The Instigator
TrenchMouth
Pro (for)
Losing
1 Points
The Contender
TheFreeThinker
Con (against)
Winning
12 Points

Technology is ruining the world's economy

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Post Voting Period
The voting period for this debate has ended.
after 3 votes the winner is...
TheFreeThinker
Voting Style: Open Point System: 7 Point
Started: 6/10/2011 Category: Technology
Updated: 5 years ago Status: Post Voting Period
Viewed: 6,278 times Debate No: 16985
Debate Rounds (4)
Comments (11)
Votes (3)

 

TrenchMouth

Pro

first round starts after some fool excepts to debate this with me.
TheFreeThinker

Con

WoW! You are a progressive AND a libertarian! This is gonna be an awesome debate!

I accept your challenge and look forward to your opening argument!
Debate Round No. 1
TrenchMouth

Pro

What is the purpose of technology? Well, in business, it is to make a company more efficient and, therefore, profitable. One of the main ways this is accomplished is by making the necessity of employees obsolete. Labor costs are generally one of the biggest expenses a business incurs - they are also one of the most controllable expenses.

To CEO's, employees are only seen as an "asset", something utilized to accomplish a business goal. Whether it's making a widget, or selling a service - employees are only necessary until a new technology comes along that makes their jobs obsolete.

President Obama points out @ 7:30 of his 2011 State-Of-The-Union address that, due to technology, "Steel mills that used to require 1000 workers, can now do the same work with 100".

OK....so what do the other 900 workers do? Get retrained (generally, at tax-payer expense)? Collect unemployment insurance? Go on Welfare?

The simple economic law of supply and demand shows that workers are becoming less valuable. Due to an ever-increasing world population (supply) and technological advances resulting in less of a need for workers (demand), the value of labor is decreased. This results in low-wage positions being offered and, begrudgingly, accepted.

While this situation initially seems great for business (lower costs), in reality, it's ruining our economy. If people don't have the ability to earn a wage that affords them the capability to buy anything but the necessities, who is going to buy the products or services a business offers?

The answer is "no one". So, as it stands right now, technology IS ruining the world's economy.




TheFreeThinker

Con

I thank my opponent for posting the opening argument.

My opponent opens his argument by writing that the purpose of technology in business is to make a company more efficient and, therefore more profitable.

This is of course a fact. My opponent however does not recognize the fact that the very same technology that makes a business more profitable and efficient also provides the customers of that very same business with a superior product.

There is no doubt that we wouldn't be able to manufacture the same products at the same low cost if it wasn't because of the high level of technology that we have.

Having a business running efficiently, besides making it more profitable, allows it to manufacture products at a lower cost, which in turns benefits a large share of the population who is able to afford the products.

We have today more good per capita than before because of technology, and since the well-being of an economy is measured by several indicators such as growth rate, gross domestic product and gross domestic products per capita, it is clear that technology has greatly improved the world's economy.


My opponent cites an excerpt from the 2011 State of the Union, in which President Obama said that "Steel mills that used to require 1000 workers, can now do the same work with 100", and wrongfully comes to the conclusion that "the other 900 workers ... Get retrained (generally, at tax-payer expense)? Collect unemployment insurance? Go on Welfare?"

This is of course a huge fallacy. In a free market economy those workers don't just get thrown away, they are still valuable assets for another company or another manufacturing place or a new business that is starting up. Those 900 workers will go and produce something else, in let's say 5 new companies, and will produce thousands of new goods and product that would have not been on the market if the first company would not have improved their manufacturing process.

Running a business that could produce let's say 1000 units of product A at a labor cost of 1000$ is not better for the economy than a business that produces the very same 1000 units of product A at a labor cost of 500$.
First of all, because the second business will be able to make the product more affordable, second because wealth is measure in total output.

Technology not only improves the products that we want to buy, but it also reduces their cost and encourages competition.

My opponents than argues that "The simple economic law of supply and demand shows that workers are becoming less valuable. Due to an ever-increasing world population"

This is of course another fallacy, because even though population increase increases the size of the work force, it also increases the size of customers who are responsible for demand.

Technology has been advancing for years, and so has economic growth. It is in nobody's interest to manufacture a product that nobody can buy, because it is impossible to make a profit that way.

My opponent clearly shows a lack of understanding of basic economic laws.


Debate Round No. 2
TrenchMouth

Pro

It seems obvious that my opponent has taken an economics course, possible a couple of them. I say this because his arguments are fairly sound, THEORETICALLY. Kind of like tax cuts for the rich will stimulate the economy, and tax-cuts for business will encourage investments. While these positions are worthy of debate, they simply aren't how things really work.

1) My opponent believes that a business which operates more cost-effectively due to technological advances will pass the savings on to their customers - so really it's the customers that save. Nothing is further from the truth. Companies simply pocket the extra profits and generally dispurse them to their shareholders as dividends. Or, pay their CEO's huge, obscene bonuses. That's reality.

2) My opponent argues that we have today "more good per capita than before because of technology", yet show's no evidence to back that claim up. Besides that, economists argue all of the time of the affect of the GDP on the normal standard of living - "are we just working a lot more than we did before?". What good is having a high-GDP if the population isn't compensated (rewarded) for it?

3) Then, my opponent argues, "In a free market economy those workers don't just get thrown away, they are still valuable assets for another company or another manufacturing place or a new business that is starting up."
Really? That's just more of the "Voo-doo" economic theory that has been PROVEN not to be the way things work in reality. What is the purpose in society of technology? To increase our standard-of-living. While, yes, it has given us some cool things...it hasn't helped with the affordability index that common workers experience.

4) My opponent quoted me on one and a half sentences??? I'm not sure what happened there - if he was just trying to take something out of context, or what?

The correct quote should be:

"The simple economic law of supply and demand shows that workers are becoming less valuable. Due to an ever-increasing world population (supply) and technological advances resulting in less of a need for workers (demand), the value of labor is decreased. This results in low-wage positions being offered and, begrudgingly, accepted."

I agree that technology can be good for the economy, but not when it is used to make workers obsolete. This is just a small part of the tragic old "trickle-down" theory popularized by Reagan.

It reminds me the once widely-held theory that the world was, in fact, flat.

TheFreeThinker

Con

I realize that the topic of this debate calls for broader discussion on several fronts, including politics, however, economics is a social science and as such is bound to several rules that do not change no matter what your personal political beliefs are. I will analyze my opponent's criticism of technology's role in the economy and explain why his points are incorrects, as well as some assumptions that he makes regarding the role of taxation and government intervention in the private market.

My opponent opens the debate by writing that technological advances do not translate into savings for the customers who end up buying the products, because "Companies simply pocket the extra profits and generally dispurse them to their shareholders as dividends. Or, pay their CEO's huge, obscene bonuses."

This statement is of course false. Every single product becomes cheaper over time, because the free market provides incentives for competition, and technology drives private manufacturers of goods to strive to always produce a better product at a lower cost to be able to outcompete other manufacturers and make a profit.

If you look at pretty much every product that you can buy, from a car, to a cellphone, to an industrial machine, you will be able to see that over time, every product has become more advanced and more affordable.

If company X is able to produce 1000 items of product A at half of the cost of company Y, it is in a company's interest to pass on the savings to the consumer, because nobody in his right mind would pay 1000$ for the same product that they can get for 800$, which results in more people buying the cheaper product, which translates in higher profits for the company.

When they came out, cellphones where gadgets that only the rich could afford. Today, because of the free market and advances in technology that allow to produce better products at a lower cost, not only are cell phones cheaper, better, and available to a large size of the population. An iPhone 4 isundisputabely a better than a Motorola DynaTAC, even though the iPhone only costs around 600$, weather the DynaTac's retail price was of 3,995$, whichwould be over 8,800$ in today's money.[1] You can verify this phenomenon with almost every product.

The issue of passing savings to the customer is a very important one, especially because you mentioned your belief that the notion that "tax cuts for the rich will stimulate the economy, and tax-cuts for business will encourage investments" is false.

I will explain why the notion is actually, indeed, correct.

Unlike the savings in the manufacturing process that allow a company to make a product more affordable to the consumer, corparate taxes, even though on the books are paid by the company, are indeed just paid by the custumer.
Every time there is a corporate tax increase, the company just passes on the tax burden to the consumer.

The reason for this is that the tax is applied to every business, so there is no disadvantage for the company to pass on the tax hike. If I manufacture a product and sell it for 1000$, which allows me to make a profit of 200$, and then the governmant increases the tax on my product to 200$, I will not sell my product at a profit of 0$. To keep my margin of profit intact I will increase the sale prive to 1200$. I don't have to be afraid of a competitor either, because in order to keep his business running, he also needs to make a profit, and will also need to increase the cost of his product that is compeating with mine. The downside of increasing corporate taxes however is that a consumer that had been so far able to buy my product for 1000$, will not be able to do it anymore. The company loses because it can't sell as many products, the consumer loses because it can't buy as many products. Translate this example to the global market and you will realize why corporate taxes are bad for the economy.

In regards to taxes for the rich and stimulating the economy:

If a rich person, at the end of the year has 1 Million $ left over that the government doesn't take away from him because of tax cuts, he has several option on what to do with it:

1) He is going to spend it.
Which would put one million $ into the economy, helping business staying afloat, which in turn can pay their employees, who in turn spend their incomes for other goods and therefore help the economy even further.

2) He can invest it to get a high return
In this case, he will spend money buying products to start a company and hire people to work for him, thus stimulating the economy. The funny thing about the so-called trickle down economy, is that it is actually a trickle up, because when you invest 1M$, the money goes to the emploeys first, who benefit from it directly, and back to the investor last, after, and if, the company turns profitable.

3) He can put it in the bank and get interests.
This allows the bank to be able to borrow several times the amount of his deposit to business that need start up cash or are expanding. This in turn allows those businesses to hire people or buy goods, which stimulates the economy.

4) He takes the cash and locks it up in his closet.
This is the only option that does not stimulate the economy. It of course does not make any sense either, because if you don't spend your money you don't get anything for it, if you don't deposit it or invest it in a bank you will not get a return and on top of that, inflation makes your money worth less every day that goes by.

If the government takes that 1M and gives it to people who have not produced anything for it, in form of labor, investment or deposit, the overall effect of it on the economy is less.
If you don't understand this point I will explain it further in the next round.

In his second point my opponent argues that I do not show that we have more wealth per capita than ever before.
I did not post a link because I am sure that that is self-evident, if it is not for my opponent I encourage him to ask his grandparents, or other older people, how life was 60 years ago. However I will provide a linke that deals with this argument. [2]

In his third point, my opponent writes that even though technology has provided us with some "cool things" and has indeed increased our standard of living, it has not helped with the "affordability index"

While I would like to point out that standard of living is actually how you measure economic output, and if technology has increased it, than it has, by definition, improved the economy, I don't know that my opponent means with "affordability index"
I am familiar with the. "housing affordability index", but am not sure if that is what my opponent reffers to, so I would like him to clarify his position.


In his last point my opponent points out to a senstence that I quoted. It was not my intention to take the sentance out of context or misrepresent my opponents position. Indeed, even with the entire senstence quoted, the outcome of it is the same because the logical fallacy that my opponent formulated is rooted in the fact that a population increas not only grows the pool of workers (supply), but also of consumers (demand).


Technology is always good for the economy and not only when it makes workers obsolete, but especially if it makes workers obsolete, because those workers are are freed up from a position that could produce the same amount of goods, or wealth, without them, and are now able to be employed in a different position, which allows them to manufacture different goods, which would not have been there if they had still been employed in the old position.

I understand that sometimes economics can seem contradictorty, but it is of paramount importance to realize the macroeconomic reality of a situation, and not only the microeconomic impact, such as workers being fired because a new machine.

[1] http://en.wikipedia.org...
[2] http://economics.about.com...
Debate Round No. 3
TrenchMouth

Pro

The "affordability index" that I was referring to is simply stating the fact that wages have not kept up with inflation over the last 30 years. And, the reasons are as I've previously laid out.

http://www.washingtontimes.com...

Or, as CNN reported in 2006. "Employee pay lowest share of GDP since 1947, when government started tracking data. Corporate profits highest share of GDP since the 1960s."

http://money.cnn.com...;

My opponent seems to be attempting to convolute the subject of the debate. When technology eliminates jobs, it is bad for the economy. Simple as that. And, it's quite obvious that technology has eliminated millions of jobs over the past 30 years.

And, finally, our standard-of-living IS declining. Watch the video from CNBC. http://video.cnbc.com...

Things are not getting better - they're getting worse. They'll continue to do so. It's just the reality we live in.

Thanks for the debate!
TheFreeThinker

Con

My opponent does not mention any of the explanation that I have given him in round 3 and instead goes on trying to show the validity of his claims by posting a news article, a link that does not work and a news video.

My opponent has been unable to formulate a clear argument that explains his view that technology is ruining the world's economy.

I have explained and clarified every single point that he has brought up.

Furthermore my opponent clearly does not understand the fundamental principles of the free market and of economics in general.

In the his last round he tries to imply that the negative effect of inflation and the fact that real wages are not going up as fast as inflation is caused by technological advances that increase the productivity of workers.

This is of course a ridiculous argument that shows a serious misunderstanding of the market forces.

Inflation is not a byproduct of technological advance but of monetary policy, and is expressed by the formula

MV=PQ

where M is the nominal quantity of money, V is the velocity of money in final expenditures, P is the general price level and Q is an index of the real valueof final expenditures.

This equation is on paragraph 1 on Page 1 of pretty much every textbook of economics and monetary policy, and the fact that my opponent does not understand that the rise of inflation is caused by monetary policy - this is, by keeping printing money out of thin air to be able to repay government debt-, is proof that his entire argumentation is flawed.


I encourage my opponent to read this link http://mises.org..., which provides some interesting data about food expenditures as a share of disposable income, real household income and some other factors.


There is no doubt that the standard of living has been increasing during the past century, and technology and the free market are the major driving forces behind it.

We have a much longer life span, a smaller percentage of child mortality and have made progress in every single economic sector because of technology.

As his final point, my opponent writes:

"When technology eliminates jobs, it is bad for the economy. Simple as that. And, it's quite obvious that technology has eliminated millions of jobs over the past 30 years."

Well indeed it is not "as simple as that" when you are thoughtful and understand how the economy works. This is clearly not the case with my opponent, as he fails to understand the difference between a microeconomic event such as the lost of some jobs because a company restructures its manufacturing plant, and the macroeconomic reality.

Technology has indeed eliminated millions of jobs over the past 30 years, but has created billions more.


I encourage my opponent to take a few economics classes to better understand the mechanisms involved in the world's economy and the role of government in the private sector.


There is no doubt that technology has improved not only the world's economy, but the standard of living of people across nations.

VOTE CON!
Debate Round No. 4
11 comments have been posted on this debate. Showing 1 through 10 records.
Posted by TheFreeThinker 5 years ago
TheFreeThinker
Any data to back up your claim history professor?
Posted by TheHistoryProfessor 5 years ago
TheHistoryProfessor
That still doesn't exclude the fact that the growing technology in the 1800's forced civilians to lose there jobs at an alarming rate.
Posted by TheFreeThinker 5 years ago
TheFreeThinker
SSGWhit, of course not, first of all because technology does not advance by itself, there is somebody that provides that technology.

A job position might become obsolete, but new ones are created all the time.

The HistoryProfessor, technology is what created a middle class in the first place. Before there were factories, the "middle class" was people working their land.

I don't think that it is a good choice to exclude scientific data such as V=M ... a priori.

If you want to have an honest discussion about a subject, than you need to be open to analysis and facts. Otherwise you're just going in with your opinion and are not ready to change it no matter what is said or proved, which is not really something to be proud of...
Posted by TheHistoryProfessor 5 years ago
TheHistoryProfessor
Take a look into history to find the answers to this debate. The technology boom in the 1800's factories made life almost unbearable for the workers. They lost there jobs at an alarming rate and were forced to work for almost nothing. It is not likely that all the jobs will eventually become obsolete, but I do believe, the more and more that technology advances the harder and harder it will become to find work.
Posted by SSGWhit 5 years ago
SSGWhit
'Freethinker'...that's debatable...especially with your short fuse. So...you really don't think that as technology advances that the jobs of the middle class are going to shrink and eventually become obsolete? No need to invoke V=M or anything to that nature.
Posted by TheFreeThinker 5 years ago
TheFreeThinker
Wow, so much preconceptions, based on what?

No, I don't live at home, I left home when I was 18 to go work for the Red Cross in Munich and have worked ever since.

This is also the reason I did not start college right away. You see my dad is a formal metal worker with 5th grade education who now cleans staircases for a living.

My older sister was the first person in the family to graduate from high school. Yes, not college, high school.

I'm still not done with college because I have to pay as I go. I have 2 jobs and am in school.
Not quiet what you thought.

I don't know what you did or didn't do, what you owned, ran and how many people employed.

What I know is what you wrote on this forum, and you have perpetrated superficial claims and populistic economic fallacies.

Like any other science, economics is affected by certain laws which have been subject of study for several centuries now.
I have taken a lot of time and care in answering every point that you have brought up.

There is nothing wrong in not knowing something or misunderstanding a certain concept, however, going after a well-explained thought with the excuse that "you know you are right on your take and you are just too lazy to argue it", is just intellectual dishonesty.

If you are really interested in understanding more common misconceptions about the economy in general and the US economy in particular, I suggest you read "Economics Facts and Fallacies" by Thomas Sowell.

Unless of course you believe you don't need to read a certain book because you already know better, in which case, I really can't help you.

Remember, Fas est et ab hoste doceri
Posted by TrenchMouth 5 years ago
TrenchMouth
FreeThinker, I appreciate your enthusiasm and vigor for debating. I hope that you keep it up. The truth is that your generation is screwed even more than mine. "Optimism is what precedes experience, cynicism is what follows."
You probably live at home with your parents after graduating from college. Most likely, you have a degree from a well-respected college. And, I would bet, your parents are 'well-to-do'. Heck, they may even pay for an apartment, and a car for you. Have you ever had a job? Do you know how much it costs to have kids? You are either one of the lucky 'born rich' people, or you're fooling yourself. Either way, I feel sorry for your generation. Best of Luck to you.

And, I do know how the economy works. I've owned a multi-million dollar business and employed numerous people for a number of years. Have fun paying off that student loan...only to find you can't find a decent paying job. That's called REALITY.
Posted by TheFreeThinker 5 years ago
TheFreeThinker
WoW, SSGWhit, I am more than happy to debate you on this very same topic.

Before accusing people of regurgitating something out of a book, maybe you should pick one up and get a basic understanding of what you are talking about.

TrenchMouth, it is exactly your "Dudeist" attitude of being lazy and unproductive that prevents you to research how the economy works and to understand what helps and what doesn't help.

No wonder you look up to Obama. Big talk, no facts behind it...
Posted by TrenchMouth 5 years ago
TrenchMouth
thanks SSG for your comment. I know I'm right in my "take" on this subject. I just lacked the motivation to try to argue the point four four rounds of "blah, blah, blah". I'm a Dudeist, which by definition, means I'm lazy. Time for another Oat Soda. The dude Abides.....
Posted by SSGWhit 5 years ago
SSGWhit
It is common sense to conclude that as technology becomes better the need for workers is reduced. In fact as a company I would want the least amount of workers in my factory as possible to reduce cost to gain profit. Across the board this could not happen because the product in question then would not be affordable to those that have lost their job because of it. It would not be affordable because they would not have the money to buy the product because of the technology that was used to replace the worker. Also as that technology becomes better and faster it will also drop in price allowing for more companies to purchase. It is just the way things will head. It has already done so. The Pro has it right but just not refined as the Con...which the Con went above the level needed to make his point which makes me think he just regurgitated something outta a book and put no thought into it.
3 votes have been placed for this debate. Showing 1 through 3 records.
Vote Placed by Double_R 5 years ago
Double_R
TrenchMouthTheFreeThinkerTied
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Reasons for voting decision: Pro failed to make a sufficient case. His main contention is that technology causes workers to loose their jobs, but has no answer to Cons rebuttals of what happens to those same workers in their role in society other then by simply calling it "Voo-doo economic theory". If Pro believed Cons contention to be false he should have elaborated on his argument. Pro looses conduct for R1 antics and R4 for relying on links to make his final case for him.
Vote Placed by Cliff.Stamp 5 years ago
Cliff.Stamp
TrenchMouthTheFreeThinkerTied
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Reasons for voting decision: Very solid performance by Con, the opening of the last round was extremely clear. 5:1
Vote Placed by quarterexchange 5 years ago
quarterexchange
TrenchMouthTheFreeThinkerTied
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Reasons for voting decision: Pro thought that workers replaced by technology were simply thrown out when in fact Con pointed out that they do something else. For instance they even build, repair, and program, etc the machines that replace them. If Pro was correct then getting rid of planes, trains, cars, etc and replacing them with rickshaws would help the economy.