Tuesday, February 28, 2017

Gates & Reuther v. Baker & Bernstein on Robot Productivity

In a comment on Nineteen Ninety-Six: The Robot/Productivity Paradox, Jeff points out a much simpler rebuttal to Dean Baker's and Jared Bernstein's uncritical reliance on the decline of measured "productivity growth":
Let's use a pizza shop as an example. If the owner spends capital money and makes the line more efficient so that they can make twice as many pizzas per hour at peak, then physical productivity has improved. If the dining room sits empty because the tax burden was shifted from the wealthy to the poor, then the restaurant's BLS productivity has decreased. BLS productivity and physical productivity are simply unrelated in a right-wing country like the U.S.
Jeff's point brings to mind Walter Reuther's 1955 testimony before the Joint Congressional Subcommittee Hearings on Automation and Technological Chang:
Every tool on every operation has a green light, a yellow light, and a red light; and when all the green lights are on, it means that all the tools at each work station are operating up to standard. When a yellow light comes on, on tool No. 38, it means that the tool is still performing, but the tool is becoming fatigued and that is a warning sign, so that the operator sitting there looking at these panels will know that he has to get a replacement tool for tool No. 38. He stands by at that position on the automated machine, and at the point the red light would kick on, on the board, he walks over — the machine automatically stops — he puts the new tool in the place of the tool that is worn out, and automatically the green light comes on and the machine goes on.  
When I went through this plant the first time I was told by a top official of the Ford Motor Co.: 'Mr. Reuther, you are going to have trouble collecting union dues from all of these machines.
And I said: 'You know that is not bothering me. What is bothering me is that you are going to have more trouble selling them automobiles.' That is the real significance. We have mastered the know-how of mass production, and what we need to do is to develop comparable distribution know-how so that we will have markets for the tremendous volume of production that automation now makes possible.

2 comments:

bob said...

IIRC, Peter Drucker wrote that Alfred P. Sloan told him when he retired from GM that the most logical person - smartest, most capable, most knowledgeable about the auto business - to replace him would have been Walter Reuther. But nobody, neither the GM Board nor the UAW, would have gone along with that. So GM and the US auto industry tanked.

Bill H aka run75441 said...

"And I said: 'You know that is not bothering me. What is bothering me is that you are going to have more trouble selling them automobiles.'"

Hence, the spotlight on the failure of not sharing productivity gains with Labor. I can convincingly improve throughput; but, I can not change the underlying thought process of management on profit.