhaps with the fact that the history of such Luddite fear-mongering is as long (at least 200 years) as its batting record is low (.000%).  Or maybe with the illogical worry about the unemployment created by an imaginary device that Dr. Reich uses to scare your readers - a device “capable of producing everything you could possibly desire, a modern day Aladdin’s lamp.”  In fact, in a future filled with such devices unemployment wouldn’t be a problem because no one would have to work in order to acquire the means to consume lavishly.  (Indeed, in such a future there would technically be no unemployment because no one would want to work.)

But Dr. Reich’s most wrongheaded claim is this one: “when more and more can be done by fewer and fewer people, the profits go to an ever-smaller circle of executives and owners-investors.”  This claim is exactly backwards.  

Read the rest here.